Jan 02, 2018 By Guru Bharadwaj

The Key to Unlocking New Business Opportunities through Digital Transformation

in Leadership

The dawn of 21st century has seen rapid technological advances that has shaped transformation of customer expectations and how enterprises fulfill these demands. Enterprises need to disrupt themselves from the business model that served them well for decades

As enterprises look to take advantage of inherent value of digital, it is imperative to look beyond technology paradigms and shift to business value, newer business models, and opportunistic revenue streams that are created and enabled by digital. It is critical for enterprises to bring the business dimension to digital strategy and integrate business units as key stakeholders in the conversation.

Imagine a large retailer commoditizing their mature transportation heuristics and optimization, or a distribution company integrating a supplier and partner ecosystem to create a marketplace to barter and trade, or an oil and gas company enabling new upstream exploration operations more quickly than previously possible. In essence, the focus shifts to outcomes from a business of selling a product or a service.

Global pressures continue to demand more flexibility, greater agility, and better quality across the entire enterprise value chain. It is imperative to look at the digital transformation journey holistically and evolve a value-based approach for creating a robust enterprise fabric. Creating a unified charter, aligning workloads to business functions, and adopting an incremental approach as part of the roadmap will optimally drive value realization.

Our experience coupled, with industry research distills the approach to 7 major principles to unlock newer business paradigms through digital transformation

Create your Success Commitment: Recognize that digital transformation extends beyond just a technology paradigm. Digital strategy and planning spans multiple business functions, technology solutions, and the enterprise ecosystem. It is critical and prudent to create a unified charter with business units and drive initiatives.
Create hybrid business models: In this day and age, every business is a digital business. This blur is turning enterprises into customer companies. Along with business stakeholders, complete a review of the business and technology portfolio. Look at opportunities to create product-service hybrids (connected, intelligent products driving digital services)
Strategize Monetization: Size the market needs against enterprise capabilities. Segment business functions that can be monetized. Such a segmentation approach needs to be tailored for each enterprise based on their core beliefs, commercialization aspirations, and the monetization process. Extend experience beyond the immediate sale. Customer engagement and experience anchor incremental transformation
Take Credible risk: As enterprises look to go digital, they must also deal with new dimensions of risk from new providers, ways of doing business, compliance, payment, and more. The balance between risk and reward tips in favor of reward in well-managed projects that exploit digital opportunities. Strike a balance between opportunity and risk. Integrate mitigation approaches including partnering on service level agreements (SLAs) and underwriting risk. Experiment to reduce risk
Leverage Innovation platforms: Customization should be approached differently with digital transformation. Point solutions defer integration costs and scale concerns. Back away from “best-of-everything” approaches; take advantage of cloud-simple functionality wherever possible. The intent should be to find appropriate solutions and to work with providers to provision features that can be switched on and off.
Shift from project to product mindset: Digital offers the luxury of being able to quickly address market demands, such as realizing new revenue channels enabled by a mergers and acquisition integration, alliance, or partnership. Similarly, non-core assets can be de-provisioned quickly. Defining and operationalizing a digital operating model is critical to realize such opportunistic synergies.
Structure for flow / high performance: Finally, design out friction to flow. Identify and intersperse quick wins for better rainmaking. An incremental approach is a natural phenomenon. Plan the roadmap and integrate for scale. Modularize and take advantage of the ecosystem of suppliers and partners.

Other Considerations

As you continue the digital transformation journey, other complementary paradigms or technology evolutions come into consideration. Some of these include:

Mobility and use of experience design techniques are real, because of mass appeal and proliferation. Look to integrate complementary approaches as part of the journey.
Experimentation
Social computing brings the people quotient of realizing newer business paradigms. Acknowledging social approaches as relevant and integrating social listening to channels will augment value realization immensely.
Making meaningful sense of data for business value is critical in this age of information explosion and proliferation because of machine-to-machine (M2M), people-to-machine (P2M) and people-to-people (P2P) paradigms. Integrate predictive analytics to drive business decisions better.
Establish trustworthy security and privacy models and practices. They are critical for every organization and the need is accentuated with digital transformation and collaboration across boundaries.

Conclusion

About the Author

Guru Bharadwaj advises enterprises on realizing accelerated business value through transformative business designs and innovative technology paradigms. His expertise spans enterprise architecture, business and technology transformation, innovation and Digital transformation.