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Bringing Home Digital Transformation - Part 1: The Critical Ingredient

Bringing Home Digital Transformation - Part 1: The Critical Ingredient
August 27, 2018

Digital Transformation”, are two words omnipresent in current times, and countless thought-provoking articles were and are still being written on them. There is a tremendous amount of curiosity among the leaders both in business and technology, and everybody is looking for that magic sauce that will bring it home. Every conversation pivots to digital strategy, and it has reshaped how we think of IT, and moved technology to the centerpiece of competencies for every business. This was once unthinkable and goes against the philosophy of focusing on core competencies as was espoused for decades in business schools. Now, maybe, it is time for leaders to redefine the core competency of their organizations.

Most leaders are now acknowledging that digital transformation is not just an inevitability but a new-age competency imperative for business survival. However, the question is: How to make it happen?

It would be really easy to go and buy the latest in the digital candy store, using funds supported by business cases that are good or engineered to look good. But for a passionate and visionary IT leader, who wants to truly elevate their organization to become digital native or near digital native, they know that money can’t buy everything. For some, shopping money, while not always easy, is not the most pressing of their problems. So, what is the problem?

The problem is culture

Companies thrive on culture. It establishes the DNA of an organization and has developed over long periods of its evolution. It has been shaped by leadership, values of owners, market demands, nature of operations, digital strategy, market position, the inherent culture of the geography, political situations, language and ethnicity, and many more tangible and intangible aspects. A successful organization relies quite heavily on its culture as a secret sauce, and has helped it overcome many a challenge and thrive or, at least, exist.

However, no success lasts forever if it relies on the same secret sauce. As times change, the sauce has to change to keep up and good leaders understand this.

Applying to our times, the era of digital transformation technologies is here and the operating environment has shifted significantly. It is time for the sauce to be updated, which means the ‘culture’ needs to be updated to ‘digital.’

What if culture remains unchanged?

In the business world, we all love to play the devil’s advocate, and for a moment, imagine that the organization is currently doing well, can afford a huge IT budget, and can buy all the digital candy it desires. Well, with or without money, this is exactly the problem we witness in many organizations. And, the symptoms look like:

  • There are detailed PowerPoint presentations on moving to the cloud, implementing AI or using microservices, but an overarching and well-thought-out roadmap is missing.
  • And worse, even if there is a roadmap, it is totally technology- oriented and the critical connection to business capabilities is considerably weak.
  • Accountability is not set up for the business to be directly involved in or own digital transformation. IT is the lone warrior fighting this battle.
  • The organization adopts agile but doesn’t use it end to end.
  • IT wants to embrace DevOps but only for deployment.
  • The business team is still stuck in the ’90’s operating model, although their titles might have changed to the product owner.
  • They can’t still let go off their dependence on resources instead of relying on processes.
  • CIO has not become CTO.
  • The CTO exists but their great work doesn’t move out of presentations and spreadsheets.
  • CIO/CTO does not have a seat on the board.
  • Every project is an improvement on a legacy business model, and somehow closely tied to the legacy ways of working.

The above list can go on but the purpose here is to merely illustrate what an organization looks like when the digital transformation is led by the digital candy store rather than a cultural shift to digital innovation. We are seeing so many organizations struggle to move fast enough despite their IT leaders being fully up to speed with what is happening in the technology world and are very capable of leading digital transformations. It is, in fact, a testament to these brave IT leaders driving change as feasible within their constraints.

The solution - A culture-led digital transformation is the new secret sauce

What many organizational leaders should realize is that the digital business transformation is not a purchase decision. It is foremost a cultural decision. Before the organization spends even a dollar at the digital candy store, the foundation that needs to be laid out is the cultural shift. This is also the hardest aspect, which will be painfully slow to accelerate but once it picks up speed, the organization will be unstoppable, and it will become very much like a digital native company. Everyone and everything that is being done in the company will first look to use digital ways of working, and digital business technology as the lever. The agile way of working, experimenting, failing fast, driving to constantly improve and tinkering with things using technology will just become an intuitive part of the organization.

In the second part of this article, I will elaborate on how to enable the digital transformation culture mindset in your organization.