Digitalization is currently an important process in many organizations, aiming to increase efficiency and innovation. It is often seen as purely a technical function. However, can information technology play a strategic role in this transformation?
In collaboration with McKinsey, we gathered a group of IT managers representing various sectors to discuss the role of information technology in digitalization. McKinsey presented the Rewired framework, which streamlines the process of digital transformation for management (see the graphic below). The participants delved into the key elements, examining IT engagement in each and assessing the effectiveness of transformation-focused investments.
The discussion highlighted crucial issues in organizations that not only strive to keep pace but also aim to be leaders in the ever-evolving digital landscape. Here are our key findings:
Participants emphasized a significant gap between top-level management’s strategy and effective implementation of strategic goals and key results (OKRs) throughout the organization. Resolving this misalignment is crucial to ensure that digital transformation strategies permeate all organizational levels.
Organizations are increasingly decentralizing their technology function, entrusting it to different business units. According to the participants, the success of this model depends on strategic alignment and collaboration between the IT department and business units. Leaders emphasized that having a CEO with deep technological knowledge is a positive factor.
Furthermore, during the discussion, it was emphasized that having five or more leaders with technological expertise at the highest level significantly contributes to transformation success. One participant’s organization is already taking steps in this direction: they have implemented a training program for their top 200 leaders to enhance their technological preparedness. Participants recognized the crucial role of leaders with a profound understanding of technology in shaping the value plan and differentiating high-performing units from the rest.
Leadership capability in change is key
Participants stressed the importance of leadership capability in the digital transformation process. This involves dealing with the complexity of organizational changes, fostering a culture of adaptability, and inspiring teams to embrace new ways of working.
The discussion also highlighted the growing importance of automation and AI exploration directly related to improving office work efficiency. Participants acknowledged the challenge of embracing a “fail fast, learn fast” approach but unanimously agreed on the need to celebrate failures as opportunities for valuable learning and improvement.
IT function reshaping organizations
Many participants confirmed engagement with individual elements of the Rewired framework, but few considered themselves leaders in this process. This underscores the complexity and continuous nature of digital transformation, which requires constant adaptation in terms of leadership, culture, and technology.
Organizations are focusing on optimizing both customer experiences and operational processes, recognizing the interconnectedness between them in digital transformation. Success is related to the consolidation of process automation, artificial intelligence, and low-code software development within one organizational unit. Such integration allows for the synergistic development of digital capabilities.
The discussion also touched upon the evolving nature of ERP transformation, focusing on operational models and ways of working beyond purely technological aspects.
The conclusions from this discussion point to the multifaceted nature of digital transformation. Organizations that embrace modern technologies and recognize the role of the IT department as a key factor can better develop digital transformation processes.
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The source of the article is from the blog yanoticias.es