Once a catch-all buzzword, "digital transformation" is now an impossible-to-ignore strategic underpinning of leading businesses. In fact, APMdigest made digital transformation a "hot topic" for 2017, recognizing that its importance will continue to grow as more and more organizations embrace it.
A relevant research piece about digital transformation was recently released by Alfresco Software, The Great Rethink: How Digital Leaders Are Building Tomorrow's Organizations. The report is based on comprehensive interviews of more than 300 senior executives at companies with annual revenues exceeding $1 billion, and it identifies common characteristics of high-performance organizations as they seek to establish themselves as digital disruptors in their individual markets.
Alfresco's research aims to "separate the winners from the losers," concluding that three key levers are typically employed by business and IT leaders when determining the best way to leverage technology to drive successful digital transformation:
■ Design thinking — leveraging a relentless focus on optimizing user experience and customer experience to guide all business technology decisions
■ Open thinking — encouraging innovation from both inside and outside the organization to drive new initiatives
■ Platform thinking — building an ecosystem of partners and customers that exchange capabilities and data to create added value through systems and solution deployment
Alfresco's research notes that the path to digital success is best realized by activating all three of these levers simultaneously.
64 percent of the report's "best-in-class" firms, those that excel across all three categories, report significant annual growth (defined by exceeding 10 percent EBITDA growth over the past three years) versus 43 percent of those still developing their capabilities across one or two of the three key areas.
Leadership Is Key
The research determines that CEOs must lead corporate digital transformation, with close to half (49 percent) of the fast-growing companies' digital transformation efforts being led directly by the CEO, versus 20 percent for all others. Digital transformation starts at the top, ideally with the CEO driving change and ensuring that the whole company is moving in the right direction.
According to Alfresco, fast-growing companies also excel at customer- and user-first thinking, with 85 percent currently having dedicated user experience teams. In addition, they commit to an open approach to the flow of ideas and concepts in their organizations, with 85 percent saying a commitment to open standards is "important or very important."
Finally, high-performing companies re-imagine their business models to incorporate support for a shared economy and platform thinking; in fact, 67 percent of these companies plan to significantly increase the capability for customers and/or suppliers to connect to them in the next three years.
The report confirms that digital transformation has truly taken hold in the corporate world and illustrates that today's digital economy is a case of "disrupt or be disrupted." The financial performance of leading firms bears this out. Digital transformation is not just a critical stepping stone to success – it can be the key to an organization's very survival.
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