The digital world can be disorienting. In many ways, we are in uncharted waters and the profusion of questions can make the passage more difficult to navigate. Which technologies create the best opportunities to connect with customers and grow revenue? What is the right amount of money to invest? Where does a large enterprise start?
Instead of approaching digital transformation with a broad change agenda, many organizations are simply dipping their toe in the water by piloting specific projects. The absence of an enterprise-wide digital strategy can add to the sense of confusion, however. Funding decisions for digital initiatives need to be part of an overall vision. Solving one problem at a time with one solution at a time puts IT on its heels and may even encourage business units to seek what they need elsewhere.
Of course, an effective digital strategy must be flexible. It must be able to evolve over time in response to the changing market. Once you have a strategy in place, start small to mitigate risk and test your chops at change management. Be prepared to crawl, walk and then run, but do not spend too much time in the crawl phase. Be prepared to “fail fast,” learn from the experience and keep moving ahead. All the while, keep your eye on accomplishing your strategic business objectives.
These are the Top 5 ways to help make the most of the beginning of your digital journey:
1. Seek partnerships that boost your agility. Most digital initiatives require several third-party relationships to ensure success, as most organizations do not have the required capabilities on hand. Source aspects of your digital transformation from providers that take an agile, fail-fast approach so you can remain responsive to market demands.
2. Focus on outcomes. Structure your statements of work (SOW) or internal team objectives so they are outcome-based. Some providers differentiate themselves both in terms of how they run projects and how they structure commercial terms with this approach. These will define their work in terms of what you can expect. An example of an outcome should be specific: “We will put into production five new mobile application functions that use intelligence gained from social media marketing feedback by the end of Q1 with fewer than 10 percent issues reported to our service center.”
3. Take one bite at a time. Once you have an overall strategy in place, approach the enablement of your new capabilities with realistically sized projects. Aiming too high or trying to boil the ocean—and causing a “never-ending change order”—will result in almost certain failure of your broader digital transformation and may even portend much more dire consequences. When small projects fail, they afford the opportunity to course-correct and fully vet possible go-forward options. Plan to use the lessons learned from a few small “fails” to help guide the overall initiative.
4. Build a flexible and diverse team, from both inside and outside of your organization. Most digital transformation projects will need multi-partner teams. Some members of the team will be strategic partners, others will be more tactical. CEOs and CIOs will be busy solidifying these relationships to make sure each strategic partner buys into your end goal and is ready to flex with you on your digital journey. Make sure your partners’ methodologies, performance expectations, co-investments and commercial relationships (which may include risk/reward objectives or even joint ventures) align to your overall digital strategy.
5. Keep your eye on the complete business case. Carefully think through which platforms will go away and which ones will stay. Make the case for re-investing the retired systems’ costs into the cost of achieving new capabilities and platforms. Don’t forget to ask yourself what co-investments your partners and technology partners could potentially make. As we know, clearly justifying investments in new initiatives tends to keep them from being cut from next year’s budget.
ISG helps enterprises navigate the challenging landscape of digital business. Contact us to discuss further.
Jamie is a member of the ISG Sourcing Solutions Advisory Team and brings over 18 years of IT experience working for organizations like Perot Systems, CSC and NetApp prior to joining ISG. Jamie co-owns a cloud services company. Jamie has extensive experience in global IT Infrastructure, data center co-location, networking, cloud, analytics and big data technologies.
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