Forget Digital Transformation!
Transformation or Optimization?
A cio.com article — “What is digital transformation? A necessary disruption” — lays out an interesting distinction. Digital “transformation” is the buzzword we hear everywhere these days. However, in many cases businesses are simply undertaking a “digital business optimization”. I believe it is worth understanding this distinction.
What’s The Difference?
The distinction stated in the article is as follows:
“In a nutshell, we reserve digital business transformation for companies pursuing net new revenue streams, products and services and business models,” says LeHong. This can include the creation of new digital business units or digital acquisitions. Sometimes the new business models can lead to ventures in adjacent markets or new industries.
Digital Business Optimization
GE is among the 10 percent of companies Gartner has surveyed that is actually doing this form of transformation. The other 90 percent are conducting various forms of “digital business optimization.” It entails using digital tools to “supercharge” productivity, bolster generation of existing revenue streams and boost customer experience. According to the Gartner 2017 CEO survey, 42 percent of respondents plan to use digital to optimize rather than transform their business.
Let’s Start with Digital Business Optimization!
Since the majority of professionals aren’t in the role of “pursuing net new revenue streams, products and services and business models”, it makes sense to focus on the “optimization” side to make a difference.
And there is plenty of opportunity…
Business optimization “…entails using digital tools to “supercharge” productivity, bolster generation of existing revenue streams and boost customer experience.”
So, with that in mind, let’s consider the Gartner “Nexus of Forces” components related to “digital businesses” — which include:
This “Nexus of Forces” is also commonly referred to as “SMAC” — Social-Mobile-Analytics-Cloud.
“Social media has provided businesses with new ways to reach and interact with customers, while mobile technologies have changed the way people communicate, shop and work. Analytics allow businesses to understand how, when and where people consume certain goods and services and cloud computing provides a new way to access technology and the data a business needs to quickly respond to changing markets and solve business problems. While each of the four technologies can impact a business individually, their convergence is proving to be a disruptive force that is creating entirely new business models for service providers.” — http://searchcio.techtarget.com/definition/SMAC-social-mobile-analytics-and-cloud
The opportunity is to apply these digital technologies, first, to our existing business operations to improve how we operate — boosting productivity and customer service. Every employee can start engaging that process.
So, the challenge is to consider how I can apply SOCIAL, MOBILE, ANALYTICS and the CLOUD to improve what I do. There is the opportunity!
Then, build from there! Let’s get started.
“It’s time for different”
Don is passionate about helping professionals and organizations keep up and adapt to the changing business world that we operate in.
“What Do You Do?”
I frequently get this question. My response (it’s not what you think!)? Check it out here!