Business Leadership & Strategy

You Need a New Digital Transformation Playbook

Digital transformation DX playbook
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Somewhere along the way of the marketing campaigns and the market hype, the industry has forgotten why we are digitally transforming and what it means. If we rewind, traditional organizations are being disrupted by digital startups; they are seeking ways to innovate more rapidly, be customer-centric, harness data to generate insights at scale, and ultimately transform their operations to compete in the digital economy.

We are already seeing evidence that the transformation is working. According to our global study of Digital Leaders, we find 46% of organizations are what we call “Digitally Determined”. They have rebooted their culture, they have a single digital strategy across the enterprise, they are able to demonstrate to investors that becoming a digital business is inherently valuable to the business, and they are running their technology on a single integrated platform.

By contrast, we find 54% of organizations are “Digitally Distraught.” The distraught are trying to transform with the same culture. They yield to the power of the LOBs and wind up with multiple digital strategies and multiple digital roadmaps. They have a short-term financial planning horizon, which puts them in the losing position of demonstrating ROI on each and every project. And rather than have a single platform, they have islands of innovation throughout the enterprise.

For technology suppliers, Digital Transformation represents a big opportunity. We are forecasting $1.5T of tech spending this year alone. There is plenty of market opportunity in all segments of tech from infrastructure to software to services. But most of you will have to employ a new playbook in order to capture it. It consists of the following three parts:

Create Business Value

58% of the tech spending on digital transformation comes from outside the IT department. This is not to say you should abandon your IT relationships; but you do need to expand your relationships with the line of business and the central DX organization. As you expand your relationships, you will need to communicate how your offerings will help them achieve their business goals, which means you need to align your messaging and offerings around solving their business use cases.

Scale Digital Innovation

In the first few years of digital transform there was a great emphasis on innovating. Enterprises were struggling with how to get their legacy culture thinking in terms of innovation. We are now entering a period where many organizations have figured this out and have plenty of science projects lying around the enterprise. Now is the time to scale the innovations.

Scale requires an integrated platform that is optimized for turning data into intelligence. Scale also requires a modernized infrastructure with new KPIs. As IT suppliers, especially those of you serving infrastructure needs, it is important for you to engage your clients in a dialogue about the new digital KPIs and help them think through their metrics as they build their infrastructure transformation roadmap.

Embrace the Workforce of the Future

In the past 24 months there has been an increased focus on the future of work. At the heart of the topics is a talent shortage. 70% of organizations report they are having a difficult time sourcing digital talent. Organizations are addressing this by simultaneously recruiting for new skills and reskilling the existing workforce. This is setting up the industry for a large and widespread opportunity to provide technology solutions that help companies address the future of work.

Despite the potential opportunity, it is still early days. Only 1/3rd of organizations have a well-established strategy or funded programs for workforce transformation. As an IT supplier, you will be spending most of 2019 evangelizing this opportunity and helping your clients make the internal case for budget. But once we get into 2020, we expect to see the market open and more opportunities will be funded.

To learn more on this topic, come see me speak at IDC Directions, our immersive conference on the scaled-up digital economy. Register to attend either our Santa Clara or Boston events:

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