Dirk Krafzig – Enterprise Transformation Circle / We bring companies together to share experiences, analyze pitfalls and develop best practices for your successful enterprise transformation. Fri, 16 May 2025 11:21:39 +0000 en-US hourly 1 https://wordpress.org/?v=6.8.1 /wp-content/uploads/2021/10/cropped-entrance_Logo_Kreis_blau-32x32.png Dirk Krafzig – Enterprise Transformation Circle / 32 32 Project Management Beyond Text Books /circles/project-management-beyond-text-books/ Wed, 08 Nov 2023 10:29:26 +0000 https://enterprisetransformationcircle.com/circles/project-management-beyond-text-books/ Standardized methodologies and frameworks offer a reference, but projects inherently entail a degree of uncertainty. The ability to deal with this uncertainty makes the difference between a successful transformation and one that fails to fully realize its benefits.

You may think that you can take a standard course or read a textbook to gain this knowledge. However, reality is often more twisted than academia can imagine. Therefore, the Circle provides a platform to discuss project management skills that are not covered in Project Management 101, such as partially agile organizations, cognitive agility, the “real” role of the product owner, the power of retrospectives and many other topics.

]]> AI and Data /circles/ai-and-data/ Sat, 12 Aug 2023 07:43:48 +0000 https://enterprisetransformationcircle.com/circles/ai-and-data/ The advent of ChatGPT could breathe life into the practical use of AI and company data for the first time. Use cases may include

  • Automated real-time decisions
  • Significant reduction of process costs and throughput times
  • Fact-based strategic management of the portfolio
  • Increasing the quality of end customer service
]]> Adaptive Product Owner Role /circles/adaptive-product-owner-role/ Sat, 12 Aug 2023 07:36:16 +0000 https://enterprisetransformationcircle.com/circles/adaptive-product-owner-role/ Most companies operate with a static role description of the product owner. This does not take into account that there is a lot of variability needed in the real world:

  • Involved people have different leadership skills and seniority
  • Different needs for distribution of decision rights between IT and business
  • Different business domains demand different degree of innovation and varying entanglement with other domains
  • Guidance of development teams must be matched to experience level
]]> Business Architecture Governs IT Change /circles/business-architecture-governs-it-change/ Sat, 12 Aug 2023 07:31:14 +0000 https://enterprisetransformationcircle.com/circles/enterprise-processes/ Enterprise process maps are a classic element of enterprise architecture. While difficult to set up and maintain, their benefits to the organization are manifold, especially in a transformational situation:

  • Understand and communicate one’s own business
  • Analyse strengths and weaknesses
  • Plan change initiatives and understand dependencies
  • Align business and IT
]]> Project Execution In Large Transformation Programs /best-practices/project-execution-in-large-transformation-programs/ /best-practices/project-execution-in-large-transformation-programs/#comments Mon, 20 Feb 2023 08:00:16 +0000 https://enterprisetransformationcircle.com/articles/project-execution-in-large-transformation-programs/

Transformation initiatives typically aim at ambitious goals such as maintaining a competitive edge or driving revenue and growth opportunities.

This article gives a summary of four chapters of the digital cookbook which explain how the ambitions on the program level can be broken down to individual projects.

Regardless of the concrete methodology any project undergoes several typical phases in a more or less iterative and dynamic way:

  1. Ideation: understand the value of what is being developed
  2. Development & Design: understand how the product shall work in detail and deliver its functionality
  3. Testing: apply quality assurance measures to ensure the proper functionality before it’s released
  4. Implementation & Deployment: put the product and processes into operation and make sure everything runs smoothly
  5. Evaluation: ongoing analysis of the results in ongoing operations

 

Implementing a project which is part of a large initiative requires a few adjustments to traditional project methodologies For example, traditional project methodologies can be limiting due to rigid planning structures and funding constraints.

