Digital transformation encompasses how organisations employ technology to re-imagine and re-invent their processes and offerings, to achieve a competitive advantage across the business. However, over the years, digital transformation has been used as a catchall term that encompasses not only transformation but also the integration of digital technologies that automate manual processes and addresses operational inefficiencies within an organisation as well as the optimisation of the suite of digital systems that an organisation uses.
A lack of alignment – especially within senior management – in articulating and defining these need-states and required solutions can lead to suboptimal outcomes when engaging internal stakeholders about the need for digital investment and support, which is often the reason why digital efforts fail. It is no wonder that 70% of organisational digital journeys hit roadblocks and fail, according to research by McKinsey.
Many refer to ‘digital transformation’ as a catch-all term for any digital initiative, which is problematic for businesses, as it leads to misalignment in objectives and expectations. By carefully mapping out and clarifying the nature of the digital journey required, whether it is digital transformation, integration, or optimisation, will help key stakeholders understand how and where resources are best placed, enabling their buy-in. Overlooking these distinctions may result in misplaced and squandered resources, and is often why digital journeys fail.
Digital Transformation – the rise of tech giants
Digital transformation is the evolution of new business operations, outputs and outcomes. It employs technology to help a business anticipate new market requirements. In its finest form, digital transformation has the power to create new market leaders and disrupt industries.
Think about how Netflix has redefined the way we access entertainment and the impact it has had on the industry, from cinemas to movie rental stores. Think about how ride-sharing apps have negated the need to stand by the roadside to flag a taxi and has improved personal safety through tracking. Think about how video meeting applications have removed the need for people to be in the same physical space to conduct a discussion.
Digital Integration – the often misunderstood and overshadowed digital journey
While digital transformation is often the phrase thrown around, what businesses more frequently require is digital integration i.e., assessing an organisation’s existing workflows and determining whether greater efficiencies can be achieved through the use of technologies.
Digital integration encompasses the concepts of “digitisation” (making analogue data digital) and “digitalisation” (using technology to enhance and augment formerly analogue processes). In its more common uses, digital integration involves the use of analytics to better define customer profiles and segments, then using this data to improve customer experience through better digital user interface design, for instance.
Take the example of a Singapore enterprise in a traditional industry i.e., marine bunkering in need of digital integration. Two years ago, Equatorial Marine Fuel Management Services (EMF) – a marine bunkering services provider that supplies fuel for ships as well as manages the logistics of loading fuel and distributing it amongst available storage tanks – approached us.
Despite Singapore being the world’s largest marine fuels hub and as a sector that comprises 7% of Singapore’s GDP, most of the industry players’ processes were still managed with a pen and paper. It was the same for EMF which had kept its legacy process since the founding of the business.
When the next generation of the family – Choong Zhen Mao – joined the family business, he saw how operational efficiencies could be achieved by integrating technologies.
Choong Zhen Mao, EMF’s Executive Director, shared, “With the advent of the recent digitalisation wave, and improvements in technological infrastructure, we relooked at our processes and felt that there was an opportunity to be more cost effective, as well as to increase the transparency of our business. To achieve this despite our limited know-how, we approached Golden Equator Consulting which has since been a valuable partner in our endeavour. They have helped with the structuring and training of our in-house team, also equipping them with the appropriate digital skillsets that have enabled us to modernise and digitise a portion of our current business processes and workflows.”
Digital Optimisation – spotting the looming iceberg on the radar
Digital Optimisation means tackling an increasingly common problem: Digital Bloat.
Digital bloat occurs when different teams across the organisation use many digital tools, some with overlapping functionalities and many with incompatibilities that – in turn – create costly silos, double-handling, and frustration. A business that has too many fragmented digital systems leads to inefficiencies and process roadblocks.
Some use Asana, while others use Monday.com, Trello, Smartsheet, and the like. Sounds familiar? It’s a sign of the times.
The digital optimisation process involves taking stock of all digital tools that an organisation currently uses, identifying overlaps and conflicts as well as finding potential opportunities for the consolidation of data, systems and processes.
Ensuring digital journey success
A digital journey is exactly that – a process and not a one-off project. It is deep and affects many, if not all, aspects of a business; it requires dedicated resources and time investment.
However, while digital journeys are strategic and long-term endeavours, it is important not to lose sight of measurements, progress, and adjustments. Strategies for digital transformation, integration, and optimisation should be implemented and improved upon in phases to ensure success. Given the pervasive nature and results that may be incremental or realised in the long-term, it is also important to obtain senior management buy-in and support for the long haul and to keep the lines of communication open with regards to progress.
That is why digital initiatives should have success metrics that are well defined and structured in a way that can be easily understood by the entire organisation – not just the IT team.
Having a very clear and deep understanding of the business problems or the opportunities that organisations wish to address is the most important first step. With a clearly defined purpose, the business can then decide which digital path should be taken to reach their goals – transformation, integration, optimisation, or even a hybrid – while putting together a digital taskforce that includes internal stakeholders, teams, and trusted external specialists.
In digital journeys, it is highly advised to start small, stay humble, test and learn. Approaching it with a “beta” mindset will mean that organisations can remain nimble, listen to feedback, course-correct along the way and ultimately, achieve the objectives initially set out.
Against the backdrop of the COVID-19 global pandemic and potentially lower level of business activities, the time is now for businesses to rethink about what digital initiatives they might need to implement presently to stay relevant and competitive for the next decade.
About the Author
Meredith Carson is Managing Partner of Golden Equator Consulting, a digitally-focused business consulting firm with presence in Singapore and Brunei. She is a seasoned digital consultant with more than 20 years of experience advising global brands as well as working with industry leaders and cross-market, cross-disciplinary teams to design and facilitate digital programmes.
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