Today I’m sharing a two-part article on The Long Journey of Changing Habits in a Digital Transformation Organization. This is part 2 of Digital Transformation Strategy: The Essential Guide to Enterprise Success.
Contents
Digital Transformation: An Essential Strategy for the Modern Enterprise
Digital Transformation (DT or DX) is a buzzword that is rocking the enterprise market. Many organizations are feeling pressured and impatient to get ahead of the curve. DX solution and data services companies are trying to capitalize on this impatience with a lot of marketing. They’re talking about artificial intelligence, big data, etc. and telling you that if you don’t adopt their solutions, you’ll be left behind. At the center of this phenomenon is technology.
DX beyond technology: The importance of people and process
Is it possible to talk about DX in terms of technology alone without also talking about the people and processes that make up the organization? When you look at proven DX success stories, you see that while technology is important, it’s more about changing the culture of the organization and the digital awareness of its people. By focusing on the people and the organization, rather than the technology, DX has been successful. But culture doesn’t change in an instant. They change over time as people become more digitally literate and redesign how they view technology and how they work. That’s why DX is a “long journey” of designing and transforming into a new business.
From the 1990s to the Present: The Changes and Evolution of DX
When it was first introduced in the 1990s, DX meant applying digital technologies to disrupt traditional social structures. Indeed, in the 2000s, with the internet and mobile era, digital technology has revolutionized our daily lives. When Amazon first announced its intention to sell books online, many media outlets mockingly criticized the idea, saying it would never succeed. But now it’s the number one e-commerce company in the world.
The same was true when Apple launched the iPhone and proclaimed it would change the world. At first, we looked at smartphones as just a cell phone with a little bit of intelligence, but now, as we know, every service in our daily lives is done on a smartphone. And when the Fourth Industrial Revolution became a business buzzword, digital was no longer the preserve of a few IT companies, but was recognized as a necessity for all businesses to survive.
What are the differences between DX in the past and DX today? DX today does not just mean technology change, but also includes management transformation and even business model transformation. The reason for the shift from technology change to business model is that the maturity of the technology has reached a significant level unlike before. In other words, DX is no longer a buzzword, but a realistic business transformation, and the market has built up trust that it is a reality that can no longer be postponed. In fact, DX-related technologies represented by cloud, big data, artificial intelligence, Internet of Things, and blockchain are producing meaningful business results beyond attempts and trends.
The cloud server market has already started to emerge as a large industry (Amazon AWS, Microsoft Azure, Google GCP, etc. are representative companies), and artificial intelligence technology is being used for deep learning, natural language processing, and self-driving cars, making it difficult to predict where the technology will end up.
Doubting DX: Resistance from Traditional Industries
However, despite the maturation of the underlying technology, some still have reservations about DX. This is especially true for organizations based in traditional industries. From questioning how a business model or process that has been at the center of an organization for so long can be digitally transformed, to believing that DX is just a fad that sounds good because we don’t know how effective it will be, to resisting the idea of a department that was once considered a computer room suddenly becoming the center of the business.
The Future of DX: Opportunities and Challenges
However, with the recent news of the failure of GE Predix, a symbol of DX, traditional companies are once again left with the question: is DX still relevant? (GE launched a business in 2013 to digitally transform various devices used in electricity, energy, and railroads, but it did not grow into a new business and ended up supplementing the digital resources of each affiliate). Meanwhile, the impact of COVID-19 was felt around the world.
(Continued in The Long Journey of Changing Habits in a Digital Transformation Organization (2 of 2))