Digital Transformation

The current leaders in the technology industry e.g., FAANG have reshaped how other non-tech organizations deal with technology. Every customer expects a Netflix data driven recommendations, Amazon.com variety of products and delivery and an Apple like interface in all the interactions today be it with a bank, insurance, telecommunication, energy or any industry that you can think of.

There are a quite a few companies delivering these types of experiences already if they are relatively new . These companies have been able to either start with new technologies or adapt quickly to newer technologies and have been able to implement them successfully. But, how do organizations that have built a technical foundation for over 50 years on really old technologies like the good old Mainframe technology transform themselves to be able to provide supreme customer experience while rebuilding and enhancing their infrastructure? The hard way for sure! There are quite a few ways how companies can implement this.

As organizations try to implement Digital Transformation efforts, 3 key principles must be addressed. Failing to implement any one of these will ensure organizations' transformation efforts fail.

The 3 key principles that must be addressed are -

• People

• Process

• Technology

Digital transformation efforts, in my experience, fail primarily when organizations do not consider all 3 aspects. This is similar to what we see in the project management space - Time, Cost & Scope which are critical for any project implementation. Let us look at what each one of these categories mean at a high level.

People

There is no company without the people involvement. They are the core for the organization and they define the organization. During Digital Transformation efforts, one of the core questions that "People" need to ask and understand is the "Why". Why should an organization get into a digital transformation and what does it actually mean? Everything works fine as it is right now, why must we do this? People or employees must have the mind set for change and must be able to think differently if the organization must change. The important point here is: Have people who are willing to change. Have change agents to be able to pull people long. This takes time and a lot of effort in transformation.

Process

A process implemented 10 - 15 years ago cannot be the same because there were constraints when this was implemented. The process was probably streamlined then considering the technology, logistics, systems and mindset. In today's world, customer's expect the exact location of package that they ordered online. It has become the norm. Organizations must be willing to blow away the age old process and implement new processes considering what is available today. Again, we cannot predict the future but ensure the process is capable of being changed or tweaked for the next few years. Lean management principles can be used to help come up with new processes to make them efficient. The aspect of changing a process is as challenging as changing peoples thinking. Some of the common statements one would hear is, this works this way today and works well for me. Let us implement the same way of doing it but in the new tool! The important point here is: Think Lean and reduce waste. Processes can make or change digital transformation efforts.

Technology

In my experience, changing technology is probably easier than People and Process. Technology is a key factor that stitches the whole organization in transforming themselves. The new tools and capabilities that we have today can help organizations be nimble and provide that unique customer experience. However, there needs to be a balance in this regard. You can do pretty much everything with technology as part of Digital transformation, but should you is the key question to ask. What are we going to change and why? The change management aspects are important. Solution architecture plays a key role in this piece working along with Enterprise architecture that must be the engine for this. The important point here is: Balance the amount of technological changes you want to implement. Understand what is critical and what is it that the organization is trying to solve.

We have seen the 3 main things that are key in any transformation - People, Process and Technology. How does an organization go about implementing these changes and be successful at it? 2 main ways that I can think of is -

• Big bang transformation

• Incremental transformation

Each of these options has pros and cons. Organizations can choose each of these options depending on the temperament and longevity of their strategy and plan.

Big bang is a tough approach which needs long term vision, funding and the temperament to trudge along. Companies have sometimes spent millions of dollars in this approach and have been successful or failed miserably. Success in this case may not be fully tangible because the time it has taken an organization to transform is so high that the industry and competition has moved on really far. Employee burn out and fatigue due to this long running effort has other issues that organizations need to hold on.

Incremental transformation is my preferred approach. I like the analogy of someone using a GPS to get to a destination. In this transformation, the destination is critical. Organizations must understand what their destination is. Incremental transformation efforts help guide the organization in a step by step fashion like directions in a GPS. This shows tangible results and short term funding needs. As the transformation solidifies there is immediate improvement that departments can see instead of waiting till the end as in the big bang. People and org burn out and fatigue is lower since these efforts are smaller and the turn around time is lower. If the destination does change, then the path can be changed to align towards the new destination.

There are ofcourse a lot of assumptions in both the cases. Organizations have been successful in all types of approaches but it is essential that People, Process and Technology all change to make the transformation successful. Smaller incremental changes do have advantages in this ever changing dynamics. Technology changes rapidly. Aligning the strategy of an organization and layering the foundation is critical. Once your layers are in and good enough, everything else becomes topping on a pizza. To ensure your transformation is successful, identify what are you challenges and what exactly are you trying to achieve. The FAANG companies have a solid focus on what they want. Amazon's 14 leadership principles play a key role in guiding Amazon. Organizations that are transforming must have and must align to the core principles and drive hard to achieve them. Data and metrics are key in any transformation efforts. This shows organizations on the before and after to show how successful the change has been.

Good luck on your transformation efforts!