I’ve recently been involved in a number of digital transformation projects and wanted to share some lessons learned in this blog.
Firstly, there’s no one-size-fits-all approach to successful digital transformation, so it always helps to start with a why. For instance, why is the company considering digitalisation? Perhaps the competitive landscape has changed or some of the existing business models are becoming less relevant in light of new technological trends.
Regardless of the reasons, I would argue that no special digital strategy needs to be developed. Rather, we need to to see how digitalisation supports the overall business strategy, and how digital trends affect your company.
While strategising in the boardroom helps, keeping customers in mind is paramount. Rather than simply digitising existing business processes (such as going paperless), it’s useful to think about them as multiple customer journeys to maximise the value for the consumer.
Design thinking is a good method to use when approaching this, as it helps to create a customer-centric solution. It begins with a deep understanding of customer problems and iterates through prototyping, testing and continuous feedback. This process also aligns well with modern iterative frameworks for software development and broader agile working.
Learning from feedback on your minimal viable product (MVP) helps to refine your initial assumptions and adjust the approach where necessary.
For example, adopting and combining technology like Cloud, Big Data and Machine Learning can help improve the decision-making process in one department, so it can then be adopted by the rest of the enterprise once the business benefits have been validated.
Having a clear data architecture is key in such transformation. It’s rarely about just building a mobile app, but about making better business decisions through effective use of data. Therefore, before embarking on any data analytics initiative, it’s imperative to be clear on why the data is being collected and what it’s going to be used for.
While working with a Power and Utilities company, I helped them securely combine Internet of Things devices and Cloud infrastructure to connect assets to the grid, analyse consumption data to predict and respond to demand and automate inventory management. As outlined above, it started with a relatively small pilot and quickly scaled up across the enterprise.
Yes, traditional companies might not be as nimble as startups, but they have other advantages: assets and data are two obvious ones. Digitalisation can help make this data actionable to better service the customers. To enable this, such companies should seek out not only opportunities to digitise their core functions, but also find new growth areas. If some of the capabilities are missing, they can be acquired by interacting with other members of the ecosystems though partnerships or acquisitions.
It’s not all about technology, however. People play a key role in digital transformation. And I’m not only talking about the customers. Employees in your organisation might have to adopt new ways of working and develop new skills to keep up with the pace of change. Recruitment requirements and models might have to adjust accordingly too.
If you would like to learn more, there’s a free online course on digital transformation developed by BCG in collaboration with the University of Virginia that provides a good summary of current technology trends impacting businesses. Feel free to jump straight to week 4 for the last few modules discussing their framework and some case studies if you are after more practical advice.