The Wrong Digital Transformation Strategy (and How to Avoid It)
Posted: Wed Dec 04, 2024 6:19 am
Although investments in Digital Transformation will continue to grow in the coming years – they are expected to reach $2.8 trillion by 2025 – very few companies manage to get it right.
Digital Transformation is not as simple as many think. First of all, it is not just about technology, as we have already discussed in this blog . Infrastructure and digital systems are key components, but there are many variables related to the organization and the user itself, such as the organization's culture, business results, governance, budget, content and, of course, vision and strategy.
Focusing solely on technology can result in organizations owning robust, modern solutions that are not geared toward business outcomes (therefore failing to achieve ROI). Similarly, not paying attention to technology will create a scenario where a potential solution does not have the infrastructure to scale properly, which will kill business growth.
Digital Transformation involves a very delicate balance of power. So what does it mean to take the wrong approach and how can organizations avoid it? Here are some of the most common misguided approaches we’ve seen across different industries and markets.
1. They rip and replace rather than leverage current cyprus business email list systems and investments to create value
Too much: Focus on new technology
What's missing: Focus on the organization
When it comes to Digital Transformation, companies often believe that a “Big Bang” approach is the way to go. After all, they want to reap the benefits of increased efficiency and agility. However, throwing out existing systems can do more harm than good.
Let’s face it. As a company, you’ve already made significant investments in core technologies and systems. Over the years, these systems and applications have developed and accumulated considerable value and business logic that can’t be easily replaced. In a way, it’s the heart of the company, but only a few can get to it.
Many Digital Transformation projects fail because, in order to modernize their applications and architecture, they rip and replace existing technology and workflows, breaking processes, weakening security measures, and jeopardizing revenue. Business continuity is at risk, and if not carefully considered, the cure can be worse than the disease.
So, to ensure lasting Digital Transformation success, you need to rethink how you leverage existing systems and investments. Modern approaches include REST APIs, service-oriented architecture, integrations, and digital experience platforms, which can breathe new life into your existing systems. Successful Digital Transformation is about being agile and methodical, while bridging the old with the new to deliver value to your workforce, customers, and external stakeholders.
2. Your existing systems bridge business logic and user interaction
Too much: Focus on technology
What's missing: Focus on the user
Legacy systems and ERPs typically have an architecture that links user interfaces (UI) to business logic – what is called a “monolithic” application. Typically, this type of software focuses on automating back-office processes rather than the user. As a result, changes are expensive and difficult to implement – not only do they require experts and specialists to make improvements, but they also limit what a user can do with the technology.
However, today’s challenges demand that companies be effective with their back-end systems. With 25% of all employees working remotely by the end of 2022 , having good user interfaces for business processes is what defines how productive a company is today. Companies are only as strong as their weakest link: if operations and logistics are key processes, their employees must be able to run, accelerate and scale with their tools.
Fail-safe Digital Transformation strategies offer solutions that decouple the user interface from business logic, making it easier to maintain, test, and evolve. IT teams can improve UX and address user needs without impacting back-end systems. This front-end autonomy significantly reduces the complexity of managing your systems in the face of changing customer demands and market conditions.
With 25% of all employees working remotely by the end of 2022, having good user interfaces for business processes is what defines how productive a company is today.
3. They deploy the best digital solutions without focusing on the entire ecosystem
Too much: Focus on technology
What's missing: Focus on the organization and the user
Implementing best-of-breed digital solutions might seem like one way to go about Digital Transformation. Yes, best-of-breed software tends to be built on the most powerful and modern technologies, so businesses feel confident that they are using the best tools overall.
But effective Digital Transformation isn’t about a single technology; it’s about building a dynamic, interconnected digital ecosystem that supports your internal processes, your people, your customers, and your suppliers. It should run like a well-oiled machine, but organizations often overlook the entire ecosystem and fail to achieve the desired return on investment.
We always remind our clients that the success of Digital Transformation does not depend on how specialized a single software is. There is no magic solution: it all depends on teamwork within your digital ecosystem. Orchestrating, managing and connecting your different technologies and tools with a horizontal approach is the way to achieve efficiency, quality and productivity. That, and developing the right processes for the future within your organization.
