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Avoiding the Potholes on the Road to Digital Transformation

September 15, 2022


Since the earliest days of the Digital Age, business consultants have been encouraging client companies to transform into digital enterprises. Tech journalist Zach Cooper insists, “Whatever a company’s vision for the future, it must include digital transformation in order to grow.”[1] The fact that pundits are still encouraging companies to undergo digital transformation is a bit surprising considering the fact that the Digital Age can be traced back to the 1980s. The pace of transformation confirms what Niccolo Machiavelli wrote in his classic The Prince, “There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things, because the innovator has for enemies all those who have done well under the old conditions, and lukewarm defenders in those who may do well under the new.” Companies that did well during the industrial era are understandably cautious about changing what made them successful.


Reasons to undertake digital transformation


If your company hasn’t fully transformed itself to function successfully in the digital era, Cooper believes the timing is right to do so now. He explains, “Digital transformation has been key in responding to the disruption of work and business ecosystems brought on by the pandemic, and most businesses ramped up their efforts to meet this sudden change.” To back up his assertion that the time is right to transform, he cites Dell’s Digital Transformation Index 2020, which surveyed over 4000 business leaders globally, and found, “Eight in ten organizations fast-tracked their digital transformation programs in 2020.” If you aren’t staying up with or racing ahead of the competition, you’re falling behind. He goes on to suggest five reasons why digital transformation is essential for business growth. They are:


1) Customers expect on-demand service. Cooper notes, “Today’s customer, internal or external, expects the same kind of experience in a professional environment that they have with technology in their personal lives.”


2) Employees need modern tools to be effective. “Workforce engagement is a hot topic,” Cooper writes, “especially when dealing with a dispersed workforce that may never fully return to the office. Employers are looking for new ways to create productivity improvements, with technology playing a pivotal role in helping employees to become more effective in their primary roles.”


3) Security must be a top business priority. Not only are customers demanding their data be treated securely many governments are also penalizing companies that don’t treat personalized data with the utmost care. Cooper notes, “As time goes on, this task becomes more difficult, with threats evolving to counteract the security practices of the past. In response, companies must enforce rigorous protocols around data compliance and access.”


4) Business partnerships need to be strengthened. According to Cooper, “Demands from customers are increasing, and competition within industries is fierce. Firms are becoming increasingly reliant on each other, working with suppliers and distributors, sub-contractors and specialized consultants, with the aim of producing a diverse range of products and services that interest customers. Managing these partners often requires document-based communication, a process traditionally viewed as an exhausting obstacle to efficiency. But technology is now available that can redesign this process.”


5) Decisions need to be made better and faster. Bain analysts, Michael C. Mankins and Lori Sherer (@lorisherer), explain, “The best way to understand any company’s operations is to view them as a series of decisions.”[2] They add, “We know from extensive research that decisions matter — a lot. Companies that make better decisions, make them faster and execute them more effectively than rivals nearly always turn in better financial performance. Not surprisingly, companies that employ advanced analytics to improve decision making and execution have the results to show for it.” That’s why Enterra® is focusing on the advancement of Autonomous Decision Science™ (ADS®) and the Enterra Autonomous Decision Science™ platform that leverages embedded advanced analytics. Cooper adds, “Placing data and analytics at the center of a digital transformation strategy will allow businesses to take advantage of big data.”


Tech journalist Charles McLellan (@charlesmclellan) insists, “Digital transformation [has] proved its worth during the pandemic, with more digitally mature businesses generally proving resilient in the face of serious disruption.”[3] He also notes that business leaders should have vision of where their company’s digital transformation journey will take them. “Successful digital transformation,” he writes, “requires an understanding not only of the capabilities of new technologies, but also of customers’ and employees’ evolving requirements, and the overall direction of the business.”


Avoiding the potholes on the road to digital transformation


Many experts have stressed that digital transformation is a continuing journey not a destination. Randy Bean (@RandyBeanNVP), Founder and CEO of NewVantage Partners, and Ash Gupta, former American Express executive and Chairman of the Board for Corridor Platforms, note that even digital leaders must continue their transformation journeys. They explain, “The ability to deploy data as a competitive business asset is what has distinguished a set of well-established, data-rich companies who have reigned as market leaders over the course of the past several decades. However, business conditions evolve, and today, these companies face a new set of challenges that threaten their hard-won leadership positions.”[4] They ask, “How do these well-established data leaders transform from excellence in traditional data and analytics — of the kind that they have deployed in recent decades — to leadership in a new era of Big Data, AI, and machine learning driven decision-making?” That’s an excellent question and one which a number of experts have tried to answer, including Bean and Gupta. Below are some of the suggestions experts have made to help companies successfully transform:


