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November 23, 2015
IT Don’t Come Easy: Digital Transformation
By: Phillip Redman

There’s no doubt 100 years from now, when sociologists and historians assess our times, it will be known as the “Digital Revolution” the same way technological changes in manufacturing spurred the “Industrial Revolution” worldwide in the 19th century. In October, Accenture and Forrester (the market research firm located in Cambridge, MA) released a report based on 396 in-depth surveys of business decision makers that evaluates digital transformation among enterprises. The results show that for most businesses, we are only at the beginning of their digital transformation. Yet is a top priority for every company driven by organizational, technological and operational strategies.

There’s no one right path or method to digital transformation. Each company has specific legacy IT system investments, market demands and future considerations that will guide their digital transformation strategy. Most are currently defining what that actually means to them and their customers. In fact, according to the report, the customer experience is a top digital initiative to 56% of the respondents, leading others as shown in Figure 1.

Figure 1-Digital Actions

Figure 1-Digital Actions

Though the next most popular response at 52% is focused on establishing a new digital governance and transformation management, only 23%, the lowest response, are hiring a C-level executive who is focused on digital. This may be because many are still looking to use their internal resources to drive their initial digital focus. Early successes can bolster this strategy however, because of the complexity of change needed in so many systems-security, cloud, mobile, applications-to name a few, companies will have to eventually look externally for expertise that can’t be found inside. Many are already considering this. The survey showed that 49% are looking to collaborate or start a joint venture with a new or existing business partner. They already feel the need to move fast and know they won’t be able to perform the transformation alone. This also opens up opportunities for vendors that put together end-to-end solutions that can assist in that speed and reduce complexity. Smaller vendors have an opportunity to partner or even see investment by bigger companies that in the past, may not have been considered. It’s a new world.

Digital is driving enterprise-wide change

At the same time businesses are busy defining the changes digital will bring to the customer, they are also looking internally at organizational, technological and operational strategies. This is a difficult task because how do companies prioritize where to start? What is the roadmap? Are they even ready to start? According to the survey results, most companies don’t yet feel prepared and ready to execute on their digital strategy. Only 29% completely agreed that they are ready on the technology front, and only 24% are ready organizationally, as shown in Figure 2.

Figure 2-Readiness

Figure 2-Readiness

It’s not a surprise that technology is driving the change. Many in IT are planning their organization and operations around technology. For example, creating a mobile center of excellence after mobile technology has pervaded the environment. A better practice would be to prepare for the technology change by using IT change drivers that can set up an organization and operations as the technology evolves. This causes lower friction and fewer security holes. It also helps when scaling staff and creating policy.

Digital transformation is complex—probably the most since it encompasses change in many different areas and functions. There still remains hesitancy and uncertainty going forward. IT leaders need to make an encompassing plan today. The report gave four main recommendations:

  1. Advocate digital transformation and the customer experience at an executive level. Digital transformation can only succeed as a companywide initiative, which requires strong collaboration and evangelism from company leaders.

  2. Execute change within the context of an end vision. A clear vision for the end state is absolutely critical to make sure that everyone in your organization is moving in the same direction.

  3. Be willing to take risks and learn from mistakes. As digital touchpoints continue to evolve and proliferate, companies will need to take risks and develop Agile processes in order to keep up

  4. Find partners whose capabilities complement your own. Even digitally mature companies will have new gaps in capabilities as the technology continues to evolve. Enlisting third-party solution providers to help navigate change and implement new strategies is often cheaper and faster than building those capabilities internally. Find partners that understand your broader strategies and have specific strengths in the functions and areas that your company lacks.

Certainly some wise advice.

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