1. All Projects Must Contribute To The Strategy

In order to achieve the goals of a large transformation initiative, its goals must be implemented via a sequence of smaller yet coordinated transitional steps in the form of individual business projects. Those projects must meet several criteria: Most importantly they must deliver results in a quick and agile way, and prove their strategic contribution at any time. Furthermore, the projects must be capable of reacting to changes and new insights on the level of the transformation program. In addition the projects must interact efficiently with many parallel projects and coordinate tasks and deliverables.

How do companies manage to find the best way for them when traditional project methods are often not suitable for meeting these criteria?

Let’s take a look at the different methods. For example, the so-called waterfall model emphasizes linear processes and cannot support the necessary speed and coordination required by simultaneously executed activities. While purely agile approaches may also have their limitations in supporting strategies or implementing innovation at the enterprise level, the ability to adopt agile into your digital project methodology is key to running a successful digitalization project. By pursuing planning as a series of smaller, reoccurring activities to ensure that the product or service can deliver on the highest business value, it can improve processes and performance, increase speed and team efficiency, elevate user experience and, above all, drive customer satisfaction.

In the article Modeling At The Project Level, we highlight in detail why we recommend dividing every important project into three phases, each with increasing granularity.

2. Start With Business Modelling

A method for iterative business model development is required. This starts at the highest level with the business model of the entire company. Since the business model is changing in the course of a transformation, the individual projects contribute to this comprehensive change. 

A suitable technique here is the Business Model Canvas (BMC) by Osterwalder [1] or the St. Gallen Management Model[2]. 

The BMC, which we will focus on here, enables a simple visualization and step-by-step clarification of an otherwise rather “cloudy” subject of discussion – the elements of a business model. 

The method is based on the concept of dividing a business model into nine core building blocks – customer (segments), value proposition, channels, customer relationships, revenue, resources, activities, partners, and costs.[3]

The BMC approach helps to systematically and structurally substantiate the business model and enables the evaluation of new ideas and their differentiation from the status quo. It shows competitive advantages as well as customer benefits and thus helps to estimate the potential success of a new business idea. The application of the BMC methodology is in line with the idea of an agile approach and can contribute significantly to reaching agreement on a “start set-up” for the business model discussion. The implementation scope is already well defined by the BMC and the “start set-up” can be used as a basis for further, more detailed specifications.

In the article Modelling Business Ideas we show how this technique can be applied in detail.

3. Service Modelling - Breaking Down Of Business Goals Into Business Services

In the next step the analysis becomes more detailed and the business services are broken down into discrete services using a service-oriented analysis. It is crucial to design manual as well as automated services with one common comprehensive approach. This avoids both a split between the analogue and the digital world, and between a business and an IT perspective. 

Ultimately, we want to ensure that the business purpose is decomposed into implementable components, both in the business organization and in the IT application landscape. 

The determination of the business service building blocks must be done quite quickly, using a light and agile approach in the first step. This requires an informal ‘whiteboard-enabled’ methodology that allows for seamless collaboration among different stakeholders.

Based on the functional target structure, once it is aligned within the enterprise, the IT services are modeled. This includes mapping onto existing or new back-end systems, data and security architecture, and message design. We recommend distinguishing between the layers ‘Front End’, ‘Process’, ‘Composition’, ‘Basic’ and ‘Back End’ due to different characteristics of artifacts within those layers.

With the help of various graphics, we outline the different steps and the detailed process in the Service Modeling article. 

4. Customer Journey Mapping: Maximizing Customer Value And Understanding Customers  

We have already learned that a “digital project methodology” is urgently needed for successful enterprise  transformations and highlighted that such a methodology must start with defining the business purpose and customer value. Having derived services, designed a service hierarchy, and discussed the importance of remaining agile in service modeling, we conclude the topic of digital project methodology and now go into more detail about the customer value already examined at the beginning of the process. As mentioned earlier, customer value is at the heart of the Business Model Canvas recommended for modeling the business purpose.

At this point of the project process, we devote our focus to the customer journey. The term “customer journey” refers to the comprehensive experience that the customer has with the offered products or services in all his interactions across all suitable interaction channels. It begins with the customer becoming aware of the offer, then exploring and comparing the offer, and finally selecting, purchasing, and using the product or service. 

