What would an efficient and scalable digital transformation look like?

How far have you gone with your 2020 New Year’s Resolutions by the way? If you haven’t already realized, we are nearly halfway done with the year. As businesses grind to a halt and billions of people hole up at home due to the COVID-19 pandemic, it definitely felt like 2020 has been cancelled.

Some of us are faring much better than others though. Jeff Bezos, likely to become the world’s first trillionaire, have been capitalizing on the situation as Amazon sees a surge in their online sales and stock prices. Facebook’s Mark Zuckerberg isn’t faring too badly either, with an approximate $25 billion adding to his wealth. For most plebeians, companies and employers alike have been exploring online and digital solutions in fervour. In fact, a Straits Times poll showed that 9 out 10 Singaporeans would rather continue working from home. It seems that life will never be back to exactly where it was, but we can expect a new normal for sure. While businesses foray into the digital realm, let us look at what an efficient and scalable digital transformation looks like.

Current State of Companies

Take an information legacy business, such as a financial or insurance company, for example. These companies have many internal elements such as staff, procedures, data, software and culture as well as external elements like suppliers, vendors and governments, which interacts with each other to provide value to the customer. The external pace of change has been slow up until the last few years, and therefore the elements that make up the company did not have to change that fast.

Now that the world is very different, customers interact with the company through multiple channels, such as online and via agents. We are always looking for easy and efficient ways to engage with businesses.

The Customer’s Journey

Using a familiar example; when a customer uses a food delivery service, they would want to scan the menu and look for dishes of their choice within a few seconds. If this process is unpleasant, they would quickly switch to other companies that can provide a better experience. Customer journeys are the mechanisms by which companies interact with their clients.

For business transformation to be effective, we need to focus on these journeys.

As it will not be easy to take all journeys into account, the best way to start is to first select a subset of such journeys as a starting point. This subset of journeys should be high volume and/or have a high impact to the company. More importantly, these journeys should align with the digital vision of the company.

These journeys have to be modelled in such a way that it could be re-imagined and digitised. Not only should we try to digitise the current journey, but rather, we should also look at how the journey could be improved. You might want to reduce the number of steps, for example, where each step of the journey can focus on a small number of specific attributes. Branding can be important in one step, while speed can be important in another; each step of the journey is essentially enabled by modular business services that can be reused in multiple locations.

Modular Flexibility

Everything is awesome when it is modular. For example, in the case of consumer purchasing insurance, one step involves the digital signing of authorisation. A business feature like this can be reused over multiple journeys and in different applications. This means that the underlying architecture must be built in a modular manner so that it can be reused. With that being said, the library of such reusable business features will continue to grow as we design and deploy more of these journeys. As the environment changes, business features will be updated over time to meet the new requirements of the ecosystem. Retinal scans can replace electronic signatures, and the upgrade of the single business feature will ensure the universal distribution across all journeys where the signature is to be used. This modular flexibility and reconfigurability enable the organisation to continue to adapt to the ever-changing business context. These business features, in turn, are supported by integrated applications and technology infrastructure.

By isolating technology in terms of the business features they provide, these technology modules can be phased out slowly instead of having to revamp the entire infrastructure. We will need architectural models to reflect reality in such a way that we can understand and manipulate quickly and easily. Architecture represents different types of entities, such as individuals, processes, technologies, applications, data, and relationships between them. The architecture, in turn, needs to be managed, where the changes are planned and budgeted for. This way, modifications to reality can quickly be reflected through changes in architecture.

Other Aspects

The overall Digital Transformation Strategy covers other factors, such as change management, talent management and a continuous process of adaptation.

Change management permeates the entire enterprise to enable a cultural shift of mind. The present state of people's know-how and expertise need to be updated to meet the new demands of the business. One of the most productive ways to help workers improve their digital knowledge is to bring them together in work-cells that involve a cross-section of people from different locations, including those within the ecosystem such as partners, vendors and even startups to work together. As new insights, strategies and methods are made available and fed into teams, they can continue to develop.

Change being the only constant

The journey of change never stops. It continues to develop and adapt to the changing needs of the market and consumers. As the transformation rolls out metrics and key indicators that were once highly relevant, they may not be necessarily relevant in the legacy context. New parameters will be created and tracked to provide a real-time dashboard to make decisions and fine-tune the organisation. With all influences of the ecosystem on the business considered, the cycle of changes never stops.

This overview is not comprehensive and aims to discuss what needs to be considered an essential part of the digital transformation effort. Each of these steps can be further extended to several levels of detail to ensure effective implementation, and more elements can be added to the roadmap depending on the needs.