Digital technologies and techniques have matured to the point where they support major organizational redesign, and early adopters have captured competitive advantage by using them. Thus, organizations now recognize they need to drive large digital transformation events. Two kinds of digital transformation are taking place in businesses today. One aims to change the way a company competes. The other kind of transformation aims to modernize a company’s technology and supporting functions so that the company can transform to a digital environment. Both kinds of transformation are journeys to new operating models, and those journeys take time and rethinking of all aspects of existing models. Most organizations find the enormity of change becomes is overwhelming. Let’s look at how the successful companies are managing their IT modernization.
Studying the leading companies – those whose IT groups are most effective in supporting digital transformation – reveals that the companies have a vision for a dramatic overhaul of IT, completely modernizing all aspects of IT. But they don’t approach it as one large transformation event or program. Instead, they break the modernization journey down into a set of smaller journeys. These smaller individual journeys enable a company to make consistent, productive progress that better supports the business and reduces operating costs.
Instead of a managing IT’s overhaul as a big-bang event, leading companies break down the modernization into a set of journeys such as the following examples:
- Move to cloud environment
- Modernize the network and other infrastructure to support a cloud environment
- Modernize the company’s approach to developing applications, leveraging SaaS products and building APIs
- Establish an automated test environment
- Establish a devops environment
- Reconceptualize desktop or workplace support to take full advantage of mobility and self-service to improve productivity of individual workers
- Elevate security across the board in all technologies
- Design processes and the digital platform to meet new privacy regulations
These individual modernization journeys start along the traditional towers – infrastructure, applications, networks. They are then augmented by new towers – security, privacy, workspace. Finally, they are supplemented or complemented by a cross-cutting initiative like digital readiness.
This multiple-journey approach gives people a much clearer path for broad, visionary concepts. It turns lofty ideals into actionable road maps on which they can execute and deliver the desired outcomes.
It’s important to note that each of these individual IT journeys is a transformation unto itself. For example, in building a new operating model for infrastructure, the journey causes companies to reconcile their legacy infrastructure and understand how they are going to move into a multi-cloud environment. Beyond implementation, they need to understand how they will manage and orchestrate that multi-cloud environment? Therefore, this journey becomes a new operating model for infrastructure. Designing/rethinking, iterating and stabilizing new operating models takes time.
Here’s another example of how these individual journeys become a transformation unto themselves. In building a new operating model for applications, companies must move from a legacy software package vehicle, which often has an offshore factory supporting either onshore and offshore shared-service functions. In moving forward in the IT modernization journey, the company must reconceive this legacy environment into devops pods.
The new operating model realigns IT by end-to-end functional journeys. For example, it will build devops teams around supply chain or around F&A processes. This is different from traditional IT teams structured around the functional stack based on vertical features and aligning teams by infrastructure, applications, security, etc. The new operating model aligns cross-functional, DevOps teams supporting such areas as the supply chain, retail mobility efforts or patient care efforts. Or, for instance, a journey toward a new operating model for workplace support would move away from the command-and-control, horrible employee experience of the traditional workplace environment to support highly productive people using mobile devices and self-service.
Each individual journey requires a new operating model that people need to move toward for supporting the company’s digital environment and new value-delivery capabilities. Interestingly, as those new operating models emerge, they further evolve to reinforce one another. Evolving the models and the organization takes time and rethinking.
The more successful firms that modernized their IT capabilities to support digital transformation first committed to a cloud-first, automation-first, software-defined, agile implementation. But they broke down the overhaul journey into these smaller journeys.
Creating new operating models and evolving them, along with evolving the organization, can be overwhelming. IT modernization involves immense change, so it’s too complicated to try to accomplish all at once in one integrated program. But if a company breaks it down into a series of journeys and then integrates those journeys, it can make steady progress to the desired outcome.