For the last few years, every IT organisation has been talking about “digital”. Digital this, digital that. “Digital transformation” has become a buzzword (OK, two words), just like “Cloud” in 2010 or “Big Data” a few years later.
But what do we mean when we talk about digital transformation? It certainly caused a stir in my recent team meeting.
To answer that, let’s look at three forms of transformation – Cloud, Business and Digital – and how they build on each other:
- Cloud transformation is about tools and technology. It’s often IT-led (though it should involve business stakeholders too) and so it’s the domain where us techies are most happy. Often, it involves creating new platforms, using cloud services – Azure, Amazon Web Services, Office 365, G-Suite, Dynamics 365, Salesforce. But cloud transformation is just an enabler. In order to deliver value, business transformation is required.
- Business transformation is about re-engineering internal processes to better serve the needs of the business and improve the way in which services are delivered. It’s about driving efficiencies and delivering better outcomes, but still focused on the way that a business (or other organisation) operates. Business transformation should be business-led but will often (but not always) demand new platforms and services from IT – which leads back to cloud transformation.
- Digital transformation relates to the external interface with clients/customers/citizens/students. This is the domain of disruptive innovation. Evolve or become extinct. It’s often spoken about in terms of channel shifting – getting people to use digital services in place of older, more laborious alternatives but, ideally, its complementary, rather than replacing existing methods (because otherwise we run the risk of digital exclusion). Importantly though, it’s no good having digital transformation without business transformation and, like business transformation, digital transformation should be business-led.
Let’s take an example of digital transformation: when my bins were missed from a council waste collection, I logged a call via my local council’s website, which created an incident in a case management system and within an hour or so the bin lorry was back in my street because the driver had been alerted to the missed collection on his in-cab display. The service was excellent (OK, there was a mistake but it was quickly dealt with), the resolution was effective, and it was enabled using digital technologies.
But here’s another example. When I was held up in the neighbouring county by some defective temporary traffic lights at some roadworks, the local authority‘s out of hours phone service wanted me to channel shift to the website (not appropriate when driving a car). It also couldn’t cope with my problem – the out of hours phone service ended up at a random mobile voice mailbox. In the end, I called the Police on 101 (non-emergency) when really some basic business processes needed to be fixed. That shouldn’t necessarily require a technical solution but digital transformation of external services does rely on effective internal processes. Otherwise, what you have created is a shiny new approach on the outside, with the same clunky processes internally.
Hopefully this post has helped to describe the differences between cloud, business and digital transformation. But also consider this… digital transformation relies on business transformation – but not all business transformation needs new IT… the important thing is to identify the challenges being faced, the opportunities to innovate, and only then consider the platforms that are needed in order to move forwards.