How to Tell the Difference Between a Transformational Project and a Transformational Technology and Why It Matters

The phrases ‘digital transformation’ and ‘transformation’ have been excessively employed to the extent of losing their true essence and purpose. A leader who fails to clarify the context behind using the term ‘digital transformation’ to their team isn’t carrying out their duties properly.

Introducing a plan or goal with clichéd phrases and trendy buzzwords brings two potential problems. Firstly, it may plant doubts regarding the credibility of the plan or goal. What you perceive as ‘thinking outside the box’ might be seen by others as continuing with the status quo. Likewise, the meaning behind the term ‘transformation’ can be interpreted differently by yourself and your team.

Furthermore, it is crucial to have a well-defined and clearly communicated plan to uphold your leadership. An organization with a clear comprehension of its objectives, goals, and performance metrics to assess progress will be more efficient than one lacking direction.

Drawing a comparison: Digital vs. Transformation

The lack of a cohesive strategy when it comes to understanding digital transformation is apparent. Most viewpoints regarding digital transformation fall somewhere within a spectrum of extremes. For some, transformative technology consists of various aspects like artificial intelligence, machine learning, drones, and adapting consumer technology for use in enterprises.

A differentiation exists between individuals who prioritize “transformation” and the adoption of digital tools and “digital age” tactics to modernize an organization, and those with comparable objectives. Despite sharing similar intentions, there is a distinct contrast in the areas of the business they concentrate on and the possible outcomes.

It can be advantageous to define the scope of technology investments that may be new to existing business sectors. For instance, AI-enabled drones can be utilized to inspect the status of electrical cables. Although this may be the first instance of such technologies being implemented, cable inspection has been in practice for decades.

Adopting drones for monitoring electrical lines presents both measurable benefits, like cost reduction, and immeasurable benefits like increased safety for inspectors. Nevertheless, this does not alter the market dynamics in its entirety. Once the awe surrounding the technology fades, it is evident that the action being taken is to enhance an existing process, by making it more affordable, efficient and expeditious.

A Missed Opportunity?

If your organization is like most in operation nowadays, it has established a target of transforming its business. Nevertheless, merely upgrading the existing business to be more cost-effective, efficient, and speedy is insufficient to achieve this objective. Digital transformation takes on greater significance for technology leaders regarding whether to propel the entire organization forward or limit it to being an order-taker that is incapable of acting strategically.

It is crucial to identify business areas that will be affected when pursuing technology-enabled transformation. A firm can opt to adapt either by attaining new skills, by penetrating untapped markets, or by doing both.

Current examples of both can be found with ease. For entry into the food delivery industry, Uber, for instance, adjusted its ride-hailing technology and associated business model. This proved beneficial as the surge in the transformative food delivery firm occurred at the same time when the ride-hailing sector was substantially impacted by the pandemic.

As an analogous instance, Dollar Shave Club introduced automated reorder of razor blades as a new “technology” for its regular clients.

The First Discussion on Making Changes

The aforementioned examples can assist in identifying if there is a discussion regarding the modification of a company, and concentrate on the prospect of either venturing into new markets or acquiring new skills.

Initiating such discussions is crucial to ensure that technology does not overshadow the primary objectives. It is critical to determine the scale of the changes to be made, which could be a major shift akin to Nokia’s transformation from manufacturing truck tires to mobile phones, or a minor alteration in the way a product is marketed or distributed.

Individuals may have varying opinions on what change signifies, to what degree the company should depart from its existing operations, and whether specific products and services need to be included. It is crucial to tackle these concerns at an early stage, instead of running the risk of arriving at an erroneous conclusion later on. This can be done by examining how other firms have undergone a transition or by seeking external guidance on strategy.

Post-Technology Transformation

To begin contemplating the digital aspects of digital transformation, it is necessary to determine the desired results of the transformation, the company’s risk tolerance, and the skills, markets, and new business models that will be engaged.

As astute IT managers, staying informed about discussions revolving around digital era thinking is crucial. Cloud computing is a potent technology, providing businesses with the capacity to rapidly develop and expand, with minimal long-term obligations. When coupled with agile innovation approaches, this can considerably reduce the time spent on testing during the launch phase. Learn more about it by checking out our guide for practitioners on digital transformation frameworks.

By adopting a digital mindset and leveraging technology, even the most conventional of firms can reduce their time to market, promptly respond to customer feedback, and grow without needing significant additional financial resources.

Technology leaders are now regarded as strategic business partners as opposed to mere implementers. Executives worldwide are spearheading digital transformation, and it is crucial to ensure these discussions are centred on achieving substantial change. Consequently, technology leaders are invited to participate in top-level strategy sessions and are empowered to steer their company’s direction by implementing cutting-edge technologies that are deemed an asset rather than an expense.

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