Digital Transformation is not as simple as many think. First of all, it is not just about technology, as we have already discussed in this blog . Infrastructure and digital systems are key components, but there are many variables related to the organization and the user itself, such as the organization's culture, business results, governance, budget, content and, of course, vision and strategy.
Focusing solely on technology can result in organizations owning robust, modern solutions that are not geared toward business outcomes (therefore failing to achieve ROI). Similarly, not paying attention to technology will create a scenario where a potential solution does not have the infrastructure to scale properly, which will kill business growth.
Digital Transformation involves a very delicate balance of power. So what does it mean to take the wrong approach and how can organizations avoid it? Here are some of the most common misguided approaches we’ve seen across different industries and markets.
1. They rip and replace rather than leverage current cyprus business email list systems and investments to create value
Too much: Focus on new technology
What's missing: Focus on the organization
When it comes to Digital Transformation, companies often believe that a “Big Bang” approach is the way to go. After all, they want to reap the benefits of increased efficiency and agility. However, throwing out existing systems can do more harm than good.
Let’s face it. As a company, you’ve already made significant investments in core technologies and systems. Over the years, these systems and applications have developed and accumulated considerable value and business logic that can’t be easily replaced. In a way, it’s the heart of the company, but only a few can get to it.
Many Digital Transformation projects fail because, in order to modernize their applications and architecture, they rip and replace existing technology and workflows, breaking processes, weakening security measures, and jeopardizing revenue. Business continuity is at risk, and if not carefully considered, the cure can be worse than the disease.
So, to ensure lasting Digital Transformation success, you need to rethink how you leverage existing systems and investments. Modern approaches include REST APIs, service-oriented architecture, integrations, and digital experience platforms, which can breathe new life into your existing systems. Successful Digital Transformation is about being agile and methodical, while bridging the old with the new to deliver value to your workforce, customers, and external stakeholders.
2. Your existing systems bridge business logic and user interaction
Too much: Focus on technology
What's missing: Focus on the user
Legacy systems and ERPs typically have an architecture that links user interfaces (UI) to business logic – what is called a “monolithic” application. Typically, this type of software focuses on automating back-office processes rather than the user. As a result, changes are expensive and difficult to implement – not only do they require experts and specialists to make improvements, but they also limit what a user can do with the technology.
However, today’s challenges demand that companies be effective with their back-end systems. With 25% of all employees working remotely by the end of 2022 , having good user interfaces for business processes is what defines how productive a company is today. Companies are only as strong as their weakest link: if operations and logistics are key processes, their employees must be able to run, accelerate and scale with their tools.
Fail-safe Digital Transformation strategies offer solutions that decouple the user interface from business logic, making it easier to maintain, test, and evolve. IT teams can improve UX and address user needs without impacting back-end systems. This front-end autonomy significantly reduces the complexity of managing your systems in the face of changing customer demands and market conditions.
With 25% of all employees working remotely by the end of 2022, having good user interfaces for business processes is what defines how productive a company is today.
3. They deploy the best digital solutions without focusing on the entire ecosystem
Too much: Focus on technology
What's missing: Focus on the organization and the user
Implementing best-of-breed digital solutions might seem like one way to go about Digital Transformation. Yes, best-of-breed software tends to be built on the most powerful and modern technologies, so businesses feel confident that they are using the best tools overall.
But effective Digital Transformation isn’t about a single technology; it’s about building a dynamic, interconnected digital ecosystem that supports your internal processes, your people, your customers, and your suppliers. It should run like a well-oiled machine, but organizations often overlook the entire ecosystem and fail to achieve the desired return on investment.
We always remind our clients that the success of Digital Transformation does not depend on how specialized a single software is. There is no magic solution: it all depends on teamwork within your digital ecosystem. Orchestrating, managing and connecting your different technologies and tools with a horizontal approach is the way to achieve efficiency, quality and productivity. That, and developing the right processes for the future within your organization.