DT - Digital Transformation

Process visibility over process replacement

01/07/202412/06/2023 by DX Talk

Process visibility rather than process replacement. The fourth installment of Digital Transformation Processes: A Key Guide to Success explores the importance of process innovation and digital transformation (DX, DT, Industry 4.0, digital transformation), covering examples and challenges of real-world process improvement. Emphasizes new approaches to process visualization and the importance of process digitization.

The importance of process transformation and how to approach it

Along with business strategy, process transformation has long been a major project for consulting firms. Process transformation involves creating optimal processes by drastically eliminating redundant and unnecessary work in various value chains, such as sales, marketing, supply chain, purchasing, logistics, production, and manufacturing, and introducing customer-centric ways of doing things so that better products can be made faster and cheaper.

In general, it’s important to keep the following in mind when driving process innovation Start from scratch, without thinking about the existing processes and systems; define the existing processes as a legacy and look at them from an outside perspective; and create and implement an organizational change management plan. This means training employees to adapt and buy into the new system. It’s not unlike applying a DX mission by creating a DX execution organization and engaging with different departments within the company.

The Challenge of Process Transformation and the Opportunity of DX

One thing we shouldn’t forget is that many process transformation challenges are not easy to succeed at. Most often, we diagnose a process and come up with meaningful conclusions about how it should be changed. However, when it comes to execution, the new processes are often ignored due to unfamiliarity and the old ways of doing things are reverted to. In the process, we add one exception after another to make things easier, and we get farther and farther away from true process innovation.

If you’ve been through this before, a DX project is an opportunity to do process transformation right. Processes that have been left untouched for the sake of expediency or avoidance of responsibility by some incumbent departments.

Real-world examples and challenges of process improvement

Let’s take a look at some examples of unreasonable processes. First is the process of individual employees applying for and approving time off. While some companies have moved to self-approval, many still rely on team leaders to approve team members’ vacation requests. At its core, personal time off is a matter of self-determination within the time allowed, and there’s no need to go to the team leader for approval.

If the purpose of the approval process is to check the schedule of the team leader or manager, a separate schedule management system can be used to check and adjust the schedule. In this case, the schedule management system becomes an element of the DX project. Let’s also look at the payment process for expenses. In the U.S., individuals are given a lot of authority and the organization is basically based on trust.

So if there is no agreement on the expense, you just notify the people involved via email and if there is no feedback that it’s a problem, you just do it. However, in the case of Korea, we basically derive a process based on the premise that individuals can misuse it, so the approval process takes quite a long time.

The processes of ‘approval’ and ‘consensus’ can also be said to be a case where they are only separated by name according to the roles and positions in the organization, and they are misused to hold on to organizational influence or to avoid responsibility. The definition of this will vary from organization to organization, but there are certainly ways to reduce the time it takes to approve processes. The final example is related to budget increases. In larger organizations, each department is given a business budget and an expense budget at the beginning of the year to guide their execution.

This is important from a financial management perspective, as it ensures that every organization stays within its budget for the year. However, the problem arises when a particular account goes under budget. Since budget limits for each account are determined at the beginning of the year, when an account runs out of money, it’s necessary to divert money from other accounts, which requires reporting and approval of the diverted money. This is the same process we’ve been doing in our organization for a long time without realizing it.

Process visualization: a new approach

So how can we change these processes with DX? The bottom line is that instead of trying to change the processes, I would recommend focusing on “process visualization.” Process visualization is about making the way you’ve been working implicitly tangible, and creating a kind of visualization of how much work goes into each process and how much time it actually takes to do that work. In other words, making the process visible at a glance, like a billboard, just as you would if you created a dashboard for DX management. To do this, you should start by digitizing any files that aren’t already digitized and are being managed manually.

The importance of process digitalization and data analytics

Once a process is digitized, it becomes easier to analyze the time spent on it from a data analytics perspective. You can see how often a process occurs, how long it takes, and how it affects productivity. This is not unlike a DX project.

What to watch out for when adopting digital tools

01/07/202412/05/2023 by DX Talk

What to watch out for when adopting digital tools. The third installment of the Digital Transformation Process: Keys to Success guide explores key factors to consider when adopting digital tools for digital transformation (DX, DT, Industry 4.0, digital transformation). Topics covered include IT project management, budget planning, the challenges of SaaS adoption, security management, employee training, and the role of the executive team. Provides a practical guide to successfully introducing and utilizing digital tools.

Intrinsic considerations for adopting digital tools

We’ve talked about adopting digital tools as a first step to improving your employees’ digital capabilities. But does simply introducing digital tools instantly build digital skills? Not necessarily. In most cases, IT departments within organizations lead digital tool adoption projects. Traditionally, their primary goal is to deliver on time and at a given cost. As a result, it’s easy to lose sight of the post-implementation impact, adoption, and change management. But can IT be held accountable for these qualitative outcomes? It’s hard to say. It could be corporate strategy, corporate culture, or HR. But if it’s not an initiative of the IT department itself, but rather a request from the CEO or another organization? It’s just a mechanical project.

