Recently there has been a swarm of articles talking about a new digital era; that of digital transformation. I’m sure you will have seen many of these already, but in case you’ve missed them, here are links to the best articles on the subject released in the last 2 weeks:
Raising your Digital Quotient by Tanguy Catlin, Jay Scanlan, and Paul Willmott of McKinsey & Company
What it takes to build you Digital Quotient by Tanguy Catlin and Barr Seitz
Digital globalization: The new era of global flows by James Manyika, Susan Lund, Jacques Bughin, Jonathan Woetzel, Kalin Stamenov, and Dhruv Dhingra of McKinsey & Company
Understanding the Chief Data Officer Role by Tom McCall of Gartner
I have uploaded copies of the Exec Summary and full reports for those that are available to my Docs.com site here: https://docs.com/neil-calvert-linq/1366/digital-transformation and I make reference to these publications in this article.
The common thread through all of these reports is that to achieve a level of digital transformation in an organisation, which includes reducing wastage caused by inefficiencies and ineffectiveness, you can’t just consider the technology you have available to you. Digital transformation requires the realignment of, and/or new investment in technology, business models, processes and people, to create new value for customers and employees and compete in a more effective way in an ever-changing digital economy. In short, you need to generate a culture of innovation within an organisation; without it, you will lose to your competitors as they strive to do the same.
As Brian Solis says in his article,
“Part of the problem is that executives do not live the brand the way customers do and as a result, they make decisions about new investments based on they see the world not how they world is.”
So how can you help the decision makers of today, who are perhaps not the most innovative users of today, make decisions which will ensure your organisation is the organisation for tomorrow?
Digitization; the process by which organisations begin to live in a digital world, is taking place unevenly. Organisations with advanced digital capabilities are capturing disproportionate benefits and are winning the battle for market share and profit growth. True digital disruptors are even gaining the ability to reshape their market to their own advantage, leaving competitors flailing in their wake. This isn’t about heading out and buying more IT equipment and systems, it’s about achieving a greater level of integration and embedding IT into an ever-widening number of business processes. Digitization involves continuously experimenting and adapting as the IT landscape changes and more capability becomes possible through those integrations. The effect is a reduction in wastage. This doesn’t mean that you immediately reduce your headcount; it means that your staff can focus on the most valuable parts of your business and can also be given time to consider innovations which lead to an increase in your digital quotient.
Digital technologies are changing how business is done across borders and increasing participation. Global flows of information increased 45 times between 2005 and 2014; a significantly greater increase than trade or finance.
Some of the numbers associated with information flows are staggering; 211.3 Terrabits per second of information transfer, 12% of global goods trade is e-commerce, 86% of start-ups surveyed by McKinsey report at least one cross-border activity, 914 million individuals have cross-border social media connections and global information flows raised world GDP growth by 10%, or $7.8 Trillion in 2014 alone.
Failing to understand how your business can capitalize on this opportunity will be significant as the decade draws to an end. How do you turn your organisations information into an asset, so that you can benefit from it in ways you have not yet thought about?
If you can communicate how information supports your business outcomes in a simple, clear and consistent way; in a way which enables you to focus on the most valuable areas of your business whilst understanding the costs associated with those value areas, you have a mechanism for prioritizing where your digitization should take place first. If you understand how your information ecosystem supports your business outcomes, you can focus on the people and systems which keep that flow as efficient and effective as possible; you can re-shape your business to take advantage of your IT ecosystem to better support those flows.
In order to close this gap of understanding, we believe that you need to be able to present information in a new way and derive insight which actually helps the business to understand how its business outcomes are supported by information. In this approach, the systems – which are the typical focus of IT planning – can take a back seat; they become a supporting actor to the flow of information through the business. Your people are another supporting resource; they use systems to perform actions which add value to information on its journey to supporting business outcomes.
This is what we are building LINQ to do. LINQ is a digital transformation tool which helps communicate the value, cost and opportunity of the information which is the lifeblood of your business. Using LINQ helps bridge the gap between the technology haves and have-mores and enables business digitization to happen in a planned and structured way, creating an asset out of your information which can be put to better use, enabling you to survive and thrive in this new era of digitization.