Introduction

Large digitisation projects often fail. They exceed their budgets, fall behind schedule and fail to deliver the promised results. According to a McKinsey study, more than 70% of large transformation projects fail due to excessive budgets, delays or lack of acceptance. At the same time, they tie up resources that are needed for quick and pragmatic solutions.

But there is another way: incremental innovation. Instead of large-scale projects that take years to complete, successful companies focus on small, gradual improvements, with pilot solutions, modular services and continuous feedback. This approach minimises risks, accelerates results and makes digitisation plannable, affordable and successful.

In this article, you will discover:

• Why large digitisation projects are so risky.
• How incremental innovation works and why it is often better.
• A practical example showing how a medium-sized company achieved great success with small steps.
• 5 concrete steps to get started with incremental innovation.

Chapter 1: The risks of large transformation projects

1.1. Why large projects fail

Large digitisation projects are like huge oil tankers: they take a long time to get going and even longer to change course. The most common reasons for their failure:

• Unrealistic timelines: projects often start with overly optimistic deadlines that, over time, prove unfeasible.
• Complexity: the larger the project, the more dependencies, interfaces and unforeseen problems arise.
• Lack of acceptance: if employees are not involved from the outset, they reject the new systems, even if they are technically perfect.
• Cost explosion: according to a study by the Boston Consulting Group, 66% of large IT projects exceed their budget, often by more than 50%.

1.2. The consequences for businesses

When digitisation projects fail, this has concrete economic repercussions:

• Loss of investment: millions are invested in projects that are never completed or do not deliver the desired benefits.
• Delayed innovation: while the company struggles with the large project, the competition moves ahead with more agile solutions.
• Employee frustration: Teams that work for years on a failed project lose motivation and confidence in digitalisation.
• Reputational damage: Customers and partners lose confidence in the company’s digital competence.

1.3. Why companies continue to opt for large projects

Despite the risks, many companies decide to undertake large transformation projects. The reasons:

• All-or-nothing mentality: Some managers believe that only radical changes are effective.
• Expectations of short-term success: The pressure to deliver visible results quickly leads to hasty decisions.
• Lack of alternatives: Many are unaware of the path of incremental innovation or do not believe it to be sufficiently effective.

But there is a better way.

Chapter 2: The alternative: incremental innovation

2.1. What is incremental innovation?

Incremental innovation means implementing digitalisation in small, manageable steps. Instead of transforming an entire company at once, individual processes, departments or use cases are gradually improved. The advantages:

• Lower risk: small projects are easier to manage and have less impact if they fail.
• Faster results: initial successes are visible within a few weeks or months.
• Flexibility: companies can react to changes without calling the entire project into question.
• Acceptance: employees gradually get used to the new solutions and are less likely to reject them.

2.2. Why small steps often have a greater effect

Large projects often promise ‘the big solution,’ but in practice it is the many small improvements that have a lasting effect:

• Continuous progress: instead of waiting years for a system to be completed, the company benefits immediately from each individual improvement.
• Learning curve: each step provides information and data that can be used for the next steps.
• Scalability: Successful solutions can be gradually transferred to other areas.
• Cost-effectiveness: Small projects are cheaper and easier to budget for.

2.3. When incremental innovation is the right choice

Incremental innovation is particularly suitable for:

• Medium-sized companies that do not have the resources for large-scale projects.
• Complex environments where there are many dependencies and uncertainties.
• Regulated sectors (e.g., financial services, healthcare), where major changes are risky.
• Companies with limited IT resources that need quick results.

Conclusion: Incremental innovation is not an ‘emergency resource’ but a strategic option, especially for companies that want to digitise quickly, flexibly and with low risk.

Chapter 3: How incremental innovation works

3.1. Step 1: Identify use cases

Not all processes need to be digitised. Focus on the areas that bring the greatest benefits:

• Customer-facing processes (e.g., order processing, service requests).
• Recurring tasks (e.g., invoicing, warehouse management).
• Bottlenecks (e.g., manual data transfer, slow approval processes).

Tip: Use data and employee feedback to identify the most pressing issues.

