Small is beautiful in digital transformation

Digital transformation is a journey often characterised by bigger initiatives and transformational decisions. However, it is the series of smaller initiatives that are the unsung heroes of the journey, as they can deliver value more quickly but often struggle to be prioritised. This article outlines ways to help accelerate these initiatives.

Following the global pandemic there has been an accelerated worldwide demand for digital transformation. According to Gartner, the predicted business IT spend in Australia is up 6.3 per cent to $111 billion this year.

Before jumping into a digital project to solve an immediate need, Australian organisations should take the time to ensure their projects remain grounded in the reality of their business. If companies and their technology partners don’t take a pragmatic approach with these projects, they can easily find their digital transformation journey grinding to a halt or costing far more than anticipated. This includes being realistic about innovation constraints including regulatory, internal governance, resourcing capacity and market access to ensure they stay on track.

Here in Australia, we recently helped a large telecommunications company deploy a digital workforce of more than 50 bots to automate its QA process. Using Robotic Process Automation (RPA), we helped to save an average of 125 minutes per order for the telco, leading to $4.9 million saved through delivery cost optimisation. To deliver this complex project, we relied on the five stages below to set the project up for success early on. These stages ensure projects meet business needs, deliver business value and are designed around the capabilities of the companies and teams that will be working on them.

5 lean stages to shape and execute quick digital wins

Stage 1 — Problem framing: Start by understanding what you’re solving and who for. Without that anchor, you will quickly expend effort without results. Start by gathering any assumptions, develop hypotheses and define a shared working model and approach for the project. Where possible, start with quantitative data to back up or disprove the hypotheses or opinions people have. Co-designing this with different stakeholders with diverse perspectives will help you find a solution for the ‘right thing’.

Stage 2 — Insights: The next stage involves research to uncover data, trends and patterns that can lead to insights. With insights gathered from qualitative and quantitative research, you can reimagine what the future might look like and define how to capture value from it. A research approach might include ethnographic research, with insights paired with quantitative data from existing data sources. Ensuring you have enough insights to make an informed decision is essential before moving to the next stage.

Stage 3 — Strategy ideation and development: We live in the age of algorithms. But what happens when number crunching fails to solve a company’s problems? We argue that many of today’s biggest success stories stem not from ‘quant’ thinking but from a combination of deep, nuanced engagement with the culture, language, and history of customers. This technique is called ‘sensemaking’ and illustrates how business leaders, entrepreneurs and individuals can use human science tools to innovate and solve their thorniest problems. It humanises the work they do, and how they go about it.

During this stage we also utilise ‘future mapping’, a scenario-based planning process that helps organisations build their strategic vision and offers an actionable roadmap. This creates a ‘safe zone’ environment, in which teams can think broadly, quickly and critically in the absence of hard data or certainty about tomorrow.

Stage 4 — Prioritisation and definition: Successfully executing a strategy requires a solid framework of performance guidelines. In this stage, financial modelling is used to assess your organisation’s financial health and plan for creating efficiencies. Investment models and business cases are used for roadmap execution. It is critical at this point to ensure business value, usefulness, and technical operations feasibility are in balance — often initiatives focus too early on feasibility and lose sight of value and usefulness.

The business case is set and shows the required investments and the expected benefits. The future-state architecture is defined and illustrates the to-be architecture that enables the transformation and ensures the organisation is fully capable of keeping up with digital developments in the market.

Stage 5 — Execution planning: Finally, all parties need to agree on a rollout plan for the transformation. This has to include a new governance model that supports the future organisation. It also includes a change management plan to ensure that the transformation is embedded in the organisation, and that employees are fully aware of what is changing and what’s expected of them.

As the organisation changes, management needs to change as well. Mandate and authority should not just be concentrated at the top level but should be distributed throughout the organisation. These structures should be defined and incorporated. Last but not least, the development of a target operating model sets out how all departments are linked together, how processes are organised, and how functions are utilised.

Many organisations in Australia see the need for digitisation but often miss the opportunity to shape something realistic to be funded and executed with the capacity constraints facing Australian businesses today.

Image credit: ©stock.adobe.com/au/Coloures-Pic