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Innovating to survive – are you doing it?

Digital transformation contains a curious paradox. On the one hand, it refers to the increasing focus on the digital enablement that is creating an entirely different business landscape across many industries. On the other, organisations are placing an ever-increasing emphasis on the concept of business outcome – it has never been more important to focus on the very ‘analogue’ outcomes, in the real world, that have always been important for businesses.

Bottom line up front – the methods and tools that organisations have used in the past to manage and evidence the achievement of these traditional outcomes will themselves have to undergo a significant and radical digital transformation through the application of contextual, business-focus analytics.

So what’s driving digital transformation and what does it mean for business? Gartner, in its annual CIO agenda report, describes some fundamental shifts driving the move towards digital. These include the fact that businesses now compete at a global level, while platform players (such as WhatsApp in telecoms, FinTech companies in financial services) are transforming the business rules, and companies must respond faster to any threats just to stay in business.

This doesn’t change what businesses are trying to achieve through digital transformation. They’re either optimising costs – being efficient will never go out of fashion in business – or they want to serve customers a better product, and deliver this in a way that better meets their needs. And they want to do all this while still running a viable business.

The issue is that the radically new business ecosystem described by Gartner means brand new expectations. Whether it’s the speed and depth of change a business must achieve, the transparency of your interactions, or the need to negotiate with stakeholders to create value for all, expectations are now higher than ever.
Applying digital transformation to business outcome management

Meeting these new expectations isn’t easy. A business that is rigid in its structures, measuring its success using service-level agreements (SLAs), and managed through passive data is likely to perform worse than the competition – and to be at particular risk in the new environment.

The management of the business will simply be too slow and too expensive to keep up with – let alone lead – the increasingly digitised ecosystem around it.

Those businesses that succeed will also apply digital transformation to their management processes, so that they have automated support for understanding and controlling the network of dependencies that make up a business’ operations, assets, products, change initiatives and stakeholders – as well as how this networking constrains or enables the outcomes the business cares most about.

Putting this contextual, business-driven analytics support in place means that change can be achieved in a rapid but scientific way, with businesses able to forecast how a specific change in their operations will generate improved outcomes.

It’s possible to go further still, because applying AI and machine learning to this task means gaining recommendations on the types of change the organisation should pursue, which means a smarter, more cost-effective approach that more closely matches the increasingly automated nature of business.

Without this support, a business risks being left behind, participating but not in control of how the outcomes that determine its success or failure are being generated. However, by learning to apply digital transformation to business outcome management, it’s not just possible for you to catch up – you could also sprint ahead.

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