The Complete Guide to Digital Transformation

Amit Kothari

in Tallyfy Technology Trends

Today’s business world is characterized by disruption. Digital transformation is essential for any business that wants to stay relevant in today’s market, as the rapid changes in technology have gone beyond simply changing the pace of business and are disrupting entire business models and industries.

Technology can be our best friend, and technology can also be the biggest party pooper of our lives.Steven Spielberg

Look at what cloud computing did to retail bookstores or Internet connectivity to the home thermostat. Social media has created radical transparency into business operations and customer experiences. No industry is immune to the impact of the growing Information Economy.

Businesses are also changing from within as the behavior and habits of the workforce shifts. A new generation of workers chooses not to have a landline telephone at home. Many avoid owning desktop computers, printed magazines and televisions, preferring instead to use tablets and laptops. They increasingly bring these expectations for social collaboration and connectivity to work with them.

But you already know all this. Virtually every business is on the front line of these changes. And nobody is closer to the change than the IT organization, responsible for keeping business technology running, relevant and cutting edge.

Organizationally, most IT departments and cultures originated in a world in which technology was a scarce resource, provisioned and controlled by the business from the inside out. Yet today, cloud computing and mobile devices are moving essential computing workloads and data outside the enterprise data center. IT isn’t the only one buying technology – IT leaders are recognizing and adapting to this reality.

The technology world is moving from a model of scarce computing resources (one that puts technology first) to one of abundant processing and data with ubiquitous connectivity. This is empowering individual departments and business users to become agents of technology change. Today’s IT environment is turning itself from an inside-out model of central control to an outside-in model that puts the business user in control – what we call Digital Transformation in IT.

It’s About Putting People First, Not Technology

Technology doesn’t disrupt businesses – people do. Social, mobile and cloud technologies are changing our behavior, at home and at work. With smartphones and tablets, people have come to expect constant connectivity, with the ability to access information, make a purchase or connect with others around the world, at any time.

Employees are bringing those expectations to work, wanting to use technology that makes them faster, smarter and better at their jobs. They have little patience for outdated technologies, long ramp-up times and extensive training. They want to collaborate with colleagues and customers, without barriers. With cloud computing and personal devices, people have more options for working around perceived barriers to their productivity or effectiveness.

Current IT Models Aren’t Sustainable

This situation poses a real challenge for legacy IT organizations built on the premise that technology is a scarce, expensive resource centrally purchased and managed for a select few, from the inside out.

IT organizations understandably want visibility into and control over enterprise data. Data privacy and security regulations often require it. At the same time, cloud adoption is growing rapidly, and evidence tells us that people are using cloud services and personal devices for work, with or without the blessing of corporate IT.

The scope of the problem emerges in the ‘war stories’ told by IT and security professionals. One major technology company discovered that its employees were using 19 different file sharing/collaboration services.

Blocking specific cloud sites is a task with no end, as another new site is always popping up. And as many companies discover, blocking a file-sharing app at work does not prevent employees from synching their files at home, beyond the reach of the corporate network. Both mobility and cloud computing are trending upward.

People aren’t bypassing enterprise IT systems or policies out of any malicious intent to thwart the business. On the contrary, it’s because they want to be smarter and faster at their jobs. IT needs to find a way to empower employees to work the way they want while protecting the common business interests.

Rethinking IT

Technology is forcing people to rethink many industries. Educators, for example, are exploring the concept of ‘flipping the classroom’ – with lectures taking place online, and discussion and problem-solving happening within the classroom context. Technology enables a radical new vision of how education can happen in which the user, or student, is in control with the aid of a teacher.

Enterprise technology is due for a similar shift. What happens when computing workloads don’t take place in the data center? When the corporation isn’t the one purchasing all the equipment, corporate networks don’t carry all of the data, and the concept of enterprise perimeter evaporates?

Traditionally, IT practitioners think in terms of linear application stacks, with “back-end” servers and storage connecting through “front-end” servers. The end-user is irrelevant.

This model is less useful in today’s enterprise IT environment. The stack is everywhere – in the cloud and in the data center – and people are everywhere. If you flip your perspective and make the person the starting point, a new vision of IT falls into place.

Digital Transformation inverts the traditional approach to technology by starting with the business user.

Instead of a linear stack of technology, Digital Transformation and IT is more like a series of interrelated systems, where data and applications interact on behalf of the business user.

