Building Digital Capabilities
Most enterprises are struggling to innovate and are not investing enough into new technologies to counter disruptive measures. As a result, in a few years, their products are becoming irrelevant in the market. Examples of Blackberry, Nokia, Kodak, Blockbuster have been quoted numerous times. Technology has lowered the entry barrier to innovation, and new entrants can easily disrupt the entire business models in a matter of months. Geographical borders do not guarantee any competitive advantages anymore. Any breakthrough or new idea travels around the world in a matter of minutes.

For an enterprise embarking on the digital transformation, following key things need to fall in place for building digital capability within the enterprise:

  • Business vision – digital transformation initiatives are cross division or cross-functional, as a result, having a common business vision to drive the transformation is very important
  • Leader led – the digital initiatives need to be top driven and led by a senior leader. The cross-functional team should report to the leader
  • People skills – cross-functional team needs to be staffed with people that bring varied experience and are adept at defining and refining digital journey focused on the customer experience. In case, the team is relatively new to digital, then hiring for appropriate skills need to be undertaken. Existing team members can undergo training for required skills. People that bring multiple skills to the table are core to the team
  • Platform approach and Automation - when looking for technology choices in implementing the identified projects, start thinking in terms of platforms instead of systems. Digital transformation is not about one project or program, the continuous iterations and interconnection of functionality, requires platforms that provide the requisite services to build such experience in a rapid manner. The implementation team should not get bogged with scalability and performance issues, things that mar the customer experience. The platform should handle the scalability and performance aspects of the application. Similarly, horizontal capabilities like data analytics, data aggregation, content services, logging services should be viewed and built as platform services. Again, if platform building skills are not available in-house, they need to be hired from market to jumpstart the process. Another key capability is to automate the Development to Operations application lifecycle (DevOps). When you working on scale, manual processes and intervention is error prone and not at all feasible. Investment in automation of all the DevOps process is an important part of the building digital capabilities
  • Open source software – in the digital products and services space, given that the product(s) can become viral overnight, scalability and performance of the product/service is a key criterion. Use of commercial proprietary products limits the ability of the enterprise to scale the product. Licensing cost is also the key factor for handling user base in excess of 100 thousand. Open source software allows benefiting from the larger community, cutting down on the costly license, use of commodity hardware and ability to dig deeper into code (if required). The platform approach is executed using a combination of open source software.

Enterprises threatened with changing business models have already built or started building digital capabilities. Companies like Walmart are no longer just brick and mortar players but giving tough competition in the online e-commerce space also. Investment into future is required for enterprise to reinvent them for the digital era.

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