5 Key Steps on the Digital Journey
Building a Digital Enterprise Means Making These Transformational Shifts.
No matter your industry, organization or job role, digital technology is most likely transforming it right now.
Digital technology has the power to improve customer experience, increase employee productivity, wring out service inefficiencies, safeguard infrastructure, strengthen the brand and ensure a competitive edge. These digital experiences serve to unlock information and provide a more integrated and contextual view in order to give enterprises a more complete understanding of customers and transactions and enable better-informed decision making.
by Dan Hushon
In short, it's where the future lies, and C-level executives, board members, line-of-business managers and IT professionals alike recognize this. Organizations are now ready and willing to invest in digital technology, but many wonder: How?
We've identified five key technology shifts that enterprises in all industries need to embrace: digital applications, cloud platforms, integrated digital service management, software-defined networks and the digital workplace. Let's look at each.
1. Digital applications: Unlocking business potential
Innovative software is transforming entire industries, yet dated applications still hold back progress at far too many organizations. The solution? Digital applications that leverage documented, published interfaces and cost-effective computing resources.
Today's digital applications are assembled from information services via APIs. That means they can cross-integrate information from diverse sources — internal business units, external partners, the Internet of Things (IoT) — and deliver results “in context” to unleash value and improve outcomes. What's more, many digital applications can loosely couple to an enterprise's legacy software, unlocking the value of information stored in older, back-end applications in new and powerful ways. For example, organizations can consumerize their enterprise applications, delivering the software to both mobile and desktop users via internal self-service app stores.
Organizations that adopt these tools can make innovative changes, display high levels of agility and dramatically improve both their speed and precision. They can deliver innovations to market quickly, make full use of cloud and mobile computing capabilities, respond swiftly to the changing needs of clients and raise revenue while lowering costs. Digital applications are key to unlocking a business's full potential.
Cloud platforms: Enabling agility In a practice known as “shadow IT,” business leaders go outside or around the IT department to buy computing services directly from third-party suppliers. They do this because privately managed environments that were once state-of-the-art now hinder their ability to meet business needs.
Related: Journey to the Digital Enterprise
2. Cloud platforms offer a compelling alternative.
These on-demand resources provide nearly unlimited flexibility for businesses to satisfy multiple user groups. Cloud platforms free enterprises from the constraints of proprietary stacks of hardware and software. And, they create an environment where users can get immediate access to necessary resources, lower costs through automation and enable developers to deliver applications in record time. All this helps take the shadow out of “shadow IT.”
How can a modern cloud platform do all this? With shifts in these four areas:
- Infrastructure. The cloud shifts organizations from highly specialized and expensive servers to generic, repurposable, commodity hardware. This hardware is tied together with resilient, open source software that automatically protects and manages the environment.
- Management and operations. With the cloud, organizations can shift from highly manual to highly automated services. Self-provisioning lets business units request resources and build environments on demand, eliminating the need for IT to step in. Cloud platforms also enhance continuous application development and delivery.
- Workload management. Here, the shift is from a static approach to one that's elastic. Cloud-based workloads can be moved from one compute environment to another based on the policies or conditions detected when the workload runs. This helps systems strike just the right balance, providing needed computing resources without overcommitting.
- Application controls and context. Cloud platforms “get” key application performance characteristics, such as data governance and access policies. As a result, issues that have plagued IT for years are now managed and controlled by the platform.
Today's diverse and demanding end user community requires the access and resources the cloud platform can provide — and business can grow as a result.
3. IDSM: Managing the digital enterprise
Today's multisourced IT solutions have become too complex for traditional IT service management. A new approach, known as integrated digital service management (IDSM), is a forward-looking way to handle growing responsibilities.
In the digitally transformed enterprise, IT no longer stands alone — or, at least, it shouldn't. Instead, IT acts as a hub through which other business services are delivered. For example, in the past when the marketing department needed large-scale data analytics and Web support, it had to request those services — and often wait days, even weeks, for them to be delivered. Now marketing can get those same services more rapidly through a self-service IT hub.
That's powerful, but it also adds new requirements. Businesses that leverage multisourced IT delivery must ensure that they can meet the needs of those services. Narrowly defined contractual responsibilities and a tower-centric approach to service integration and management (SIAM) can hold IT back.
IDSM is the next logical step. This approach takes a holistic view of SIAM through the lens of DevOps and continuous delivery. IDSM focuses on the processes and responsibilities of parties to respond with shared accountability for requests and remediation.
Today's enterprise recognizes the need to mesh digital applications, cloud platforms and a modern IT infrastructure. IDSM can be the glue that holds it all together. With IDSM, IT departments can better manage complex solutions, lower their costs and risks, and deliver great value.
Related: The Digitization of Anne
4. Software-defined networks: Speeding the business
The classic enterprise network architecture is at a crossroads. Demand for network resources is escalating — and at the same time, companies find that traditional approaches to network design and implementation can't measure up to the ever-fluctuating workloads, changing load patterns, and new services and capabilities coming from outside the data center.
Software-defined networks (SDNs) present the solution. In an SDN, software applications can handle performance, service or cybersecurity issues proactively through a broad set of network- and network function-based controls to better serve the business.
Compared with the traditional diagnose-and-react manual process for application performance management often used today, SDN offers big advantages. For one, the network is no longer defined by its physical devices. Instead, the network extends from servers (with virtual switches) to mobile devices. At the same time, the network's role changes, from one of connecting devices to one of supporting applications — and with software-based controls, these changes can be put into effect in seconds rather than days.
