Digital Transformation: 3 Phases Every Enterprise Should Follow

If an enterprise wants to have a successful digital transformation, it should follow a strategic plan or road map. Sometimes, that strategy may involve key pillars, or the entire plan might be divided into critical phases.

Hariharan Ugendran, a digital transformation product manager at Mindtree, believes that there are three phases that must be followed in order to accelerate a digital transformation. We spoke with Ugendran about the three phases, and current trends in the space.

Enterprise Digitalization: What are the three phases of digital transformation?

Hariharan Ugendran: The first phase is strategy and vision, which is where we measure the actual contextual risk. This is in terms of when you actually define the vision and strategy of the program, you need to be able to identify and prioritize the different digital enablers that you would want in terms of changing the business objective. What are these digital enablers which you think is essential for your business? You cannot just want the entire system to be changed, and you cannot do everything at once. You just need to pace it out. I think essentially, we need to identify those key enablers and then set up road maps for each of those enablers during the transition. You need to set the tone of the risk management at the design stage itself so that you will be able to achieve minimal disruption.

The second phase is the implementation where you've identified these enablers and you want to transform the tools and capabilities to deliver these services. I would say when you develop these technical stacks, you start to incorporate the digital enablers with respect to vendors, compliance, and security. Select the right technology for different business processes. You basically start to map these different technologies and tool sets, which is going to help you achieve your end vision. From an implementation standpoint, I would a start incorporating these risk assessing measures within the architecture itself. Also, bring in that mindset of the digital first approach. Rather than implementing everything and then saying that this is how it is going to function, start to inculcate that mindset within your stakeholders.

And the final phase is program management. We need to ensure cross functional synergy and that we eliminate risks arising due to these interdependent processes. There needs to be a clear understanding when you set up the governance within the organization. You need to identify the stakeholders and clearly define what is that risk that would arise, and how would you mitigate it. Rather than dealing with the risks later on, you know the mitigation measures and you are preparing for that.

ED: What type of industries do you see as leading the pack when it comes to digital transformation?

HU: Banking is definitely the forerunners in this. I think of banking in general is something that everybody uses on a day-to-day basis. I feel healthcare has done well, and since it's a highly- regulated industry, there is a lot of work that needs to be done. The potential is huge in healthcare. Defense is another industry where I think digital transformations are taking off.

ED: Who is driving the digital transformations?

HU: I see digital transformation a successful one when it comes from the top most level, which is from the CIO or CEO level. They need to feel it because if they are not ready to support this initiative, then I think it will break down in its course of time.

ED: What is driving digital transformation today?

HU: There is a large penetration of smart devices. A sudden change in culture where everybody has a smartphone, more customer expectations, and there is a change in demographics. We are dealing with millennials who are always connected through some sort of a digital device. To connect with the customer agent, it is important for organizations to understand the persona of its customers and cater them. I would say also the increase in the internet speed. When we were all dealing with a dial up connection, I didn't see a lot of transformation happening. Now with 4G and eventually 5G, I'm seeing a lot of change in terms of accessibility and in terms of data transfer. That is one driver. Also, the shift in the mindset of the people where we are all adapting to innovations and our inclination towards advanced technologies. I see these factors to be driving digital transformation. It all revolves around the customer.

ED: Regarding the three phases of digital transformation, which of those phases do you think presents the biggest challenge to enterprises?

HU: I would say the strategy and vision (the first phase) because that involves identification, people management, and knowing how much you want to spend. This is where you start to be the devil's advocate, and you start questioning the mission of why this is required. Go to a trade fair and you see all these options which are fancy, but do you really need that as part of your core business? When it comes to the core business, I need to understand if this is going to enable reaching out to my customer to improve the user experience.

ED: If an enterprise follows the three phases that you've described, what will be the final result?

HU: The final result will be that you have already made out the blueprint of what you are expecting. You'll know exactly the areas that you need to focus on in order to get a strong structure. Making an informed decision of what this transformation is going to be, and at the same time you are bringing in that culture of the digital mindset throughout the organization at a much earlier pace. As it is being set during the strategy and vision phase, it enables a smoother delivery and the adoption rate is amazing when you do this phased approach.