Tuesday, May 10, 2016

Three Gaps Digital IT Can Bridge

Digital transformation is a long journey, there are many gaps on the way.

Although forward-looking businesses nowadays intend to catch up with digital speed in order to adapt to the pace of changes. Still, the majority of organizations get stuck in the lower level of maturity due to static mentality, silo processes, culture inertia, undifferentiated capabilities, and ineffective Change Management. Digital IT plays an omnipresent role in catalyzing business digital transformation via leveraging internal and external resources, integrating business processes, enabling, innovating, and optimizing the consumer-driven technology that’s going viral in the enterprise. In order to speed up digital transformation, which gaps digital IT can help to bridge, in order to become a strategic business partner and improve business effectiveness and agility more specifically?

From raw data to business insight: Today, most of the organizations are still data rich, but insight poor. Yes, the business has abundant information, IT as the steward of business information is to ensure that the information has the right quality, that the information is used properly, that the right information is provided to the right people to make the right decision. IT and business should have an in-depth understanding of managing information (the information provisioning) as a strategic imperative, to bridge business’s hindsight (operational performance) and organizational foresight (growth opportunity & risks). Information Management is to manage the full life cycle of knowledge pyramid: Data-Information- Knowledge-Insight-Wisdom. The information allows you to build an actionable insight as for how to move from one level to the other. It applies to the context and environment in which decisions are made. The enabling value of information can be captured in this way and an information lifecycle is developed from it, so different information is required at different points in the decision and operational delivery chain. Information only has a value when it has been used. The information management gaps can be bridged when information has been used to abstract the insight for making an informed management decision to develop the right product, enter a new market, exploit a new channel or having the information to be able to conduct day to day operations, which have an output value as well. Realizing the digital business's full potential depends on how it unleashes its information potential via break down data silos and bridge gaps in information management life cycle.

From silo process to cohesive capability: IT is the only functional domain which is at the unique position to oversee business processes and build digital capabilities. Hence, it plays a significant role in identifying the gaps between strategy and implementation. Organizational processes underpin business capabilities. A "business process" evokes the notion of inputs, manage known from flowing; a business capability is the ability of the business to consistently deliver an expected result to the marketplace. The business capability is, therefore, at a higher level than a business process and is in the conceptual layer. IT is often the “superglue” to close the gaps between process and capability via systematic alignment of crucial business elements such as people, process, technology, and assets. A "business capability" describes what is a business entity in the organization, what is their purpose and output to the enterprise. That output is generated by applying their internal business processes, and can also be combined both at the macro level to construct the wider, cross-entity business processes. Business processes are enabled by technology and people within the framework of a capability. Capabilities can be an enormous help in understanding and prioritizing changes business/IT are attempting to create. Capabilities may evolve and move from the fundamental level to differentiated level between categories based on the technology evolution, business driver, business model evolution etc. This happens when an organization can close the process gaps and decides to differentiate by taking an existing capability to the next level. The business process/capability management provides a foundation that brings visibility, enablement, compliance, reduces errors and avoids cost, all important elements to the survival of an enterprise.

From “culture eats strategy for lunch” to culture as competency: Most of the hierarchical organizations are process and control driven. Emphasis is on compliance with the result people forget to think freely, overly rigid processes stifle innovation, and outdated talent management and performance management systems discourage talented employees grow, but encourage silo thinking and reward mediocre, therefore, they further create many gaps in strategy management, change management, and overall organizational management, and cause the fatal symptom of “culture eats strategy for lunch.” IT is in the unique position to well align people, process and the latest technology to reinvent culture and bring visibility of such an invisible and soft business element. Creating and maintaining the right corporate culture is in itself a competency. Culture can powerfully reinforce the competitive advantage a generic strategy seeks to achieve if it is an appropriate one, such as the culture of learning and innovation. Culture is a collective mindset, so digital organizations must realize that the very process and controls instituted emanated from the thought process of people and to be robust and helpful must allow people to think and contribute to the design and restructure the process. Be open to learning and sharing new knowledge to bridge talent gap and innovation gap., etc.

Digital transformation is a long journey, there are many gaps on the way, such as leadership gap, strategy execution gap, talent gap, innovation gap, information management gap, the gap between business and IT, etc. Running IT to bridge the gaps means that IT is becoming an integral part of the business, leveraging IT as a business driver to both create change and adapt to change, and innovating IT as a game changer and business growth engine.


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