To address the customer journey and also the associated emotions, we need to understand who the customer is in the first place and the context in which they interact.

Our article Customer Journey Mapping gives a description of the underlying concepts including – for example – the persona concept. We explain why this strategy brings customer and company closer together through new understanding conditions and why such a human-centered methodology fits perfectly with the concepts of design thinking.

Here you can find the individual articles:

]]> /best-practices/project-execution-in-large-transformation-programs/feed/ 2 Maintain a Consistent Fact Base Through-out the Entire Project Life Cycle /best-practices/maintain-a-consistent-fact-base-through-out-the-entire-project-life-cycle/ /best-practices/maintain-a-consistent-fact-base-through-out-the-entire-project-life-cycle/#comments Fri, 11 Nov 2022 14:59:11 +0000 https://enterprisetransformationcircle.com/?p=12354

Delivering the promised scope at the agreed time is the top priority for projects. But how do you deliver on this target? Of course, in some cases, a scope shift is justified and can be attributed to unforeseen changes to the project requirements – e.g., if market conditions or corporate strategy changes. However, it is important to realize that more often than you might think, changes to the project scope are not based on a deliberate decision but are due to a shift in the political balance of power, a lack of consistency, or insufficient planning.

This is an interesting phenomenon, which organizations seem to forget in the wake of project promises. Unfortunately, this lack of consistency often has little or no consequences for the people involved and is hardly ever noticed, although it can have severe repercussions for the enterprise and undermine its ability to execute midterm and long-term business strategies.

We, therefore, urgently advocate tracking key facts over the entire project life cycle, including major goals, high-level requirements, key architectural decisions, financial impact, and milestones. 

This may sound a little old-fashioned or even bureaucratic, however, we must accept a pinch of formalism to ensure the delivery of intended results and traceability. A change of direction should thus always be a conscious decision. Especially if you are using agile techniques to achieve maximum flexibility, it is imperative to track key decisions and changes of direction rather meticulously.

What Concrete Actions Do We Propose?

Document key project facts

Firstly, the documentation of the key facts must become a mandatory project practice. This is the basis for ensuring that all stakeholders can be involved in important decisions and that the work of the project team is comprehensible and verifiable for people outside the project team.

Make the documentation as lean as possible

Distinguish clearly between key facts and other documentation items. It is critical that the scope of the documentation is as lean as possible – e.g., comprising major goals, high-level requirements, key architectural decisions, financial impact, key facts, and milestones.

Select a language which combines precision and ease

Natural language is often not precise enough. When project portfolios get big, unstructured text is too unwieldy and doesn’t allow for tracking dependencies and causality. At the other end of the spectrum, typical IT people languages such as UML, BPMN or Archimate are too difficult for outsiders to understand. Therefore, you must find a fair compromise – e.g., a simplified subset of Archimate or UML combined with role-specific presentations like simple lists and tables.

Establish a centralized document storage

Provide one central location for storing and managing the documentation. Additional documentation can be placed in special repositories. However, the key facts must be stored together in one place.

Define governance touchpoints

Define a few simple governance touchpoints – also called quality gates. For example, “project candidate”, “project sign-off”, “planning” etc. The base for the reviews at these governance touchpoints must be the centrally stored documents.

Extend the documentation incrementally

Gradually expand the documentation from milestone to milestone. For example, assume that you have delivered project goals for the milestone “project candidate”. The next step is deriving business and IT services impacted by the project for the milestone “project sign-off”. Furthermore, use cases are a good level of abstraction which help clarifying the scope for the milestone “planning”.

Note: this approach is of crucial importance, especially in agile projects. Here, autonomous teams‘ decisions are guided by the strategic goals. In this regard, agile methods require a great deal of discipline.

Ensure full transparency

Make all documentation available for everyone. No secrets!

Educate your organization

Ensure that the entire organization can read, understand, and contribute to the documentation. This is where the simplicity of the underlying documentation language as well as the lean scope is important. You must ensure that the skills to handle the key documentation can be acquired in a few hours of training.

