Today’s heightened competition is in large part the result of digital transformation. As such, boards now view the CIO as a strategic leader, one who can identify blind spots where digital disruption poses a threat and orchestrate transformation where digital business presents an opportunity.
As the stakes increase for a business to become agile, go mobile, move to the cloud, focus on actionable intelligence, and create an innovation-driven culture, etc., so does the place of the CIOs, and their teams, as strategic leaders who can deliver on these fronts.
Strong spending on digital transformation
Across the board, companies are spending to up their digital business game:
- The Altimeter Group recently completed a survey where 88% of respondents said their organization is already undergoing a formal digital transformation effort.
- According to IDC, 64% of enterprises worldwide are exploring and implementing digital transformation.
- MIT Sloan Management recently reported that 27% of senior executives rate digital transformation as a matter of survival.
- Gartner estimates worldwide spending by enterprises to design, implement, and operate the Internet of Things will hit $40 billion in 2015.
Digital threats abound
Digital transformation is wreaking havoc on business leaders across industries, toppling them at an unprecedented pace, as WSJ blogger Irving Wladawsky-Berger notes in his post Embracing Disruptive Change - Why Is it So Difficult?:
“The topple rate, a measure of how rapidly companies lose their leadership position, has increased by almost 40% since 1965. The tenure of companies on the S&P 500 was 61 years in 1958; it's now 18 years. If these trends continue, 75% of the S&P 500 companies will have changed over the next 15 years.”
While startups may have garnered the spotlight for their digital disruption success, established competitors are fast becoming the real digital threat. As reported in Digitalist Magazine:
- 57% of executives have experienced “moderate” or “severe” competitive pressure from established competitors’ digital products and services.
- 69% of business leaders anticipate digital-business threats from existing firms in the next 3 years, compared to 58% who expect challenges from startups.
Business process ‘quick wins’ key to sustaining digital business success
It is perhaps the vast scope of disruptive technologies – cloud, mobile, social, big-data analytics, coupled with their ubiquitous play throughout business, that tempts some CIOs to attempt a massive digital transformation – that takes years and millions of dollars.
But CIOs need not break their budget, or risk their necks, to achieve digital business success.
In fact, at NTT DATA, we advise our CIO customers to steer clear of comprehensive, bet-the-company, business model redesigns. Move quickly? Yes. Move strategically? Absolutely. But we advise doing so in a more focused manner that targets immediate threats and/or opportunities and delivers meaningful results quickly and continually, and with minimal disruption.
Select a core business processes and the applications that power it. Re-imagine this business process, end to end, against the backdrop of digital transformation. Redesign the business process leveraging cloud, mobile, and big data technologies to achieve measurable and meaningful business results. Repeat quick win.
Contact NTT DATA for more on how business process ‘quick wins’ ensure digital business success.