Let’s face it, digital transformation efforts frequently overpromise and underdeliver. Many “transformations” fail to deliver on expectations simply because they are not really transformative. Upgrading digital experiences and creating new mobile apps delivers a level of differentiation that is short-lived. At the speed of digital business, competitors quickly match or exceed your efforts.
Many digital leaders and vendors enthusiastically label any digitization project as a digital transformation. But we’ve been digitizing business for 30-plus years. Simply upgrading technology, creating new digital experiences, or moving legacy apps to the cloud are not digital business transformations.
The opportunity, and challenge, for businesses to transform lies in understanding what the business must transform from and to.
Transform From A Product-Centric Business
Businesses have been organized around product silos for centuries. As products gain traction in markets, the business teams formed to evolve these products grow in strength inside the organization. Each silo gets really good at product design and delivery. And these silos get very good at competing internally for scarce resources from finance, HR, IT, and marketing.
The opportunity for digital transformation is to shift the business from product centricity to become a technology business built around the delivery of customer outcomes. This transformation requires the company to become comfortable with the continuous delivery models associated with technology services. This transformation requires an innovative culture and the ability to learn from customer feedback. And most importantly, it requires a business-unit structure designed to continuously deliver improved customer outcomes using technology.
Such a fundamental transformation can’t be completed overnight, and it can’t be done in a big-bang approach. To make digital business transformation work requires hundreds of pragmatic incremental changes to move the organization in the direction of becoming a digital business: a business that uses technology to deliver better customer outcomes.
Transform To An Outcome-Delivery Business
To set your firm on the right course, you need to have a strategy — but not a digital strategy. You need a business transformation strategy. That is a strategy to reshape your business as a digital business, one focused on using technology to continuously deliver customer outcomes in new ways to become an outcome-delivery business.
Executing against this strategy is a challenge. It takes time. And you don’t have time. Your business needs to accelerate, not slow down. To help you on your journey, you’ll need to build an ecosystem of partners. Choose technology partners with the best assets and capabilities to help reshape your business and your technology. Chances are, you’ll need more than one.
Pick Partners That Understand Transformation
Whenever representatives from a vendor claim they are experts in digital transformation — which, let’s face it, is all of them these days — I ask them to define digital transformation. Listening to how a vendor describes its interpretation of this term tells me a great deal about how well its people understand the opportunity and challenge. If it sounds like the vendor simply relabeled its traditional IT services as digital transformation, it probably did. While they may still be helpful in managing your legacy technology, they are less likely to have the capabilities you need to accelerate toward becoming an outcome-delivery business. But beyond being able to tell a convincing story around transformation, you want to find partners with the right set of capabilities to compliment your own team and with the kinds of technology tools you can put to use immediately.
Pick Partners With Technology You Can Use As A Catalyst
The consulting industry is transforming from a business model that used to sell labor hours in service of clients into a hybrid technology business that also delivers services. Service providers are slowly transforming to become customer-outcome businesses. And to succeed, they need to bring their own unique technology to their clients.
Service providers are in the business of helping clients apply technology. Many help clients by writing code and building systems. And leading providers look for ways to reuse the IP they create to apply it across multiple clients. As a result, there are hundreds of new software and data assets coming to market every year — some more robust than others.
The assets already launched deliver a broad array of technology-enabled services. Data services reduce the time it takes to understand and optimize pricing models. Learning platforms reduce the time to retrain the workforce with new digital skills. Low-code platforms reduce the time it takes to develop new applications. There are so many of these new technology assets that it’s already hard to track and classify them.
The good news for you, as a digital leader, is you now have the ability to leverage this broad array of technology-enabled services to act as a catalyst to your own business transformation. But you need to shop carefully to find assets that will deliver proven near-term value.
To help you, we’re undertaking research to better understand and explain this rapidly evolving asset landscape. The first report in this series was published this spring — “The Forrester Wave™: Global Digital Business Transformation Accelerators, Q1 2019” — and I’ll be publishing a series of follow-up reports over the next year.
“Spark Sustainable Innovation With The Right Transformation Partner” shows how you can customize the Wave research to meet your specific needs, and I’ve included a sample list of questions for prospective partners. Service providers will increasingly differentiate themselves not just in their industry expertise but in the assets they can deploy to accelerate your transformation journey.
Today, you can successfully accelerate you firm’s real digital transformation by picking strong partners with the right accelerator assets. The right partners will not only help you shape the change but will also work with you to measure the outcomes and even be willing to negotiate payment on the basis of delivering on their promises.
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