How to master digital transformation?
Digital Transformation is an incremental change and requires constant adaptation. Mastering Digital Transformation could be a mammoth task, however its possible and it offers huge benefits. According to IDC (2020), Digital transformation (DX) is at the center of modern organizational strategies. IDC estimates the economic value of DX at over $20 trillion, or over 20% of global GDP, with direct investment of over $8.2 trillion as organizations and entire industries transform themselves to compete in the digital economy.
With the digital disruption on the rise, where digital natives are disrupting the incumbents, for example, the emergence of fintech, new digital banks etc. The incumbents are responding and disrupting each other in the process. This is evident across market verticals, for example, telecommunication, financial, manufacturing etc. The aim of this blog is to provide some tips on how digital mastery can be achieved by applying the best tools and skills. This will probably lead to a series of well researched blogs with real life examples.
On this blog, I will share my learning and key take away from LinkedIn Learning course "Master Digital Transformation training path". This learning path comprises of 32 courses, 40 hours 15 minutes of presentations packed with cutting edge insights presented by world leading experts in Digital Transformation. Upon completion, you can acquire the following top skills: Design Thinking, Machine Learning, Digital Transformation, Big Data and Agile Methodologies. These are mainly at conceptual, architecture and management level. I know right, what a great way to start a new year. The main reason I did this training path was to gain contextual understanding from other world experts for my PhD thesis, Digital Transformation in Telecom, laboring on the hypothesis, "the under-preparedness of contemporary IT functions in organizations to adapt and adopt the emerging digital transformation". With the aim and objective to define a flexible and responsive strategy methodology to enable Technology leaders to quickly adapt emerging digital technologies. I hope you will enjoy the reading as much as I had fun watching and learning from the LinkedIn educational videos.
According to LinkedIn Learning, "Digital Technology is transforming business around the world." Exploring the transformative and technological forces at work and ways to use them would benefit most organizations in the long run. The learning path covers three key points:
Discover strategy for how to navigate Digital Transformation.
Discover design thinking and agile practices for innovation.
The convergence of digital technologies to drive Digital Transformation.
Let's zoom in and take a closer look:
1. Check readiness: Look before you leap
I recommend starting with the Current state assessment of digital maturity and capabilities within your organization. Define To Be state, how it can be improved. Please refer to my blog, "Digital Transformation Assessment Framework" for more insights. According to the Digital Transformation (Tips) LinkedIn course, doing the following actions, in no particular order could yield positive returns:
Spend more time in planning before you start, avoid analysis paralysis.
Build leadership buy-in to boost adoption. By providing a clear reason for change, makes it more likely to be accepted. Therefore develop a mandate for change.
Start from a well defined processes for smoother transitions. I think a lot of people fall on the trap to try and overhaul the system and then start afresh, well the assessment should provide a relevant approach (Evolution or Revolution) for your organization. Remember what work for others might not work for you.
Very important, Transformation projects come at a cost and require experienced resources. Therefore, verify available time and funding before you start to successful completion. To achieve this, provide conservative estimates, obtain solid commitments and while you are at it, you might as well ensure you have a formal project charter to guide the execution.
To watch out for transition overload that can stall adoption. Its important to ask yourself, what else is changing? For example, the results of change saturation would include: competition for resources, since resources might be committed to multiple projects, run / operational activities, slow adoption and inability to sustain change. This should be avoided.
Keep in mind, a critical piece of any successful project is communication.
Transformation is a sustained and continual effort. Evaluate, Measure and Improve.
Transformation also requires new behavior's and may make major changes to your organization's overall culture.
Always keep in mind that Digital Transformation is a coordinated change effort at scale, diffused through all aspects of the business.
These tips should be done in an iterative manner, using lean thinking for each digital transformation initiative.
2. Constant change is inevitable, embrace it
The fourth industrial revolution will transform our world to effect how we learn, work, move and interact. Technology evolution has come a long way from steam powered motor and electricity which enabled mass production, the telephone invention, gas-powered combustion engine which led to automobile and aeroplanes, then transistor invention, personal computer and the internet. According to Jonathan Reichental (2019), "Foundation of the fourth industrial revolution course", adoption just won't be about technology. It will involve drastic change, the regulatory environment, politics, economics and culture. Some recommendations:
Covid-19 pandemic accelerated Digital Transformation. Working remotely, i.e. from home has become a new normal for most people around the world. Adapt your business strategy for the new normal.
Leverage enterprise architecture, develop loosely coupled technologies, such as containers and microservices, cloud-first strategy, retire old technology while standardizing with emerging technologies as much as possible, this will help to transform effectively.
Adopt cloud-first strategy to gain competitive advantage. Cloud computing level the playing field and enable cost efficiency. With cloud services, you pay for only the resources you use and you can quickly scale up and scale back as needed. It is key to understand your current workload / applications. Remember one size doesn't fit all, so pick cloud deployment models (IaaS, SaaS and PaaS) that aligns with your digital transformation strategy. Great recommendation from David Linthicum (2019), "Learning Cloud Computing: Core Concepts Course". Select only the workloads that will likely show success when doing migration. Don't boil the ocean, pick the easiest applications first. Budget for mistakes and make sure you allow enough time for errors.