The layers closest to the user include access-related services (devices, locations), directory/identity layers and applications. Supporting these services are other systems and layers, including underlying services, controls, and infrastructure. These last layers are the domain of the enterprise IT organization and are generally transparent to the user, yet essential to the overall IT environment. Using the image of a sphere, these are the layers that hold everything together.

interrelated systems chart

The Guiding Principles Behind Digital Transformation

Does Digital Transformation represent a technology shift? Yes – but incremental changes in technology aren’t going to get you all the way to Digital Transformation. You need to embed new guiding principles in the organization, culture, and technology systems you implement. After all, what you are trying to achieve at the end is a complete business process transformation. The aforementioned core operating assumptions can be boiled down into the following five principles.

1. Digital Transformation serves the business by empowering people.

IT’s evolving role is to empower people to work better and smarter. Getting people to engage, connect and act in real-time adds incredible velocity to a business. IT leaders need to look for ways to optimize how individuals and departments work while protecting the business interest in data security, compliance, and governance.

2. Digital Transformation adapts to the way people work, not the other way around.

Instead of requiring people to adapt workflows to meet technology needs, or to delay projects by weeks while waiting for configuration or special-request reports, business technology should fit seamlessly into the workflow. It should be easy to use, flexible, and customizable to fit the style of each individual and department. This requires new IT systems to be extremely flexible at the edge while maintaining consistency and security at the core.

3. People, information, and knowledge must connect in real time.

Collaboration is a growing imperative for today’s knowledge-based workers. Hoarding knowledge is out, sharing and collaborating are in. In the Digital Transformation environment, people have intuitive and natural ways to share and collaborate with colleagues, partners, and even customers. IT empowers collaboration rather than impeding it.

4. Mobility is a work-style preference, not a device.

When worrying about managing mobile devices, it’s easy to lose sight of the people using them. Mobility is a way of life. People expect access to information from anywhere at any anytime via any device. Digital Transformation goes beyond simply allowing mobile access to limited services, instead of supporting the mobile work style from any device. The digitally transformed organization empowers people to be productive from anywhere, using the best device for the task.

5. Security should be inherent and transparent to the user experience.

Security and compliance are both mission-critical. In fact, security is more important than ever as the information economy continues expanding. But when security goes head-to-head with convenience, convenience almost always wins. Heavy-handed security measures or cumbersome processes are counterproductive, as users will find workarounds. Security must be ever-present, inherent but invisible, integrated into the systems presented to the user without creating friction or delays.

Business Justifications

As businesses adopt cloud computing, they are seeing payoffs in terms of productivity, time to market, and overall IT spending. In a Vanson Bourne study (commissioned by Google), 96% of surveyed CFOs said that cloud computing delivered quantifiable benefits, including:

  • 21% average reduction in product time-to-market
  • 18% average increase in employee productivity
  • 17% average reduction in IT maintenance costs
  • 15% average reduction in IT spend

IT’s Evolving Role in Digital Transformation

The IT organization is as critical to Digital Transformation as it is to the legacy model. But the shift to a Digital Transformation strategy requires changes in mindsets and in roles. IT leaders need to start building the strategies and tools to be successful in this evolving role.

Stronger Business Relationships: Digital Transformation starts with an understanding of the business user and their needs. IT teams need to collaborate closely with business units to deeply understand business user needs and preferences. IT should be a key player in every new business initiative from its inception.

New Skills and Knowledge: In addition to broad business knowledge and strong communication skills, IT teams also need a deep understanding of business data structures and how data flows between apps and users. While specialist skills are always valued, there’s a role for the IT generalist capable of taking a systems-based view of business processes, as well as individuals with a good understanding of the cloud stack. And to be successful, today’s IT practitioners need to be lifelong learners, ready to evaluate a constant flow of new technological possibilities and opportunities.

Refocused Objectives: Old-school IT organizations focus on managing servers and infrastructure with the intent of driving cost efficiency and minimizing downtime. Digital Transformation teams focus on enabling the business and measure their effectiveness in terms of user productivity, time-to-market, and business agility.

Flexible Tools and Technologies: In a cloud-enabled world, IT fills an essential role identifying, curating, provisioning and integrating the right tools and technologies to enable Digital Transformation in computing. These will include cloud applications, solutions for embedded and frictionless security, identity and access management processes, and integrated systems from the user to the infrastructure. In an environment with many interlocking systems, open standards and interoperability will be critical parts of the overall architecture.

Let’s revisit the company with 19 different file sharing and collaboration services. This company’s various working groups engaged with cloud services for the purpose of sharing information more easily. Ironically, the end result of this situation is that effective collaboration is actually harder, as each different file service creates a new silo of information.

