THE IMMENSE IMPACT OF DIGITAL TRANSFORMATION ON INDUSTRIES
Digital transformation is the means by which organisations use technology solutions to redefine their business models in the search for measurable performance improvement. Companies undergoing a journey to digitization often seek to use innovative approaches to gaining rapid market share and are agile enough to adapt and scale swiftly (compared to incumbents characterized by large, slow business models holding on to chiefly physical business models). These digital disruptors enjoy attractive cost reductions, customer-centric business orientation and higher revenue streams.
The speed at which digital disruptors can gain market share – and the potential market share to be gained – distinguishes them from more traditional business structures. Digital disruption is sweeping indiscriminately across all industries. Less than half of the Fortune 500 companies that existed at the turn of the millennium exist today. Executives believe that on average, across industries, around four out of 10 incumbents will be displaced by digital disruption over a five-year period. The immensity of impact can be likened to a vortex, as business models, processes, and value propositions are digitized to the full extent possible.
Yet the process of digital transformation can be a headache for firms that lack the right partnerships, strategy, or vision. According to McKinsey, technological projects run 45% over budget and 7% over time, while delivering 56% less value than predicted. Successful transformation requires a new momentum of relentless cultural change (see our article on A Winning Strategy to Becoming Digitally Agile) with an organizational structure that closely aligns IT objectives with business goals.
THE INHERENT CHALLENGES OF DIGITAL TRANSFORMATION
One of the most common problems we see among clients is the over-complication of new IT systems integrated with inefficient legacy systems; stifling agility. This is especially true for firms that lack a clear digital road map and get caught up with resolving short-term needs. As firms experience greater complexity in the form of the advancement of ongoing projects, as well as the introduction of new ones, they may find it necessary to go back to basics and reconstruct their processes. This inevitably delays time to market and adversely affects agility.
The right talent will be able to counter these challenges by orchestrating the technical elements of digital projects while driving business goals. Organisations chasing maximum ROI on their new disruptive model should pay close attention to new opportunities in business architecture for redefining customer experiences and fueling growth through additional or alternative revenue streams. Crucial to this digital enablement is hiring talent armed with both the commercial understanding and technical expertise to breathe life into companies’ visions of a new digital era; by laying down the foundations capable of executing short-term projects and that are also flexible enough to cater for projects over the long-term.
INTRODUCING THE ARCHITECTS OF THE FUTURE
A digital consultant can implement the required processes for incorporating technology into business teams and their processes. In doing so, they become instrumental in ensuring that organisations do not fall down technological black holes which drain time and resources.
This new breed of digital architects answers a pressing need for companies who need leaders who can drive technological upheaval in a way that is meaningful, efficient, and mitigates the risk of transformation, all while working closely with the C-suite.
A digital architect (whether that’s a strategic partner or an internal hire) can work with you to identify critical gaps in your processes and opportunities to maximize ROI. They can help you map out a sound digital transformation strategy and are instrumental in ensuring that digital projects support business objectives. Their roles can be both outward or inward facing:
CONCLUSION
Digital transformations are inherently complex, but this does not mean that they have to be a headache. Even the most robust of digital strategies need a dedicated leader with the right expertise to integrate technologies in a way that provides real, game-changing ROI. Whether it’s by internal hires or an external partnership, digital architects will continue to play a vital role in determining the success of digital transformation.
About the Author
Manuela leads the Marketing division at IMS, advising clients on branding and market positioning in both Europe and Asia.
Prior to joining IMS, Manuela worked in financial regulation and compliance. Past experiences include representing France in roundtable discussions in Brussels for the European Venture Capital Fund (EuVECA) Regulation.
She obtained her LL.B (Hons) at UCL before graduating from Sciences-Po, Paris, with a Master’s in Financial Regulation.
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