Are you a Digital Enterprise? (Part one)
The bombardment of “Digital Transformation” imperatives is generating confusion and cross purposes for enterprises. Digital transformation means different things, depending on who you talk to. Analysts, like myself, assert (see this prediction) that organizations need to transform their digital capabilities and approaches now to compete in the future. But digital transformation is the tip of the digital enterprise iceberg.
Digital transformation is the tip of the digital enterprise iceberg
Many digital transformation projects have a high failure rate. Most are random acts of transformation focused on technology and tactical changes. This is fine if the goal is to reduce professional risk and check-off boxes for completion. It’s an IT responders’ approach. It looks to master digital elements through externalized capabilities that alleviate operational overhead. This piecemeal approach will get an organization just so far and bind the business to “working for the technology”, not the “technology working for the business”.
Many digital transformation projects have a high failure rate. Most are random acts of transformation focused on technology and tactical changes
Change – i.e., transformation – is needed, indeed. That change starts with how the enterprise thinks about digital. George Westerman of MIT emphasizes that it is a “radical rethinking of how the organization uses technology.”* An enterprise should not merely rethink how it uses technology but should rethink the nature of its business because it has digital capabilities. It’s the difference between an enterprise with digital and a digital enterprise.
A digital enterprise addresses technology and business needs concurrently through continuous improvement and frictionless innovation.
The digital enterprise is concerned with the degree it leverages (or doesn’t leverage) technology to conduct, enhance, and improve its business. The approach is unique to the business, its processes, offerings, and talent. Digital is an enterprise program. Without a conscientious approach the less the enterprise will be able to keep up with today’s business dynamics:
1. Constantly changing technological advances and innovation
2. The evolving enterprise, work, skills, and talent
3. The rapidly changing nature of conducting business
A digitized enterprise can (see prediction):
- “… dynamically change their business strategies, operating processes, technical algorithms, and supporting platforms…” as the business requires it
- “…meet customer expectations and to reshape workforce experiences”
- “…exploit the digital power of enterprise innovation with disruptive technologies”
- “…defend against rapid further attacks and cyberwarfare”
- “…address tactical process deficiencies that aggregate into strategy failures”
The more enterprises approach digital as essential to continuous business improvement, the easier it becomes to establish a future where the idea of having a digital strategy will be as ridiculous as having an electricity strategy.
This is part one of a multi-part article on the Digital Enterprise. In the next articles, we address adopting a digital enterprise mindset, becoming a digital enterprise, and some approaches that can help.
*George Westerman, MIT principal research scientist and author of Leading Digital: Turning Technology Into Business Transformation. Quoted in: “What is digital transformation? A necessary disruption”, Clint Boulton, CIO.com, May 31, 2019.