Friday, October 13, 2017

Three Stages to Reach The Maturity of IT Digital Transformation

A high mature digital ready IT organization is a threshold business competency and the catalyzer of digital innovation.

IT continues to grow in importance to organizations, both operationally and as a competitive advantage. IT also plays a critical role in driving changes and leading digital transformation. IT has to reinvent itself to exemplify proficiency in planning, designing, innovating, and building a new business model or optimizing information management. Digital CIOs need to take the risk above the status quo, take on a new set of activities that are involved in defining, developing, and differentiating their organization to reach the high level of digital maturity.

Defining the "digital flavor" IT organization: Many traditional IT organizations were run as the support function for years, often they suffer from redundant application maintenance and heavy legacy technologies, act as the business controller or restraint, no longer fit in the dynamic business circumstances of volatile digital new normal. Further, due to the limitation of legacy technologies and scarcity of information, often IT has to make a compromise of varying factors such as cost, speed, or quality., etc. For example, if you choose "cheap" and also choose "good," then expect "slow." Alternatively, if you choose "fast" to accompany "cheap," then expect poor quality. It seems you couldn’t get them “all,” only have two choices at a time. Nowadays, the emergent digital technologies are nimble and lightweight, IT delivery cycle is significantly shortened. IT has a better chance to achieve them all - better, faster and cost-effective, and even do more with innovation. To reinvent IT and achieve high digital maturity, IT leaders need to first define their “favorite flavor” of digital IT based on IT organization’s innate strength and growth potential - shall you run an innovative IT, a “highly intelligent” IT, a customer-centric IT, a speedy IT, or a change agent IT, etc. IT needs to shift from “T” - the technology-based organization to “I” - information-driven organization, to ensure information flow seamlessly for improving decision effectiveness and expediting changes. Digital IT should be more strategic, future-driven. CIOs are there to help the organization think clearly about the two horizons of the future, the short-term gain and long-term win, build a balanced IT portfolio to “run, grow, and transform.” Digital IT needs to be defined as a trusted business partner, to create a digital rhythm that establishes clarity around the top priorities of the company, and then review those priorities on a regular basis to ensure executing with consistency.

Developing good relationships between IT and the business to bridge the gap: IT is understaffed, overloaded, and often misunderstood by the business. To gain respect from the business and build a good reputation as a trustful business partner for the long term, IT has to develop good relationships between IT and the business. IT has to recharge itself, to engage the business with strategic conversations, collect feedback, and run a digital IT from a customer's viewpoint. A good relationship between business and IT becomes visible by clearly defining tasks, authorities, and responsibilities to manage both opportunities and risks accordingly. At the digital era with the exponential growth of information and consumerized technologies, businesses need to understand not only the power and the opportunity information could bring in, but also the potential risks the business might get exposed to. To bridge the gap and integrate IT into the business, CIOs need to do a thorough analysis of IT activities, programs, and policies in terms of IT contribution in maximizing shareholders’ benefit, cost optimization, innovation, etc, build a healthy IT portfolio which has a direct link with business benefit and customer satisfaction. It is also important for CIOs to gain an in-depth understanding of a holistic business including organizational strategy, goals, structure, process, people, technology, etc., to truly make IT an integrator to weave all important business components into business competency. What business really wants from IT is a partner, someone who knows what they want before they know themselves, who innovates by understanding the business, as well as what they do; the strategic partner that works both "on the business" and "in the business," not just "for the Business.

Differentiating IT to become the business advantage: IT can be used as a tool, a commodity service provider, a business enabler, a change catalyzer, or a digital platform to meet the ultimate goal of the organization’s short-term, medium, or long-term strategic plans. At the high maturity level, IT is the key differentiator between digital leaders and laggards. In fact, the differentiation provided by innovative technologies usually is more long-lived than differentiation provided by marketing actions that can be copied easier. Innovation often happens at the intersection of people and technology. IT plays a crucial role in discovering the path for business innovation, it is also the linchpin for building the differentiated business capabilities in executing strategy. Business leaders should realize that the breakthrough digital transformation of the business requires not only forward-thinking strategies but also a transformation of the company’s underlying functions and processes, in order to build the differentiated business competency. Running a differentiated IT starts with the unique IT leadership. IT leaders need to wear multiple hats with different personas to practice situational leadership, innovative leadership, and transformative leadership, to lead IT as a competitive differentiator of the business.

A high mature digital ready IT organization is a threshold business competency and the catalyzer of digital innovation. It goes beyond the stage of IT-business alignment and moves up to the level of integration and engagement, from reacting to change to become a game-changer. In practice, digital IT playbook is not for the faint of heart, CIOs need to rise above the status quo, and take on a new set of activities that run IT strategically, innovatively and proactively.


As Customer Success Manager @ Mendix I can endorse this blog. Alignment between Business and IT is a big success factor in your digital transformation journey. That's exactly why Mendix made this a major topic in the customer success plan support.

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