The “new normal” post-corona will be much more realistic, practical, and
focused on impact. So, it’s time for enterprises to take it slow.
The current crisis has disrupted the business world severely. Sectors are shutting down, and many companies are implementing partially inactive mode to focus on consumer-critical operations and business continuity plans.
This is the time for digital transformation 2.0, where the new normal will be much more
realistic, practical, and focused on impact. This is what was lacking in the digital transformation 1.0, especially considering its unfortunate track record of success.
Focus is the main game-changer, since there were no financial challenges- as many digital
transformations were pretty well-financed without a clear pipeline of innovation. As a result, the digital teams of firms are “chasing” opportunities, and creating busy work which actually creates minimum value. In the past five years, industrial firms poured billions of investments in the digital transformation initiatives trying to strike gold. For many, the lack of focus led to multiple failures and false starts. The next three to five years are going to be all about focus, impact, and profitable growth.
Global digital transformations can no longer be complex processes with multiple entities,
dozens of workstreams, and thousands of projects running in parallel. Most of them are set up as parallel establishments suffering from a lack of accountability, leadership, and a certain level of disconnect with the core business. The future is going to be only about fluidity, agility, and clear accountability to business stakeholders. Removing all the unnecessary complexity is an essential step to match the level of market dynamism.
Digital transformations need to focus on real holistic innovation around the core business to
generate growth for the various core market verticals. This is definitely a hard lesson to learn, but a necessary one too. The implication of this has a higher level of coordination and integration between the core legacy entities and the digital business. A great divide between the two organizations is not recommended.
The digital future is all about true innovation and executable opportunities. It is time to go back to the basics and focus on customer problems, customer pains, true differentiation, willingness-to-pay, and pricing power. This clearly implies that the digital teams must do their groundwork early in the process, and kill projects if they fail to meet the impact requirements. It is also crucial to address the internal typical organizational bottlenecks.
New business models guide true digital innovations. They should not be business-as-usual.
Instead, the focus should be on the feasibility, attractiveness, and viability of the opportunities. A digital transformation includes a dozen new business models that have to be essentially managed as a dynamic portfolio.
The 2020 COVID crisis has turned out to be a stress test for the internal digital capabilities of firms. It is the opportunity to test the communication capabilities, IT infrastructure,
collaboration tools, and also the firm’s bandwidth. This also examines the digital mindset
among IT departments and engineering teams. It’s time to take a realistic look at the effect of this crisis and then modify the road map accordingly.
This crisis has offered new beginnings and opportunities. Digitization is not dead – it is resetting like many other functions and processes in the business. Digital transformation 2.0 is much more focused, less complicated, profitable, differentiated, customer-centric, and grounded in data monetization. Digital transformation 1.0 is now dead as the digital transformation 2.0 sets in!