A pandemic-riddled 2020 only served to highlight that it’s become all about speed, flexibility and most importantly, agility, especially as the global workforce rapidly adjusted to a non-traditional, upended schedule. Some organizations took note of this and advanced up the digital transformation curve, but some are still yet to see their digital transformation efforts bear fruit.
However, embarking on this digital transformation journey can be a daunting process for organizations and many will question why they should embark on this venture? How do you measure success? And what are the risk factors? As we enter 2022, here’s how you can maintain that transformative momentum accelerated by COVID-19 in 2020 and 2021.
Three things that need to change in business digital transformation journey
The Covid-19 pandemic has made automation, digitizing the physical, enabling a work-anywhere economy - and mitigating risk in supply chains, more relevant than ever. IDC Research also predicted that direct DX investment will total over $6.8 trillion between 2020 and 2023 - a compound annual growth rate (CAGR) of 15.5%. That translates into nearly two-thirds (65%) of global GDP being digitalized by 2022.
This is now a world where boundaries are becoming meaningless, and services are fluid, so it’s clear that business are required to truly commit to complete their digital transformation. Further, the pandemic continues to prove that digitalization is a matter of business survival. And, the benefits are clearer than ever! Not only can digitalization provide a myriad of benefits including improving customer engagement, reducing churn, enhancing collaboration both internally and with external stakeholders, boosting employee innovation and productivity; most importantly, it can inspire business growth post-pandemic.
However, the challenge most organizations face is that in a fast-changing market with so many new technologies, new players and disruption, their current business models and IT set-up don’t always give them the agility they need to react to market change. In fact, they hinder their business growth. There is an urgent need for organizations to consider a fundamental change of position when it comes to digital transformation, and for those digitally savvy enough to take advantage of it, the benefits abound. But who needs to be in the driving seat?
Who should be the stakeholder of the digital transformation process?
Collaboration is key! CTOs are generally responsible for the technology strategy, R&D and delivery of those solutions that facilitate digital transformation. However, putting the Chief Product Officer (CPO) in the driver’s seat will also elevate what customers want to buy from having previously been just an afterthought, to now really being deemed to have more equal prominence in important technology decisions.
Making digital transformation bear fruit
In this increasingly agile world, it’s important to experiment with new business models, run MVPs, and play around with ideas and solutions. This leads to organizations being able to build an operational environment that gives them the flexibility to launch offerings rapidly into market, as well as collaborate with their ecosystem and a growing number of technology partners. They can also go to market partners to build new digital solutions for their customers or expand their market reach through channel partners.
Equally important is to get more value from their investments by removing internal silos and increasing synergy across their business. Deploying technology that is scalable and facilitates a multi-party ecosystem is key here. Time is of the essence, and those that start lengthy R&D processes to develop newsolutions with a blank sheet of paper will lose precious time and fall behind.
Keeping sight of the important metrics
When digitizing the physical workplace and experimenting with the deployment of new services and solutions, tracking metrics enables you to not only measure return on investment (ROI), but also highlight where action may be needed to improve performance. Keeping sight of the following metrics will enable you to make those decisions and digitally transformation faster:
- Agility - a universal metric that applies to all enterprises! Facilitating that scalability and elasticity that enables organizations of any size to start small and scale depending on the success of the business. But as a first step, find out which customer needs are poorly served by existing legacy services, then consider evolving to an asset-light, digital business platform model. Ensure your technology is facilitating the rapid launch, sale and monetization of new digital services in days or weeks, not months.
- The right business model - you need a clear road map of what digital transformation success looks so before embarking on this journey, ask yourself how much of the company revenue comes from expanding to new business models, and how much resource is invested into the growth engine at the expense of the existing business model?
- Co-creation - assess how open your IT platforms are for external parties to innovate and co-create. How many of your solutions were the result of collaboration with your partner ecosystem and how innovation came from external sources? Don’t be afraid to experiment with those solutions that facilitate digital transformation. Ramp up production of those that work, and simply scale back those that don’t.
- Innovation gaps - work to consistently transform while ensuring that your technology stack constantly improves and as you experiment with cutting-edge technologies. Organizations will not see momentum if you have to rebuild everything from scratch every three years when new technology arises. It’s much better to continuously transform your architecture in small steps in order to move forward.
- Resource management (both human and infrastructure) - placing talent where they can make a real difference for the company. Focus them on market differentiation and customer experience, not on rebuilding existing solutions and competing with infrastructure providers and software vendors.
- Performance consistency and repeatability - engineers are very often innovators and don’t like to do the same thing twice. Therefore, it’s very important that you direct the focus to the right topics and establish repeatability and consistency in your technology stack and solutions as this is the only way you can scale and be successful. You can’t reinvent the wheel every day and every week.
- Mitigating risk factors - Mitigating any potential challenges on your digital transformation can be made easier by keeping openness at the forefront of the agenda. Ensuring you are innovating with the help of new business models and monitoring the impact of co-creation, what solutions are appealing to the market, and what is proving to be risky and needs to be scaled back. The key though is to not stand still. Try to move with the industry but never changing the approach elevates the risk factor.
Conclusion
While it can seem overwhelming at first, when approached methodically, this roadmap should serve as your digital transformation 2022 planning toolkit. Taking the plunge and putting the above steps into action, thereby beginning your organization’s journey. Through this, being able toexperiment with new business models, running MVPs, and implementing new ideas and solutions will enable your organization to effectively - and with agility - build an operational environment that provides the crucial flexibility to hasten a quicker go-to-market strategy. Pre-planning will also help simultaneously foster hands-on collaboration with your organization’s ecosystem plus a growing number of technology partners. Entered into strategically, setting KPIs and SMART goals, this roadmap will help you surpass that transformative momentum accelerated by COVID-19 in 2020 and 2021. And don’t forget to enjoy the ride!
