Digital transformation is probably the most used buzzword in tech today. And while it's relatively easy for new businesses to embrace fully digital business processes supported by the latest apps and services, it can be a major challenge for existing companies trying to become digital natives. Scott Leader is the Regional Vice President for Box in the ANZ region.
I discussed some of the challenges of digital transformation with him and what business can do to make the change easier and more successful.
"If you have a lot of legacy amongst your application topography it's a huge challenge," said Leader. What we're seeing a lot of companies do is invest in systems of innovation".
Leader said that IBM realised it didn't have the right tools for innovation and collaboration. So, they looked at apps like Slack and Box and then wrapped those around their legacy systems of record. Rather than changing everything, they focussed on building around what they had.
Telstra, he added, made significant investments over a long period using systems like Siebel. But Salesforce and other tools gradually 'infiltrated' the business. Now, it's become the standard with the tools the company used to work with external partners, as they made it easy to share content and collaborate, now used within the company.
What's the goal?
Often the goal is a single view of the customer said Leader. "No after who you're dealing with... having a single view of the customer enables you to serve them better and driving the move to a whole of enterprise approach".
This isn't a new problem. Anyone who has been a customer of a large company knows the frustration of being bounced from department to department when trying to resolve an issue or even have a simple question answered. By wrapping the right tools around legacy systems, which can be almost impossible to remove, it becomes possible to improve outcomes for customers. But that begs the question - why go to cloud solutions? Why can't we do this with on-prem software?
"What's driving this is that the cloud is being recognised as a secure and cost effective way for delivering services externally and internally. Rather than having to build data centres and house infrastructure, companies are just saying they want the software as a service. It's a lot easier to deliver as well".
The lead time for standing servers up internally can be weeks. But it's possible to have entire projects complete in that time Leader said. It's about a faster time to value and reduced long-term costs.
The other benefit, said Leader, is that APIs make it easy to connect different systems. Many SaaS tools have APIs which make it easy to connect different tools. In the past, companies had to choose between a set of best of breed applications and then build their own middleware to bring them together or use lots of manual processes. Or they could choose a fully integrated solution where all the pieces worked together but didn't really fit the way the business wants to work.
But it's now possible to choose best of breed applications that suit your business and then connect them through APIs.
This enables fully digital business processes and the ability to store data in one place but make it accessible from multiple locations. So, if you share a file using a collaboration tool like Slack, you can access the same file through your preferred productivity app for editing and then let people know it's been updated. In the past, that might have resulted in multiple versions of a file being sent as file attachments in email.
Making the shift
So, how do make this shift? Many companies have programs around new ways of working that are faster and more effective.
"What we're seeing with a lot of emerging technologies, one of the big drives is that they're so easy to use. You don't have to be trained in how to use the software. If you can use a website you can use these tools".
That simplicity goes a long way to helping people make the transition.
There are some pitfalls to avoid. Leader says you need to decide on your "target state architecture" and move towards that, avoiding the temptation to have different tools for internally and externally focussed tools. The, go "all in" on that approach. Companies aren't getting the returns they expect because they don't commit and end up creating new silos.
It's not just tech, people matter - a lot
There's also a cultural issue where companies settle for "good enough" and don't pursue better options.
"There's a bit apathy; near enough is good enough," said Leader "That can happen when we're dealing with technology areas who say 'We have something in that area so we're not going to look for anything new'. They're missing a big trick there".
Success in digital transformation, or any significant business change, is strongly dependent on people and culture. A shift from vertically integrated software to best of breed applications connected via APIs is a substantial shift and many people find comfort is sticking to applications and precesses they are familiar with.
And while many technical innovations make it substantially easier to acquire, deploy and manage systems, there can be resistance. But having a plan, focussing on the positives and helping people through change will go a long way to assisting with a successful transition.