Off the back of our recent Conversations that Count lunch series and the Wake Up with GWI breakfast session last week, I have had the chance to pause and reflect on the state of play for organisations of all sizes trying to renovate their ICT environment. Depending on your school of thought you may call this Digital Transformation.
But how transformative is it really?
For me, unless you are looking at changing or disrupting your existing business model, it isn’t that transformational. It is just, in a non-pejorative sense, improving ICT delivery to drive efficiency.
Much the same as we have done for the last 40+ years, businesses are constantly evolving to find new ways of doing business to enhance outcomes, discover new efficiencies and improve service delivery. They must be adaptable to overcome unexpected challenges. COVID-19 is a perfect example of this. We were forced to embrace digital change and organisations who did reaped the rewards, whilst those who didn’t fell behind.
If you are still unconvinced that digital business is ‘the main game’ and not just an interesting addition to your existing approach, I would offer the following evidence:
The top 5 business on the US S&P 500 are all tech companies.
- Facebook and
- Google (Class A and Class C shares)
These five companies now account for 24% of market capitalisation of the S&P 500. Together they are worth $6.7 trillion. By next year, some commentators suggest they could control more than 40% of the S&P 500.
Businesses can no longer ignore the pace of digital change, they need to embrace it.
So, in talking with people about their digital transformation and ICT renovation journeys, I have come to think about two key dichotomies;
- This one is more obvious – organisations understand that being truly digital means looking at how the whole business operates. Others think of this as simply improving the existing processes with better ICT
- The second is less obvious, but just as common – digital transformation across the whole business vs digital transformation happens in pockets of the organisation but not across the board
This second model is where most organisations live. Pockets of excellence, highlights of innovation and piles of legacy ICT.
As ICT and digital professionals, we need to get better at guiding our organisations through this dual existence. It isn’t good enough to move at the pace of the slowest technology in the portfolio, neither is it acceptable to ignore the last 20 years of legacy IT.
By GWI Partner and Digital Transformation lead, Ian Roderick