Three Phases and Underlying Principles of Digital Transformation
#1 Building the Foundation - Enabling Small Teams
Most of the time, large teams in businesses function monolithically. Movements of whales come to mind, slow but they make huge splashes. Before beginning development, large teams have to gather a project's requirements consistently. Without this, the project could quickly go astray and waste tremendous resources. For example, in finance, the complexity of governance and finance procedures limits how rapidly the project's scope can be altered to reflect ever-changing consumer demands, market dynamics, or competition dynamics. Software created in this manner frequently becomes plagued with dependencies, making it challenging to quickly expand the project or deploy it in diverse situations in the future.
To start making progress, a corporation should start thinking about replacing large and tightly governed teams with a variety of small, flexible, and lightly-controlled teams that can innovate and adapt to changes faster. These teams should be able to integrate quickly and release many minimum viable products (MVPs) in short periods. Then the teams should let customer feedback guide development, and scale efforts up or down as necessary. This would be a far better approach than investing time and resources in a single monolithic application that may be based on obsolete, changed, or uncertain assumptions. To create this kind of quick-moving operation, a company will almost certainly need to decentralize its operational model to offer individual teams more authority and use a modern cloud architecture.
#2 Agile Development - API Implementation
Modern, cloud-first application designs are built around APIs. When properly leveraged, they reduce the backend complexity into an interface that developers can use. In essence, they connect systems. An API initiative can speed up internal development efforts since data and functions are given access in an easy-to-consume, endlessly scalable way thanks to APIs, but that's only a one-use case. Businesses are increasingly allowing other partners and developers access to their APIs. This enables those companies to interact with potentially billions of other users in digital ecosystems. These ecosystems can aid an organization in maximizing its unique competitive advantages while utilizing other partners to close gaps, offer scale, and provide access to new markets.
#3 Pulling Ahead and Developing an Edge - AI and Machine Learning
To win as a business is to move quickly and continuously enhance the goods and services provided to its customers. To do this successfully, a business needs intel to refresh its offers without wasting too many resources. In other ways, this is about creating customer-business feedback loops, including proactive monitoring and analytics that show how a company's product is used. One way to gather these insights is to utilize artificial intelligence to help businesses make better decisions.
Once data is available, AI could be utilized in many ways for a business. For example, to improve meeting efficiency, a digital assistant could monitor company meetings over time and suggest new ways to improve the structure or flow of the meeting and shorten them. Alternatively, Google Ads' forecasting tool also utilizes AI to suggest marketing budget changes in the next month to maximize marketing efforts and ROIs.
These suggestions for improvements, while could be done by a human, are generated at a much cheaper and faster rate using AI. Live data would be fed into AI with way lower error rates and In any case, machine learning could be hugely beneficial to all facets of a business. To successfully utilize AI and machine learning, a corporation must ensure four pillars are in place, namely data, algorithms, computing capacity, and expertise.
Digital transformation is a continuous process and should be part of a company's business strategy to stay ahead of the curve. At least for the coming decade, the principles of the three stages in digital transformation would do your organization wonders if implemented correctly.