Digital transformation is providing opportunities for companies to enhance business processes and deliver products and services that might have been unthinkable even just a few years ago.
While much of transformation is driven by technology developments and initiatives, the responsibility for ensuring that companies take advantage of opportunities to be innovative and not lose out to competitors lies at the highest levels of the organization.
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"Starting with executive leadership, there needs to be 'tone from the top' and an expectation that innovation is a strategic driver for the organization," said Tyrone Canaday, managing director and global head of innovation at consulting firm Protiviti. That's the way businesses can remain competitive in today's marketplace, and also achieve top-line and bottom-line goals, he said.
The corporate culture of the modern enterprise should be to embrace change and encourage "failing forward," so that the organization can evolve and learn about new technologies and also identify growth opportunities and/or risks to the business, Canaday said.
Not all of this innovation needs to come from within, however. Many organizations are looking to hire outside of their industry or partner with innovative third parties to bring fresh perspectives, ideas, and expertise that can help spark internal ideation and creativity, Canaday said.
As organizations undergo the latest evolution in technology, business models have shifted to become focused on mobile channels, and more recently there's been an increase in voice-activated interfaces. What's driving this is customer demand.
"Companies need to operate where the client transacts, and need to be hyper-focused on the customer experience" to ensure that those customers will continue doing business with them, Canaday said. Increasing transactional volume and use of their products and services allows organizations to then pivot efforts to mining data sets, and to take advantage of technologies such as artificial intelligence and machine learning to gain deeper insights into their customers.
A key trend business leaders need to pay attention to is the adoption of Agile software developmentmethodologies. "With the rapid pace of innovation, organizations must be able to quickly develop and deploy incremental builds of new code," Canaday said. "This allows the business and IT to course correct in an accelerated fashion, and adjust to customer expectations with more flexibility and speed."
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It also helps to mitigate risks around over-investment in a technology project that's not going to deliver the anticipated functionality or benefits.
One of the major challenges organizations face as they digitally transform is maintaining senior executive advocacy for innovation projects. That's primarily because transformation projects are multi-year and complex, and the benefits might not be realized right away.
"Oftentimes there is high turnover in the key champions that support the change projects, which introduces additional complexities," Canaday said. By taking an incremental approach in which companies can realize tangible benefits through agreed upon metrics that are supported by data, they can make a business case that lasts for the duration of a project, he said.
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