In the past few months, IDC has conducted an extensive survey of more than 1,000 business and IT executives, sponsored by software company SAP, on how they were executing digital transformation. What are the strategies and KPIs that distinguish “digital thrivers” from the “survivors” who were merely struggling to survive its effects? What is the structure in place where CIOs are leading and pushing information transformation to innovate, to differentiate the business by developing new products, services, and programs and ultimately generating new revenue streams?
IDC has identified five “recipes for success” that show how successful organizations are delivering results and are putting digital transformation at the center of their corporate strategy.
Recipe 1: Develop transformational leadership attributes
With 88 percent of European DX strategies directly backed by the CEO and board, there is a dire need for leadership to start executing on set objectives. We also see that CEOs have often found it necessary to drive digital initiatives among survivors. It is therefore clear that CEOs are increasingly associating themselves with technology and innovation. However, among digital thrivers it is not the CEO but the CIO who has stepped up to the plate to drive the transformation across the broader organization —a natural response as it is ultimately up to the CIO to help drive technology changes.
Recipe 2: Create a “digital dream team”
Even though transformation requires special leadership qualities the CIO can’t do it alone. A collaboration across the whole organization and enterprise-wide participation that involves executives from operations, marketing, sales, and finance is needed to merit success. Otherwise, IDC believes, 70 percent of isolated digital transformation projects will fail by 2018. If the CIO forms a special partnership with the CDO to align on vision an effective DX rollouts, better results can follow.
Recipe 3: Put information at the heart of digital transformation
Data is king. Why does it rule? Simply because it can produce the greatest value – both with regards to monetization and the creation of new business models and by empowering business users with analytics and data visualization tools that enable fast and quality decision making. CIOs must recognize the value of structured information and create the tools to harvest its potential. The organization of the information architecture leads to the fourth recipe for success.
Recipe 4: Establish a “future proof” digital platform
What is the architecture of the digital platform that builds for the future? In short, it is based on “transformative technologies” that are open and ecosystem-centric and that allow for real-time analyses of big data sets. APIs grant easy access to information and allow its distribution – basically accessing valuable information and distributing it to customers, partners, and other stakeholders in the ecosystem. And of course a flexible, scalable infrastructure is cloud-first at the least, if not cloud-only.
Recipe 5: Embed innovative metrics (or masteries)
This last recipe is all about delivering and measuring progress. New KPIs create clear and measurable objectives for digital transformation initiatives linked to business outcomes. IDC’s research found that those CIOs that were measured primarily on operational excellence tended NOT to be leading companywide digital transformation initiatives. To thrive in the process of digital transformation, organisations need KPIs that ask the right questions and measure progress and success in the right way. Only then can they embed a culture that is open to disruptive innovation, while most survivors focus on short- to medium-term gains.
The IDC InfoBrief “Enabling the CIO to Lead Digital: Recipes for Success” provides guidance in the form of best practices as well as case studies from major companies and prescribes actions that help any organization to thrive on their journey of digital transformation.
Download your free copy of the 5 recipes for success as a collection of best practices for a successful digital transformation process.