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Last year was the test for digital capabilities: without them, businesses would have struggled to keep afloat at all. It’s no longer controversial to state the necessity of having ‘digitally transformed’ – it’s the received wisdom, the absolute bare minimum for companies to operate in the 21st century.
Accordingly, a long overdue shift is underway about this somewhat nebulous phrase. Companies are realizing their initiatives should never have been framed in terms of one-off exercises, but, as analysts have suggested, an ongoing process that requires paying attention to the needs of their business on a continuous basis. In other words, there is a key difference between one-off digital transformation – a limited project that fails to build over time, or adapt to changing conditions – and continuous transformation, essential for a modern, digitally savvy business.
Old habits die hard, though, and legacy attitudes haven’t quite caught up yet. That’s why the time is now for businesses to revisit their objectives and re-align their thinking to correspond with the agile nature of digital.
What is continuous transformation?
Even before the Covid-19 response, says André Christ, CEO and co-founder of enterprise architecture and cloud governance business LeanIX, customers were already undergoing a number of transformations, including migration to the cloud, rolling out new ERP systems, a pivot to microservice-based architectures, and M&As.
When the pandemic did strike, operating models had to embrace digital wholeheartedly, and it became clear even to the legacy holdouts that digital transformation is simply the cost of doing business today.
There are three key areas leaders need to keep front-of-mind to stay on track with the principles of continuous transformation, and the flavors of these concern organization, technology, and people and skills.
A project-centric mindset remains a lingering attitude for enterprise, but Christ suggests the progressive move is to pivot to a product-centric one. Whereas businesses may have traditionally assessed budgets and allocated projects on that basis, now the most successful tech companies are embracing the concept of a product organization – where teams take ownership of the product, with the freedom to continuously improve it based on customer feedback rather than handing them off when they’re complete.
“The conceptual difference in how to execute this change is for enterprises that still think in project portfolios,” Christ says.
Running parallel on the technology side, organizations can easily find themselves stuck thinking in terms of application landscapes – applications grouped by capabilities – when they should be thinking about platforms, he adds: “You need to look at your own IT landscape not as hundreds or thousands of different applications, but as ‘what are the big platforms I’m running’, and ‘out of which applications are these composed?”
While there’s been movement towards breaking down monolithic infrastructure, it is platforms-based thinking, the establishment of ownership within product teams, and clearer direction towards granular models that will better enable continuous improvement.
Bringing in a modern EA tool like LeanIX to support this platform-based thinking allows organizations to fine-tune their ability to manage technology assets to increase the speed for making decisions and complete IT transformations on time, reduce technology risks, and ultimately, save money on IT costs.
Despite all the ongoing transformation within organizations, there remains a dearth of talent that can take a holistic view of the whole IT landscape and connect the technical details to business objectives.
Plenty of eyes may be on strategy or infrastructure, but organizations still lack people who “create the glue between these two worlds.”
“This is where the role of an enterprise architect or a cloud architect jumps in,” Christ adds. For example, lifting and shifting into the cloud without strategic insight behind the decision may only increase costs. A smarter approach involves the Enterprise Architect or Cloud Architect, because they are the ones who can help align decisions to business goals, and determine whether it makes better sense to retire, re-platform, re-host, or re-write applications based on objectives.
The pressing question is in the boardroom
Enterprise architecture is hardly new, however, businesses traditionally outside the technology space are realizing the strategic advantage that this deep understanding brings, and it’s this that can help them truly become technology companies.
“The pressing question in 2021 will be in the boardrooms,” Christ says, adding that this will involve leadership pushing their organizations to understand whether or not they are on track to becoming tech companies. Here, again, is where enterprise architects can assist, enabling their organizations to get a real view of the fitness of their platforms, and provide feedback to leadership about if initiatives are on track.
To get to this point, leaders must shed dated ‘PowerPoint analysis’ and instead “get their hands dirty” by diving into data-driven solutions, to make better informed, data-driven decisions..
“That is a switch where the C-level can help to move away from a very static way of managing architectural change,” says Christ.
There are two main schools of thought around what keeping track of that change actually looks like. Some organizations buy in to solve their problems with one major platform, while others rely on a set of platforms designed to monitor their estates.
For Christ, the answer lies in well-integrated, best-of-breed “IT for IT” tools that play nicely with all the main players. “Looking at developments on the commercial ERP side, I must say we’ve found over time that you can’t solve it all with just one big ERP system for the company,” he says. “We’ve seen a lot of innovative solutions popping up that have helped, and the big trick is to have them very well integrated – a lot of out of the box integrations in that ecosystem.
“I think it’s important for organizations to understand where they really want to be: Do they want to rely on platforms that do everything, or do they want to differentiate and bring the best tools and solutions in?”