Digital transformation : Primary driver of business innovation
Digital transformation is defined as the integration of digital technology into all areas of a business resulting in fundamental changes to how businesses operate and how they deliver value to customers.
No longer are companies building software or running IT for cost savings and operations, but rather IT has become the primary driver of business innovation. Embracing this shift requires everyone in the company to rethink the role and impact of IT in their day-to-day experience.
Corporate re-think
Like digital transformation itself, budgeting for digital transformation requires a corporate rethink. The CEO must embrace the transformation as a business imperative. Transformational initiatives live or die based on C-suite commitment. Without enough funding, digital transformation is just lip service and nothing will be accomplished other than a bunch of presentations and erratic process changes.
Define the transformation story
Each “chapter” of a transformation story, such as an opportunity you've identified for automation, involves a series of processes to be executed. GIve each chapter a budget target. By breaking down the overall problem, organizations can develop a more manageable picture of cost.
Plan for flexibility.
While the overall timelines for digital transformation are longer than the planning for capital expenditures, the individual budget allocations should be done on shorter time scales with the ability to change and adjust as the transformation continues. For example, you'll probably change how capital is allocated across business units.
Highlight growth results.
As a business becomes more friction-free and automated, it is fairly easy to see the savings in terms of reduced headcount or less capital spend. However, you can only optimize so far. Successful digital transformations focus more on measuring added business value from new services, new delivery mechanisms, and the ability to leverage existing processes in new ways.
Reacties