Digital transformation is not only about technology. It is about business transformation and combines cultural and people factors, business capability introduction, IT modernisation, master data strategy alignment, cross-functional integration, operational continuous improvement and talent development.
Digitalisation contributes to providing data continuity across the digital thread to leverage the virtual to create, simulate and enhance the real. For example, in modern manufacturing digital tools play key roles to help engineers create new products or related services by simulating operations as part of the development process—before they actually exist in the real world. Digital tools also help model and optimise how products and services operate in the field, and ultimately help monitor, update and predict performance or maintenance requirements.
Disruptive times can be imposed by external factors like economic downturns or global epidemics—such as the coronavirus (COVID-19), declared a pandemic by the World Health Organisation on 11 March 2020. Though every crisis is different, a pandemic directly impacts people’s life and business health at scale. Responding to these challenging times require disruptive thinking, drastic and responsive operational decisions. In such context, business and IT leaders must bring effective and rapid measures to protect all stakeholders: from employees and their families to business assets, customers, supply chains and innovation networks.
In the times of a pandemic, ongoing digital transformation priorities must be swiftly aligned to the new reality to avoid wasting time and allow for preparing the appropriate response. Business leaders need to re-assess their strategic project portfolio; this includes making one or more of the following critical decisions:
1. Create a crisis response team
A dedicated leadership unit is to be created to focus on crisis management, covering scenario planning, incident management, stakeholder communication. This team is to focus on meeting government priorities, continuous risk assessment of the crisis, aligning existing business continuity and minimizing the risk of business disruptions. Being effective at this level is about leadership and creative contribution, rather than pure operations management.
This team must ensure that the organisation takes a wider perspective in the context of the crisis in order to:
- Implement proactive measures to ensure workforce welfare.
- Continuously assess business cashflow and trade plans.
- Consider actions to stabilise or alter supply chains while bracing for unpredictable revenue and profitability, including looking for substitutes.
- Consider re-prioritizing and accelerating digital transformation initiatives which can have a direct impact to enable remote working and improve IT infrastructure resiliency.
- Consult and communicate with stakeholders, including customers, adapt pricing and delivery strategies.
Previous business change and digital initiatives were not designed in the context of the crisis; therefore, leaders should question their relevance going forward. Priority must be given to critical operations addressing causes or consequences from the crisis.
2. Reduce non-essential activities to minimum viable operations
The de-facto position is to stop all continuous improvement activities that do not focus on creating immediate value or mitigating current risks.
For example, as employees and suppliers are required to operate remotely in times of a pandemic, leaders must focus on enabling ways to collaborate remotely and focus on core activities:
- Increase desktop virtualisation and related digital capabilities to enable home working at scale.
- Assess which existing programmes of work need to continue, which new programmes must be launched, what scope is to be prioritised and in which capacity.
- Monitor digital tool access control and network bandwidth allocation based on business priorities.
- Stop non-value-added activities with immediate effect once a static state has been defined and reached.
- Re-define what constitutes essential non-value-added activities in the context of the crisis (which might drastically differ from what existed prior to the crisis).
This needs to be implemented with the view to reduce expenditure to align to reduced value creation while ensuring that non-essential operations are “hibernated” until the situation improves. It might involve discontinuing supplier engagement and putting internal employees on standby for a period of time.
3. Prioritise digital transformation initiatives to counteract the crisis
Business change can be difficult to implement in normal times due to cultural adoption challenges and technical complexity. In crisis time, the balance between short-term and long term changes need to be revisited:
- Focus on analytics transformation to get more and new insights about essential operations.
- Aim at boosting smart operations with automations with short-term value to remote workers.
- Develop improvements to accelerate technical deployments, including remote testing, smoke testing and rollout automation, including DevOps and self-service capabilities to develop new support models.
- Consider re-purposing exiting or creating new technology initiatives to help counteract the crisis; these could be joined initiatives with other organisations as part of existing or new innovation networks.
4. Prepare for after the crisis
Crises have their own lifecycle and they will eventually end. Leaders need to accelerate relevant business transformation efforts during challenging times to put their organisation in a better position after the pandemic passes. This includes planning on resuming operations and delivery ramp-up—aiming at a stronger position and having learned the lessons from past crises.
Implement hard measures during hard times, but do not compromise long term business capabilities. Leaders must invest during the crisis into what will make their organisation stand out by looking at ways to:
- Boost digital disruption as change might be more favourably tolerated in times of reduced operations and productivity.
- Review talent development plans and use “hibernation” time in a productive manner to build or learn new capabilities and skills—this also includes looking for business expansion opportunities with new partners and new collaborative networks.
- Keep open internal and external channels – rather than shutting down all strategic operations and disengaging with key suppliers and customers at once.
- Re-strategise and focus on new digital continuity initiatives, scalable cloud-based solutions, AI analytics, etc. including new IT-as-a-service and IT-as-a-product models—delivering digital capabilities and experiences at the speed that customers and employees expect.
Digital transformations might not be the cure to pandemics, but they are key enablers to changing how companies operate in difficult times; they also contribute to how companies adapt to challenging situations and ultimately bounce back to improved value creation once resuming to the new normal. It has never been a better time for humility, open innovation, learning and collaboration.
What are your thoughts?
This post was originally published on the Digital First Magazine on 1 April 2020.
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