]]> /best-practices/maintain-a-consistent-fact-base-through-out-the-entire-project-life-cycle/feed/ 3 Agile Sin #1: Poor Processes /agile-sins/agile-sin-1-poor-processes/ /agile-sins/agile-sin-1-poor-processes/#comments Mon, 01 Mar 2021 17:10:33 +0000 https://enterprisetransformationcircle.com/best-practices/agile-sin-1-poor-processes/

You are not alone if you experience shortcomings and inefficiencies of processes in your work environment. For example, because the collaboration between departments is poor, co-workers lack the know-how, vendors are not appropriately managed, different stakeholders have diverging interests, or because of many other reasons. Interestingly, problems like that can persist over a very long time and even inherited from one generation of employees to the next. People tend to ignore poor processes if there is no simple way of fixing problems, and nobody is held responsible for the end-to-end process performance.

Situations like that have a severe, long-term impact on the health, morale, and efficiency of the workforce. Employees suffer from the high workload and unsatisfactory work results. In the perception of the employees, the company is not trying hard enough to solve the problems. They become frustrated and wearily.

Motivated by success stories like Spotify or Google first teams in enterprises start working agile. 

So, the way a company becomes agile often starts bottom up. The success of these first agile teams is based on agile frameworks like SCRUM, SAFE, or LeSS.

These frameworks guaranty a smart start in the agile world and generate quick results, e.g. quality improvements, or better time to market. This success is visible to the top management, and soon business agility is identified as an enabler to becoming more flexible to meet new market requirements. The board members initiate an agile initiative to introduce an agile framework in the whole company. They act in this way with the hope that this initiative will change the way of working more or less in the existing organisational structure.

We see several issues with this approach:

If you are lacking or – even worse – ignoring knowledge about inefficiencies, workarounds, and political disputes, you probably find their agile cousins popping up in your agile organisation.

But even if your processes are in good shape, not every process serves a highly dynamic market and must be changed to an agile approach. Sometimes it is sufficient to review the existing process and launch a new version with improvements to achieve goals like cost reduction, flexibility, or speed. Furthermore, other processes better stay as they are because they are given by customers and regulators, or constraint by law or other standards.

Why is it so difficult to fix process problems?​

What makes process improvements often so tricky is their impact on multiple stakeholders. A change that might satisfy one stakeholder upsets another. Changes may also have personal consequences, i.e. some individuals can lose power, control, or reputation.

In agile initiatives, there is another problem. The percipience of process management is very formal, often impeding creativity and pragmatic solutions. So, processes are not the priority when you start an initiative to introduce business agility. In addition, some agile coaches find it disturbing and cumbersome analysing the process landscape and their ugly details. They feel that it is their job to overcome the limitations of old-fashioned processes and therefore tend to avoid process analysis.

The blind spot of the agile textbook​

The agile manifest describes properties of agility, gives orientation on what behaviour has a higher priority and which one a lower. But it does not explain how the agile way of working looks like in a day-to-day business. To some extent, agile frameworks like SCRUM, SAFE, LeSS, or others fill this gap. These frameworks describe the agile way of working for a team or enterprise and provide useful definitions of roles and responsibilities. For example, SCRUM is very lightweight – it focusses on how one team should work in an agile manner. SAFE is made for the enterprise level. It delivers an implementation roadmap and gives some abstract recommendations about the target picture of an agile enterprise.

But no framework defines critical preconditions or even support from other disciplines if the preconditions are not met. 

So, every enterprise which is aiming at becoming agile must individually identify what preconditions must be fulfilled before starting.

And this is a critical blind spot of existing frameworks.

Recommendations​

We recommend defining a work package that analyses the process landscape and answers the following questions before or at the start of an agile initiative:

  • Is there comprehensive process documentation, and does it match reality?
  • Are there processes that are given by a third party, e.g. customer, partner, or regulator?
  • What is the volatility of the processes?
  • What are the external dependencies – e.g. interfaces to other organisations?
  • Are there known shortcomings in these processes?
  • Are there disciplines that must define the margin for an agile team that should be responsible for the considered process?

