IT Focus Area: cloud
December 4, 2018
Is Your Organization Ready for Transformation? Craft Your Business Transformation Charter Today
Google the terms “business transformation” and “digital transformation” and watch a sea of content rush forward—everyone from Gartner to Forbes has recommendations, research and reports on what to do for a successful transformation, how to avoid transformation pitfalls, and who is doing what, when, and why.
It’s a tsumani-like wave of information—but what does transformation really mean and, more specifically, what does transformation mean for your business? The rush to incorporate new technologies won’t serve your business well unless you have a well-defined mission statement with a solid business case before you begin.
Business transformation is not a roadmap that your business will follow, step by step, milestone after milestone, until you reach a destination or end-goal called “digital transformation.” A final destination does not exist—transformation is more like an on-going charter—you set out with well-reasoned and well-supported intentions (a strong business case and buy-in from the C-suite) for your business to venture into the future. The unexpected will occur, but your business will learn from it. It may change course, take a route you might not have anticipated, but the transformation mission will remain a solid mandate and act as a golden compass to steer the ship.
We have helped dozens of clients from every sector of industry embark on their transformation journey and each one is different. Here are six guidelines for crafting your charter for business transformation:
1. Define what transformation means to your enterprise and your customer.
Transformation is different for every enterprise. Your first goal will be to define what it means to your business. Have a look at several ways we have seen businesses articulate the mission of their transformation:
- Enable the technology to move at the speed of business
- Take the vision of the executive team and make it applicable with technology
- Learn how to adopt technology quickly in order to quickly pivot to customer needs
- Leverage data analytics to enable business intelligence to chart a business course
Certainly, those definitions of transformation are not mutually exclusive and there can be many more. But every business must ask: how will our transformation serve our customer? Who is our customer and what does our customer need?
Transformation demands a customer-centric approach—and in today’s digital world, there is a new generation of customer with new requirements and expectations. A few years ago, nobody conducted mobile banking on a Saturday night. But now that is the norm. You must provide services 24/7. Any downtime is lost business and lost customers.
Ask: what do you need to provide for your customer? That is where your business must go. Your charter begins there.
Another good question to ask when defining your transformation charter: Are you going to be able to adopt and sustain change? In other words, is your scope too broad and too much to handle at once? If so, you may want to start your transformation with a smaller bite than your transformation appetite desires.
2. Align IT and business.
OK, so customer demands are changing and you need to be able to adjust for that—does your executive team include consideration of customer needs in their business strategy? Is the business aligned with IT?
Let’s say your executive mandate is to provide cloud services in rapid fashion. You may build a team based on the Cloud Center of Excellence (CCOE), but it won’t really matter if its public, private, or hybrid cloud—what matters is that IT is taking the vision of the executive team and realizing it with technology. Your business transformation must be aligned with the directives of the business to realize proper business outcomes.
This is why iteration is so important to transformation. Many companies request a 36-month roadmap to their transformation--but how will these technologies develop three years from now and impact your business? There are so many unknowns when you embark on a transformation and you need to be able to respond to what you find during that transformation, rather than stick to a plan set in stone. A large foundation of your mandate will be to constantly re-align the transformation with the desired business goals, even as the technology changes over time.
3. Laser-focus on one thing you do really well.
Many specialized businesses today have exposed a chink in the armor of big companies that provide so many services— a specialized business is laser-focused on providing one service and doing it really well--even better--than anyone else.
We have witnessed the consumer moving away from buying services from a single conglomerate. No longer is the big cable company contract the standard; now we engage Netflix, Hulu, or Amazon Prime because they specialize in their markets and provide better service than the large corporations. Consumers can choose the services they want, individualize their choices, and engage strategically with the businesses that do it best. Your company may want to follow this lead, define a niche, and settle in for market dominance.
4. Lead with a Tiger Team—and make it a brilliant one.
Business transformation requires 1. smart people and 2. empowering smart people to make decisions. This doesn’t mean gathering every smart person in your enterprise into one room to undertake a business transformation—you would most likely undertake a giant mess of differing opinions.
Instead, select a Tiger Team of excellence to engage in a broader conversation that requires the cooperation of organizational units across the entire enterprise. This Tiger Team should consist of one or two experts from each group: Development, Infrastructure, Business, Procurement, Operations, and Security. This is also known as a “pizza team”--a team small enough to be fed with two pizzas.
The Tiger Team must be empowered to make decisions without the interference of bureaucracy or siloed concerns. The team can then determine where and how to begin the transformation: start with a smaller iteration, experiment, fail fast (more on this idea below), see what works and what doesn’t, and then scale up the projects from there. This represents a new kind of leadership based on trusting the brilliant people in your enterprise to make decisions and innovate. Entrust your Tiger team to become the change agents steering your transformation. Steve Jobs said it best:
It doesn't make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do.
5. Innovation is the key driver of transformation and, to innovate, you must allow for iteration and failure.
You’ve probably heard it many times: “Fail fast and fail better.” But perhaps the very co-existence of the words “failure” and “business transformation” in the same sentence gives you hives. Most likely you’ll need an enterprise-wide change in mindset for your business transformation to succeed.
Technology has hit warp speed compared to just five years ago. An initiative that may have taken months to stand up can now take only days or even hours. This means that you can fail at smaller levels. Instead of an enormous investment in time and budget allocation (and enormous risk to boot), your Tiger Team could test a hypothesis, and if it works, great; if not, try something else, re-iterate. When the initiative is scaled back, so too is the time and investment. An experiment may only cost a week of time and a minimal check to a cloud provider—not a catastrophic failure costing precious lost time, millions of dollars, and perhaps even the business itself.
“Fail fast and fail better” is a commitment to the idea that trial and error is the best way to learn. Failure, then, does not cue the ultimate sad trombone and the end of a project; failure is merely one step on the way to larger success. This thinking will require a cultural change throughout your organization, but it begins with instilling the new mindset within your brilliant Tiger Team. Your change agents must understand and believe that it’s ok to fail because they can recover fast and try again, rinse and repeat.
6. Build in security and privacy.
Your business and your brand must be built on trust, not only trust that your business offers the best service, but that your business protects its customers and data.
One of the major tenets of EU GDPR, implemented in May 2018, is the individual’s “right to be forgotten,” representing a landmark change in the global data protection space. Although the legal regulations apply to the EU, the message for businesses everywhere is clear: Protect your data, or pay a steep price. More specifically, protect the sensitive data you collect from customers.
Security and privacy are hotbed issues today, calling into question the collecting and sharing of customer data, and also the selling and profiting from it. Protecting privacy and security is a business requirement and must be built into any transformation charter—not an after-thought. Remember: Include a brilliant mind from your security team on your Tiger Team. The future of your business and your brand depends on it.
Conclusion: Seek Guidance with Your Business Transformation
Do you still feel your enterprise is in uncharted waters with business transformation? Seek an experienced and expert partner to navigate your success today. We can help.