One of the most invigorating projects I have worked on in recent years was helping Karl-Heinz Streibich, CEO of Software AG write his book, The Digital Enterprise. It conveyed his passion why every enterprise, irrespective of the industry or the geography in which it operates, needs to become a Digital Enterprise. The book included 22 guest executive perspectives and more than 300 innovation cameos representing more than 20 industries in more than 25 countries. Coca Cola Enterprises talked about how mobile technologies have reshaped their go to market, GE talked about its industrial equipment has become smarter with software and sensors, Daimler about next-gen factory concepts, Allianz about how analytics are reshaping insurance, Statoil about how digitizing has influenced safety think in the oil industry and on and on.
So, I was pleased to read a recent McKinsey article which says “digital transformation is uniquely challenging, touching every function and business unit while also demanding the rapid development of new skills and investments that are very different from business as usual. To succeed, management teams need to move beyond vague statements of intent and focus on “hard wiring” digital into their organization’s structures, processes, systems, and incentives.”
Contrast this with narrow focuses many so-called Chief Digital Officers are bringing to their enterprises. They focus on digital marketing or e-commerce or 1-2 potential areas of transformation. While that is necessary, it is often not sufficient. There are so many opportunities to digitize products, channels, shop floors, logistics, business models etc. So many legacy systems need to upgraded and integrated to. The portfolio of skills needed to build a vibrant Digital Enterprise is very wide.
I am reminded of the promise of reengineering in the 90s. Way too many companies ended up with small “r” reengineering – just implementing “best practices” in off-the-shelf software when they should have radically rethought business processes. We run a similar risk with expedient, small d, Digital Transformation.
I like what McKinsey says in that article - Be unreasonably aspirational.