In the third installment of our digital transformation series we’ll focus on the term digital disruption, and take a closer look at popular myths and realities of digital transformation.
What is digital disruption?
Like every umbrella term, digital disruption has many definitions that differ from each other in larger or smaller details.
- McKinsey describes this term as understanding how technology is transforming industries and how leaders and organizations can respond.
- For Deloitte, digital disruption alters the landscape of an established market, significantly changing the way businesses have traditionally operated. These disruptions force industries to adapt or risk becoming irrelevant, and can even lead to the birth of a new industry.
- Gartner sees it as an effect that changes the fundamental expectations and behaviors in a culture, market, industry or process that is caused by, or expressed through, digital capabilities, channels or assets.
Digital disruption flips the table in the industry and forces its players to respond, adapt, and in the best case scenario, use it to distance themselves from the competition. Chaos is a ladder – some may fall down, while others climb up to the top.
Digital disruptions – examples
- Electric vehicles (EV) – while being with us for longer than we think, the last few years is a steady rise of their popularity. The biggest car companies expanded their portfolio with EV. In the first three months of 2022, the number of registrations escalated to 60 percent even as the overall market was down by 18 percent, marks Automotive News.
- Remote work – pandemic only accelerated the already visible tendency for people to work outside their offices. Although some companies are already trying to convince people to come back to their cubicles, people like the idea of choosing to work remotely. This means the necessity to invest in distributed teams software, new approaches and frameworks to help them cooperate effectively.
- Streaming platforms – no wonder there are so many bets on video-on-demand it was dubbed streaming wars. Streaming companies fight for viewers’ attention with original content, exclusive features, and fan favorites, like The Office or Lord of the Rings franchise. As the market gets more and more saturated, the biggest players will try new things or resort to old tricks (like low-tier ad subscriptions).
- Artificial Intelligence – although it’s used basically everywhere, we’re still looking for new ways we can implement AI into our lives. Self-driving cars, Internet of Things, even generating art are some of the examples of the effort to implement AI into every aspect of our lives.
- Telemedicine – another sector that has greatly benefited from the pandemic. The ability to contact the doctor via mobile devices can help stationary patients in monitoring their health states, and ease those who are in need of a quick help with their flu or minor diseases. Combined with 5G and sensitive health trackers, telemedicine becomes much faster and more reliant, giving the specialist real-time health stats.
What are the causes of digital disruption and digital transformation?
Digital disruption and transformation myths and realities:
Change is about technology – myth
Digital transformation and digital disruption are holistic processes. Buying new software and new laptops isn’t enough. Focus on frameworks, work culture, and business goals.
Chief Technology Officer is responsible for the digital transformation – myth
This process requires cooperation between different teams. This means managing distributed teams and keeping them aligned to ensure the change can run smoothly.
Digital transformation requires a lot of effort and preparation – true
You can’t just jump into the digital transformation. Set objectives and goals, prepare the roadmap, pinpoint the potential positions to fill, set the budget and then you’re ready to give it a shot.
Digital transformation is similar to digitization – myth
Digitization usually refers to converting the already existing analog documents into their digital counterparts. It is, of course, much convenient, but doesn’t even scratch the lid of the whole digital transformation can.
Digital transformation is quick – myth
Haste makes waste. Prepare for a process that lasts at least a few months, if not years.
Digital transformation is interdisciplinary – true
Similarly to the CTO point, going through that process requires synchronized work with different departments. You can’t work with “new” IT departments having “old” HR or marketing departments.
Digital transformation isn’t only for big business – true
You don’t have to be a blue chip company to implement new approaches and tools.Digital transformation can be successfully implemented on a smaller scale too.
All trends can be predicted – myth
We truly live in interesting times. The world is getting more and more complicated and while we can predict some bigger trends, it often feels like guessing, especially in the long run.
Digital transformation is also about work culture – true
Focus more on the way your company function. Think about relationships, transparency and channels your coworkers and employees communicate with.
Digital transformation is a perpetual process – true
It’s impossible to pinpoint the end-date of the digital transformation. You can end the chapter or achieve the milestone only to find out you need to update and upgrade some already obsolete areas of your operations. Digital transformation is a marathon, you must be ready it will last long.
The role of hyper-connected optimization in digital transformation
What is Hyper-connected optimization? Digital Adoption marks four different definitions:
Gartner’s Nexus of Forces – the convergence of social, mobile, cloud, and information, major forces that drive today’s business scenarios.
HFS’s OneOffice – a 3-story back office: the digital underbelly, digital support functions, and digital processes. These functions connect to the digitally-driven front office, driven by social, mobile, data, and design.
SMAC and the Digital World – Social, mobile, analytics, and cloud offers another model that integrates digital business functions under a single hood. As the author speculates, SMAC is losing relevancy as new technologies emerge.
DARQ and the Post-Digital World – A recent Accenture report envisions SMAC’s replacement, DARQ, that stands for digital ledger technology, artificial intelligence, extended realities, and quantum computing.
All of this revolves around data and the need for the whole company to rely on the Single Source of Truth (SSoT) – a repository that gathers every important information for interested parties. No longer does each department work as a silo. Digital transformation and disruptions heavily relies on an interconnected effort. This way one may ensure that benefits of digital transformation are within the company’s reach.