Why Digital Transformation may be the toughest one yet?

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Image Credit: Stefan Erschwendner on Flickr

The disruptive innovation is driving a sense of vulnerability and an opportunity for every organization around the world. The smaller startups are raking in “crazy” market capitalization and big ones are spawning digital functions. However, this may be the toughest one yet. Why?

A new way of working

The anatomy of an iPhone explains it all. If you unravel an iPhone, it is that beautiful and successful amalgamation of many competencies — material science, sensors, electronics, industrial engineering, software, platform, user experience, and services — all layered into one. It is almost impossible to build or even conceive an iPhone in isolation.

If you consider each of the above competencies as a vertical that requires immense depth of expertise, bringing each expert to work together within the frame of a vision that requires a breadth of experience, expertise, and ability to product manage multiple work threads. It also requires speed to market, testing multiple iterations, and relentlessly focusing on creating nothing but the best user experience.

All organizations have to undergo a transformation to adapt and adopt the new way of working, which is horizontally integrated, agile working, learn start-up, product teams that are experimenting, iterating, and learning their way to creating amazing user experience with their products. In addition the open innovation economy is bringing in massive talent pools that span beyond an organizations’ definition of employee.

Simply stated, organizations have to rethink the way they go about their everyday activities. Organizations starting with a clean sheet of paper have a leg up over companies that already have an engrained legacy operating model.

A new way of thinking

The anatomy of your Facebook feed explains it all. Facebook plays us into up our own psychology of wanting to share, express, and encourage each other.

To upkeep that spirit, it does a meticulous job of gathering insights (all details about us), our interests (things we like and share not only within Facebook but in any other site), our intent (using our location data and behavior patterns such as our cuisine preference for food) to bring highly individualized experiences. It stores reams and reams of data about us, runs complex algorithms to better understand its Customers.

Facebook monetizes its ability to bring that individualized experiences by connecting brands and their advertisement dollars. Facebook’s revenue model itself is contingent on Facebook’s ability to know the Customer and use all of the data (“big data”) to drive highly-individualized, reasonably accurately targeted feeds. The more relevant the feed the better it is.

If you unpack the above, Facebook role models two behaviors — Customer-Learning and Data & Analytics mindset. These behaviors are built on carefully assembled infrastructure, data-centers, contemporary software programs, product management layers that all align to an organizational culture of customer-learning and data & analytics mindset.

Simply stated, organizations have to rethink the way they go about building their products. It is not anymore “just” about your engineering, compliance, or quality leader saying everything is great. It is about Customers using the product and giving you the big-data. This means reimagining skills, mindsets, and infrastructure.

A new way of doing business

Let’s unpack Amazon. The company sold Books online, expanded its product catalog, built popularity and then realized a need for making its infrastructure robust at scale on-demand. When the IT department and the software engineering group thought about how to automate this, it figured out a potential way to sell servers and infrastructure just like it sold its online catalog of products. Any one could simply push a bunch of buttons, start up servers, add software, build complex applications, and not worry about scaling on-demand. All of a sudden anyone with dreams and chops could disrupt anything they chose to. It sowed a brand new terminology called Cloud.

The beautiful think about this is the confluence. Apple role modeling a platform with its iOS ecosystem and building a Mobile economy, Facebook making Social house-hold name, software programs like Hadoop making data/analytics a reality, we could dream-up things like making every device talk (Internet of Things (IoT)), and even build platforms like Watson that is as Intelligent as a human brain.

Intelligence, Social, Mobile, Analytics, Internet of Things (IoT), Cloud (ISMAIC) all all operating together in tandem to unleash disruptions to technology and ways of doing business like never before. Organizations are now faced with a daunting challenge of keeping the current going, watching the corners, and building the future.

A new way of thinking about the future

Let’s unpack Google. It started out by building an algorithm that disrupted the guide of Internet (aka Yahoo). Internet got a lot personal and intimately accessible with Google. Google didn’t stop there. As the infrastructure needed to support search grew, it built massive data-centers. To power those data centers it setup a wind-farm and then optimized the farm to maximize the power generated from the farm. Suddenly, it generated enough power to partner with local Energy companies and launch Google Energy Plc. Google’s moonshot project and dreams means it invested in Healthcare, Wearables, Hot Air Balloons to make Internet accessible, and a lot more. To further achieve its dreams, it’s now created Alphabet — a holding company that includes Google and other such companies.

The above is tip of the iceberg. Uber — a no stack company (a company that had no employees, no maps, no messaging infrastructure, no cars), built an App that connected people having a need with people who could fulfill the need. It became a tsunami disrupting the taxi and transportation industry. There are many such disruptions such as Robots, Graphene, Solar Energy, BitCoins, Market Networks, Driverless Cars, Space Tourism, and others that are challenging every existing assumption of what the future could be.

If changing the way to work, think, and do business wasn’t enough, Organizations have to constantly upkeep with the future.

Why is this hard?

Organizations starting with the clean slate have an early mover advantage and large organizations have the scale, money, market, breadth, process, and other advantages. However, fundamentally changing the way you were raised isn’t always an easy thing.

Organizations have to rethink the way they work, think, do business, while preserving the current, creating a future, and looking over the horizons that is coming after the future. That is fundamentally changing every human and there by the entire organization in one swoop. Hence digital transformation may be the most toughest one yet!

What do you think?

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Disclaimer:The opinions expressed in this article are mine, and do not reflect in any way those of my employer.

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