Is your enterprise ready for digital transformation? Do you have a constructive roadmap to take the necessary steps towards digitalization? The importance these questions entail is that the rise of digitalization is at the doorstep of all business functionalities. Gartner stats suggest that over 125000 companies expect their revenue initiatives to rise above 80% by 2020 due to digitalization.
Today’s business executives are posed with various questions related to the implementation of to their business model. However, is implementation enough to gain revenue benefits and customer value of digital revolution? Stats from forester suggest that only 27 per cent of the enterprises have the coherent strategy of creating customer value through digitalization.
Michelle Mckenna-Doyle, the CIO of National Football League, shared her insights on essential factors for a with Straight Talk, a thought leadership platform for senior technology leaders; she said that knowledge of driving factors is essential to achieve complete digitalization. She also said that of all enterprises attempting digital transformation, only 30 per cent are likely to succeed as most of them lack a well thought roadmap. Moreover, if these stats do not make you sweat, then either you are not able to comprehend the gravity of the situation, or you do not wish to see your company succeed.
So now that we know of the problem what is the solution to it? A complete is a high-end task that cannot be achieved in a day or two. Strategy to completely transform business and its functionalities require focus and planning over the most trivial factors. Below stated are some factors on which executives must focus attentively to achieve digital transformation.
The commitment of Senior management
Any transformation in an organization is mainly dependent on the commitment of its leadership team. One cannot just sanction a digital transformation, he or she must communicate a vision or dream that is required to be achieved. In order to demonstrate the supreme priority like digitalization leaders should take on the responsibility and develop a strategy to achieve the feat. The results are achieved only through relentless engagement every day. The CDO (chief digital officer) of Aviva states that CEOs must be aggressive and single-minded in driving the transformation. He also states that it's not enough to just have CEO sponsorship, it needs to be ambitious, provocative, disruptive plan to be successful.
By setting clear targets enterprises can prevent back-sliding when times get rough. For each source of value creation, a target is needed be it revenues, cost-savings, the satisfaction of employees and their performance.
For instance, for a number of releases, the percentage of transactions migrating from one channel to other, the percentage of processes to be automated, level of personalization required, and the number of campaigns running each month.
A significant amount of investment is necessary for digital transformation. AXA a European insurer invested 950 million Euros in two years for digitalization. Enterprises with outdated systems in IT infrastructure need to spend almost double of their current spending to survive in the market. The investment might result in lower profits for some time but is beneficial in the long run.
High Caliber Teams
Securing an efficient team to work under the CDO is never overstated. CDO plays a key role in coordinating the digital transformation – by avoiding any duplication in redesigning the customer journey. He/she can ensure that the resources required are in place, decide the sequence of transformation, monitor progress, and ensure that priorities get the required attention. Key members in the launch team include the scrum experts to facilitate the agile development, developers to work on the advanced IT environment, designers to examine customers’ needs and implement the changes in products and services. An enterprise with investment over 5 billion dollars must hire at least a team of 40 to 100 new specialists during the developing stages of their transformation.
Adaptation of new operating models
Whichever infrastructure the enterprises choose initially, it will reach its best only after the fundamental redesign of the organization. Silos in the operational management are always a drag in collaboration and performance in large enterprises. Executives need to reinvent how their company works and remove the inability to share expertise, data and resource across the organization.
Enterprises need to shun their rigid functional boundaries and traditional matrix structure and make way for agile matrixes if they want their digital transformation to succeed. Marcus Ryu, the CEO of Guidewire Software, states that “agile principles are now a standard operating procedure for software designs”.
Digital transformation requires a fundamental rethinking of the corporate model, where the technology acts as a catalyst. Various sources of the organization’s structure, efficiency and revenue are up for scrutiny, they need to offer more empowering, flexible and rewarding paths. The roadmap to digitalization is no walk in a park, but it is the necessary step to survival.