The importance of project management and cross-functional collaboration

To address these challenges, you need to take a different perspective. Treat digital tool adoption like any other IT project and don’t just look at it as a cost and schedule. The value it will bring to the company and how employees will use it must be explained and addressed within the project scope. This requires a process of employee buy-in as part of the project introduction. And if necessary, involve other departments outside of IT.

Understanding and budgeting for subscription services

Adopting digital tools inherently requires an investment of money. Subscription services, primarily in the form of software as a service (SaaS), dominate. Google Workspace, Microsoft 365/Teams, and Slack are all examples of enterprise subscription services. For subscription services, it is common to pay a monthly fee. Therefore, unlike traditional SI projects, the cost is centered on operating expenses (OPEX) rather than capital expenditures (CAPEX). If you need to create a new budget for your project, you need to fully understand these differences and prepare a plan.

The challenges of SaaS adoption and the impact of enterprise size

In the case of subscription services, it is difficult to customize them to suit your company because they are already standardized and used by companies. Until now, many companies have optimized their requirements in the form of SI to carry out IT projects. However, when using a SaaS subscription service, you have to use the service provider’s servers, let alone change the functionality. These differences make the whole process of adopting SaaS digital tools challenging. If your company is small and hasn’t yet established its own IT systems and infrastructure, you can get started without too much difficulty, but as soon as your company exceeds 100 employees, the complexity of stakeholders increases exponentially.

The importance of security and privacy

The first step is to integrate with your existing legacy systems for a seamless service. For example, automatically integrating a company’s organization chart and employee information. In most cases, the SaaS service provider does not do this directly, so the adopting company needs to integrate it separately according to the SaaS service’s specifications.

This kind of integration is easy. The hard part is security. If you’re a security-conscious company, you’ll have to go through a lot more trial and error. There are a variety of security issues that come with new tools, from document security to data leaks within the organization. Due to the nature of SaaS, these services don’t exist on your internal network, but on an external network. This means that all intellectual property created within the enterprise is stored in external storage.

This fundamental change in environment needs to be well explained and convinced to other stakeholders in the organization. While adequate security and internal controls are necessary, poor decision-making can prevent organizations from fully leveraging the benefits of SaaS and reduce the likelihood of project success. This means that the essence of DX can get lost in the shuffle of unreasonable requirements. So, whenever this happens, you should never forget to ask yourself, “Why do we want to introduce digital tools into our company?”.

Practical direction and employee training on leveraging digital tools

Adopting digital tools is all about changing the way you work. The changes that digital tools bring are bigger than you might think. Everything that was previously done in analog form or based on personal experience becomes digital and standardized. The centralization of all work processes within a company, making them available as corporate assets, is the hidden goal behind the adoption of digital tools.

As mentioned earlier, you need to provide your employees with guidelines for using digital tools in order to inspire change in their daily work. If your company’s culture is not accustomed to the digital environment, you should also consider training your employees. This shouldn’t be a one-time thing, but an ongoing process to ensure that working digitally is internalized.

Companies are already creating and distributing detailed workplace guidelines to employees even before they start a DX project, such as how emails should be formatted (subject line, content, etc.) or how files should be named when creating work files. If you’re using messengers, you might want to tell them how to distinguish between chats that need to be kept private and those that don’t, or that when editing documents in the cloud, they should always create and edit files in the cloud, not on their personal PCs. You can also include guidelines for forwarding files to links in the cloud rather than physically attaching them in emails or chat conversations.

Guidelines and training can also guide employees on how to create team spaces that align with the company’s organizational chart, how to operate channels when new project teams are created, and when to delete used online collaboration spaces at the end of a project. And while it would be great if all employees were proficient once trained, that’s not always the case, so it’s important to keep checking in with employees to see how well they’re utilizing digital tools, and to conduct internal assessments of utilization and retraining after a certain point, so that they can continue to build on their skills.

Leadership roles and strategic use of digital tools

More importantly, however, is the change in management and executives. The fastest way to spread digital tools is to start at the top. Of course, it’s harder for executives to adapt to an unfamiliar environment than it is for employees, but if you want to accelerate DX, their example is critical. For example, take meeting minutes directly in the cloud and share them with employees.

When creating slides for reports, I instruct them to communicate their opinions in the cloud, and I also check the reports written by workers and give them feedback with comments. Project schedules are also discussed in the project management tool, not in Excel tables or reports. Weekly reports are also discussed in the wiki or documentation in the collaboration space, not in a separate document. If executives or executives take the initiative to utilize digital tools, employees are bound to feel more nervous and try to use them themselves. That’s why we need to train executives separately.