We recommend addressing potential issues right away. Otherwise, people will blame agile for poor processes.

Summary

Companies need to be agile because of rapidly changing market conditions. So most probably their processes change often and fast. Therefore, fixing a concrete issue of the company`s processes is desirable, but it does not increase the agility in the long run. The better way is to define what “properties and principles” the new agile company should fulfil. For example, when business units are weak in describing requirements accurately, one might want to formulate the principle that each significant step in a company process needs to have an agile team that is responsible for it. These properties and principles give guidance to every team member.

Another significant point in the process landscape is the block of governance processes. Agile teams should, and are strongly motivated to, work independently and take responsibility for their decisions. The question is whether or not an agile organisation needs governance processes. Some agile coaches say no. But is that really an option? Is an agile team able to terminate a contract with an important customer or their own mother company? Can an agile team ignore compliance requirements? Surely not! The need for governance in an agile organisation is as crucial as in organisations today. Cross-cutting teams like legal, compliance, enterprise architecture, and others have the responsibility to give agile teams a framework of guidelines and principles, consult them in all phases, and govern them if a team tries to deviate rules, guidelines, or principles.

]]> /agile-sins/agile-sin-1-poor-processes/feed/ 2 Chapter 4: Defining Digitalisation /digital-cookbook/part-2/defining-digitalisation/ /digital-cookbook/part-2/defining-digitalisation/#comments Wed, 01 Nov 2017 11:32:35 +0000 https://enterprisetransformationcircle.com/best-practices/defining-digitalisation/

Everybody seems to be using the term ‘digital’ today. Politicians are laying the foundations for the ‘digital revolution’, product companies have off-the-shelf-solutions for being a ‘digital leader’, and consulting firms can help you with the ‘digital transformation’. However, you hardly ever find anybody who can tell you exactly what ‘digital’ is; in fact, the term means different things to different people. 

At one end of the spectrum are the rather simple features, such as replacing paper. At the other end, ‘digital’ is a synonym for the transcendence of the industrial era. 

Therefore, it is unsurprising that there is no consensus on the definition of digitalisation in the literature. Every author either comes up with their own definition or avoids taking a clear standpoint.

In the remainder of this book, we use the term ‘digitise’ (or ‘digitisation’) if we’re talking about modernising something with a few digital ingredients, for example converting paper to a digital format. Most of the time we take a more far-reaching perspective and use the term ‘digitalisation’ as the beginning of a new era beyond the industrial age. Businesses in the industrial age have been characterised by automation, standardisation, mass production and enormous increases in efficiency. So, what are the characteristics of their digital successors? For a closer understanding of the change encompassing us, look at an ordinary family at the intersection of the industrial and digital age: observe that parents and children have totally different preferences for maintaining social relationships and communicating.

For example, parents are used to making appointments with friends a few days in advance. Their relationships are characterised by well-thought-out arrangements. Communication is driven by the necessity to negotiate those arrangements. Young people behave differently. They are used to digital media that provide information instantly, allowing seamless connectivity with all their friends around the clock and automating repetitive tasks. They are not in favour of long-term planning and multi-step processes, but instead decide ad hoc and at short notice. They are also less reluctant to change plans.

We believe this to be the most important attribute of the digital age: the intensive usage of digital means to change and enhance the way we maintain social relationships and communicate.

Correspondingly, we define a ‘digital enterprise’ as an organisation that makes extensive use of new digital technologies, such as social media, mobile connectivity, analytics or embedded devices, to fundamentally enhance or alter its relationship with all its stakeholders, including clients, employees and suppliers, and its interactions with them.

The following table depicts the critical aspects of this new digital relationship:

The digital relationships and the fundamentally modified possibilities to interact have profound consequences: digital enterprises deal differently with innovation and have significantly different processes, organisational structures and culture, and business models compared to traditional companies.

