Digital transformation, or DX, is considered to be central to all modern business strategies according to IDC, with an economic value of more than $20 trillion – the equivalent to more than 20 per cent of the global GDP. As the digital economy drives fierce competition, IDC also notes that direct investment into DX is valued at more than $8.2 trillion as businesses and industries transform.
In the report The 5 Conversations CIOs Must Have to Support Digital Business Acceleration Gartner outlines how the pace of DX has caused frustrations for CEOs, and the expectations that lie with CIOs to create new efficiencies and drive value.
However, as the report outlines, digital transformation should not be the responsibility of IT leaders alone. There are other roles across the organisation that will impact on the success of digital transformation including the CFO, CMO, Human Resources, the company board and any direct reports. Communication must centre on understanding the impact on each area of the business and building an action plan based on shared success.
Leading up to 2020 there were many predictions made regarding the pace of digital transformation, however COVID accelerated the pace of speed by up to seven years in some business areas, and organisations reacted to sudden changes up to 40 times quicker than expected.
One year on, Telstra commissioned research to better understand the state of digital transformation in a post-pandemic world. Our research found:
- 77 per cent of respondent decision makers have their DX strategies spurred by a desire to increase adaptability and accelerate the speed of change within their organisation.
- 64 per cent are focused on value creation through their DX initiatives to increase top-line revenue streams and to deliver personalised customer experience.
- More than 6 in 10 businesses increased the pace of DX and innovation projects as part of their top pandemic recovery priorities.
- And yet, the journey has only just begun – 55 per cent of organisations have yet to fully implement and activate their digital transformation strategy.
Telstra’s research also found that organisations lean towards digital transformation to enable rapid change within the business, as well as to improve cost structure and open avenues for new revenue streams.
What this means is that recovery was just the first step. Organisations have larger aspirations for DX and are rolling out initiatives in waves.
The DX balance that benefits everyone
Through all this, one thing is clear – there is no single driver for digital transformation, it’s an amalgamation of numerous goals, and organisations will have to balance priorities between internal change, cost management and value creation.
Businesses that are at a crossroads with DX implementation can look to a partner, like Telstra. We work closely with many of our customers at all levels of the organisation to help develop their strategies, and design and implement their transformation journeys.
At Telstra, we understand that DX can mean quite different things depending on the industry that you are in, and the role that you hold within the business - from C-level to the end user.
At the board-level, DX it is about transforming the business to achieve financial benefits from new revenue streams, productivity and process improvements, and creating market differentiation. For the most part, the technology is considered secondary and primarily acts as an enabler.
IT departments are focussed on the benefits of the technical solutions and their ability to support and deliver on the business objectives in a scalable, flexible and cost-effective manner. The technical expertise of the partner that is designing, implementing and potentially managing these solutions is critical to the DX program.
Those partners must demonstrate expertise in the technical solutions and understand how they are being applied within the business. Correlating these requirements is pivotal to success.
And finally, the people using the solutions will want to understand how these changes will impact their daily working life. Digital solutions must deliver ease of use and very tangible benefits and require strong change management to ensure that the business rationale is clearly communicated.
These factors tie back Telstra Purple’s beliefs on bringing purpose to technology and not just implementing technology with a narrow view.
DX can be a long program of work and is subject to changing internal and external influences. This means being flexible and agile in structuring these programs and being ready to adapt and move at pace to meet the changing priorities of businesses is essential.