Saturday, September 3, 2016

IT Transformation as an Integral Part of Digital Transformation

IT transformation as an integral part of digital transformation means that IT is a business ‘solutionary’ and digital transformer.

Transformation seeks to change. The word "transformation" in itself means change and change for the better, the new ways and methods of doing things, new structures, new relationships, new capability, etc. Organizations large or small are on the journey of digital transformation, how to leverage information to capture business insight, and how to apply the latest technologies for improving business efficiency. How to run IT as a changing organization for catalyzing business transformation?

IT transformation is an integral part of the business transformation: There are changes in two shapes: One is internal where IT transforms and the second where IT helps to transform or change the business in line with new strategic imperatives. So the challenges would depend on whether the focus is on the former or latter. For either case, it means, whatever the driver, understanding the "As is" position of the business and the role IT plays in it and identifying the desirable "To be" state. The next step is to build and execute a strategy and the associated change programs that enable the "To be" state to be achieved, and a set of processes and activities that keep it dynamic. The CIO needs to play a critical role in such transformation. IT needs to become an innovation engine for business growth, the information provides the lifeblood for any organization to make data-driven decisions and capture business insight, IT enables all critical business processes, which underpin business capabilities in enabling such transformation.

Three dimensions of transformation: The reason why some or many transformations fail - some soft factors and the challenge of complexity come into play. One thing is to implement certain best practice ingredients for a transformation. The previous sequence needs to be executed having in account simultaneously with three essential dimensions: people, business values, and organizational structure. Enterprise leaders are increasingly looking to the IT function for introducing beneficial change into their business models to improve strategic performance, achieve operational excellence, enforce customer intelligence and to position the enterprise for future industry leaders, etc. Therefore, IT transformation must be an integral part of the business transformation.

As IT leaders, the goal in IT transformation should be focused on business outcomes, and running IT as a business: CIOs need to be prepared to invest in the future, they cannot ignore the benefits of properly leveraging what already exists. For every IT project, which is also a business initiative, IT leaders should see the potential business impact and make it personal. There are too many large-scale transformational programs based on the introduction of new technology either run for years will little progress towards the original goals or hailed as a tremendous success only to never be accepted into the Line of Business departments. Running IT as a business means IT understands what’s the customer’s true need, help to solve their problems, but also transform from a cost center into a value center. IT transformation as an integral part of digital transformation means that IT is a business ‘solutionary’ to understand how the organization works and then give solutions that will increase the functionality to lower cost and, if applicable, increase output. This means a higher profit. IT should help to make products/services better, faster and cheaper, and achieve business effectiveness, efficiency, and agility.

Due to the “VUCA” (Velocity, Uncertainty, Complexity, Ambiguity) nature of digital transformation, CIOs have to deal with constant ambiguity, increasing complexity, rapid change, and unprecedented uncertainty, either IT transformation or the organization’s overall digital transformation is a journey, CIOs have to build a solid strategy and take the step-wise approach for running a cohesive digital organization with IT as a digital engine and value-added business partner.


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