What Is Digital Transformation?

 
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Digital Transformation: Surveys say most companies are doing it. Academics claim that those who don’t are destined for disruption induced failure. The one question no one seems to be able to answer is...what is it? There are many definitions of digital transformation, but all of them seem to miss the essence of what digital transformation really involves. Is it just a fancy new word for “technology integration,” “digitization,” or “digitalization”? Or, is digital transformation something bigger.  To get a handle on this concept, I believe a good starting point is to look at a real-life case.

Associated Textbook, Inc., a textbook publishing company, was about to release their first entirely digital book. You could get it on your Mac, PC, Kindle, or Nook, but it would not be available as a paper book. The digital assets were in place. The webstore copy was written and submitted. Everyone at Associated was excited about this strategic direction. Then, on launch day, nothing happened. Quite literally, nothing happened. The book wasn’t listed on the website, which meant no one could purchase it. Associated had an expensive digital asset which was supposed to disrupt an industry and no way to sell it. There was a mad dash to figure out who had dropped the ball. Fingers were pointed. Accusations were made. Everything was checked, and to Associated’s surprise, nothing had been missed. Everyone at Associated was stumped.

Every process at Associated Textbook had been digitized. Technology had been seamlessly integrated into every process. Most importantly, as far as the individual silos were concerned, those processes had been optimized. Every team that would be involved in the distribution of the digital book had been involved in the planning and done everything they needed to do to launch a digital book. Yet, despite all of that, the product launch failed.

Associated was missing was a broader view of how value had been delivered to consumers by the organization previously and how this would change with the new endeavor. Each silo had made sure that the systems they designed got the product from the beginning to the end of their process. Since this book would be entirely digital, the printing operations team wasn’t involved -- yet they were the ones who had the answer to the product launch conundrum. The automated system which lists books for sale was tied to the receipt of the order by the printing team. (This check was implemented after an issue years prior when a book was listed in a physical catalog but was ultimately canceled). To ensure this never happened again, books were not listed on the website, until the print order was received. In our scenario, the webstore listing for this groundbreaking digital title was just sitting there waiting for the receipt from the printing team -- something that was never going to happen. Associated had technology integration. What they needed was digital transformation.

Technology integration, digitization, or digitalization involve making manual processes automated. Digital transformation asks the questions, “Do our processes and strategy still match the way we deliver value to our customers?”and “Is our process frictionless?”  These question can’t be answered in a silo. They require an examination of everything from business strategy to delivery and, most importantly, all of the steps in between. Digital transformation takes a deep dive into what we are doing, how it is getting done, and why we started doing it that way in the first place. Only after this picture is developed can we integrate holistically developed technology to take the enterprise to the next level.

Next week, Inspirant Insights will take a deeper look Enterprise 2.0 and the Frictionless Enterprise. Stay up to date with the most recent Insights by following Inspirant Group on LinkedIn and subscribe to our weekly newsletter at inspirantgrp.com/inspirantinsights.

 

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