Embed Artificial Intelligence (AI) in your business processes, products and services for efficiency. "AI is the capability of a machine to imitate intelligent human behavior" - Merriam Webster. AI has many benefits, to name one, automated decision-making through analytics based on historical trends and data, i.e. pattern of previous transactions. "Its important to understand the benefits of the different AI approaches, such as strong AI, weak AI and planning AI. Also to understand the strengths and weaknesses of these approaches." - Doug Rose.
"Leverage digital twin, a virtual replica of a physical thing, which exists only as software rendered by computing power." - Johathan Reichental. This could help improve your system design capabilities.
Leverage Big data with AI to find new competitive advantage and adapt dynamically. Big data gives you more data sources and more data. This enable organizations to adapt to changes in a more agile manner.
Technology offers great possibilities to address problems and to enable organizations to leapfrog. According to Peter High (2018), Digital transformation requires four things:
Its necessary to digitize your culture to encourage learning agility.
Adopt modern solutions.
Develop edge based innovation.
Transformation of core business.
3. Embed strategic agility in your practices
Technology is evolving at a faster pace, strategic planning methods needs to adapt. According to Gary Bolles (2017), "Strategy Agility course", an agile strategy is a set of practices to infuse into the way you continually adapt to the rapidly changing world. Its about driving change on an ongoing basis, encouraging a culture of taking risks, and rewarding innovation. Being digital and leveraging technology in the best possible ways and most importantly being human. Having the confidence that you can continuously set and achieve your organizational goals, even when the entire landscape is changing around you. Strategy is traditionally all about change management, going from what you are today to what you want to be tomorrow. Whereas strategic agility is about transformation. Some recommendations:
Your strategy is failing if the competitor beats you in your core area, workers are unaware of your strategy, inability to move quickly, difficulty in attracting and retaining talent and wasted time and money on initiatives.
These are times of tremendous and exponential change. Its important to become an adaptive and agile organization. Adaptive and agile organizations base goals on core constituent's needs, collaborate with teams members, empower teams to make decisions and test decisions quickly. Every individual deliverables must be tied to their team goals. These goals must be baked into the performance management process.
Understand that cultures are difficult to change. Align organization's strategic goals with individual goals. Activities with strategic goals.
Make the vision so big, its unattainable and mission to be attainable. Encourage risk-taking and model adaptive behavior.
Utilize data to define goals and track strategic objectives. Hold process and innovation hackathons.
Think digital first and leverage digital technologies to be strategically agile.
Empower individuals to make decisions and teams must band together to solve problems.
"Digital leaders should listen at scale, share content to shape and engage to transform" - Charlene Li. Digital leadership is key to lead successful digital transformation.
At the end of the day, the agile strategy that you are helping to craft is only as good as the process which is implemented and the people who are implementing it.
4. Foster new ways of working and innovate
"The digital revolution has provided new tools and ways of working that are spreading quickly throughout all industries" - Phil Gold. Haiyan Wang and Anil Gupta (2017), "Leading with innovation course", says that, the rapid pace of technology development, integration of multiple technologies and fierce competition is fostering innovation. This is altering the organization DNA to change their mindsets and adopt an innovative culture.
A wise man said if you're not busy being reborn, you are busy dying. Organizations should adopt design thinking, lean thinking and agile mindset to come up with new groundbreaking business models. Design thinking is a user-centered way of solving problems. It involves extensive collaboration, using strategies such as mapping customer journey, concept creation and prototyping. Amazon introduced 1 click check to dramatically reduce process steps, taking the pain away from the customer and automating internal processes. Some recommendations:
Promote continuous learning and growth - even the best tools in the world won't serve any purpose if the audience doesn't know how they work. Capture learning and make it available to new team members.
Enable agile principles in the modern workplace.
"A mindset is a radical change from how most organization operate." - Doug Rose. Embrace uncertainty, focus on different ways of working and understand why you do things differently.
Agile teams start with the highest value and deliver predictably in a short timeframe.
Agile teams deliver small functional features to the customer in iterations or sprints.
If your organization has a strong control culture. Its best to create an entire separate agile team.
"Design thinking is a mindset. A mindset is part of an organizational culture." - Turi McKinley. Encourage lateral thinking, the art of reframing questions and breaking assumptions leading to breakthroughs.
"Create a Kanban to improve your delivery process and predict demand for your team. However if you want radical change, it might not be the best place to start" - Doug Rose. Remember one of the benefits of Kanban is that it gives you a way to measure and manage your flow.
"We need to continually adapt how we measure performance. Take a commitment to continually improve. Start with individual, continue to teams, ultimately change the overall performance of the organization" - Gary Bolles.
Continually embrace your failures, take risks and learn how to improve in the future.
Develop new technologies, products and process by partnering with independent groups through Open innovation / Collaboration. No man is an island.
Every innovation requires looking outside of today's world view and boundaries.
"Give full autonomy to individuals driving Moon shot innovations. These type of innovation disrupts the industry and could deliver groundbreaking business models. Roof shot innovation which aim for incremental improvement in existing products and services should be embedded within existing business units initiatives" - Anil Gupta.
Reimagine the target customer, identify unserved markets, redefine customer value and rethink the entire value chain.
Focus on substance over style, create and nurture a customer-obsessed culture. Don't stop experimenting with new ideas.
Ask yourself how you can use new technologies to create new value for customers, to expand your reach and become more efficient.
We need to imagine or reimagine our future state and work backwards. I hope you will find these recommendations helpful in your Digital Transformation journey. It shouldn't be a painful experience but a fun and exciting one.