The two faces of digital transformation

Some pundits think digital transformation is yesterday’s news. Here’s why they’re wrong.

It’s fashionable among some professional technology pundits and futurists to complain “Why are CXOs are still talking about ‘digital’ and digital transformation? This is yesterday’s news.” The new shiny thing has now shifted somewhere else – digital is just part of the landscape now, right?

Unfortunately, no, that’s BS. Anyone who’s telling you this isn’t living in the real world – they’re living in an echo-chamber populated solely by other pundits.

So why isn’t this all done and wrapped up with a nice bow?

A big part of the reason is that many, many organisations are still figuring out what ‘digital’ means for them, and secondarily what digital transformation means – so they can start to make practical plans. But the answer to the former question is very context-specific, and the answer to the latter question is also multi-faceted.

Here I’m going to look at the second piece. There are two ways to read the phrase ‘digital transformation’, and they’re both crucially important to understand:

• Transformation of an organisation so that it takes maximum advantage of relevant digital technologies – to enable it to co-ordinate business resources as economically efficiently as possible. You can think of this as ‘transformation to digital’.
• Transformation of an organisation using tools and techniques that have been proven to be effective in digital-native organisations. You can think of this as ‘transforming digitally’.

So the concept of digital transformation is partly about introducing new capabilities into an organisation to drive business results; but it’s also about driving that change in what will be a very new way for most organisations.

Let’s be specific here. ‘Transforming digitally’ means using the playbooks of digital natives – using strategies like these:

• No more big bangs. Starting small, and delivering demonstrable results quickly.
• No more silos. Working collaboratively across team and department boundaries with common goals.
• No more ‘we know what we want’. Experimenting with new developments, using real data to understand the results of those experiments, and only further developing those options that are shown to be valuable by the data.
• No more ‘build vs run’. Thinking like a product business when making technology-enabled business changes; not thinking about delivering projects, then handing over to completely separate support teams but thinking about everyone working together to deliver product-like capabilities to the business with planned future release and feature roadmaps.

Why use these strategies? Because they’re born from the perspective that change is constant, change must be embraced, and change must be fast and confident. We should all know why that perspective is valuable.

From my recent conversations and interviews with CXOs, I’m finding that – just as there’s a multitude of perspectives on digital technology and its value – there’s also a lot of confusion about what digital transformation means.

So, in answer to a question I get asked quite a lot: no, digital transformation isn’t just the same as every other kind of transformation.

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