Five imperatives to capitalise on greater digital transformation returns

As demands for seamless services and solutions continue to increase across the entire business theatre, competitive races are unfolding before us in every sector. Advancements in connectivity, shifts in end-user preferences, the ongoing pandemic, and the evolution of emerging technologies have very much concocted a ‘perfect storm’ in digital terms. While forecasting what awaits in the future, one thing is abundantly clear in the present – these happenings have dramatically accelerated the need to transform digitally.

Like all other regions, this applies to the Middle East, where companies have made sustained progress in this direction – demonstrating resilience, navigating the turbulent climate of late, and catering to those they serve. However, the success of some does not mean the masses have followed suit. As per BCG research, 70 per cent of organisations globally are falling short in their attempts to capture digital benefits and assert themselves in today’s developing landscape.

Admittedly, hurdles to overcome will become apparent down any digital transformation route, with complexities of varying severity. Even before the pandemic, reasons for shortcomings included improper direction, insufficient financial resources, inadequately equipped teams, problems acquiring talent, and flawed working processes and practices.

And fast-forward to today, the risks and challenges associated with digital transformation have multiplied due to recent events – customer expectations are rising, pressure from competitors is increasing, and securing the required personnel is even more difficult.

Despite these factors, though, there are also reasons to be optimistic. After all, there are many use cases, lessons, and inspirational examples from which organisations can build foundations for future digital transformation success – 30 per cent of companies worldwide are well on their way to achieving complete digital transformation – embracing new ways of working and positing themselves to capitalise on upcoming opportunities in the new digital era.

Therefore, the time is now for other organisations to re-evaluate their operations, and understand the fundamental principles of digital transformation, and take the necessary action.

Below are five imperatives to success that must be addressed:

1. Establish a digital governance framework
Setting up a dedicated digital transformation office with comprehensive procedures and oversight will equip and empower companies to pursue related activities with adequate guidance and leadership. In addition to ensuring executives and staff are aligned on directions being taken, such a framework will help establish important key performance indicators (KPIs), define ambition, and monitor progress. Moreover, creating a use case and programme portfolio that ensures objectives are met will be simplified, as will overhauling corporate activities that help drive transformation.

2. Embrace new ways of working
Streamlining experiences for internal personnel, external partners, and end-users hinges on new ways of working and sustaining them. If and when successful, introducing products and services faster and providing reimagined experiences will become a reality. To do this, companies should identify and prioritise the areas that need overhauling, initiate pilots to showcase the value of new methods, create standardised manuscripts and distribute them to all departments, and subsequently scale up their efforts by applying lessons learned.

3. Implement new technology
Companies should also prioritise veering away from legacy systems and transitioning to modular tech architecture to achieve digital transformation success. Devising and pursuing a tech roadmap in line with business targets, as well as a mitigation plan and decommissioning strategy, will be paramount. Furthermore, welcoming modern working methods and piloting the new delivery model will also be essential. In doing so, IT processes will be redesigned and cutting-edge capabilities freely accessible – with end benefits including greater agility, dynamic market adaptability, and quicker go-to-market timeframes.

4. Promote a new organisational culture
Digital transformation efforts will be significantly boosted with a digital-first mentality. Therefore, companies should introduce a new operating model and digital workforce strategy that ensures digital and innovation are embedded across the entire scope of operations. From senior leadership to new staff members, all personnel can come together collectively and elevate the organisation’s digital capabilities by embracing a new culture.

5. Utilize data and analytics
In the new digital era, data and analytics will be – and already are – invaluable components. By creating an analytics and monetisation agenda – and ensuring cohesiveness between an analytics operating model and individuals, departments, and objectives – companies can identify opportunities, achieve sustained revenue growth, monetise data, and unlock the full potential of data and analytics.

As organisations yet to achieve digital transformation success look ahead, it is undeniable that digital is the future – and companies fully prepared witness enhanced performance and far better results. By ensuring the above imperatives are addressed through the actions recommended, companies can finally begin to make progress and witness the full benefits of digital transformation unfold.

The top companies have already done so – and have never looked back. Now is time for others to do the same.

David Panhans and Kaustubh Wagle are managing directors and partners at Boston Consulting Group (BCG), while Shoaib Yousuf is a partner