Accordingly, ‘digital transformation’ (or ‘digitalisation’) is the organisational process of changing an enterprise towards being a ‘digital enterprise’. This transformation process is initiated purposefully to change the enterprise, as opposed to a force of nature that just happens to the enterprise. 

This change is a fundamental one – it is nothing less than the reinvention of the enterprise, comprising its processes, organisations and business models. 

Such a substantial change is necessary to facilitate truly digital relationships with the enterprise’s stakeholders.

]]> /digital-cookbook/part-2/defining-digitalisation/feed/ 2 8.5 Embedding the CDO into the Organisation /digital-cookbook/part-3/embedding-the-cdo-into-the-organisation/ /digital-cookbook/part-3/embedding-the-cdo-into-the-organisation/#comments Tue, 31 Oct 2017 23:00:00 +0000 https://enterprisetransformationcircle.com/best-practices/embedding-the-cdo-into-the-organisation/

The CDO is driving comprehensive change across the organisation. While he or she is directly responsible for a number of key tasks crucial for the success of this transformation, the CDO also needs to interact effectively with almost all other departments of the organisation, typically in a matrix-style approach.

In order to drive forward the digitalisation agenda, the CDO and the CDO Office will work with the other CxO functions (see table below) for highlights of those interactions).[1]

Given the number and variety of necessary interactions with other departments in the enterprise, the CDO needs to act from a position of strength as regards the ability to influence the enterprise. 

We have elaborated on this in the previous section on leadership. As a manifestation of this position, the CDO must be given a seat on the Executive Board, so he or she can act on a level playing field with colleagues across all the dimensions previously discussed.

Detailed consideration must be given specifically to the interaction between the CMO/CSO roles and the CDO. As the CDO defines the core thrust of the future strategy and digital client experience, the CMO/ CSO functions should be brought into the CDO department. The same holds for the CIO function as the backbone of the implementation of the digital strategy. However, good arguments can be made for and against the construct of the CMO/CSO and the CIO reporting to the CDO. The actual choice depends on the particular situation in the enterprise.

It is also evident that the creation of this new role, with its multiple tight interactions with other functions, has the potential to trigger conflicts in the organisation. 

The leadership team must be aware of this conflict potential from the outset and develop the means to immediately identify, address, discuss and alleviate such conflicts as they occur. 

These conflicts are not anomalies, but rather are clear signs that the fundamental change stemming from digitalisation is actually transforming the organisation.

_____

[1] Hughes, P.: ‘The Rise of the Chief Digital Officer’, Deloitte Digital, 2015.

]]> /digital-cookbook/part-3/embedding-the-cdo-into-the-organisation/feed/ 3 1.1 Technology Enables Digitalisation /digital-cookbook/part-1/technology-enables-digitalisation/ /digital-cookbook/part-1/technology-enables-digitalisation/#comments Tue, 31 Oct 2017 23:00:00 +0000 https://enterprisetransformationcircle.com/best-practices/technology-enables-digitalisation/

The Cattedrale di Santa Maria del Fiore (also commonly known as Il Duomo di Firenze, or Florence Cathedral, Italy) is an extremely high calibre feat of engineering that transformed the engineering standards of the day. The dome of the church, nearly 150 feet across, was the largest of its time and remains the third-largest in the world to date. Interestingly, at the start of the construction project there was no viable technology to build the huge dome, which had been conceived architecturally, yet the highly ambitious project sponsors launched the project hoping that the right technology would appear at the right time to finish the dome. Their faith was rewarded – after a fairly long wait, they found Filippo Brunelleschi, who, using his great creativity and technical knowledge, engineered a unique solution that enabled the construction of the dome. The construction of the whole cathedral took almost 150 years.

This anecdote presents insights into innovation that are also applicable to digitalisation:

  • Strong commitment and desire in spite of the challenge, and perseverance with an existing legacy.
  • Organisational capabilities and a culture of learning and innovation that can handle change.
  • New culture of interaction among all stakeholders, including customers, partners and employees.
  • Affordable and readily usable technologies that allow rapid innovation and productising.

