A lot of buzz surrounds how to become a digital business right now, but precious little about what the term actually means.
Several pieces use some variation of this explanation from Gartner Fellow Ken McGee:
“Digital business is not synonymous with IT. It is about revenue, value, markets and customers. It is outward-focused. It is a metaphorical combination of front office, top line and downstage compared with back office, bottom line and backstage. True, information and technology help to build the capabilities for digital businesses, but they are only part of a complex picture."
Maybe I’m a bit hard headed, but that strikes me as still pretty unclear marching orders. Okay, technology is not the point…but what is?
Veteran industry observer and writer Joe McKendrick recently offered a counter definition that seems more focused on the technology aspects. In a recent Forbes piece, McKendrick cautioned that companies are just now starting to explore what it means to become a “digital enterprise.” “For the sake of argument,” he suggests defining the digital enterprise as “wholeheartedly embracing cloud, data analytics, mobile, embedded devices, and social platforms as a major part of its strategy, operations and revenue streams.”
Peter Weill, senior researcher and chairman of the MIT Center for Information Systems Research (CISR), offered another clue as to what it might actually mean. He told TechTarget that the successful digital enterprise “hinges” on three components:
Whatever the digital enterprise becomes, I think there’s one safe conclusion CIOs can make from all of this: Your data needs to be integrated, cleaned and service-enabled for fast access.
Even though we’re still in the vague, hype stage of the so-called digital enterprise, here is why I say it’s a safe bet to invest in data integration and other tools that streamline data:
Information is seen as a strategic asset in the digital enterprise, and data is the currency. “Data is the new currency in this digital world that's going to help us have insight so that we can market, sell and change our product offerings based on what we know," Adriana Karaboutis, global CIO at Dell, said during an MIT Sloan CIO Symposium panel covered by TechTarget. "The only way to gain those insights is to embrace digital technologies." A recent e27 article, “Six Key Steps to Build a Successful Digital Business” adds that information strategy is “a key element of digital business strategy.” Of course, you’ll have to balance that against regulatory compliance, the piece warns.
Chief data officers are gaining power in the wake of the digital enterprises. The CDO role is rising in importance in part because CIOs are struggling to work with chief marketing officers and other business leaders, consultant Dan Petlon told CIO.com. “Put another way, the CDO comes in to break down silos separating departments, particularly at companies struggling to enter the digital age,” the article states.
The digital enterprise requires collaboration. The digital enterprise requires “the right mindset and shared understanding,” according to Gartner, which says the digital enterprise will be able to act quickly on business moments, which it defines as “transient opportunities exploited dynamically.” Recognizing and acting on these passing moments will inevitably require collaborative access to data and information.
As another CIO.com article noted, content can be the “connecting tissue” between employers, customers and business goals — if the data is there to support. The article includes this quote from Jeffrey Mann, a vice president of research at Gartner:
“Just like oil, if it stays buried underground, there’s not going to be any value created from it.”
We may not yet know what a digital enterprise is, but it’s a safe bet it’ll require better access to quality data.