What is a true digital enterprise?

A true digital enterprise is fundamentally more economically efficient than others that haven’t embraced digital technology

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'A true digital enterprise will integrate information, processes, work and people so that the entire organisation can collaborate more efficiently and effectively'

 

It is a misconception to think that investing in BYOD, cloud storage or big data analytics alone puts companies at the forefront of the digital revolution.

In a digital business, digital technology must be at the heart of what the business is doing and how it generates revenue, seizes competitive advantage and produces value. A true digital business will have a profound impact on the way individuals work and the way companies do business in the future.

Some businesses may think, ‘Haven’t we been a digital enterprise for over a decade?’ Well, no, probably not. Back then, companies with an e-commerce website would label themselves as a ‘digital’ company. However, as analysts Gartner put it, ‘A digital business is not the decade-old concept of e-business in a new wrapper. It is a radically different and more disruptive change.’

>See also: What does it really mean to be a 'digital business'?

Digital enterprise is a concept that is about changing the way organisations use and think about technology – moving it from a supporting player to a leading player in the business. However, it has become apparent that organisations are still not clear on a definition of digital enterprise, let alone a road map to become one.

Instead, we’re seeing everything from electronic sign-in and BYOD to cloud storage and big data analytics heralded as the disruptive change that is driving the digital enterprise revolution. But, a true digital enterprise is about more than just adopting singular IT programmes – it’s the fusion of these digital elements to bring about organisational change and drive efficiency and productivity.

Analyst firm McKinsey believes the best place to start in the digital enterprise transformation is for an organisation to understand the value that it can bring and then decide on priorities.

‘Firstly, they need to understand, really, where is the value of digital. Is it in marketing? Is it in sales? Is it in automating operations or a combination of all of those? Secondly, they need to prioritise. There are always too many things to do in the digital portfolio, and focusing on the ones that count is important.’

Overall, McKinsey believes the value of becoming a digital enterprise should be in reducing costs by replacing labour-intensive activity with software-supported activity, either through full automation or through improving the productivity of individual workers in their jobs.

Productivity is a huge concern for companies in today’s digital environment. Productivity gains at the end of the 20th century were much higher than they are today. In fact, the US Federal Reserve stated that productivity growth has been in decline during the 21st century and IT investment has not necessarily reversed this.

In Europe, productivity has stalled completely; some areas are even seeing productivity levels declining, which leaves economies facing the prospect of deflation. Business and operational models from the 20th Century can no longer scale to meet the exponential growth in information, activity and connections. Workers no longer have the scope or space to get work done as waste and ad hoc processes quickly destroy productivity levels.

One widely accepted view of the digital enterprise is that it’s about leveraging technology to gain a competitive advantage. But achieving and maintaining a competitive advantage isn’t possible if a business isn’t productive. Boosting productivity is about more than simply adding new processes here and there; instead, organisations need to reorganise how they operate and the way their employees work. The key to achieving this is by eliminating the waste of unnecessary paperwork and overly complicated processes by digitising and automating the way we collaborate at work.

>See also: What is a digital business and how can it make an organisation more agile?

A true digital enterprise will integrate information, processes, work and people so that the entire organisation can collaborate more efficiently and effectively, and therefore produce more valuable products and services. Tools designed to help productivity, such as enterprise content management solutions and process management platforms, can play a significant role in this transformation and will have a dramatic impact on our lives as knowledge workers.

A true digital enterprise is fundamentally more economically efficient than others. In a digital business, digital technology must be at the heart of what the business does and how it generates revenue, seizes competitive advantage and produces value. A true digital business represents a more extreme revolution than previous technology-driven changes and will have a profound impact on the way individuals work and the way companies do business in the future.

 

Sourced from John Newton, Alfresco