This section focuses on the last two of these points – i.e., how applicable technologies empower a new culture of interaction and rapid innovation relevant to digital transformation.

For many enterprises, especially legacy ones, digitalisation is both ambitious and transformational. Where should they go to find the technical capabilities they need? 

Should they have to wait a very long time, as in the Florence Cathedral project, and rely on hope and luck to realise their digitalisation goals? Fortunately, in modern times great advances in a variety of technology areas have produced an abundance of affordable technologies necessary for digitalisation.

All businesses have two sides – the demand side and the supply side. The most valuable link in the food chain of a progressive business is the customer who demands or gets excited by certain products or services, becomes eager to consume them, and feels happy to pay for them, thus ultimately driving business transformation. The customer belongs to the demand side. Innovation in an enterprise’s offering or operating model also needs adequate support in relation to how the products and services are realised, i.e., internal and external capabilities to source knowledge or raw materials and manufacturing – these belong to the supply side. 

Technologies relating to digital transformation deeply impact innovation in, and interactions with, both the demand and supply sides.

As the chart[1] displayed in the comic strip, most of the global population is now on the Internet, creating a highly connected network. Internet access is now very easy for most people and offers high bandwidth in most locations; availability of relatively cheap yet full-featured smartphones is also breaking down the economic barriers to rich mobile interactions between a business and its customers and partners. The number and variety of devices and sensors that are connected to and can be manipulated over the Internet (also known as the Internet of things, or the IoT) is on a sharp rise and is expected to reach 35 billion in less than five years. Human interaction over social media, facilitated by the ever-connected world and the events generated by and captured from the IoT and digitised business processes, are together producing enormous amounts of persistent and transient data in both structured and unstructured formats, expected to reach 35 zettabytes (1 zettabyte = 1 trillion gigabytes) by 2020.[2] Fortunately, technologies to handle such large amounts of data and to produce insights from them are also advancing equally rapidly.

This broad connectivity, together with rich mobility, has changed the way end customers expect to be reached and served by a digital business: marketing must have sufficient social media presence; time to market of new and improved products and services needs to be extremely short; consumption of products and services must be intuitive; the quality-to-cost ratio needs to be high; customer service must be proactive; and wherever possible companies need to become data-driven, gathering insights from traditional and big data, and making rapid decisions from such insights ultimately for the benefit of the customer, leading to competitive advantage.

Similarly, on the supply side, a digital enterprise must naturally adopt a very high level of automation, adequate mechanisms to quickly push useful innovation into production, and dynamic value networks with its partners and suppliers to deliver products and services efficiently and effectively. Employees must be digitally savvy and extra-responsive to customer feedback and needs.

An enterprise has available to it a range of technical capabilities to allow it to deliver on the customer’s expectations of a digital business, including: high-power and low-cost computing, storage, memory and networks; emergence of a wide variety of affordable sensors and devices; innovative user interface designs; advanced foundational and application software; big data and real-time analytics; and cognitive computing. The availability of technical capabilities over the Internet via fixed or mobile networks (known as ‘the cloud’) and a pay-per-use service model has essentially eliminated barriers to entry for the use of basic, standard and emerging technologies. With the IoT (i.e., connected devices), service requirements can be sensed and dealt with even before something actually goes wrong. And a cognitive computing platform with super-high-capability analytics, such as IBM’s Watson, which only a few years ago needed a million-dollar budget to gain access to along with expensive and hard-to-find specialists to set up, can now be used in an innovation experiment for just pocket money without any set-up requirements.

Of course, most of the above-mentioned technologies have been around for quite a while. 

So, what makes the present time particularly special for technology drivers of the digital transformation? It is their availability to everyone, and also their highly economic pricing – anybody who wants them can have them.

______

[1] Zickuhr, K., Smith, A.: ‘Who’s not online and why’, Pew Research Centre, 2013.

[2] Loshin, D.: ‘Business Intelligence – The Savvy Manager’s Guide´,Morgan Kaufmann, 2nd ed., p. 12, 2013.

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