Too many aspiring digital businesses aren’t set up correctly for digital transformation. They’re organised in silos around traditional functions instead of having a flexible network of teams that work on transforming key business processes. The focus of many digital transformation efforts to date has been on the adoption of new technologies. But without first doing some organisational redesign, this has been like forcing a square peg into a round hole.
What does a successful organisation restructure look like? Which technologies and strategies will accelerate a company’s digital transformation journey next year and beyond? Dimension Data’s Technology Trends 2019 report explores seven key areas of focus for companies, with digital business playing a critical role. Here are five trends that will be dominant in the digital business in 2019.
Organisations will restructure to get ready for digital transformation
Many companies aren’t set up correctly for digital transformation. Antiquated job functions and processes have resulted in a real lack of flexibility. Encouragingly, we’re now seeing more companies accepting that to transform successfully, they must first redesign their core business processes around the customer experience and then reorganise the enterprise to align with these digital processes.
Not every company wants – or needs – a radical, non-hierarchical structure like some digital natives have adopted. Most, however, should start by adding a network of project-based teams tasked with transforming particular areas.
In 2019, more enterprises will abandon their ‘technology first’ attempts at digital transformation and embrace a ‘customer first’ approach. Consequently, successful transformers will focus on what their customers want; using data to understand them, innovating relevant offerings, redesign business processes, restructure the organisation around them, and – only then – implement enabling technologies.
IoT is starting to deliver ROI
After much hype and buzz, companies are finally starting to enjoy a positive impact on corporate profitability from their internet of things (IoT) implementations, and this upward curve will accelerate into 2019.
The kind of projects that produce a concrete financial improvement tends to be those that look at data through a new lens and apply IoT at multiple points in the value chain. The best business outcomes are obtained when you use IoT to monitor an entire business process and blend your own data with third-party sources.
The Royal Swaziland Sugar Corporation, for example, is using IoT throughout the process of growing, transporting, and processing sugar cane. This is increasing their efficiency at every point and improving corporate profitability. They use it to monitor the water levels in fields, rivers, and reservoirs – then combine this with remotely gathered data on crop growth and health. Weather forecast data is then used to consider the cost of the electricity required to pump water for irrigation.
Ready-made platforms are accelerating digital transformation
Accelerated digitalisation is achieved by those who don’t try to build everything bespoke, but rather exploit ready-made platforms that get them to their goals a lot faster. Platform adoption is getting more popular in the infrastructure space, due to the unpredictability of the digital world. Buying into a pre-built platform that can adapt quickly is increasingly preferred to building and owning your own.
Consuming information technology as a managed service not only increases agility and speed of execution, it reduces compliance and security risks. This allows organisations to pay for services as they use them. The research found that 60% of organisations are engaging in digital transformation through outsourcing and partnering, while a study by The Technology Industry Services Association reveals that technology-managed services are growing at 40%.
Barloworld Equipment and Handling decided to move their sales management capabilities from a standalone solution implemented 12 years previously to a cloud-based extension of its enterprise SAP platform. This not only increased the company’s ability to provide time to value for its customers, it was also a beneficiary of time to value itself.
Digital leaders are looking at data through a new lens
Old ways of looking at data aren’t cutting it. More of our digital transformation engagements with clients are starting with major data engineering exercises. A lot of data in organisations isn’t structured appropriately for analysis. They have data they don’t need, and need data they don’t have. They need to add new kinds of data from external sources to shed new light on their businesses, and they need to focus on different metrics.
B2B digital trading platforms are coming
One of the biggest growth areas in 2019 will be B2B digital trading platforms. Bill McDermott, CEO of SAP, predicts a world where customers connect directly into your supply chain, and it’s hard not to agree with him. The advantages, both in terms of customer experience and operational efficiency, are too exciting to ignore.
If you can show business clients not just current stock levels but the expected date of replenishment, they’ll be more confident about ordering from you. If they can give you better data on their future demand, you can optimise your inventory and production accordingly.
And future integration will go even further. Beyond today’s supply chain collaboration linked to ERP, we’ll see integration with CRM systems featuring artificial intelligence and robotic process automation. These will allow consumers to reach right back to your supplier’s inventory through their mobile apps. That’s a true digital business.