Skip to main content

What’s holding up the transformation?

One cannot attend an enterprise technology expo without hearing endless talk about “transformation.” With almost cultish devotion, executives around the world speak in excited tones of the new era of technology that will yield faster application development, improvements in customer service, higher productivity levels and, of course, a fatter profit for shareholders.

The implications cannot be overestimated. We often hear – and not just from vendors – that a true transformation will change the rules of business while enhancing operations in marketing, sales, manufacturing, supply chain, customer service, administration and, well, the whole enchilada.

The trouble is, most companies haven’t even started. And that’s not good.

Transformation is more than this year’s buzzword. Cloud-enabled technologies will very likely move the IT department from a foundation of hardware to one of software. And with that comes a requirement that IT departments “transform” themselves from teams focused on maintaining on-premises datacenters to groups that launch cloud-based systems that delight customers and business colleagues alike.

Software engineers, application developers and data scientists are in hot demand amid promises they can spin up instances of new services in hours or days compared with the weeks or months associated with soon-to-be legacy technologies.

It gets better. The cost of operating your business in the cloud is bound to be significantly lower than the fortune required to build a traditional on-premise datacenter. What’s more, transformative technologies like Infrastructure-as-a-Service or Software-as-a-Service are financed out of highly flexible operations funds instead of the long-term capital expense budgeting required for the hardware-heavy networks.

It’s no wonder that 93 per cent of business executives surveyed earlier this year by the Business Performance Innovation (BPI) Network said that they are transforming their companies with the help of new, more agile technologies.

Learning to walk

However, a just-released BPI Network survey of frontline IT workers around the world shows there is trouble in paradise. The new study, which can be downloaded from Reinvent Datacenters, reports that most companies are failing or close to failing in their transformational efforts due to an array of problems with planning, staffing, funding and collaboration.

Here are some details:

• Just 15 per cent of IT workers said that their companies have a clear and detailed IT roadmap to guide them through transformation. The rest of them said that plans do not exist, need updating or provide only general direction.

• Only 18 per cent said they regularly meet with business colleagues for discussions in cross-functional teams, a critical step in identifying business priorities and technical solutions.

• Asked about their skills, IT workers confessed they are weakest in planning, application development, software engineering and data analysis – the very skills that they and their business counterparts say are requirements for a successful transformation.

These are serious issues, especially when you compare data from Europe, the Middle East and Africa (EMEA) with the rest of the world. In EMEA, just 11 per cent of IT organisations have a detailed roadmap compared to 18 per cent elsewhere. And just 5 per cent of EMEA technicians say their new systems are already up and running, compared to 9 per cent in the Americas and Asia-Pacific regions.

Clearing the hurdles

Nobody said the road to transformation would be easy, but the BPI Network report says that the end goals remain achievable for organisations that are willing to embrace a few basic rules. The alternative isn’t pleasant. The business world is rapidly dividing into two camps – the leaders and the laggards. The leaders will enjoy the fruits of transformation while the laggards struggle to close an ever-widening gap between them and those armed with better technologies.

So what can speed-up the transformation? Here’s what BPI Network thinks:

First, there must be executive commitment (read: appropriate funding) from C-level management. And the news has to spread far and wide through the company that the transformation is on.

Second, those very same execs must bring the tech workers and business managers into a room and tell them to document the specific needs of the business and the capabilities of the new technologies.

Third, those cross-functional teams need to come up with a plan, a detailed roadmap that will carry the company through the transformation and beyond.

Fourth, companies need to get creative in recruiting the IT talent they need. Can’t compete on salary? How about giving new engineers more freedom to innovate than they would find as a cog in a bigger company’s wheel? Or how about stressing the advantages of not working in London or Silicon Valley, where bigger salaries get gobbled-up by higher housing costs?

Fifth, the ultimate goal should be flawless execution of transformation strategies, with regular reviews of both the IT and business players based on business metrics.

Sounds simple, but few companies have been able to transform on their own. Almost all the successful corporations studied by the BPI Network have done it with the help of trusted partners who had been there and done that before. That was particularly true in Europe where a crazy-quilt of privacy and data security regulations add unwelcome border checks along the road to transformation.

Tom Murphy, Editorial Director of The Business Performance Innovation Network