What did you buy when you were looking for Digital Transformation Support?
by Brendan McLaughlin, on Apr 21, 2020 8:19:35 AM
Everyone is interested in Digital Transformation. Organizations want to provide a smoother, friction-less customer experience with the added benefit of lower cost. True Digital Transformation delivers breakthroughs orders of magnitude better than what it replaces. This is the frontier of value creation and it is much more than automating current processes. Furthermore, the opportunities for Digital Transformation continue to expand with new options created by innovations like cloud technology and artificial intelligence.
For most organizations, the results remain elusive. A Standish Group study shows that 63% of all projects fail to meet ROI, budget, or functionality goals and that 39% of all projects fail to meet all three of these objectives. Looked at another way, would you get on a plane with only a 37% chance of landing? According to a recent Forbes study, enterprises will invest $1.3 trillion in Digital Transformation initiatives and that $900 billion of that spending will miss the mark.
Obviously, there can be many and varied reasons for this, but I’d like to focus on the fact that many organizations don’t understand how to purchase the transformation support services and tools that they need. You can’t buy transformation – just like you can’t delegate leadership, but you can purchase the right methods, tools and support services. Emphasis on support, your vendor can’t transform your business only you can – but getting the wrong support services can kill a transformation program. This is more than an automation problem. If you ask for the wrong thing, you will likely get it. We see too many executive teams thinking transformation is a technical thing that they can buy or an effort they can outsource to a consulting firm – both are dangerously wrong.
Do you know what you are looking for?
One factor is that the options and opportunities are changing so quickly. Enterprise solutions are complex and major capital investments. People don’t lightly replace large enterprise systems until there is a compelling justification. The systems to be replaced may have been in operation for 20 or 25 years. A purchasing approach that works well for better-understood requirements (computers, trucks, etc.) isn’t a good fit for a rapidly evolving solution area. The organization may have no real understanding of what is practical and possible.
There are a lot of reasons for this:
- There is a saying that’s been attributed to Henry Ford “If I asked people what they wanted, they would’ve said faster horses.” People naturally frame their needs in the context of what they know.
- People self-censor. They don’t ask for what they think is out-of-reach, not realizing that much of their dream solution is in fact feasible and economical.
- Individuals defining requirements, “the experts,” may be threatened and defensively define the requirements to preserve their authority. They may not want to reorganize their function or their perceived source of power.
The dreaded fit/gap
When organizations are looking to acquire a new technology-enabled solution, it is common for them to issue a Request-for-Proposal (RFP) with multi-page lists of required functionality (“the requirements”), and for prospective vendors to make outrageous interpretations to say that they address those requirements. This information from multiple vendors is analyzed by a team, usually a hard-pressed team with other full-time jobs, into some kind of Fit/Gap analysis. This Fit/Gap analysis often does the organization a disservice. It’s too easy for vendor to say, “Yes we do that.” The Fit/Gap analysis is a blunt instrument that is too crude to differentiate approaches to selecting evolving, innovative solutions in complex business areas. The Fit/Gap is often the deciding factor in defining a vendor short-list. Remember, the group that defined the requirements may not have a good sense of what is even possible. The requirements were developed from a current perspective. Despite the team’s best intentions, they may not be asking for the right things. They may not be asking for enough. They may not be asking for the kind of synergies that will drive transformation and long-term benefit.
What road are you on?
There is another old saying, “If you don’t know where you want to go, any road will take you there.” A big reason that so many Digital Transformation efforts fail is that, despite the best intentions, organizations set out on the wrong road. They don’t have a clear sense of where they want to go and why? It may take months or years and significant investment before that mistake becomes apparent to the decision makers.
Digital Transformation is critical to your future and your future competitiveness. Traditional procurement approaches are not sufficient to select and plan the best path forward. At Accelare, we welcome the opportunity to discuss alternative approaches that help you and your organization to align your Digital Transformation efforts for maximum, transformative impact.
To learn more the Digital Transformation and how Accelare can help you to drive successful transformation reach out to Brendan McLaughlin at Accelare: Brendan.McLaughlin@Accelare.com