“Digital Transformation” is lodged in every corporate and IT lexicon today – a “hot term,” as IDG InfoWorld Executive Editor Galen Gruman explains, that’s mentioned far more often than it’s understood. So, to boost that understanding, let’s do a bit of linguistic sleuthing and isolate just the word transformation: Look it up and you find Merriam-Webster and other dictionaries offering definitions around “dramatic,” “thorough,” “major” or “complete” change.
Now we’re onto something! Use cases of digital transformation demonstrate that success indeed comes only when companies mount a dramatic and thorough (or major and complete) reimagining of their business – not just IT, but everything about their organizational activities, processes, business models and workforce competencies.
However, I don’t think we can fully understand digital transformation until we realize something else: The phenomenon is happening everywhere – not just everywhere within a particular company – but everywhere in society, across all sectors of the economy and all manner of business enterprises.
The Analytic Mandate for Digital Transformation
Nowhere was this realization more evident than at a recent “Digital Revolution Summit” on analytics that Teradata co-sponsored with Forbes Magazine. In the course of just a single day in early October at a conference center outside San Francisco, our summit hosted a breadth of industries – from transportation and finance; to manufacturing, major league sports and even city government – as a measure of how virtually no sector remains untouched by digital transformation.
For the more than 150 analytics professionals who came to the summit – top data executives from companies like eBay, Uber, Wells Fargo, Facebook and American Airlines, to name a few – the mandate seemed clear: Our job is to connect the dots, identify client needs and bring solutions to market in time to make a difference for a wide range of customers in countless industries and continents. So how do we go about it?
Digital Capabilities… and Digital Leadership
One major takeaway I’d like to highlight is that digital transformation requires us to spend as much time innovating our processes and operating models as we spend innovating the technology itself. As the chief digital officer at one global networking company put it, rushing to innovate technology without also innovating underlying governance, roles and responsibilities leads to “institutionalizing dysfunction.”
This is especially important for large enterprises that may support any number of clients in numerous sectors; such clients are only as transformational as the digital partners they rely on. Success, as this global networking executive explained, requires asking up front questions like “Do we have clear alignment on business goals? What are the implications of where the business is moving? And how is technology going to be the enabler of this?”
When questions like this go unasked, companies can end up with expensive infrastructure built around outmoded business models. Unfortunately, not enough companies today have the C-suite acumen to think this way. Or, as industry analyst Tom Davenport put it in his keynote address, “You can buy digital capabilities a lot more easily than you can buy digital leadership.”
Analytic Fuel for a Global Phenomenon
Taken as a whole, our Forbes summit laid bare a raft of insights and challenges for the analytics community. We saw how analytics can optimize the customer experience; how to use algorithms to better scale your business; how data analytics is transforming the way city governments govern and grow. And – of course – we shared the Sentient Enterprise capability maturity model, which I’ve been advocating for some time, to enable agile decision-making for even the largest multinational companies.
On all these fronts, our goal is to leverage analytics for a digital transformation that is truly worldwide and all-encompassing. Indeed, an oft-quoted World Economic Forum report shows digital transformation is a global juggernaut on track to create $100 trillion in value over the next decade. In developing the analytics that fuel this transformation, we don’t just need to think big – we also need to think broadly across all sectors of society.