6 minute read
Sep 28 2018

Three roadblocks of digital transformation

It is hard to serve customers in a rapidly changing competitive landscape. New technologies are the pivot of agility, scalability and customer experience. These days, every company is a technology company. The challenge for businesses is to recognise potential value propositions that spring from the arrival of emerging technologies. The trick is to identify opportunities before digital-native start-ups disrupt the market. Unfortunately, in many organisations legacy prevails over capital-intensive investments. This is how organisations outgrow their competitive benefits.

Digital transformation (DX) is a struggle, no doubt about that. Budget dilemma’s and the gap between business and IT are the main reasons organisations do not seem to get their transformation up to full speed. But not making it a priority, is not going to take away the urgency.

The advantages of embracing the DX economy are numerous; it is the road to a productivity increase, improved customer relationships, greater insight into valuable company data and the ability to quickly adapt to market trends. A smart approach would be to build business and IT strategy simultaneously. This would result in tight alignment, growth and a competitive edge. Frankly, for most organisations that is one big step to far.

Budget versus ROI

IT and business seem to be alienated from each other since the pace of change continues to accelerate. In many organisations IT budgets and legacy systems are not able to keep up with customer demand. To succeed in such a rapidly changing environment, businesses must be agile. The fact that business needs and delivered applications are not tied-up anymore, causes a contradictory significance. A bad bargain for any digital technology project. According to a PwC study, 35% of executives raise lack of collaboration between business and IT departments as the issue that is preventing them from the aimed results.

In this supply chain playing field the motives differ. Where IT departments are focussed on working within a framework of budgets, business lines act upon the return on investment of their purchases. To prevent that the business ends up with systems that do not fully meet the needs or are hard to administer, it is important both parties see eye-to-eye. Also to ensure that IT will base a decision as to whether it is more fruitful to build a custom solution from scratch or to use a middleware solution on a more customer centric level. Therefore, strategically, it is key to help IT become a profit centre rather than a cost centre.

Balance communication

As the previous paragraph sets out, IT and business lines have different mindsets. The effect this causes will be aggravated by their impaired communication, as if they are on different frequencies speaking a different language. For example, people from the business have difficulty in getting across the requirements, that are derived from the customer demand, in a way that IT people can understand. When IT departments actually do decipher the business’s needs and develop a solution, their staff might find it hard to get the complexity out of their presentation towards the business.
More and more disruptive new technologies and processes will keep on transforming businesses of all sizes and across all industries. To know whether there should be anticipated on market developments, it is important for business and IT to get at the same page. Another spoilsport in the collaboration is, that technology investments are not solely done by IT departments. According an IDC report purchases by business lines tend to grow faster than spending by the IT organisation, expecting this will be equal by 2020.
To ensure better communication, organisations should have people in place that understand both business and IT and are able to act as the connecting factor between business processes and IT systems.

Conquer legacy

The last but certainly not least roadblock of digital transformation to be underlined in this article is IT legacy. Often workforces are doomed to work with outdated systems, that are not on par with the current digital pace. The legacy systems contain a lot of useful data, but organisations struggle to communicate with new digital apps and systems. As a result, it is impossible to keep up with customer demand. Customer experience is not limited to a single application. It is spread across all applications.

Get rid of the old and build new? Not necessarily, not right away. Legacy systems often remain critical to day-to-day operations. Before implementing a new solution, organisations need to assess its potential. As revolutionary a technology might seem, it is important that it fits the distinctive business model. Another bump in the road could be that certain technology is not compatible with the current infrastructure.

A current emerging technology with high potential for digital transformation is robotic process automation. RPA can power an overlay at the frontend in the form of apps, websites or any other interface, by automating the processes behind it and get the right data out of the legacy systems in order to complete a certain process. An interesting technology for a digital transformation journey. Then again, it is crucial that this technology dovetails with the business model and the IT roadmap. But if it fits, the results can be amazing.

An example of successful RPA implementation is seen in the telecom industry with among others Deutsche Telecom. One of the involved parties is Another Monday, a high-profile newcomer in Forrester’s top fifteen RPA providers. They simplified complicated procedures for technicians by developing a single app and automating the jumble or tasks, that are now executed in the background interfacing with the different systems the technicians had to use before. Software robots have taken over the boring and time-consuming tasks, like exploring, searching, copy and pasting information between different systems here. A great example of how an relatively new technology can enable workers to do their job without any hassle and enhance the customer experience at the same time. RPA could be an organisation’s first step towards a digital transformation. If you can seamlessly connect applications in the back-end and replace the maze of legacy platforms with a single transparent interface in the front-end, employees are freed up to do more valuable, customer centric work. On the condition that mapping of the processes is done flawlessly, RPA also has a positive effect on accuracy and efficiency.

That said, RPA is just one of the amazing technologies of today. With the rise of artificial intelligence and machine learning technologies like these will become more and more intelligent. But remember, automation as a patch is never the ultimate goal. It is a starting point, that enables organisations to bridge the shortcomings of legacy systems. The higher goal should always be to challenge these shortcomings and create a technology backbone that improves business agility, efficiency and scalability.

Who is wrong?

Digital transformation stands or falls with mindset, communication and legacy solutions. There is no issue of who is wrong or right. Business or IT, from their own perspective they are both right. The perspectives just do not match. The solution comes down to connectors that align strategies, reunite mindsets and create mutual sympathy. The human connector as being someone that deeply comprehends business as well as IT, the technological connector as being robotic process automation. This way you can truly get the digital transformation up to speed within any organisation.



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