The phrase digital transformation seems to evoke a variety of thoughts and emotions. With all the press about digital transformation in the last few years, it is easy to either ignore or simply cringe at the statistics: Is it possible that a large, multinational corporation could be missing something in its overall corporate strategy to compete? Will digitally transforming drive value to the business?
According to a recent survey, only eight percent of companies said their current business model will remain economically viable if their industry keeps digitizing at its current course and speed (McKinsey & Company). In other words, 92% must evolve their business models to survive at the speed of digitization. How does a firm realize, scale, and execute on a digital program that drives new business models and outcomes while also optimizing current work functions?
It would be easy to point to the buzzword or technology we read about last week to solve these problems. It is important to reflect upon the strategic business goals we are looking to achieve within a digital transformation. These are not technology goals for technology’s sake; these are corporate goals and usually part of the overarching corporate strategy. It is apparent that many firms don’t need to approach digital transformation as becoming the next Netflix or Uber to transform their business. In fact, digital transformation can be as direct as transformation through enterprise optimization.
Business outcomes are realized through end-to-end strategy execution, whether it be a proof of concept or an implementation. Goals that are well aligned throughout the corporation should drive complementarities for organizations to create benefits in indirect places. This means the corporation should be fully in sync on both its business strategy and its technology strategy to balance the enterprise optimization equation. Easier said than done.
A real-world example
Recently, I visited a life sciences firm that expressed interest in a cold chain for logistics solution that helps manage time out of refrigeration and temperature for relevant biologic products in manufacturing and logistics. In this example, the solution was an industry innovation kit for SAP Leonardo.
What we learned – quickly – was that this cold chain solution is only part of a much larger opportunity to further digitize the supply chain and extend the value of the solution into and across other platforms, driving greater enterprise optimization opportunities.
When considering these technology decisions, it is important to think broadly about the long-term, interdependent corporate goals. In doing so, the enterprise optimization approach can drive value and interoperability across other platforms and applications to drive greater enterprise-wide benefit. Key point: That value ties back to the business strategy in more ways than just the point solution or latest technology flavor of the day; it transcends technology where enterprise optimization can prove out the business strategy.
As we look across the enterprise, it is easy to get lost within various technology point solutions that can leave us feeling left behind. Leveraging your enterprise systems of record to complement those systems of intelligence will allow the enterprise tools to support the global business strategy.
Today’s global marketplace requires innovation across every facet of your business. Employees, partners, and suppliers have to react faster to new opportunities and proactively create new ones. To learn how the latest innovations in artificial intelligence (AI), Internet of Things (IoT), machine learning, analytics, blockchain, and cloud technologies can help you create customer value and competitive differentiation, register for this informative and interactive Webinar, “Unlock Your Intelligent Enterprise.”