Digital Transformation means understanding not just which cloud services employees have purchased or signed up for, but also which ones they actually use and get value from.

IT’s responsibility is to lead the evaluation of those services for risks and benefits, standardize on the ones that best meet business needs, put in the necessary security controls without degrading the user experience, and promote these services across the entire organization. In this way, IT maximizes the value of the cloud services and helps drive an organized, secure, and productive path to the cloud.

How Do You Get To Digital Transformation?

The path to Digital Transformation relies as much on cultural change as technology choices. How you get there will depend in where your current IT culture falls on the spectrum of adopting new technologies and approaches.

Where is your organization today?

digital transformation adoption curve

Innovator

Innovative IT leaders are quick to adopt new technologies for competitive advantage, as they are closely aligned with business priorities. If you fall into this category, you are already putting your users first.

Try taking a holistic look at what business users need to drive the business forward and find strategies to integrate identity, security, and other controls in a systemic and seamless way to empower users. Align with partners who share your vision for Digital Transformation so you can inspire business users and become enablers of business success, rather than merely supporting users.

Early adopters

These businesses adopt new technologies before their competitors if possible – trying to be first movers or fast followers. Business users have input but may have to wait longer than they would like for the wheels of business to grind. Sometimes this wait is due to legacy investments, other times it’s due to misalignment between leaders in the business.

If you’re an early adopter, then you’re probably already using cloud computing as part of your IT strategy. Legacy mindsets may be preventing you from being as agile or as user-focused as you like. Make cloud computing a larger part of your IT strategy. You’re ready to embrace the five principles of Digital Transformation, aligning current and future IT initiatives with those principles as well as with business objectives.

Mainstream

Mainstream IT organizations wait for technologies to be proven and well adopted before taking action. These IT organizations usually maintain a firm grip on technology investments but do maintain relationships with the business units, considering their needs as one data point in technology initiatives.

If you fall in this category, it’s time to strengthen your business unit relationships and start putting the business user at the center of IT designs and plans. Figure out what people are doing today (with or without your knowledge), and look for ways to address their most significant work needs up front while laying a groundwork for the technology you need moving forward. Engage with business leaders to build a roadmap for delivering the tools and technologies your organization needs to become digitally transformed and fast moving. Start a pilot with a department, or small group of users, to validate a new technology before wide deployment.

Conservative

Conservative IT organizations are often skeptical about mobility and cloud computing and need strong ROI, detailed user cases and proven customer stories (preferably in their own industries) to move forward. IT is often about command and control and maintaining the status quo.

If this sounds like your IT organization, then your first step is to recognize that your employees have most likely embraced cloud and mobile services already, with or without your blessing. Gain an understanding of the top two or three services your business users are using, weave them into your IT processes and make them available to more users. Engage with your business users and start defining a path towards becoming a digitally transformed organization.

Try a small pilot of a cloud-based solution that addresses a significant business need – using the pilot to identify skills gaps, concerns, and core assumptions built into current processes. Be sure to measure results, adoption, and user satisfaction at every phase of the pilot. Optimize your apps before deploying them to a larger set of users.

Next Steps

IT leaders have a key decision to make: either embrace a new model of IT or risk becoming irrelevant. The forces of the information economy – including social, mobile, analytics and cloud – are unstoppable and they are pointing businesses towards a Digital Transformation approach to IT.

Depending on where you are with current IT organization, getting to the vision of Digital Transformation is not trivial. Putting the business users at the center may seem almost radical in some organizations.

And technology alone isn’t enough. There’s no way to do a ‘forklift upgrade’ to Digital Transformation infrastructure, and no single technology blueprint to deploy. That’s exactly the point – the actual solutions vary with business user needs.

The core technologies are themselves changing almost every day and will continue to evolve. What you need is the IT culture, mindset, and approach to creating a technology architecture that will be resilient to ongoing technological change while unswervingly serving the business interests. Helping business users be better, smarter and faster at their jobs is the ultimate payoff for adopting a Digital Transformation approach.


How did YOU embrace digital transformation within your organization? Let us know down in the comments!

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2 thoughts on “The Complete Guide to Digital Transformation


  1. Megan barnett Reply

    Hey Amit
    Digital transformation is a present day business imperative that no business can take for granted. Every business part of the digital marketplace is trying hard to beat the competition, take lead in transforming digitally but each of them finds themselves in a specific sphere in terms of the digital transformation. What do you think?
    Megan barnett


      1. Amit Kothari

        Megan – this is unavoidable. I think it’s natural that companies get into specialisms, even though the wider initiative stays the same.

        Amit

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