What is Digital Transformation?

Why do we need to change?

Organizational structure are no longer fit for purpose

Technology and the industry-standard processes that govern them are locked in a Darwinian dance perpetuated for decades. As technology has become more complicated, so too have the controls. Mistakes can be inordinately expensive; we strive to avoid lost revenue, incorrect software purchases, and outages. We propagate a second vicious circle. As changes become riskier, we become more risk averse. We instinctively try to make fewer changes less frequently. Conversely, our changes get more complicated and even more difficult. The longer we stay locked in this battle of wits, the less agile we become.

Beyond our organizations, technology has now become ubiquitous. Your business is now wholly reliant on it to work efficiently for its success. The world changes fast, so we must innovate our technology products even quicker. In the example above, the business’ constraint to marketing its product more effectively is how quickly we can change the eCommerce website. ‘The company’ views IT like power and water, something necessary but not core.

Technology-selling organizations usually supply customer-facing products through separate but loosely integrated divisions. Most companies with over a hundred or so staff in their technology departments form smaller groups, sometimes organically, defined by roles rather than products. The IT division often has internal departments, such as the service desk, operations, development, and application teams. People in other non-IT divisions are often responsible for products and owning feature lists and roadmaps. They are then defined for the technologists to deliver.

We need to remove waste

The delivery process will affect its organizational, process, and product architecture. Interfaces in digital product architectures reflect the hand-offs between the teams responsible for their delivery and support, reflecting the level of communication between these teams. The same can be true for all the non-technological aspects of the product life cycle. These include product management, customer relationships (engagement and feedback), procurement, advertising, and marketing.

Siloed architecture teams, usually spread across different vertical structures, will create distinct architectures with hand-offs. We often develop architectures in isolation, with communication limited to a formal hand-off at the end of each iteration. We expect task queueing as we wait for the next architectural team to take on the design’s next phase. Any issues created upstream appear only when the next iteration is in progress. We can waste valuable time and effort as designs flow back up the pipeline for re-work. The same is true for other parts of the delivery chain. Consider the handover between Architecture and Development: it involves us scheduling a meeting in advance (taking weeks or months) for the developers to analyze the architecture presented by the architects. Then, an interpretation follows, coding the architectural flow into the application interfaces and data flows. These iterative flows are often inherent throughout our organization.

  • Procurement - fill out these forms, speak to this investment board, and wait
  • Technology selection - request a slot on this review board and wait
  • Supplier selection - fill out this form for commercial to do due diligence and wait

It is not that any of these activities are wrong - far from it. We must protect ourselves from unscrupulous suppliers, badly supported technologies, and spending too much money this quarter. But, our implementation of these controls, usually iterative, stifles agility and innovation. We need to find a better model of governance. People will find a way around these processes leading to one of two negative behaviors:

  • People subvert the controls (meaning they invalidate or bypass them). They tend to buy more products from the same supplier, locking us in and robbing us of marketplace innovations.
  • People fall into the tramlines and stop innovating altogether, completely stifling innovation.


We are trying to identify and eliminate waste within our system. By ‘Waste,’ we mean wasted time, effort, and money spent not delivering our products. Waste stands in the way of the flow of change. To improve our flow, we need to remove it. To understand what waste is, we must consider core and context concepts. The core is the activity directly associated with delivering the products. Context is everything else. While necessary, those HR systems, timesheets, and employee benefit programs are all contextual. The doohickey that everyone wants to buy and its delivery pipeline are core. Waste is all the time, money, and effort we spend away from the core. We will streamline our core delivery if we can identify and eliminate waste.

We need to find a way to break the cycle and create an agile environment whereby we can use innovation as an engine of growth in our markets and beyond.

When we look at the market leaders for digital products, they are usually the organizations that often introduce new features without negative impact. They stay ahead of the game. Successful market disrupters are the ones that bring a new model into the market and continually adapt it. Digital-speed IT is what we mean by creating new digital products or introducing change quickly.