Digital Transformation

Atom Consulting

A lot of companies that approach Atom Consulting ask us “What does our company need to do to be innovative?” or “How do we become a digital company?”. These are great questions to ponder at a strategic level but when it comes to the transformation journey, we find that the real enquiry needs to start at a more fundamental level, around their business, their customers and their people. Understanding all three is essential to understanding the costs and benefits of digital transformation.

Transformation is not new, the sort of changes that we are seeing in the market today are similar to what has always occurred as new technology arrives. Think of the shifts that occurred around the Industrial Revolution, new technology automated and transformed whole industries. This also occurred as computers made their way into commercial use and the pace of both adoption of new technology and change continues to accelerate as AI and Machine Learning move from labs to practical application.

Types of transformation

Process - Application of technology to existing practices/processes increase efficiencies. Technology applied to improve workflow and streamline/automate existing work functions. The application of Mobile Banking Apps is a good example of the application of technology that changes the current processes, who has been to a Bank branch lately?

Model - This is the area that captures the most attention. When technology is applied to a whole business/sector to disrupt the existing business models. Companies like Spotify, Netflix and Uber are good examples of the application of scalable technology to transform business models. This also exists across many sectors where data and analytics is helping businesses understand customer needs better and leading to development of new digital access for customer and partnerships where businesses serving the same customers are teaming up. Mortgage providers and Real Estate Agents co-developing mobile applications.

Adjacency - Where expertise within a business creates the opportunity to expand into new/adjacent fields. Amazon, a transformative business itself, saw a growing need for cloud services. This early identification of a business need and their developed expertise in running data warehouses led to the creation of Amazon Web Services. A new line of business built from their customer needs and internal expertise. Alibaba in China is another example of this ecosystem embracing expansion. Similarly the recent application for a Digital Banking Licence by Grab (ride hailer) and Singtel (telco) is an example of building into an adjacency that is currently playing out.

This list is far from definitive but helps companies start to understand what transformation they are seeking. We see this typically evolve as, identifying a customer need, identifying if technology can help, quantifying the change and costs required, identifying the cultural awareness of staff to embrace the transformation.

The later point - cultural awareness is a crucial and often overlooked factor in driving the transformation of an organisation. Without a growth mindset and a framework to promote continuous improvement transformation projects often flounder, leading to low or negative benefits realisation.