Tuesday, July 5, 2016
WhyDigitalTransformationIsNotEnough
The role of technology in business has become a no less than fundamental in most industries. For decades now, market leaders have gone to great lengths to find or create technological innovations to build sustainable competitive advantages. At the same time, software companies have built lucrative businesses by continually developing new and incrementally better platforms to gain even more efficiencies for their business clients.
Our ability to harness and process huge volumes of data has increased exponentially. The tools and technologies at our disposal today eclipse in power what was in common use 20, even 10 years ago. For many companies, it has been a challenge to even keep up. The danger of this hyper-focus on digital transformation is that we lose sight of the overarching strategic objectives that led us down this path in the first place. Like the proverbial monkey who has his hand in a hole in the tree, full of nuts, but because his hand is full of nuts, he can no longer get it out of the hole. Rather than release the nuts and free his hand, he grasps the nuts tighter and pulls harder – loosing sight of the fact that his current decision-making is not accomplishing his overall objective – which is, of course, to eat the nuts.
In that same way, the overall objective of pursuing digital transformation is not to simply possess more data. It’s to enable more powerful insights that feed more powerful decisions and innovations that create huge business value and ROI. Technology cannot make decisions for you. Big data cannot make decisions for you. And the growth in an organization’s technical capabilities does NOT have a fixed, 1 to 1 relationship to its increase in insight. In other words, even though a company’s ability to crunch more data increases exponentially and the quantity and quality of the analytics that come from it increases likewise, it would be a mistake to assume that the level of insight and capacity to innovate will increase at the same rate as the increase in technical capability. That assumption overlooks a critical component of this important equation.