The blurring line between business and technology design

Digital transformation blueprint is significantly different than a normal transformation blueprint. It is built on discipline and focus, agility, connectivity, openness and transparency and empowerment and enablement.

Despite the noise and sound bites about digital transformation, most industries still have lower level of digital transformation with the average digitisation penetration around 37% across industries (Source: Mckinsey Quarterly February 2017).

Digital transformation has a significant road to travel and will continue to demand the top seat on the executive agenda. As the organisations embrace digital transformation, the key question is how does one go about developing its digital transformation blueprint. Economic benefit case of digital transformation is not always easy to calculate and hence it is important to look at a number of initiatives that form part of the larger blueprint in order to establish credibility and stakeholder commitment. It is also important that the digital transformation is driven by the executive management and looks at end-to-end processes as against the functional or organisational boundaries. Assuming that the early buy in has been achieved and a business case is established, the next key stage is the development of transformation blueprint. In the digital age, transformation blueprint looks very different than the standard transformation blueprint. Here are few noticeable differences:

A single integrated business and technology blueprint: An integrated business and technology blueprint is the key. The boundary between the business and technology design has blurred extensively in the digital age and will continue to get blurred more. Hence, an integrate blueprint owned by business and technology leadership jointly is the first important step.

Radical Business Model Change: If the organisation is not a digital organisation from its inception (like the digital start-ups or disrupters), more likely than not, the megatrends of digitisation and service orientation will demand a radical shift in its existing business model. The old method of understanding the current business model from inside out has to give way to an outside in view.

Determining the Digital Capabilities Required: Working out the high-level enterprise architecture and then determining the capabilities needed is equally important. However, unlike large monolithic projects, a number of pilot projects (some of them in parallel) need to be started with cross-functional teams to establish what works and what does not. Failing early is the preferred route for digital transformation and does not have any stigma attached to it in the digital age.

Networked Organisation: Agility is the key in digital transformation and hence programme and project groups are created through the formation of informal networks and not by the rigid organisation design. Keeping the team highly motivated and removing the constraints should be the priority as against hierarchical structures.

Discipline and Focus: Being agile should not be misconstrued with the lack of discipline. Agility demands more discipline and focus. Once the blueprint has defined the desired outcomes, the organisation has to focus relentlessly on achieving them. It has to constantly prioritise the things that drive the most value- customer and talent, data and products. The organisation has to be disciplined in execution.

The digital transformation blueprint has to enable the organisation to move away from the traditional power structures, toward open, transparent, and connected structures and organisational cultures that encourage innovation and experimentation. That’s how to build a business that’s fit for the digital economy. That’s how to be truly digitally sustainable at all times.