SDNs also offer greater control over network traffic. The technology helps IT staff differentiate network access for users and applications based on qualifying metrics, such as user privileges and connecting devices. By separating information flows, IT can better deal with individual service interactions.
These next-generation networks will also have a profound impact on today's virtualized hybrid data centers. SDNs can shift an enterprise's approach to workload performance, IoT communications, mobile services and much more. It does so, in large part, by replacing rigid, hard-coded network properties with variables that are fulfilled at deployment. For example, if an IT department using an SDN identifies a potential problem, it can automatically prescribe a course of action to prevent any disruption of service.
In effect, the SDN not only provides an advanced level of programmability, but also changes how CIOs think about their information networks and overall service architectures. IT leaders can now design and provision networks to handle today's new business demands, connected devices, next-generation technologies and a multitude of modern services. That's a networked road to success.
5. Digital workplace: Fueling collaboration
It's easy to talk about the digital workplace, but actually creating one requires managers to adopt an “outside-in” perspective. This means acknowledging that innovation is no longer limited to the organization's four walls. It can instead come from just about anywhere — suppliers, partners, customers, even competitors.
In the digital workplace, workers can easily get the information they need to perform their jobs with speed, efficiency and effectiveness. And they can do so regardless of the information's location, format or underlying technology. So, how does an organization create a hyperproductive digital workplace? With four key elements:
- Simplified access to information. Employees must be able to access applications and information and collaborate with colleagues from various physical and virtual devices, both inside and outside the corporate firewall.
- A collaborative experience with centralized controls. The organization must enable controlled collaboration among employees, partners, customers and, in some cases, the general public.
- Enabled end users. Self-service tools can empower employees to request, install, configure and use applications when needed.
- Job-specific individualized experience. Employees must have access to the right tools and information for their roles, and the user experience should be individualized.
Because employees are among an organization's greatest assets, giving them the power to access information quickly and easily, to employ self-service techniques to get their jobs done and to collaborate with other talented individuals both inside and outside the organization can lead to business success.
CIOs can move their enterprise forward in the journey to digital by taking full advantage of these five transformational shifts. The steps may involve tectonic shifts for both individual organizations and entire industries. But make no mistake: The time to act is now.
Banking: Managing Risk
Bank CIOs face a dilemma. To stay competitive, they must invest in new “change-the-bank” systems that empower customer-focused finance. At the same time, they must continue to spend a large part of their budgets on day-to-day, “run-the-bank” operations.
So how can they manage the transformation? By starting with two important steps. First, bank CIOs can make changes that lower the costs of run-the-business operations. Then, they can shift some or all of those savings to innovative, change-the-business initiatives.
Next-generation IT infrastructures will enable banks to wring out savings from legacy IT architectures — the systems they’ve been building for decades — by as much as 50 percent of the run cost. These savings can then be invested in the customer-focused, digital technology that will drive future success.
Getting there will be a journey, one that begins with migrating from older systems and modernizing both off-the-shelf and custom applications. The next step is moving to new cloud-based platforms — key to lowering the percentage of total spending dedicated to running the business. Modern applications also set the stage for making innovations and improving customer experience for a competitive edge.
Healthcare: Getting Personal
The delivery of healthcare is becoming more collaborative and more focused on outcomes. A new approach, known as population health management (PHM), promises to help in both areas. PHM is a multistep process that involves first aggregating patient data across multiple IT systems, then analyzing the data into an actionable record and finally using that record to actually improve both clinical and financial outcomes.
PHM aims to keep the patient population as healthy as possible, minimizing the need for expensive interventions such as emergency room visits, hospitalizations and imaging tests. PHM can also lower costs, in part by focusing on high-risk patients who generate the majority of healthcare expenses. The technique also systematically addresses the preventive and chronic care needs of patients.
In most cases, PHM requires automation to help organizations better assess population needs and stratify populations based on geography, health status, resource utilization and demographics. Bringing IT to bear on these tasks saves time and money, making PHM economically feasible.
The shift to PHM also makes it possible to personalize patient care by adding context to data and distilling it into something actionable. In healthcare, there’s no shortage of data. But a shift to PHM can help providers put that data to better use.
Insurance: Managing Change
The insurance industry is under pressure. Clients used to mobile banking apps now expect one-click ordering and instant fulfillment from their insurers, too. At the same time, new competitors are entering the market from other industries, including finance, retail and automotive.
Insurers that understand and respond to these industry forces by embracing the shift to digital can seize new business opportunities, control infrastructure costs and lay the foundation for a more profitable future. The transformational journey will ultimately lead the industry to redefine its basic value proposition, going from a model of simple indemnification of loss to one that also includes education, prevention and continuous value for customers.
Insurers can adapt to the digital transformation by making three important shifts:
- From policy-centric to customer-centric. In the past, insurers stayed in the background until customers needed their services. Now, they can advise, educate and help customers reduce risk. In this way, insurers can establish customer relationships that are deep, ongoing and highly valuable for both sides.
- From data capture to data analytics. Strategic aggregation and analysis of data promises to alter the insurance value chain. By using existing data from both systems of record and external sources, insurers can develop a more complete picture of their customers.
- From manual to digital processes. Paper forms are making a long, slow exit, due largely to new regulations. At the same time, a growing number of insurance products, services and processes are becoming all digital.
Digital insurance promises continuous value and true customer engagement. Powered by new forms of data, analytics and automation, the insurance model of the future has the ability to help customers live better lives and propel an organization’s success.
Dan Hushon is CSC's chief technology officer.