Digital transformation has been the watchword for well over a decade, but many businesses are still struggling to implement it effectively.
Being strategic is the key to getting a digital transformation right, said Nick Connors, group chief executive and co-founder, TEKenable, which specialises in supporting companies through the modernisation process.
In practical terms, he said, this means planning.
“You have to sit back and plan it,” he said.
Failure to plan can have a number of consequences: it can, of course, result in being overtaken by more nimble competitors. However, it can also result in being frogmarched into a transformation after disaster strikes.
“Some companies are forced into it because they have a catastrophic incident, such as a security breach, or their old technology just lets them down, or perhaps simply they start losing business as competitors get ahead of them,” said Connors.
Naturally, neither scenario is ideal, and both can lead to chaotic and piecemeal ‘strategies’ that are anything but strategic.
One common mistake is to focus on the technology. In fact, TEKenable itself prefers to use the term ‘business transformation’ over the more common ‘digital transformation’, as technology is not the core issue. Yes, technology is changing, and with it customer and market expectations will change, but this needs to be addressed as a business issue.
This is a recipe for frustration, or even failure, Connors said.
“Some people just jump into the digital side, without looking at what it means for the overall business. Fundamentally, if you are just doing a purely digital transformation – which is to say, purely looking at the digital side – you are changing processes and ways of working that have may been in place for perhaps ten or 15 years but by simply replacing technology on its own you don’t bring the users with you, and you won’t get the expected results,” he said.
Every area of the business, whether it is finance, operations, manufacturing, warehousing, or anything else, will experience the results of transformation, so this needs to be considered.
“Technology supports your business, but the business still needs to be doing the decision making. It should never be the tail wagging the dog,” said Connors.
Technology supports your business, but the business still needs to be doing the decision making. It should never be the tail wagging the dog
Consider artificial intelligence (AI), for instance: there is no question that AI is a useful technology, but what it can do for a business will only be revealed by understanding what the business needs and ensuring the IT functions support this, such as by offering a single source of truth.
“Having a single source of truth across the business really gives you an advantage, and with AI coming to the fore you can use it to interrogate your data. It’s much easier to do that where your data is centralised in the cloud,” he said.
Ultimately, as technology becomes akin to something like a utility – crucial for a business, but not central to its business – there is an opportunity to ensure that the technology supports the processes a business needs and the people performing them.
“You have to take a broader view of technology and the investment you are willing to make. You really need to sit down and make a business case for that investment. Looking at the long-term needs will give you a much better idea of what to do, whereas jumping in and buying technology for the sake of it is a dangerous way to go, as you can end up with a plethora of products that may all do what they say, but do they work together for the business,” Connors said.
The results are worth it, though, and Connors said that improvements in efficiency and competitiveness should be clearly visible.
“Done right, 95 per cent of companies have a really positive outcome and say they wish they’d done it a few years before,” he said.