It’s now only a matter of time before digital business transformation sweeps across every major vertical industry. The only question at this point is which organizations will thrive as result of making that transformation versus those that will inevitably be consigned to the scrap heap of history. The main difference between those two outcomes will invariably come down to an organization’s inherent ability to build a digital transformation framework around which the organization can absorb and exploit a raft of emerging IT technologies.
A digital transformation framework is not something an organization can buy. It needs to be built around a series of technology initiatives spanning everything from mobile computing devices to backend enterprise resource planning (ERP) applications. Any one of these technologies can be employed to transform a single business process. A digital transformation framework is about putting the platforms in place required to launch multiple digital business transformation initiatives simultaneously across the organization that all build on one another.
Building such a digital transformation framework has become the top priority of CIOs for 2019. A Gartner report finds 33 percent of businesses now in the scaling or refining stages of digital maturity, up from 17 percent last year. Only 4 percent of organizations have no digital initiative at all, says Gartner. By 2022, Gartner is predicting that 80 percent of revenue growth will depend on digital offerings and operations.
International Data Corp. (IDC) estimates more than $1.1 trillion will be spent globally on digital business projects in 2018, an increase of 16.8 percent over the $958 billion spent in 2017. Most organizations, however, are not moving especially fast when it comes to digital transformation. IDC is forecasting it will take until 2027 for 75 percent of organizations to digitally transform.
Huge Scope of Digital Transformation Framework
One of the primary reasons digital transformation will take so long comes down to the scope of IT effort required. Critical IT projects that need to be launched, managed and orchestrated within the context of a digital business framework span:
Mobile Computing: Most organizations today provide access to email from a mobile computing device. But that’s a far cry from providing end customers with access to a mobile application that automates a business process. Most organization start their digital transformation journey by building a handful of mobile applications. But that often winds up be more challenging than anticipated. A study of 200 digital leaders at U.S.-based enterprises with more than 500 employees conducted by Qualtrics on behalf of Dropsource, a provider of low-code application development tools, finds 84 percent admit their efforts to develop a mobile application to support business goals are still nascent. A total of 41 percent of respondents say that lag is already negatively affecting their market competitiveness.
Dropsource CEO Ben Saren says the root cause of the problem continues to be misalignment between IT and the business. That’s not necessarily a new issue, but the need to digitally transform the business is bringing a long-simmering issue to a head.
“There’s no playbook in a lot of these organizations,” says Saren.
ERP Applications: Most of the enterprise resource planning (ERP) applications employed today are built on inflexible monolithic architectures that make these applications difficult to update. Digital business transformation requires a level of agility across backend processes that doesn’t exist within most organizations. To inject flexibility into those applications, organizations have been embracing microservices developed using primarily Docker containers that make it simpler to isolate and update specific classes of workloads and types of business logic.
At the same time, providers of packaged application ERP software such as SAP and Oracle are employing microservices to deliver a more modular suite of applications that they are trying to convince organizations to primarily consume as a cloud service managed by them.
Regardless of the approach, the shift to microservices will require organizations to embrace DevOps processes to manage those services, says Ravi Kumar, president and deputy COO for Infosys, a global systems integrator. Most organizations are already moving down that path at different rates within their organizations, says Kumar.
“The role of DevOps in digital transformation is well understood,” says Kumar.
Data Management: Most organizations have not been historically adept at managing data. Most of them still struggle with reconciling how customers, suppliers and partners are even described across multiple applications. In an ideal world, most organizations would have a single metadata model spanning all their applications. Longer term, there are even ambitious efforts to create common data models spanning multiple applications being contemplated.
Collectively, those efforts would do much to reduce the data quality issues that hamper digital business transformation projects spanning multiple applications that are by definition cross-functional. In fact, the level of collaboration between sales, marketing and service required to create a digital experience will require new approaches to content management that can span all those silos, says Haresh Kumar, director of strategy and product marketing for mobile and connected experiences at Adobe.
Unfortunately, the level of collaboration required to achieve that goal is highly inconsistent in most organizations, notes Kumar.
“It’s been quite choppy, to say the least,” says Kumar.
In the hopes of making it simpler to access a common pool of data, many organizations have embraced Big Data platforms such as Hadoop. But setting up and maintaining a Big Data platform such as Hadoop requires a level of IT expertise most organizations still lack. In fact, most instances of Hadoop are consumed as a cloud service for that very reason.
Integration: Most organizations add layers of application, data and business process integration on top of monolithic applications with mixed success. Digital business transformation will require organizations to define a common integration framework around which their applications revolve. Rather than adding integration in an overlay fashion, the assumption is that every application will include a well-defined set of application programming interfaces (APIs) through which it can expose services that can be consumed by other applications that have access to a common integration framework.
That type of approach to IT is critical because digital transformation never ends, says Steve Wood, chief product officer for Dell Boomi.
“Digital transformation is an ongoing continuum,” says Wood.
That means organizations need to build an IT environment that is designed from the ground up to be truly extensible in any direction.
Artificial Intelligence: Once the IT fundamentals are addressed, it then becomes feasible to employ machine and deep learning algorithms to create artificial intelligence (AI) models capable of employing bots and other types of digital assistants to automate processes. Those AI models, however, are only going to work as well as the quality of the data that is made available to inform them, says Tim Stack, a product marketing manager within the Cisco Data Center and Virtualization Group.
“Data is the fuel for AI,” says Stack.
At this juncture, it’s clear that every enterprise application will soon be infused with some level of AI. The challenge now is to make sure organizational biases don’t wind up creating an AI model that drives a suboptimal digital business outcome.
Security: They say integration is the enemy of cybersecurity. The more things become integrated, the easier it becomes for malware to spread laterally across the IT environment. A digital business framework represents the ultimate integration achievement. The good news is that because the IT environment is modular, it becomes much simpler to isolate various elements by segmenting various application workloads from one another.
That microsegmentation approach makes it easier for IT organizations to contain breaches. There will never be anything such as perfect security. But the level of cybersecurity expertise applied to that framework can turn security into a differentiation for the business.
The challenge is putting a framework in place that accurately identifies not only when a breach is occurring, but can also automatically remediate a potential vulnerability before it gets exploited, says Peter Alexander, chief marketing officer for Check Point Technologies.
“Organizations need to be able to automate remediation in real time,” says Alexander.
Be Digitally Prepared
Naturally, a host of other emerging technologies, such as augmented and virtual reality, the Internet of Things (IoT) and blockchain databases, will one day soon play a pivotal role in any digital business framework. The goal is to build a framework in a way that makes it much easier to securely incorporate any emerging technology.
Given the current state of enterprise IT, it’s clear that many of the sins of the past are going to make it challenging for most organizations to turn on a digital dime. But as more new competitors start to emerge that don’t carry as much legacy IT baggage, most organizations don’t have nearly as much time to transform as their business and IT leaders might like to think.