How Do You Do Digital Transformation?07/12/16
Can digital transformation happen in organisations that are just not born that way?
Some organisations are just born digital.
The likes of Amazon, eBay and Australia’s REA Group come to mind. Nigel Dalton, CIO of REA Group, stated that they don’t have a digital strategy because it’s “all we do”.
Their businesses have been built on an agile service management approach with supporting systems and automation, a focus on the customer experience, and in-depth analytics to deliver enviable results in a slick package.
But what about more ‘traditional’ organisations like healthcare or government departments, which have to look to approach digital transformation from a much weaker position, often having legacy IT service management processes in place which are cumbersome and overly bureaucratic. These organisations are also generally risk-adverse and reluctant to relinquish tight control over what is currently in place. How can they possibly cope with the demands of such a large-scale change?
The other side of the same scenario is the smaller businesses with a lack of resource, cash and ability to deliver the changes needed to streamline and transform.
What are the key considerations ‘traditional’ small, medium and large organisations will have to make when embarking on their digital journey and what does it mean for IT?
These are the 5 key things to consider for IT.
According to Wikipedia, digital strategy is the process of specifying an organisation’s vision, goals, opportunities and initiatives in order to maximise the benefits of digital initiatives to the organisation.
1. This is not an IT strategy. This is an organisational strategy of which IT is one part. Organisations will have to have a clear vision and goal for their digital presence and for many this will be hard to articulate. External assistance may be required to work through a plan of action and organise the necessary internal or external resources. The right people could be working within the business currently so how to recognise these employees and review their strengths quickly and easily will be useful. Skills Framework for the Information Age (SFIA) is a methodology to help determine what skills your organisation has today, the skills it needs for digital transformation, and where the gaps exist that need to be addressed. See point 4.
A digital strategy is far more than an online strategy, yet the terms get thrown around interchangeably. Online presence is just your business website, your social media profile, corporate online advertising profiles etc. A digital presence is a deeper customer interaction with more personalised, contextual and customised offerings backed up with automated processes, sophisticated data analytics and data driven decision-making.
2. Governance, leadership and sound management has never been required more. For all organisations, a centralised team needs to be created to drive the strategy across the entire enterprise. This may be under the direction of the CEO or the CTO but will comprise not only IT but also marketing, finance, multiple business units and external representation where necessary. This team would be a critical entity to manage and coordinate the implementation, undertake an ongoing review of the strategy, ensure organisational collaboration, and resolve competing priorities.
3. Agility – In the McKinsey & Company paper, ‘Reinventing IT to support digitization’, authors Andersson and Tuddenham talk about adopting a two-speed approach that delivers results quickly whilst still reshaping IT for the long-term. The two-speed approach and bimodal capability requires first building a ‘high-speed’ IT function to work alongside the existing IT function, focusing on one or two valuable business areas such as web and customer relationship management. In this way benefits to the business can be delivered quickly. A critical element is agile development and rapid releases. As the paper states ‘Delivering high-quality end products quickly requires new ways of working, including agile development, rapid release cycles, automated testing and deployment, and a ‘test and learn’ approach to changes’. The paper goes on to say that often the greatest challenge here is not within IT but in persuading the business to adopt this approach. See point 5.
4. Talent attraction (and retention) will be key. The digital and agile skills required by the ‘traditional’ organisation to move them into the digital age may be hard to attract, as they will be consumed by the leading edge (and attractive) digitised organisations such as Amazon and eBay. Therefore organisations will need strategies to attract and retain these well-credentialed and experienced individuals to form part of the digital team. In point 1, I mentioned SFIA as a methodology to assist organisations identify the skills they will need for digital transformation. SkillsTX is a platform that automates the use of SFIA and can generate digital job descriptions to assist with the recruitment process.
5. Organisational change management (OCM) will be critical as it is with any change. As noted in point 3, there will be the need to adopt different approaches and ways of working, which will require OCM. Also in many businesses the digital strategy will, to a great extent, remove the need for some staff or roles. Within IT, new skills and techniques will be introduced as mentioned earlier and legacy systems retired over time. Again, this will have a direct impact on staff and Organisational change management should be an integral part of the strategy and implementation of digitisation to ensure that the very people at the coalface are on board with the vision for change.
It is no doubt a fast moving era in IT and time is of the essence. As Barry Ross CEO of Ross & Ross International said “You can’t delegate Digital Transformation for your company… you and your executives have to own it! Executives need to engage, embrace and adopt new ways of working with the latest and emerging technologies.”
Are you and your organisation ready?
Macanta is a gold reseller of SkillsTX and has Certified Agile Service Management (CASM) and accredited SFIA consultants who can assist you.
“It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.” Charles Darwin