Research from NETSCOUT revealed that around eight in ten IT and business decision makers believe digital transformation (DX) to be an urgent requirement for their organisations, with the average expenditure on transformative programmes expected to rise from 29 percent in 2017 to 34 percent in 2020.
Digital transformation is, by its very nature, disruptive, of course, and can lead to organisational and operational changes, affecting an organisation’s business models, its relationships with its customers, and the expectations of its partners. This disruption is further compounded by the fact that each member of the C-suite is likely to have a different view on the purpose and the logistics of the digital transformation programme.
CIOs, for example, will tend to be more focused on short-term IT services and delivery, and will therefore look to the cloud for greater capacity. CTOs, however, may concentrate more on using transformative technologies to promote a specific initiative, such as developing applications natively in the cloud to accelerate their delivery pipeline independently of IT.
It’s perhaps unsurprising then that, with varying responsibilities and perspectives in play, ownership and accountability will suffer. Indeed, a separate report found that while the majority of organisations have a formalised digital transformation strategy in place, only a fraction were found to have thought through all aspects up to full deployment, and that only a quarter had reported being able to reap the benefits of digital transformation.
This need for clear leadership was further illustrated by our research, which found that 93% of decision-makers has encountered business challenges when trying to implement transformative measures.
With several different players simultaneously staking their claim in their organisation’s digital transformation, there is a risk that the strategy will be diluted. There is a clear need, therefore, for a singular voice able to take a broader perspective on its overarching goal, whether that’s increasing business agility and intelligence to enable an existing business strategy to be more efficiently executed, or to devise an aggressive new strategy for market disruption.
Introducing the CDxO
The chief digital transformation officer, or CDxO, is likely to find themselves in constant conflict with the C-suite, the majority of whom are accustomed to focusing on their organisation’s near-term bottom line and operational efficiencies. CDxOs must be able to clearly and successfully deliver on a vision which may radically differ from anything the board has been used to.
It is therefore the CDxOs responsibility to conduct a business analysis, taking into account the market opportunities both current and new, and propose a strategic plan that will add significant value on top of the CEO’s original strategy.
The ability of the CDxO to communicate and execute this vision is therefore far more important than technical skills, as is the need for great influencing skills, business acumen and a proficiency in conflict resolution. Tools such as the cloud, big data analytics, artificial intelligence and machine learning, orchestration/automation, and the IoT combined with edge or fog computing, can all aid the CDxO in realising the vision laid down to transform a business.
A CEO may provide an initial direction for the organisation’s transformation, but it is the CDxO who will have to generate the digital vision of the future for that organisation.
A physical vision of the entire IT estate is therefore paramount, and only through complete visibility of an organisation’s networks will strong, robust service and security assurance processes come into their own. Through these processes, organisations will then be able to execute their own plans for digital transformation effectively, and innovate confidently.
Hiring, planning and monitoring
Given the importance of a clear vision, and of an objective, challenging voice, it’s crucial that a CEO appoints the right person as CDxO; rather than a “yes man”, they should instead hire a critical, independent thinker.
Having clearly defined the charter for this newly established role, the CEO should make sure the CDxO receives the support he or she requires to deliver on it. Corporate objectives and job expectations should be clearly articulated, for example, and the appropriate budget and resources made available. At the same time, barriers to transformation should be removed wherever possible, particularly objections and challenges related to conflicts with near-term objectives, raised by other C-level execs, and the CEO should be available to mediate any disputes that may arise along the way.
Working in collaboration with the CEO, the CDxO should establish a plan which includes key milestones such as creating a strategy outline, building a cross-functional digital transformation team including key board-level stakeholders, conducting business analysis, and providing recommendations to the CEO and the board.
Once the plan is finally in play, it’s imperative that the CEO and CDxO work together to evaluate the success of their combined vision and ensure that it is functioning effectively.
A successful digital transformation strategy depends on a combination of a winning business model, the effective leverage of innovative information technologies, smart data and – importantly – a rewarding customer experience. New metrics must therefore be developed to monitor the transformation’s progress, reflecting the impact of IT on business outcomes, operational efficiencies, and customer satisfaction.
By defining and monitoring clear and impactful KPIs to support their transformative initiatives, the CDxO and CEO will be able to gain meaningful insight into how their vision is being realised.
This insight requires visibility across the entire service delivery infrastructure, however, along with the ability to convert this visibility into intelligence in areas such as business analytics, service assurance and quality of user experience.
In an environment made up of ever more moving parts and dissenting voices, the introduction of the CDxO is a necessity. Without a clear vision, a CDxO will be unable to effectively deliver the digital transformation an organisation requires, and that vision will only truly be clear with the benefits of service and security assurance.
Sourced by Michael Segal, area vice president, Strategy, NETSCOUT