Do You Speak Digital Transformation? Yes? You are doing it wrong!

I will avoid to talk about the so popular “digital transformation” topic which in these days (2years?) is populating the main social platforms and is present in almost any CIOs agenda.

I will talk about what this Digital Transformation (DX) is NOT, about some misconceptions, about the risk of not doing it (the DX) and about the major challenges I see. Lastly I also want to spend 2 words on where we should really focus if we want to lead the innovation (or play doing it).

Lot of people out there speaks about Digital: Digital Disruption, Digital Transformation, going Digital etc. But how many of those who pretend to be familiar with this concept, the concept of Digital and its real implications, are fully aware of what does it means? How has to be done?

I constantly listen to people speaking digital and not having any IT understanding; how is this possible? it reminds me my home country: where suddenly on Sundays all the people, for don’t know what bizarre reason, becomes Football Experts / Football Trainers. Engaging complex discussion about what the players had to do etc.

Digital?

Digital or “going digital” doesn’t simply reduces as “automate an activity that was previously done manually”, using IT assets such as computers, computer programs, robots, integrations or whatever IT asset you want to use. This kind of transformation is simply called IT:

We invented the Sales Point and put it into the supermarkets: now selling products is done automatically by a scanner, the operator just verifies the items and presses a button. Fiscal Recipe or Invoice is produced, Cash Collected, Warehouse updated etc. This is not Digital! This is simple IT applied at business level.

We went digital 30 years ago and start noticing it just now?

Not really, there’s a revolution out there. On how companies are doing business, on how people perceives services, this is changing and the companies has to focus on the right priorities to stay up-to-date with their service portfolio and keep the customers / users happy.

We saw already M2M, IOT, BigData. Where they are now? Is all gone? Now we change page? No, that was the first step in the earth digitalisation journey. That created the pillars for building our digital community. The infrastructure which is currently in use.

If you see it, is not digital!

Long time ago I was “building” my first PC, it was a Pentium 200MHZ, I was so happy. I took the newest RAM (DIMM) memory technology, it was quite new I had to search for it. I had one of the first motherboards with USB ports etc. Everything it was under my eyes.

Today I have my phone, here in my pocket. It’s 8x time faster, 20x time more capable, it has all type of connections, support almost any kind of protocol. I see just my little black box and the user interface. I take it, I open the UBER app downloaded for free from the "appstore", I order my taxi with 2 taps on the screen. The payment will automatically go on my credit card. I’ll find Invoice and details in my mailbox.

THAT’S DIGITAL my friends.

Digital has to be transparent for the user, this is the real difference between digital and IT: IT is the big scanner you have in front of you at the airport, that scans your passport at the border control. Digital is passing through the border control without human or non-human interactions and having automatically loaded your security and clearance data on the system, just walking through the gate.

Why seems some companies struggle with digital?

Before? Before you had the option: you want to go high-tech? yes/no. No matter what, but before, every player on the market has his space. Lot of businesses were done just as they were done in the past. As simple as that.

Today we reached the limit, the EOL (End Of Life) of the old way of doing (some type of) business. What does it mean:

• To say competitive many companies are forced to embrace IT, even they never had this experience before (and knowledge, therefor), nor the needing,
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• The drivers (CIOs and CTOs of the world) are not all ready for using wisely these new assets (knowledge, infra etc), this cascades directly in their company strategies, I’m sure in the next few years we will see the effect of these weak strategies like the history teaches us,
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• Sometimes you hear about totally wrong visions like “With our digital technology we will avoid IT costs, saving ours and our customers money”, which make no sense, this is scaring men,

In other terms, this struggle happens because of a big gap: at HUMAN CAPITAL level:

Is a very basic: Companies has to create a very strong IT culture if want to lead in the digital age. The IT how we know it today will probably disappear, but this doesn’t mean that the IT engineer job will. Is actually the other way, that job will be more and more demanded.

Employees1.0 has to be updated: Employee2.0, the digital era employee.

Speaking of employees, the new generations, Generation Z and Millennials probably, are already updated. They came along with the service pack by default, from factory. But previous generations have really to pass through a 2017 IT crash course. At any level, from the top, no one excluded.

That’s how companies create an internal culture of “IT awareness”, which will go hand by hand with the big corporate culture change journey that we are facing.

Fair enough, so what?

So we need to acknowledge that the generation Z expectations are really very high, sky high. that's the generation with the most buying power ever in the history, and for a service company, generation Z has to be The target customer. Changing the customer expectations automatically impacts the customer satisfaction level, which will drop badly. Service providers has to adopt a new set of service levels and calibrate them in order to match a whole set of new standards that this digital age is creating.

Let's see how the world will react to this,

Luca Bottesini

16/06/2017