The key is not to explain how to use the tools or what the guidelines are, but to focus on why they are using digital tools and what the business benefits are. It should be done in a way that resonates with them. It’s not about explaining that the times are changing and we should follow suit, it’s about convincing them that it’s a necessary step to get results. Explain how working in the cloud, giving and receiving feedback along the way, and having all information centrally managed will help improve productivity from a management perspective, not a functional or technology perspective.

And if you can explain how it helps manage the risk of employee transition and turnover, you’ll get a lot of buy-in. If you can explain how you’re sending files back and forth via physical email, but you can’t find the email, and you have to call back and ask them to send you the file, and even after the final report is created, it’s “final,” “final,” “final,” “final,” and so on, you’re going to get a lot of buy-in.

Don’t forget that digital tools are the first step in improving your employees’ digital capabilities, so don’t just focus on introducing them, but also on how to use them, what they can do for you, and getting buy-in from your employees, including management, is a critical approach to your DX journey.

Digital transformation starts with the adoption of digital tools

01/07/202412/05/2023 by DX Talk

Digital transformation starts with the adoption of digital tools. In this second installment of Digital Transformation Process: A Key Guide to Success, we explore the historical evolution of digital tools and their impact, changes in the post-COVID-19 workplace, and the impact of the proliferation of remote work on digital transformation (DX, DT, Industry 4.0). Learn how small changes that start with the adoption of digital tools can lead to big workplace efficiencies.

Historical changes in digital tools and their impact

There are many factors that have influenced the productivity of office workers over the years. If we had to pick one tool that has had the biggest impact, especially in the last 30 years, we’d have to say digital tools.

Let’s go back to the late 1980s and early 1990s. As PCs began to be utilized in corporate offices, documentation that had been done by hand or on typewriters went digital. Then came Microsoft’s Excel and PowerPoint, which not only changed productivity but also changed the way we work. We spent less time looking for information. Calculation errors were reduced as numbers were managed in Excel.

How communication has changed since the 2000s

The 2000s brought the internet. The change in communication represented by email was revolutionary: before, people used to communicate via landline phones or, if necessary, by mailing paper documents back and forth. But now, email is at the center of it all. Today, we are constantly sending and receiving emails.

The rise of mobile and workplace productivity

The proliferation of mobile environments in the 2010s also brought about a major shift. The shift from wired internet on desktops and laptops to mobile devices on smartphones has led to another boost in productivity. For example, email communication, which was once limited to wired environments, is now possible anytime, anywhere in the mobile era. There was a time when BlackBerry was the dominant smartphone in North America before iPhones and Android phones took over the market. The BlackBerry’s core feature was real-time messaging. Many office workers flocked to BlackBerrys because of their ability to communicate in real time. Now, mobile-based messengers, cloud services, and more have evolved the workplace.

COVID-19 and rapid changes in the workplace

The COVID-19 pandemic that swept the globe in 2020 changed the way we work even more rapidly. Conference calls and video conferencing, which were once only possible with expensive, dedicated equipment like Polycom and Cisco, have given way to mobile services like Zoom, Microsoft Teams, and Google Meet that are accessible to everyone. At the same time, telecommuting and remote work have become accepted as part of the workplace.

The rise of remote work and the importance of digital tools

We’ve been hearing a lot of talk lately from tech companies about increasing the amount of telecommuting and remote work. This is because they’ve found that employee satisfaction is high and productivity hasn’t dropped significantly, regardless of COVID-19. These changes are, in turn, driving the use of digital tools. Chat and video conferencing for communication, traditional email and calendar sharing, and cloud-optimized file sharing, document creation, and collaborative editing.

In addition, digital tools such as task management and project management tools for to-do and work management are not just being used internally, but also by partners and collaborators outside the company, and it has become difficult to work together without them. We started using Google Workspace (formerly known as G Suite) and Microsoft 365 as collaboration tools, and we started using Teams and Slack for communication.

Are these changes just a complement to remote work? They may have been triggered by remote work, but the end result is a fundamental shift in the way we work. Until now, we’ve been using digital tools on a case-by-case basis in the name of personal know-how. But after COVID-19, digitizing work became a company-wide task. Projects that used to be managed like a diary in Excel have become much more convenient and intuitive with the use of ‘project management tools’. This change has not only affected IT companies, but all companies regardless of industry.

Digital Transformation: Start Small, Make a Big Difference

DX doesn’t have to be intimidating. Just by digitizing the way you’ve been working, you can increase your productivity. Simply adopting many of the tools mentioned above can make a big difference. When a new employee joins your team, should they start by going through an orientation and being handed a bundle of shared documents by the youngest person in the department, or should they learn about the conversations, deliverables, and decisions that have gone into a project from the top down in a digital workspace like Slack?

If you’re comparing apples to apples, the answer is already clear. DX starts with changing the way people work. Changing tools changes the way they work, and everything they do leaves behind data. Another way to look at it is that it’s about increasing business continuity. As a result, you can take on bigger challenges like changing your business model. In this way, DX is about starting small, expanding items like a game journey, and dreaming of ultimate change.