THE CHANGE AGENT
To create and then maintain a competitive advantage, organisations must build a digitally resilient enterprise, modernise their business and embrace transformation.
Building a Digitally Resilient Enterprise
A global pandemic. Rising inflation. Supply chain disruption. Rest assured these won’t be the last disruptions businesses face. While the digital economy that delivers goods and services around the globe has changed lives for the better, it also puts more pressure on organisations than ever before. Disruptions in the flow of goods and services cost businesses time, revenue and customer loyalty. The brands that build a digitally resilient enterprise and can ride out the ebbs and flows of the market are poised to capitalise on disruption.
Building digital resilience goes beyond using technology to maintain or restore business continuity. It’s the ability of an organisation to evaluate changing market conditions, apply decision intelligence, fully leverage its digital capabilities and quickly pivot the business to capitalise on the new environment.
In short, disruption can be viewed as a threat or an opportunity. When the COVID-19 pandemic struck, companies that had invested in digital transformation initiatives were not only better prepared—they had an edge over their competition.
Cultivating digital resilience and modernising the business means upgrading legacy technology. That’s no easy feat. Legacy technologies and systems are deeply embedded into the day-to-day processes and workflows critical to running the business. There’s a lot to untangle. But it doesn’t need to be so overwhelming that it leads to indecision. In fact, organisations that fail to take action exacerbate the problems caused by technical debt, such as:
- User experience: Customers and employees expect seamless, personalised experiences with every interaction. Legacy technology and systems hinder the organisation’s ability to deliver these exceptional digital experiences.
- Costs: It can be difficult to account for the added costs of maintaining legacy systems. Some of the costs that get overlooked include the need for more specialised staff—particularly those with experience in dwindling skills like COBOL—to troubleshoot technical issues and the constant need to patch security vulnerabilities.
- Missed opportunities: Siloed systems prevent organisations from harnessing the true power of their data with AI and machine learning. Also, legacy technology lives in silos and invariably causes downtime. Customers who can’t make a purchase go elsewhere.
These challenges inhibit business agility and weaken the company’s ability to respond to shifting markets and changing buyer behaviours. To create and then maintain a competitive advantage, organisations must build a digitally resilient enterprise, modernise their business and embrace transformation.
Orchestrating for Agility
There are countless examples of how the pandemic accelerated business process modernisation and digital transformation efforts. A digital transformation strategy requires a clear roadmap. The companies that followed their plan created flexibility and resiliency so they could innovate and thrive through disruption. But, obviously, it’s not quite that simple—otherwise, every company could simply follow a plan and build digital resiliency. What is it that’s stopping them?
To start with, business modernisation is a massive undertaking. The definition alone can give one pause. According to Gartner, modernisation efforts address the migration of legacy to new applications or platforms, including the integration of new functionality to provide the latest functional innovations to the business. Modernisation options include replatforming, rehosting, recoding, rearchitecting, reengineering, interoperability, replacement and retirement, as well as changes to the application architecture to clarify which option should be selected.2
The thought of modernising the business tends to get very big, very quickly. The scope and scale aren’t something every company wants to tackle head-on. Organisations are aware of the need to modernise, but they don’t always know where to focus their attention. There isn’t a one-size-fits-all approach, but the most successful roadmaps include a focus on building agility and shaping mindsets.
The key to modernising the business and building digital resiliency starts with agility. The first step in achieving agility begins with leveraging data. That doesn’t sound revolutionary; organisations have been pulling in large amounts of data for decades. The key is that in the past, they weren’t really doing anything with it. Yes, their data teams could extract data from their database and create complex tables or charts, but they weren’t consistently applying AI and machine learning to generate actionable insights that optimised the decision-making process. They weren’t able to use data to sense and respond to changes in the market or truly understand what their customers want.
Take, for instance, the insurance industry, which has historically been predicated on brick-and-mortar storefronts—the traditional agent-on-the-corner models. Today, insurance firms use data to give them insight into improving the customer experience. The data they gather shows them how their customers’ buying behaviours—particularly millennial behaviours—changed. Customers want a digital experience. They want the ability to purchase insurance, modify coverage or submit a claim online. So, industry leaders pivoted the business to meet their customers where they are with digital solutions. They’ve created apps where customers can pay their bill or change coverage using their mobile device. In the event of an accident, customers can use their mobile devices to submit photos, expediting the claim process.
The insurance industry didn’t modernise the business overnight. Industry leaders looked at modernisation as a journey. They built a foundation for business agility. They found partners who collaborated with them to design a roadmap that executed the vision and delivered real business value.
As organisations navigate their business modernisation journey, they must continually evaluate progress and course-correct as needed. It’s critical to keep in mind that the ultimate goal of business modernisation isn’t to simply revamp processes or replace legacy technology. That might be an outcome, but it can’t be the ultimate goal. To create a digitally resilient enterprise, the organisation must think through how they evolve and optimise the business. Modernising the technology and rethinking processes are key components, but they must not lose sight of how they modernise mindsets and equip their people to transform. Achieving modernisation across all three areas—people, process and technology—creates a holistic, continuous transformation mindset that will future-proof the organisation.
Shaping mindsets and fundamentally shifting the culture are critical to achieving digital resiliency. The organisation must train itself to think differently. If your employees’ perspective is rooted in legacy systems, outdated ways of working and traditional behaviours, you’ll never fully transform the business. Employee mindset can’t be boxed in by the limited capabilities of your legacy systems. You must shift their mindsets and reimagine how your company tackles business problems to delight customers and achieve a competitive advantage. Ultimately, evolving the mindset of the organisation must come from the top.
Business modernisation must be a strategic, business-led initiative. IT is a key driver, certainly, but none of this works without a top-down approach that’s driven by the C-suite. Communications from leadership must clearly articulate the vision to encourage adoption. Leadership must model behaviours that demonstrate the mindset shift. And employees must be provided tools and training so they can hone their skills in a digitally resilient environment.
Every company, regardless of industry, is asking themselves how to do things better for their customer. How do they engage? How do they create better experiences? In other words, how well does the organisation sense and respond to their customers’ worlds? Modernising the business will enable digital resiliency and future-proof the organisation with a continuous transformation mindset that will enable the business to thrive through the next disruption.