Digitalization – what is this about!2017-03-14

Why are some companies successful in their digital transformation and others not?

Do you want to know the secret?

CIO plats a pivotal role in the corporate digital transformation

DEFINITIONS:

IT Digitalization: A concept of using IT technology to digitizing business/customer processes with an internal perspective – increase internal capabilities and productivity. IT Digitalization is all about implementing new IT services in Cloud, Business Intelligence/Big Data, Security, Business Systems (ERP), Internet of Things, Mobility and more. These are indirectly enablers to creating customer value.

Digital Transformation: A concept of transforming the leadership and governance of the company or organization with an aim to optimize customer experience over time (unpredictable). Digital Transformation is about change in leadership, culture, governance, agility to respond quicker to new trends and customer behavior. Collaboration across boarders!

The biggest challenge of CIO 2017:

• Digitalization of the company• Support corporate innovation• Support corporate transformation

The focus of CIO 2017:

• Cloud Services (SaaS, IaaS, PaaS)• Mobile Technology• Modernizing old IT systems

Source: IDG CIO 2017 report and IT Radar 2017

BUSINESS CHALLENGE! Transformation to the digital business!

IT FOCUS!Digitalization in tradition business!

We need to understand the nature of digitalization from an external perspective to master the digital journey

DIGITAL BUSINESS

Traditional Competitiveness(high predictability: > 12 months)

Digital Competitiveness(low predictability < 12 months)

Fast moving! No loyalty! Experience!Slow moving! Protected! Price & Quality!

Trad

itio

nal

Capa

bilit

ies

(Pro

duct

ivit

y, s

tabi

lity)

Co

mm

and

& C

ontr

ol

Dig

ital

Capa

bilit

ies

(Spe

ed,

agili

ty &

inno

vati

on)

Trus

t &

mot

ivat

e

TRADITIONAL BUSINESS

!WARNING!

PHASING OUT OF MARKET

!WARNING!

LOSING PROFITS

DIGITAL TRANSFORMATION DIAGRAM (Gillior, 2016)

31% of all companies have a digitalization strategy*

* Sou

rce:

IDG

CIO

201

7 re

port

**C

SC C

IO re

port

2016All future business models

will depend on smart use of IT**

In the end, digitalization is a leadership and organization challenge –mastering the forces of digital change

New competitive landscape –losing revenue and shares!

Market and Organizational unpredictability – no period stability. More frequent Disruptive trends.

NO loyal customers!

Increased need for digital capabilities, innovation and collaboration cross boarders

The driving forces together create a fearful and stressful need for digital transformation –starting now!

• Organizational Stress and Fatigue / FEAR

• Conservative, Passive and Misaligned Leadership

• Sub-optimized digital capabilities – what is digital?

• Low value-adding investments (not supporting business/customer value creation)

• Slow steering – not able to react to new trends

• No processes or structure to support change

The resisting forces together shape an organization without the tools, leadership or motivation to change.

Forces resisting changeInternal: culture & leadership

Forces driving changeExternal: digitalizationThe

Digital Dilemma

“Organizations show the same symptoms as people with ‘burn out syndrome’. It is all about people and a culture and leadership issue.”

“80% of corporate leadership do not understand how to win the digital battle –or where to start. They assert more control, stress and information”N

on-D

ynam

ic O

rgan

izat

ion

Prot

ecti

ve,

Polit

ical

, La

ck o

f Tr

ust

and

Dir

ecti

on

Digital Transformation is easy with the right focus – leadership, capabilities and governance!

Digital LeadershipA leadership leading continuous change through motivating and coaching of employees. Taking ownership of the digital challenge with digital awareness and taking right decisions based own analysis of digitalization.

Digital CapabilityThe digital capabilities must be viewed from a customer experience and value perspective – not sub-optimizing IT but actually including the complete value chain. Digital Governance

An agile management system enabling fast response to trends and challenges. Digital Governance is based on units and functions collaborating across boarders in a true value chain.

How is your leadership, governance and capabilities aligned to the new digital pre-requisites?

My recommendation!

• Understand the complexity and pre-requisites of your industry – and how it is influenced by digitalization (competition, customer behavior, etc.). Based the understanding on your own analysis and conclusions!

• What are the expectations of business, executive leadership? Are these expectations aligned with ITs ambitions and plans?

• Understand the forces within your organization – what are the driving and resisting forces? How to create right energy and momentum?

• Bring in people “Digital SWOT Team” who have the right experience and knowledge to drive digital transformation, and deliver change and results – it is the best investment!

A recommended first step is a Digital Stress Test to evaluate the digital performance in the digital arena. The Digital Stress Test identify strengths, weaknesses and bottleneck in the organization to master the digital industry and market (see next page).

Recommendation

Digital Stress TestThe offering leverage “best practice” method to evaluate the digital performance of the company or organization based on real-life digital scenarios. Where are the bottle-necks, unclear responsibilities and other weaknesses/strengths in running the digital company?

Digial Stress Test Details:The Digital Stress Test (3 weeks work) will go through 10 different digital scenarios and evalutate the performance from six dimensions (process, decision making, speed, information, innovation and motivation). The outcome is mapping, analysis and recommendation.

Process Decision making Speed Information Innovation Motivation

Assessment Criteria

Dig

ital

Scen

ario

s

109

87

65

43

21

Contact information

Hans Gillior – Senior Advisor/Digital Transformation

Email: hans.gillior@sofigate.comPhone: 0768 643 778Blog: hansgillior.wordpress.com

THANK YOU!!