6 steps for digital transformation

In terms of digital transformation initiatives, there’s a lot of talk right now in terms of strategy and less emphasis on practical execution. Everyone wants to advise the CEO and the board, but these discussions often only take the conversation so far.

So how should an organization think beyond the strategy and get to transformative execution and outcomes? It’s important to develop an approach that can span this divide between strategy and execution so that once the transformation objectives have been selected, there’s a clear path to a unified architectural approach for IT and subsequent agile execution.

Here are six steps for digital transformation that you can take to progress from innovative strategy development, to an architectural framework, to practical execution:

Step 1: Identify your transformation objectives

As you progress from strategy to execution, it’s important for the strategy to set the stake in the ground in terms of target business outcomes. Digital business is often discussed solely from the lens of the digital customer experience, but that’s only a part of the story – albeit a vital part. In addition to re-thinking and re-designing of entire business models, the key desired transformation objectives often map to the following areas:

• Enhancing the digital customer and end-user experience to improve  loyalty, revenues, productivity and retention
• Transforming business processes to reduce costs, improve productivity, integrate supply-chain partners and differentiate offerings
• Simplifying service management to reduce complexity, solve issues before they occur, and gain visibility and control over assets
• Optimizing infrastructure and operations to improve agility, flexibility and cost-effectiveness
• Deriving insights from analytics to make better decisions, improve efficiencies and gain competitive advantage

Every organization will have a slightly different set of transformational objectives, with different priorities, but this is a vital first step for organizational alignment.

Step 2: Study technology enablers in the market

The next step is to be fully aware of, and leverage, the technology enablers in the market. Look beyond the SMAC stack and into the next wave of enablers including personas and context, intelligent automation including human-machine collaboration, the Internet of Things and of course, cybersecurity. Advanced cybersecurity is a key enabler because when emerging technologies are not secure from the start, they create delays in realizing their full business benefits as organizations struggle to implement appropriate security controls.

In addition to these more recent enablers, the core SMAC stack is clearly evolving as well. Mobility is evolving and embracing wearable technologies, and the cloud is evolving and embracing broader concepts such as hybrid IT and software-defined data centers. These key disruptive technologies now serve as the foundational building blocks – some mature, some emerging – in the new digital business platform ecosystem of on-demand services. Taking a holistic view across all these enablers can help to maximize business benefits and unlock new forms of value in the years ahead. 

Step 3: Envision the future platform for digital business

Architecturally, these foundational technology enablers can be utilized to assemble a highly-virtualized, highly-distributed platform ecosystem of on-demand services. Based on your perspective, you’ll select powerful combinations of these technologies to achieve target business outcomes such as improving the digital customer experience, enhancing the digital workplace, transforming business processes, optimizing infrastructure, simplifying management, and implementing an adaptive cybersecurity defense posture.

Overall, this new platform can be used as a frame of reference for digital business transformation in terms of the key IT capabilities – both technologies and approaches – needed to support your transformation objectives. In “Beyond SMAC: The New Platform the Digital Business”, I recently discussed six key characteristics of the platform and how the model can help with your planning.

Step 4: Master the digital services lifecycle

The next step for IT is to consider the “how” as well as the “what.” It’s no longer sufficient to have an innovative set of products or services (the “what”), you have to be a master of how you design, develop, deploy, manage and continually evolve your digital services (the “how”) as well. Mastery of the digital services lifecycle is going to become a key competency for organizations to grow their business and build sustainable competitive advantage in the years ahead.

All in all, there are six key approaches that are shaping how IT services are produced and consumed: agile, DevOps, as-a-service infrastructure, intelligent automation, personas and context, and finally, digital service management.

Collectively, these capabilities help to accelerate digital service development and deployment, make services available on-demand, automate extensively, personalize to specific roles, and manage holistically. Progress in these six areas will help you build your organization’s mastery of the digital services lifecycle in terms of the digital touch points, interactions and transactions with your customers.

Step 5: Organize for digital business innovation

Having established the platform ecosystem for digital business as described earlier, organizations will select the appropriate sub-set of building blocks (i.e. disruptive and enabling technologies) based on their specific target business outcomes. Rather than a monolithic platform that integrates everything, the future platform will consist of a highly virtualized, highly distributed, ecosystem of services from best-in-class providers. Foundational services will be selected based upon role-specific and outcome-oriented needs. Common groupings of pre-integrated services will emerge such as those provided by software-defined data centers so that you don’t have to do all the assembly yourself.

In terms of practical execution, business managers can therefore select from this palette of options based on their specific needs. For example, for the digital customer experience we need a new set of capabilities including a persona-driven approach, omni-channel integration, customer centricity, and insights from analytics. Some of the key elements are therefore as follows:

• Persona-driven approach to support new work patterns and preferences
• Omni-channel integration and re-designed business processes for faster, improved experience
• Customer centricity using social, mobile and cloud computing to transform work processes
• Contextually-relevant anticipatory analytics to enhance customer insight and differentiation

More broadly, in the case of the digital customer experience, the full set of technology enablers can be envisioned based on an understanding of the key attributes essential for a world-class experience as outlined in the digital customer experience bill of rights.

Step 6: Execute an agile journey to the future platform

Finally, when taking the journey to this new platform, it’s important to bear in mind that we live in a hybrid IT world. Organizations need to take the journey to the future platform, while supporting and maintaining their existing applications and infrastructure. While some elements may be retired or modernized, other elements may need to co-exist and be integrated into the new platform.

Since IT will be a hybrid environment for quite some time, it will be important to interoperate across these two divides. In addition, an agile and iterative journey to the future platform can simultaneously optimize infrastructure and simplify management on the back end (the IT transformation) as well as improve the user experience and transform business processes on the front end (the business transformation). That way the business can gain early benefits for customers and end users at the same time as IT transforms its own delivery model.

Finally, in terms of change management, CIOs and business leaders don’t have to create entirely new processes, or reinvent the wheel, to execute on digital initiatives. You can use existing corporate funding and corporate innovation mechanisms, but will need to make five critical fine-tuning adjustments to readjust the sights squarely on digital business.