Driving success in the other half of failing digital transformation projects

The success of half of digital transformation projects are uncertain because enterprises may not have got the right mix of project stages, people and resources, explains Ranjith Kaippada, Managing Director from Cloud Box Technologies, and advises on how to better generate a success story.

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In the GCC region, digital transformation continues to drive profitability improvements for large corporate enterprises in market segments such as airlines, banks, financial institutions, energy, logistics, food processing, among others. Post pandemic profitability and shareholder dividend announcements in 2023 have exceeded previous years.cloud box

While strong visionary directions from the nation’s leaders are responsible for these impressive results, it is also the tandem emphasis for businesses to innovate and adopt digital technologies, as part of the digital economy, and as described in national vision statements.

While large enterprises and corporate businesses have demonstrated success stories of productivity and operational improvement, there are other global examples where such investments have not yielded equally impressive results.

At this stage it is important to understand the overall process of digital transformation and highlight the areas that require care and attention to drive successful and predictable results with the investments being made into digital transformation.

According to Gartner, the transformation journey is taking large enterprises at least twice as long and costing twice as much as they originally anticipated. 53% of organisations surveyed by Gartner remain untested in the face of digital challenge and their digital transformation readiness is therefore uncertain.

So, what is a successful road map for regional enterprises to follow? Here are some points to consider.

  • What are the various stages of digital transformation?
  • Who are the transformation champions required?
  • What are the resources required for digital transformation?
  • Is the objective to optimise processes or transform processes?


Transformation champions

The CIO is the lead and forms cross functional teams across the enterprise. It is necessary for the CIO to collaborate with peers such as business heads to help prepare and guide the digital transformation strategy. With this collaboration, the CIO communicates the goals of the digital transformation journey across the enterprise.

New business processes and workflows rely on the right applications being in place. Application leaders ensure that new technology platforms are suitably adopted; manage the delivery of these applications; and support them in their lifecycle journey.

Data management leaders are responsible for data modelling, supporting algorithms and analytics, and alignment with decision making. Enterprise architects activate new technologies and tools, align technology with digital business, and conduct experimentation for the right solutions.

Vendor management leaders manage vendor innovation contracts as well as activities involving vendor sourcing, evaluation, and procurement. Professional service leaders engage with business teams to architect new methodologies, workflows, processes and operations


Early stage

In the beginning of digital transformation, it is very important to describe the digital ambition of the business and the strategy the enterprise is adopting to reach that goal. Based on the technology and business maturity of the enterprise, what are the core competencies of the enterprise, what are the additional competencies required, and what is the extent of change management that will be required, also need to be articulated.

There needs to be definitive understanding of how progress on optimisation goals and progress on transformation goals will be balanced. Equally important is to have from the beginning a strong and clear communication platform to hard sell the entire digital transformation exercise to the enterprise.

Recent disruptions and innovations in the enterprise’s industry needs to be mapped and catalogued as well as inside adjacent industries. Based on the enterprise’s digital transformation strategy, business leaders need to develop new business and sales models to outpace and differentiate from laggard competitors.

Again based on its digital transformation ambitions, enterprises need to select strategic partners who are aligned with its digital vision, and who can accelerate its transformation and differentiation from competitors.

Lastly at the centre of the digital transformation strategy must lie the needs, requirements and expectations of the newly targeted customer segments.


Middle stage

Once enterprises have gone through the early stages of digital transformation, they need to start building prototypes and proof of concepts in order to ascertain the changes that need to be made to the technology infrastructure. This also helps to plan for the change management required to be introduced based on the culture and technology maturity of the enterprise.

Proof of concepts and prototypes also give an idea of the challenges in implementation and the skills required to navigate the implementation and later support the implementation. They also help to define key performance indicators required to measure success of implementation, enterprise adoption and enterprise digital transformation.

In order to move from the pilot and prototype stage to enterprise wide scaling there needs to be a plan to measure the milestones for enterprise wide adoption and continuous measurement of alignment towards the final objectives. This also implies a shift of governance and compliance from the existing processes and operations towards the transformed processes and operations.

At this stage, the commercialisation of digital transformation would have begun, from a technology led roll out into a business led roll out.


Advanced stage

At this stage the enterprise would have progressed through the commercialisation of digital transformation and would have adopted and migrated into new business and revenue models. As the challenges of implementation and change management in this digital transformation begin to recede it is important to reflect and assess the progress that has been made.

Has it benefitted enterprise customers and how has it impacted the industry? Has it helped the enterprise to differentiate and outpace its competitors?

Since digital transformation is a journey and not a one-time project, the enterprise needs to continuously monitor its customers and its industry to assess and prepare for the next disruptive cycles of transformation. Digital transformation is successful if the enterprise has developed the agility to reset and transform itself, with the next cycle of disruptive opportunity.

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