• The best place to start is at the beginning. Like McClellan, Ashwin Rajeeva, Co-founder and CTO at Acceldata.io, insists companies need to have clear vision of where they are and where they are going. He explains, “Like any journey, you need to decide where to begin. Having a clear transformation story mapped out is perhaps one of the most crucial tips for a successful transformation.”[5] Suresh Sambandam (@sureshsambandam), Founder and CEO of Kissflow, adds, “Before you change course, it’s important to look critically at what you have accomplished already. … No matter where you are, it is critical to assess what key changes you want to achieve — efficiency, precision, time-to-market, etc. — and rewrite the roadmap that will help you get there.”[6]


• Understanding data is essential to digital transformation. Bean and Gupta note, “One of the greatest assets that any business maintains is its unique set of customer data — customer interactions, transactions, and behavioral history. Whether this is information about your customer’s behavior, habits, or transactions, or other information, it is essential to understand what unique insights your particular data gives you. Knowing that, and how to combine it with external data sources, allows you to build and maintain a uniquely competitive business asset for your organization. Highly successful companies distinguish between the quality and quantity of data that they maintain.” Sambandam adds, “The amount of data at our disposal continues to grow exponentially, with the majority of it having been created in the last few years alone. It is far too much for one organization to understand — let alone make use of, so it is important to be strategic about the data you are calling on. Likely, your data is caught up in silos, making much of it unavailable for cross-functional use. … This requires having a roadmap to build (or buy) an enterprise-wide data platform.”


• Use that data to digitize your core operating model. Rajeeva insists, “For a successful digital transformation, your organization needs to digitize its core capabilities, including but not limited to all steps of the value chain — from shared functions to the supply chain and the customer interface. Your digital transformation must extend to the end-to-end customer experience design and go beyond just the automation of organizational processes.” At the same, assert Bean and Gupta, you must ensure that tech investments will provide a return on investment. “Link technology investments to high-value business objectives,” they explain. “Organizations too often equate success with making leading edge technology investments, while often straying from the core business strengths which has made a firm competitive and unique.”


• Don’t forget about people. Focusing on technology and ignoring people is a recipe for disaster. Bean and Gupta note, “It is long past the time when C-executives can profess ignorance of these new technologies. … While executives need not understand technical details of ‘the how,’ they should absolutely grasp ‘the what’ of the resulting business value to the firm.” Rajeeva adds, “The process of digital transformation is not easy. The executive team you choose to lead it should be digitally savvy and committed to seeing the change happen.” And Sambandam insists, “The most innovative, efficient solutions cannot replace the critical thinking of a talented team. Your employees are arguably the most important part of your digital transformation process that ultimately is meant to make their jobs easier.”


Concluding Thoughts


Because digital transformation is a journey, course corrections will be necessary as the journey progresses. According to Rajeeva, key performance indicators (KPIs) can help you recognize when course corrections are necessary. He explains, “Successful digital initiatives depend on transformational leaders recognizing data strategy as a means to achieving measurably better business outcomes. The right KPIs help you track goals and measure success.” He also suggests being open to new possibilities. He writes, “To maximize your organization’s digital growth, you need to seek out new adjacent opportunities.” This proactive approach is also recommended by Bean and Gupta. They conclude, “Senior leaders of companies that follow these steps will be far more likely to differentiate themselves from their more cautious competitors. They will distinguish themselves as innovators who will shape the future of their industries and markets in an age of disruption, Big Data, and AI.”


[1] Zach Cooper, “Five reasons why digital transformation is essential for business growth,” ITPro, 27 July 2022.
[2] Michael C. Mankins and Lori Sherer, “Creating value through advanced analytics,” Bain Brief, 11 February 2015.
[3] Charles McLellan, “Digital transformation in 2022 and beyond: These are the key trends,” ZDNet, 5 August 2022.
[4] Randy Bean and Ash Gupta, “Legacy Companies Need to Become More Data Driven — Fast,” Harvard Business Review, 15 June 2021.
[5] Ashwin Rajeeva, “Digital transformation: 8 guiding principles,” The Enterprisers Project, 25 July 2022.
[6] Suresh Sambandam, “Digital transformation: 5 steps to boost your progress,” The Enterprisers Project, 29 June 2022.

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