3.2. Step 2: Launch pilot projects

Instead of embarking on a large project, start with a small, manageable pilot project:

• Limit the scope (e.g., one department, one process).
• Set clear goals (e.g., ‘reduce processing time by 30%’).
• Use existing tools (e.g., cloud software, low-code platforms).

Example: A trading company initially digitised only order management for a specific product range and expanded the solution only after verifying its success.

3.3. Step 3: Gather feedback and adapt

After implementation, feedback is essential:

• Ask employees: What is working? What is not working?
• Analyse the data: Are the objectives being achieved? Where are there problems?
• Adapt and improve: Small iterations improve the solution over time.

3.4. Step 4: Scale successful solutions

If a pilot project works, apply the solution to other areas:

• Standardise processes to facilitate transfer.
• Train employees to use the new tools.
• Use SaaS solutions that are easily scalable.

3.5. Step 5: Continuously improve

Incremental innovation is not a one-off project, but an ongoing process:

• Regularly identify new use cases.
• Update technologies and processes.
• Engage employees to encourage acceptance and ideas.

The result: continuous digitalisation that moves the company forward step by step, without major risks or investments.

Chapter 4: Practical example: a medium-sized company sets an example

4.1. The initial situation: a machinery manufacturer with outdated processes

A medium-sized machinery manufacturing company with 300 employees was facing the following challenges:

• Outdated ERP systems that no longer met requirements.
• Manual processes in order processing that led to errors and delays.
• A failed large-scale project, which was cancelled after two years and an investment of 1.5 million euros.

4.2. The solution: incremental digitalisation

Instead of starting a new large-scale project, the company opted for small, gradual improvements:

1. Pilot project ‘Digital order management’:
   • Introduction of a cloud-based solution for a specific customer segment.
   • Objective: to reduce processing time by 40%.
2. Gather feedback and adapt:
   • after three months, the solution was optimised based on employee feedback.
3. Expansion to other areas:
   • following its success, the solution was expanded to cover all order processing.

4.3. The results

• Reduction in processing time: from four days to 1.5 days per order.
• Reduction in error rate: 60% fewer manual errors.
• Increase in customer satisfaction: delivery reliability improved from 85% to 98%.
• Cost savings: instead of investing £1.5 million in a large failed project, the company invested only £250,000, with a quantifiable return on investment.

Conclusion: with small steps, the company achieved more than the large failed project could ever have offered.

Chapter 5: 5 steps to get started with incremental innovation

Step 1: Identify the use cases with the greatest influence

• Ask your employees: Where do they waste the most time?
• Analyse the data: Which processes generate the most costs or errors?
• Set priorities: Which improvements bring the fastest and greatest benefits?

Step 2: Start a pilot project

• Limit the scope (e.g., one department, one process).
• Set clear and measurable goals (e.g., ‘reduce processing time by 30%’).
• Use existing tools (e.g., cloud software, low-code platforms).

Step 3: Gather feedback and adapt quickly

• Ask users after the first few weeks.
• Analyse the data (e.g., processing times, error rates).
• Adapt the solution and repeat the process.

Step 4: Scale successful solutions

• Standardise the solution so that it can be transferred to other areas.
• Train employees to use the new tools.
• Use SaaS solutions that are easily scalable.

Step 5: Establish continuous improvement

• Make digitalisation a continuous process.
• Regularly identify new use cases.
• Foster a culture of innovation in which all employees can contribute ideas.

Conclusion: why small steps are the future of digitalisation

Large transformation projects are risky, expensive and often unsuccessful. Incremental innovation, on the other hand, offers a safe, flexible and cost-effective alternative. Companies that take small steps benefit from:

• Faster results, without years of waiting.
• Lower risks, as mistakes in small projects are easier to correct.
• Greater acceptance, as employees are gradually involved.
• Better scalability, as successful solutions can be easily transferred.

The message is clear: digitalisation does not have to be a big project. Small steps often have a greater impact, with less risk.

Do you want to drive your digitalisation forward, but without taking big risks?

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We will show you how to achieve quick wins with incremental innovation, without years-long projects or large investments.

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