Digital transformation is all in the execution

It’s hard to believe that it has been a decade since the launch of the first Apple iPhone. When the product first hit the shelves in June 2007, the first generation of social media platforms were just hitting the mainstream, and America was on the cusp of electing Barack Obama as President. 

Ten years ago, most companies had yet even to consider the impact that consumer technology was likely to have on the way they did business. Most did not have a mobile strategy, let alone a mobile presence for engaging with their customers or for helping employees collaborate. How times have changed.

Trying to make sense of digital transformation

Today, businesses of all sizes find themselves in the midst of a period of immense disruption, one in which the digital art-of-the-possible is pulling away from average practice.  As organisations scramble to keep pace, most are still struggling to define what digital actually means for their business.

For all too many organisations, digital equates to massive, complex upgrades to existing systems. Some of these projects will be wildly successful, but many more fail due to a fundamental misunderstanding of what digital projects should aim to achieve. Digital is not just another IT-driven project. It is a core part of your business in a new world fuelled by disruption and should be at the heart of your business strategy. Doing what you already do slightly better is not going to put you ahead, you need to embrace innovation and create new experiences with a people obsessed mindset. A digital strategy will get you to a “me too” point, but to really differentiate and disrupt, your strategy needs to be digital.

Great ideas are nothing without the ability to execute

Digitally mature organisations define change in a distinctly different way. Rather than focusing much on individual technologies, or over-emphasizing existing operations, they fundamentally re-imagine the business by exploring the fresh opportunities that the digital world enables, from new business models and creating new markets, to reinventing the core business in contemporary technology terms.

According to one recent report, 80 percent of business leaders agree that digital transformation will fundamentally change their company’s operating model. It’s encouraging that such a high proportion of businesses recognise the critical importance of digital transformation to their future success. More worrying however is the fact that just 40% of those same business leaders have a strategy or the competencies needed to execute that transformation.

To me, ideas are worth nothing unless executed. They are just a multiplier. Execution is worth millions

Asked to comment on his secret for success, Steve Jobs once said: “To me, ideas are worth nothing unless executed. They are just a multiplier. Execution is worth millions.” Speaking to my many of clients I’m seeing that while ideas are not in short supply, the majority are struggling to execute. The question is, why?

Hamstrung by legacy

A recent report Avanade published looking at digital transformation in the banking sector found that senior IT decision makers are spending as much as 19% of their annual IT budgets managing and maintaining legacy IT systems, something which they say prevents them from focusing on innovative projects designed to drive the business forward.

The amount of resource currently being allocated to updating and maintaining the status quo represents a significant barrier to innovation. Modernising your IT is, therefore, a critical first step for any business looking to execute true digital transformation. But the fact is even getting to this point on the journey often proves an insurmountable challenge for organisations.

However, this is only part of the challenge. The type of bold thinking required in digital transformation thrives in a flexible execution environment. Yet the structure of many large organisations tends to rest on rigidly defined processes, chains of command and cascading communication. The resulting lack of flexibility is frequently at odds with the speed of execution that true digital transformation demands.

The ‘try things, fail fast’ mentality that characterises the approach of many of today’s digital success stories remains an alien concept in many highly structured large organisations. Incremental, or iterative changes to the status quo are far easier to sign off, because they follow the established process. Meanwhile, good ideas are watered down to the point where they no longer fulfil the original, strategic vision.

Lacking the skills to deliver

Even when transformational ideas do make their way through these layers of process, for many organisations the ability to deliver is often held back by the lack of internal resources and structures capable of taking these projects forward. Successful digital transformation relies on having access to a group of creative people with highly specialist, and highly sought-after skills.

It would be unreasonable and impractical for the average high-street bank, insurance provider or utility to have this type of specialist available on tap. And besides, even if these organisations could attract this type of resource to join them permanently, could they really keep them motivated or busy in the long-term?

Creating the right environment 

The successful execution of digital transformation projects relies on having the flexibility to execute at speed. As most large organisations simply aren’t structured to accommodate this type of approach, they need to look at ways to build that flexibility through other channels.

Businesses in almost every sector are increasingly looking towards third parties to provide the mix of agility and highly specialised resource they need to create new digital experiences for their customers. In response to this demand, organisations including Avanade are taking a bespoke approach by creating dedicated digital studios, where experienced designers, data scientists, digital strategists, and developers are brought together in an environment clients can tap into in order to experiment, test and develop digital services in a very agile way.

Even visionary geniuses have help

It is tempting to attribute great, disruptive innovation to a single ‘Eureka’ moment, from which everything suddenly falls into place. Few would dispute Steve Jobs’ position as one of the leading visionaries of the past century, but he had a few other aces up his sleeve too.

Not only was he not hamstrung by the need to maintain a costly legacy infrastructure, he also recognised the importance of trial and error in the pursuit of a great product. Finally, he had an incredible team of specialists around him to execute on that vision.  As businesses look towards a future defined by digital, they will do well to ensure their vision has the same ecosystem of support in place.

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