Role of Technology in Business Transformation – Part 2

In my last article, I revisited the wisdom of Jaithirth “Jerry” Rao's perspective from the early 1990s about the role of technology in business. Rao compellingly argued that the primary aim of adopting technology shouldn't be to cut costs. Instead, its value lies in enabling your business to do things that would otherwise be impossible, making it an integral tool for transformation. Today, I want to delve deeper into some salient aspects of how to make technology adoption more strategic.

Fit for Purpose: The Real Question

Any decision regarding technology adoption must begin with a thorough understanding of its intended role. Will it solve a particular problem? Will it optimize a certain process? More importantly, is it truly fit for your business purpose? Technology should not be like a Swiss Army knife with tools you'll never use; it should be more like a scalpel—precise, efficient, and solving a specific problem or set of problems.

Price Tag vs. Utility: The Misconception

In many boardrooms, there's a prevailing belief that the more expensive a technology is, the better it must be. This is a dangerous misconception. The value of technology is not in its price or its novelty, but in its utility. A "fancy" technology suite that includes features you don't need is no better than buying a sports car for a daily commute in downtown traffic—it's just not the right tool for the job.

Process Improvement: The True Aim

Some executives adopt technology hoping that it will magically solve all of their problems. However, if the underlying processes are flawed, even the most advanced technology can't fix that. Instead, technology should serve as a catalyst for making these processes more streamlined and efficient. If your new system is more cumbersome than your old one, you're not leveraging technology properly.

Speed and Workflow: The Actual Metrics

Technology should make your company more agile, responsive, and efficient. If a new system or tool makes your work more tedious and slow, it defeats its own purpose. Your metric for success should be how much quicker and smoother your processes run post-implementation, not how many features you can brag about in meetings.

Design From Scratch: The Often-Overlooked Option

It's tempting to take existing processes and simply digitize them, hoping to get the same results faster. However, this approach often bakes in inefficiencies that existed in your older processes. Sometimes it's not just about automating existing tasks, but reimagining them for the digital age. A fresh perspective could result in fundamentally new ways to achieve your objectives, bolstered by technology.

So, while cost should not be the starting point for technology adoption, it's clear that the overarching goal should be value addition. Adopting technology just for the sake of it or for short-term cost-cutting can have disastrous long-term effects. But, if wielded strategically, technology can be the most potent weapon in your arsenal for business transformation.

?Questions to Ponder

• If adopting technology increases your costs initially, what long-term value does it add to your business?
• Are you adapting technology to fit your old processes, or are you willing to redesign your processes to optimize the new technology?

As always, this is hard work, but the dividends for getting it right are immense. I look forward to your thoughts and experiences on this topic.

#transformation #leadership #technology?