Digital transformation requires organizations to change how they work and structure themselves - technology cannot do it alone. While the IT setup of course needs to support digital transformation, the involvement of the entire organization is paramount.
More than half (54 percent) of the respondents in NNIT's Expectation Barometer 2020 agree that digital transformation will change the way their organization works and structures itself over the next 18 months. Digital transformation is high on the agenda in today's organization. And rightly so - it is more important than ever.
This was illustrated in the spring of 2020, when the global pandemic forced organizations to find new ways to keep their businesses running in a tense, unprecedented and constantly changing situation. Abruptly, they found themselves needing to run their businesses remotely, while client meetings had to take place digitally.
Having the right digital tools and processes in place suddenly made the difference between disaster and survival:
- Digitalization is longer something that happens at your own pace; it has become a license to operate. And the organizations that are prepared and at the forefront also come out on top, says Brian Troelsen, Business Development Director at NNIT.
Pilots will not transform your organization
NNIT's Expectation Barometer 2020 was conducted while the COVID-19 pandemic swept across the world. The results paint a somewhat heterogenous picture of how mature organizations are when it comes to digital scaling.
Some organizations are fully coordinated and engaged in digital transformation at an accelerated pace. But they are few in number; only 12 percent of the respondents fell into this category. Fewer than a third of organizations (29 percent) are what NNIT calls "coordinated" - in other words, they have a plan and they are moving in the right direction, becoming more digitalized at a decent pace.
- But almost 60 percent are still what we call "fragmented" - they are experimenting with smaller pilots in project teams, yet they struggle to find a way to speed up their digital efforts or scale them throughout the organization. And while pilots are beneficial in many ways, they will not drive transformation alone. Scaling digital initiatives throughout the organization is a necessity, says Brian Troelsen.
In short, there is room for improvement. The question is: What stands in the way?
Organizational involvement is a prerequisite
Judging from the answers to the survey's questions, it is primarily the softer side of the organization that slows down progress. Processes (57 percent), organization (53 percent) and people (52 percent) are highlighted as the main barriers to digital transformation.
- The challenge is no longer lack of digital strategy, as most organizations have long understood the need for good strategies to have digital components. But it is not enough to put the CIO in the driver's seat with a well-written strategy. Your digital transformation requires involvement throughout the organization and all stakeholders must take ownership, explains Brian Troelsen.
He emphasizes the importance of bringing everybody to the table:
- Top management needs, of course, to be involved from the start, but it is a good idea to create an agile transformation team with different profiles. Aim for a cross-functional team composition, and do not underestimate the importance of having leaders onboard who have practical experience with change management and people who dare to challenge conventional thinking. Transforming an organization digitally is truly about changing the organization, and change requires hard work.
Time to let go of legacy IT
Digital transformation can shift the mindset of an entire organization if you have strategic goals and the right organizational setup to achieve them. But if your existing IT structure is not geared to support the transformation, you will not get far.
While most can agree that IT must support the transformation, the respondents in NNIT's Expectation Barometer 2020 are divided into two main camps when it comes to how mature their existing IT setup is in driving the desired transformation: 40 percent believe it is geared, while 43 percent judge it is not, and 16 percent find themselves caught in the middle.
Brian Troelsen suggests one overarching reason for this:
- The fact that we see a slight majority of organizations caught on the wrong side of the field can be explained by the reality that many organizations are fighting with legacy IT.
The waiting game is a losing game
Legacy IT is a burden in several ways:
- Old legacy systems will not only slow down your digital transformation, but allow competitors to take advantage of it too, Brian Troelsen says.
- In general, IT is incredibly scalable, not least for start-ups. This can pose a threat to those organizations that have a heavy technical anchor holding them down. It allows for smaller and more agile competitors to show up out of the blue and create disruptions in the blink of an eye, he explains.
Therefore, his advice is clear:
- Getting rid of your legacy IT must be a priority, though it is not done overnight. It requires time and resources and huge investments must be made. But waiting will do no good because you risk being overtaken by competitors on the inside. You must make this a priority to get up to speed, Brian Troelsen ends.