At the moment there is a near obsessive need to “go digital". Organisations are looking towards Digital Transformation (DTx) or to “go digital" as a way of staying competitive in the face of some serious disruption. So what does digital transformation actually mean for an organisation and is it indeed just a trend?
Despite the use of the term Digital, DTx should not be just about the organisation focusing on technology, which in most cases will be the enabler to such transformation. DTx should be more about how the business transforms itself (including people and culture) and the way it operates by utilising digital capabilities to continually improve the customer experience.
Digital transformation is definitely not just about employing a Chief Digital Officer (CDO) or changing job titles to include Digital, or about hiring a bunch of graduates to come up with a mobile app.
There needs to be more thought given to any digital transformation which must be backed by the senior leaders within an organisation through a clear vision and business strategy, which must also include a digital element.
It is no good just having a mobility service without the customer analytics to derive insights or the ability for your customers to directly tweet or interact with the business from its mobile enabled applications.
The way I see it, digital is not one particular “thing” - it requires a change in mindset (e.g. lean, agile, UX, customer experience) and culture (e.g. collaboration, pods, empowering, multi-skilled), and a move away from traditional thinking (e.g. keeping the lights on), to being more about an organisation's use of social media and analytics to drive decisions as well as understanding how the organisation uses the "cloud" (SaaS, AWS or Azure). It also requires having a mobile presence for its products, services and experiences. The strategies and subsequent use of social media, analytics, mobility and cloud (the so called digital capabilities) by any organisation must coexist.
For instances, it is no good just having a mobility service without the customer analytics to derive insights or the ability for your customers to directly tweet or interact with the business from its mobile enabled applications.
Your customers and people must be at the heart of any digital transformation, where the aim is to drive continual improvements in services, products and experiences that your customers will love and actively promote.
As Daniel-Zoe Jimenez in his article The five facets of digital transformation states, "Digital Transformation is a continuous process in which enterprises adapt to or drive disruptive changes in their customers and markets by leveraging digital competencies to create new business models, products and services. It enables enterprises to seamlessly blend digital and physical business and customer experiences, while improving operational efficiencies and organisational performance".
So not "going digital" should really not be an option for many organisations, especially if they want to be loved by their people and customers and remain agile enough so they can continually respond to, or even lead the development of disruptive products, services and experiences.
However before embarking on any digital transformation, the foundations must also be in place to support this transformation, such as people (with the right mindset and multi skilled), automation, CI/CD, stable infrastructure.
So where do we start with digital transformation? At the beginning it may be viewed as hugely complex with many moving parts so there could be a temptation to kick off larger projects to address many aspects of the transformation at once. The more efficient approach would be to start with smaller low-risk initiatives that have a positive impact on the customer journey and/or putting the foundations in place on which to build digital products and services.
In my view, digital transformation is a change in mindset and culture, led by senior leaders, supported by technology as an enabler to continuously enhance the customer journey through products, services and experiences that they love and actively promote.
Read more: CIO Upfront: Breakthrough or middle ground?
Peter Yates (@peteyatesnz) is head of operations and platform delivery at Spark Ventures.
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