Digital transformation is a buzzword we hear more and more each year. It seems like a new spin on the dotcom era “New Economy” that emerged 20 years ago. Before you dismiss this opportunity and continue with business as usual, there’s more to know about this trend. The first step to go beyond the hype lies in clearly defining what’s meant by digital transformation.
Defining Digital Transformation
Take a step back and find out what this term means. According to ZDNet:
“Digital transformation involves using digital technologies to remake a process to become more efficient or effective. The idea is to use technology not just to replicate an existing service in a digital form, but to use technology to transform that service into something significantly better.
Digital transformation can involve many different technologies but the hottest topics right now are cloud computing, the Internet of Things, big data, and artificial intelligence.”
The point about not merely replicating an existing process is a key definition. For example, if you recreate a paper form on a screen, you’re missing out on efficiency gains. To leap digital transformation requires courage and the willingness to take risks. You might have to use processes and technologies that are unproven or unfamiliar to your peers. For example, adopting cloud computing might be a closed question. In that case, it’s time to look more closely at ways you can leverage machine learning.
Why Does Digital Transformation Matter for IT Leaders?
Unlike sales and marketing, IT is usually seen as a cost center in most companies. That means less respect for IT leaders and their staff. Getting approval for IT projects is tough when the VP of Sales delivers revenue results. That second-class status situation for IT is starting to come to an end, but only for organizations that embrace digital transformation.
By leading a digital transformation program, IT will save money and pioneer new products. Ignore the transformation opportunity and IT will be pushed further into the background. New projects will be given to outside consulting firms, while the IT department is limited to maintenance.
How to Tell if You’re Ready for a Digital Transformation
Now that you know what digital transformation is, consider whether this is the right time to pursue it. It’s an important question to pause and consider. Skip this question and your transformation efforts are likely to fail. Fail too often and the executive committee may ask you to resign!
1. Competitor activity
If your organization has yet to embrace digital transformation, focusing on competitors is often a good strategy. For example, if you run a television network, consider the rise of Netflix and Amazon Prime as competitors that have embraced digital transformation from the beginning. If you’re in the banking industry, consider looking at the rise of cryptocurrencies or innovation-oriented brands such as Capital One.
Take Action: Work with your team to come up with 3-5 competitors who are embracing digital transformation to grow faster, reduce costs, or make other achievements.
2. Goals
Do you understand your company’s goals? If you’re in a publicly traded company, confirm your findings by reviewing materials prepared for the annual report or investor day. In those materials, you’ll often discover that your company is committed to increasing market share. The exact goal might be different in your situation. The critical question to ask is this: how does embracing digital transformation advance your company goals?
Take Action: There are two steps for you to do here. First, reach out to an executive to verify your understanding of the company’s goals. Second, brainstorm all the ways that digital transformation could help you grow.
3. Support for digital transformation: people, process, and systems
What would happen if your company doubled the number of customers it serves this year? Most companies would collapse under that kind of growth. That’s why you need to consider your organization’s ability to scale safely. For people, this means developing reliable training programs and supporting new hires in becoming productive. For process, this means standardizing your operations to reduce errors.
Now, on to systems. This is a major opportunity to enable your digital transformation. Without good systems in place, growth and transformation aren’t going to deliver benefits. For example, do you have a physical security system to regulate access to your building? Alternatively, do you have a system to help you manage access requests and passwords? When you rely upon manual approaches, you’re just not going to be ready to implement digital transformation.
How to Enable a Foundation for Digital Transformation
By reflecting on competitors and goals, and with support in place, you’ll probably come to two realizations. First, you see the need to speed up a digital transformation program so that you stop falling behind. Second, you’re worried that your organization just isn’t equipped to stay the course with digital transformation.
The solution is simple. Press the pause button on launching digital transformation for a few months because you need to put in place a foundation of systems and processes to serve as a foundation. The following are two practical projects you can implement in the next 90 days to enable digital transformation.
1. Automate your IT security maintenance
Choose and implement a solution such as Compliance Auditor to automate your IT compliance activities. This will save your managers from having to check access manually. Compliance Auditor is just one good option you implement to save time. What about eliminating the most common cause of help desk tickets: password resets? That’s easy when you use Password Management.
2. Improve your cybersecurity training program
What happens when employees don’t understand the role they play in security? You’re much more likely to be hacked. When you’re hacked, the stock price is going to dive, and you’ll have to answer tough questions from customers. That’s why you should refresh your employee security training annually. For example, you could deliver a password training program to your people managers this month. Alternatively, you could hire an outside consultant to review your cybersecurity training program and provide recommendations.
