How to overcome the biggest handicap in digitalization

How to overcome the biggest handicap in digitalization

In my 15 years of working in different development roles in IT and digital services I’ve seen the evolution of maturity for both the client side, as well as the vendor side in digital business. Disruption has been driven by unexpected new players such as ‘born digital startups’ that base their competitive edge on digital approach to traditional industries.

Established companies have answered to that disruptive threat in different ways: hiring CDOs, building digitalization taskforces and recruiting teams of developers and designers. We have seen a boom of design driven digital agencies that build solutions that improve digital services and channels for consumers, while incumbent service providers and specialized companies strive to offer solutions to making companies’ internal processes and use of data more efficient.

A lot of investment has gone to this space that is loosely defined as “digitalization of business”. Currently we are seeing increasing demands on the return of investment in this space. Companies are redefining the role and expectations on digital teams and CDOs, and the relationship of traditional IT and core business.

Yet, from what I am seeing, the biggest problem still seems to be the lack or quality of dialogue between the digital teams and business stakeholders.

When I speak with business decision makers, more often than not I hear something along the lines of: “Great that you called! Could you come and tell us what our IT is doing and what this new platform can do for our business?”

On the other hand, the digital teams are making digitalization experiments that are not tightly enough connected to business case thinking or might (in the worst case) be completely off business decision makers’ radar.

Do not get me wrong though, open-minded experimentation is good. However, we need to be clear on what is the objective: Are we experimenting to provide measurable business benefits or competitive advantage – or are we just testing a technology or justifying the existence of an expensive digital team?

Getting ahead in the market and building competitive advantage is hard work. For both the business stakeholders, as well as the digital teams. I argue that it is actually more difficult from the business perspective. A well-defined digital project is the easy bit, but delivering the desired business result is harder, as you need to consider processes and culture too.

The solution is for companies to focus on developing their internal dialogue, metrics and business driven digital purchasing – and choose partners that can work within that framework to deliver business results from ideation to implementation.