For IT executives already feeling the pressure to implement digital transformation across the enterprise, here is some bad news: Expect things to get even worse in the years to come.
According to IDC, worldwide spending on “DX” is expected to top $1.3 trillion next year, a nearly 17 percent jump over 2017. That curve is expected to continue through at least 2021 when the market is expected to top $2 trillion, the vast bulk of it going toward the technologies that alter business models and operations, as well as the information that drives improved decision-making and new product development. At the moment, the key decision is what kind of technologies best support these goals, with IDC’s Eileen Smith saying that it is largely coming down to two classes: 3rd Platform tools like cloud, Big Data and mobility, and Innovation Accelerators such as the IoT, AI and cognitive computing.
Over the long term, however, technology alone is not enough to fully transform the business model. Deloitte’s annual Tech Trends report stresses the concept of “The Symphonic Enterprise” in which strategy, technology and operations work in harmony across multiple domains and boundaries. An example of this can be the co-implementation of tools like augmented and virtual reality coupled with new HR strategies designed to foster greater coordination between human- and machine-driven workflows. At the same time, organizations will need to rework core functions like finance and supply chain management with an aim toward breaking down traditional barriers to information exchange. In this way, the enterprise can implement meaningful change to key processes rather than continue with the incremental, often isolated, upgrades that rarely fulfill strategic objectives.
If there is one overarching theme to DX it should be to increase agility, says Bpm’online CEO Katherine Kostereva. This can be accomplished in a number of ways, although initial efforts should focus on internal operations and customer-facing services. By targeting these areas, the enterprise can keep pace with a constantly changing business environment while laying the groundwork for an all-new business model affecting everything from product development to marketing to ongoing customer support and retention. Not all of this will center on advanced technologies, nor will it be accomplished through a single upgrade. Instead, get ready for a philosophical commitment to perpetual transformation.
With this level of complexity, however, it is important to avoid trying to do too much too fast, which can ultimately lead to failed projects and disillusionment. Joe Yankle, of Kodak Alaris Information Management, says federal agencies, which are under the gun to transform paper-based processes by 2019, have achieved the highest level of success by focusing on five “quick wins” to get the ball rolling: accounts payable, mailroom automation, records management, forms processing and customer on-boarding. A central theme in this process is the adoption of an ecosystem-based approach to information capture that includes digital scanners, intelligent software and a flexible services program backed by a global partner network.
Perhaps the two biggest challenges in digital transformation are crafting the strategic vision to guide the process, at least through its initial stages, and maintaining the necessary focus among management, the workforce and the partner/supplier ecosystem. Few organizations will be able to accomplish this without setbacks, of course, but by laying out the big picture, the enterprise at least has the proper framework with which to guide technology and process development and resolve the disputes that will inevitably arise.
Arthur Cole writes about infrastructure for IT Business Edge. Cole has been covering the high-tech media and computing industries for more than 20 years, having served as editor of TV Technology, Video Technology News, Internet News and Multimedia Weekly. His contributions have appeared in Communications Today and Enterprise Networking Planet and as web content for numerous high-tech clients like TwinStrata and Carpathia. Follow Art on Twitter @acole602.