Solving the riddle of digital transformation

All businesses must have a strategy for a world that is increasingly digital
All businesses must have a strategy for a world that is increasingly digital

Mobile usage is exploding and businesses around the world are scrambling to get in the game.   In fact, mobile has probably been the biggest disrupter in recent years, leading to the acceleration of digital interaction and precipitating huge product and service change.

Thanks to mobile devices, the Internet and the Internet of Things, power is now in the hands of the user. As a consequence, service culture is having to adapt dramatically in order to support the way in which businesses need to respond to consumers and other businesses alike.

Data related to such digital interaction is also growing at an exponential rate, e.g. data comprising the catalogues of products and services offered and data representing customer orders and the ongoing service they receive. The sheer volume of data available, the level of analytical sophistication required to address increasingly competitive markets and the pace at which organisations need to respond to the intelligence gleaned, are leaving many organisations struggling to keep up.

The result is that all businesses are now facing the need to develop a strategy for a world that is becoming increasingly digital.

Increasing complexity is a threat to all businesses

For the so-called ‘digital-first’ companies, this is a natural state, but for older (and perhaps more traditional) businesses the opportunities and threats of an increasingly digital world represent a real dilemma. For example, a natural consequence of the relentless growth in digital and big data is that enterprise IT is becoming massively complex, particularly in large organisations where there is typically a significant estate of legacy applications and infrastructure. Complexity at this level threatens to break our internal organisations, but a well thought out and executed digital strategy that supports the automation of previously manual processes and, importantly, links external digital projects with internal processes and workflows, can help to mitigate the risk. The blocker for many organisations is that it is genuinely difficult to understand how best to approach digital transformation and pinpoint exactly where to start.

One important aspect to bear in mind is that digital transformation is not just about technology change, it’s also about transforming the wider organisation to create new business opportunities and products and services, that can leverage investment in digital assets. While a clear technology strategy is needed to achieve a new digital solution, organisations also need to consider how its existing organisational structure, culture and processes will need to change to optimise the adoption of the new technology. It’s very different to, say, a finance transformation where the changes are typically localised to that specific function. With a digital transformation, the full flow of benefits are generally realised by joining up key workflows across the organisation. Arguably, the best starting point for this is to develop a target operating model for digital that enables the organisation to visualise its operation and work through its priorities and options. You don’t need to set a rigid path but instead use the model to work out how your digital vision can evolve in a way that best fits in with how your organisation operates. We advise our clients to look at ways of improving points of capability and processes, one step at a time, all within the overall framework and context of their digital vision.

As with all transformation programmes, technology will be the key enabler and careful thought needs to be given as to how this is designed, deployed and leveraged by the business, particularly since significant degrees of integration with legacy applications and infrastructure are likely to be required.

A good example of this comes from a current programme being undertaken for a large client that provides on-line digital services to major financial services organisations. That client has a large number of suppliers to, and customers of, its services. However, those services are supported by product lifecycle management processes and customer service fulfilment processes, that are primarily manual and operate around islands of unconnected, overlapping data (in databases, spreadsheets and documents). The client’s cost of operations, its time to market for new services and its business risk are all potentially compromised by such an information, process and systems architecture.

DAV is helping the client establish a new mode of operation for its digital business and a new implementation of business process and systems in support of it. This transformation begins with the creation of a single logical model for the data that describes the business – a model in which the client’s customers, its product, service and resource catalogues and its suppliers are represented, and their relationships and importantly their rights are maintained digitally. That model and the resulting distributed data, is used as a reference for streamlining and automating product creation and customer service fulfilment and assurance process, one step at a time. The benefits to the client are great. Costs and risks are reduced incrementally and the client’s agility to create new offerings for its customers is increased.

Be equipped for the journey

Whatever your circumstances, the most important factor to remember is that digital transformation should always be viewed as a journey towards a beneficial outcome and not a means in itself. The goal is to achieve lasting change that makes a difference to your customers and your business, whereby true benefits are realised rather than just implementing the most up-to-date technologies. Ultimately a digital transformation is no different to any other large-scale business change programme. To be successful it must be approached, planned and managed in the right way and done for the right reasons.

DAV can provide the leadership and support needed to drive long-term success and make sure that your digital transformation programme delivers the products and services you anticipated while enhancing your performance as a business.

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