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Digital transformation is dead

Posted on 7-Dec-2017 09:31 by Donovan Jackson | Filed under: Articles

The trouble with buzzwords is that even when they make perfect sense, you hate yourself for using them. Again and again. So, when the pitch from an Australian consulting outfit arrived with the alluring topic of ‘digital transformation is dead’, the prospect of allowing some of the hot air to escape from the balloon was rather enticing.


“So, Bruce, tell me why digital transformation is dead, because we’re all heartily sick of it,” came the question.


Except, goshdarn it, Bruce McGregor, founder of Brisbane-based Adhocracy Consulting, wasn’t actually saying any such thing. Instead, he reckoned it is the big, organisation-wide DTs that are going the way of the dodo (or moa), because they carry with them too much risk. “These days, it is not a digital transformation, it is a service transformation where digital plays a part,” McGregor clarified.  “The service transformation of businesses is about a focus on culture and a people perspective, not a technical one.”


OK, then. “The reason digital transformation is dead, is even the most ambitious of leaders are not taking the risk of putting millions into a programme. There is big risk and there is a history of failed transformations. If those were successful, everyone would be doing it.”


Indeed; and McGregor made the point that vendors tend to be pushing the view that DT is all about technology. Which it is, to a good extent, because after all you can’t be mobile, cloudy and connected to intelligent services, whatever those might be, without a fair measure of it.


“But it is not, fundamentally, about tech, it is about people and customer intimacy and [the tech focus] is what’s lead to a landscape of failed transformation programmes.”


We wanted to know more about these failed programmes; in a follow up email, McGregor pointed to the Australian Federal Government where, ‘transformations have traditionally had a very heavy, over-reliance on contractors, consultants and other forms of work force labour’; and at State Government level ‘There has been a wasted opportunity for state government to collaborate better on insights and  learnings between each other as each government is tracking their own transformation path nearly as a lone island’, and also at ‘Corporations where the Leadership team are not 100 percent committed on the outcome.’


Alive and kicking
But not the outright failure of the DT concept. Instead, said McGregor, the process needs to change to one which sounds a little familiar: the DevOps style of project delivery. “If people want to de-risk, they need to do it smaller. They need to find a smaller part of the organisation [to ‘transform’], start there, improve and grow.”


Over the ditch in New Zealand, Brighter Days is similarly focused on delivering various consulting services in aid of digital transformation. Founder and principal Lee Stevens said he agreed with McGregor’s assessment. “The term ‘digital transformation’ itself should be dead, it is overused and misunderstood,” he started.


Indeed, like many of the industry’s best hypey terms, it can mean almost anything, in this case from a server install to an ERP rollout. “What most government and large organisations have done is put a new label on an IT policy. There is a reason for that, what they do is employ other corporate people with no experience of the outside world or with multiple companies, and that means the customer is not at the centre of whatever it is they are trying to achieve.”


It’s interesting that Stevens raised ‘the customer’ as being at the centre of DT, because it is something McGregor constantly referred to also (except McGregor called it ‘customer intimacy’), maintaining that it is these people that DT is all about.


“If the customer isn’t at the centre, then you’re not going to deliver the experience expected from the whole digital thing,” Stevens added.


He also aligned with McGregor on the pace and scale of DT approaches: “You definitely want to go away from a major and sudden shift to an iterative one. But many companies and certainly government departments are not equipped for iterative development and delivery. They want certainty for every dime spent which doesn’t lend itself well to iterative.”


The customer view
Whatever the approach to DT might be, it is probably outright best that it suits the circumstances and needs of the customer at hand. Horses for courses, you might say, and particularly if you were talking about the New Zealand Racing Board.


Not wanting its business to be Uber-ised from under its feet, NZRB has noticed the rapid rise of online gambling and the vastly expanded options on how to spend a dollar available to its customers through their mobiles and computers. So, it set about transforming, getting rid of a lot of infrastructure and IT overhead.


Asked if big digital transformation projects are off the table, a jovial head of accounting and operations Steve Burgess was forthright in his reply. “It’s the complete opposite. For us, it has meant going completely cloud including Google away from Microsoft and [digital transformation] has done exactly what it was meant to do. It is costing millions and millions but should change the face of our customers and what they see every day, it is going to multiply the betting options [we offer] 10 or 20-fold; instead of manually trading, customers will have multiple games they can operate on.”


All thanks to digital.


But where Burgess agreed strongly with both Stevens and McGregor is on customer focus. “Absolutely, this is all about our customers and giving them the experience and flexibility they expect from a gaming provider,” he confirmed.


And to sum up the value of going through a digital transformation process, Burgess said, “It has made us able to do our business anywhere any time. That is the best description of it; all the information systems now have resilience and we can focus on our core business and customers – and the customers are the only thing we should be focusing on.”


Think or do
Where McGregor reckoned the problem is biting off more than can be chewed, Stevens added that there is another issue which wants consideration. “Large companies tend to spend too much time thinking and planning rather than doing. That differs from agile, which is about actually delivering stuff.”


And where NZRB’s initiative, which includes a move to a scalable cloud back end, might be described as a revolution, Stevens said it doesn’t have to be. “What you do need is positive change. If you can do that first through 4 or 5 mini projects over the course of weeks with low investment and massive gain, you’re on the right track.”


And who should be setting off down that track? Any business which recognises the coming change. “It’s not necessarily the traditional businesses you might expect. We’re working with a scaffolding company which wants to be the Uber of its industry, it wants to be a fundamentally digital business, changing what it is doing using apps to drive efficiency out of what it does.”


It’s something McGregor is after, too. “What we are advocating is that there doesn’t have to be any big transformation. Think small, think of pain points for your customer when leading transformation programmes. We had over 50 agencies come and see what we did, and we asked a simple question: did you speak to a customer? Often, the answer is simply ‘no’. That means the very, very basics aren’t being done.”


The original version of this article appeared here: