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Tag: digital leaders

  • The 2020 Digital Leader Priorities

    The 2020 Digital Leader Priorities

    When it comes to digital transformation, 2020 promises to be full steam ahead as many of the trends are already well underway. However, it’ll be those businesses that can execute at the quickening rate of technological change that will set the leaders and laggards apart for the years ahead.

    A survey conducted earlier last year by market research firm Vanson Bourne found that 50% of technology leaders have a challenging time managing their digital operations, and nearly 50% of respondents also said it’s their customers that identify problems before their technology and quality control teams do.

    Which brings us to our priority: Digital laggards need to step it up.

    Digital Transformation: Laggards Versus Leaders Packs Separate

    When enterprises shifted from their focus on e-commerce to a broader focus on their digital transformation efforts a few years ago, those who have been successful with their transformations are starting to reap results.

    Still, while the vast majority of enterprises do have digital transformation strategies that they are implementing, a Tech Pro Research report found 70% of respondent companies either had a digital transformation strategy in place or were developing such a strategy. While a separate study, the Kony Digital Experience Index Survey found a strong indication that those efforts aren’t paying off as well as many businesses may like—at least when it comes to their customers.

    According to Kony’s survey, customers are more satisfied when their digital experiences are effortless, and 63% said they would spend more money when their digital experiences are, in fact, effortless. That study concluded that businesses are not listening to the needs of their customers because only 28% of enterprise digital transformation initiatives are explicitly started with customer needs as the priority.

    The 2020 Priority: CIOs and chief digital officers are going to have to ensure that their organizations can execute against their digital transformation strategies. Those that create superior digital experiences are going to start to set themselves further apart from their laggard rivals dramatically. Those CIOs and CDOs at laggard companies are going to have to focus on turning themselves around as quickly as they can.

    The Continued Rise of Robotic Process Automation

    To advance their digital transformation efforts, most enterprises are increasingly turning to robotic process automation (RPA) and software bots to automate any cumbersome and costly manual processes they have in place. While the benefits of RPA and software bots are high, they don’t come without potential danger. These bots, if not managed properly, can open enterprises to increased security and regulatory compliance risks.

    The 2020 Priority: Effectively govern the security of their software bots so the associated risks are mitigated, and they can reap the most significant benefits from RPA.

    Low-Code Development Continues to Help Clear App Backlogs

    The demand for software is relentless, while the availability of professional developers isn’t limitless. And most enterprises have a backlog of application requests they can’t clear. According to a report from OutSystems, currently, 41% of enterprises use low code platforms, with an additional 10% about to start. That was up from 34% in the prior year report.

    Low code development platforms are popular because they help to make software development more accessible to non-developers by creating development more graphical. The low code development platform market is expected to grow to $27.2 billion by 2022.

    The 2020 Priority: focus on low code platforms for business users where it makes sense for them to be able to create their applications and capabilities. Not as a way to displace the development team, but to augment until those applications that warrant development and require professional developers can be built.

    AIOps Starts to Meet Its Promise

    As enterprises increasingly run their business-technology systems on a mix of clouds (both public and private) as well as on-premises systems, managing this infrastructure has grown more complex. The embracing of microservices, continuous delivery and DevOps has enabled organizations to deliver application enhancements more rapidly, automate testing and deliver their software with increased agility. However, interdependencies and the complexity of systems have also increased. This increased complexity shortened the amount of allowable time necessary to resolve system issues.

    When it comes to effective operations management, operations teams need to become as effective as possible since a breakdown anywhere in the environment can initiate thousands, and alerts can create multiple application and service disruptions.

    The 2020 Priority: This increased complexity will prove a catalyst for more enterprises to turn to AIOps. By using data gathered from operations management tasks with machine learning, organizations can become more effective at managing performance and availability and service management. AIOps has remained a buzzword for several years now, with very few actual deployments. That’s set to change.

    Optimizing Microservices Architectures

    Enterprises face a seemingly limitless demand for applications–customer-facing apps, back-office applications, APIs and digital services–and this demand has been a significant catalyst behind the popularity of microservices architectures.

    Microservices also help to ease budget constraints. Almost every survey shows microservices architectures are now in use by the majority of organizations, with benefits being cited, such as improved employee efficiency and customer experience, as well as infrastructure management. Microservices architectures also help enterprises to improve application scalability and bring new digital products and services to market more quickly.

    The 2020 Priority: Identify where microservices architectures can have the most significant impact on revenue-generating processes and prioritize the deployment of microservices to these areas first. It’s these areas where workflow improvement and application agility can have the greatest business impact.

    Looking out at a new year and imagining the possibilities is always exciting, but with the accelerated change in enterprise technologies and the level of digital transformation underway, this year is setting itself up to be more interesting than most.

    — George V. Hulme

  • Many CIOs Left Out in the Cold, Survey Finds

    Many CIOs Left Out in the Cold, Survey Finds

    While many enterprises realize that the very success of their business depends upon how well they invest and execute in their technology deployments, a full quarter of CIOs don’t have direct access to their company’s board of directors. This was a finding from the recent “ITWeb Brainstorm CIO Survey.” The 2019 survey was conducted August through October and captured input from close to 200 CIOs.

    While a quarter of the CIOs surveyed said they don’t have direct access to their company’s board, more than half did say that they report to the CEO and half do have a seat on their board.

    Those results indicate that at least half of enterprises realize the importance of enterprise technology in their future.

    However, when it came to public sector IT, those CIOs expressed that their organization perceives IT as more of a technical support role than as a strategic business partner.

    The survey also found enterprises have significant work to do when it comes to their digital maturity. According to the survey findings, 54% of respondents self-reported as having a “basic” digital maturity. While 38% self-described their digital maturity as advanced, and only 6% as fully mature. That could explain, at least partially, why CIO respondents in private sector businesses said their organizations perceive them as a strategic business partner.

    How do CIOs say they spend their time? Forty-seven percent said they spend their time digitizing processes, while about a third of respondents said they spent their time discussing strategy with business leadership, security/risk management, governance/compliance and developing new products and services.

    When it came to what is holding back their efforts, the CIOs cited the following in order of importance: lack of skills, conflicting stakeholder priorities, unrealistic expectations around delivery, legacy constraining new developments and low budget. So it’s no surprise that 55% of respondents said their organizations are actively seeking new skills, while only 13% are not growing new talent.

    The survey also found that respondent IT budgets are outpacing core price inflation and those budgets are targeting cybersecurity (63%), data analytics (47%), ERP and core applications (44%), network infrastructure (40%) and automation/RPA (40%).

    What is so surprising with these findings is that only 36% of private sector organizations have an IT budget for innovation (only 15% for public sector organizations), and 17% of private sector CIOs said that they don’t have any time for innovation as they are too busy supporting their current systems. That figure leaped to 39% for the public sector.

    In today’s era of digitization, that’s not a tenable situation for enterprises that want to succeed and thrive. Our recent post, “CIOs See Dramatic Change Ahead,” covers the results of a 2019 Harvey Nash/KPMG CIO Survey, which found those organizations where the IT team is formally involved in business technology decision-making have better business outcomes.

    Also, according to that survey, those enterprises that consider themselves to be digital leaders outperformed in many categories including the time to market, customer experience, revenue growth and profitability in the previous year. Digital leaders were found to be more likely to introduce “major new changes to products and services” in the next three years and focus on profitability.

    When considering those findings, it’s clear maintaining legacy business-technology investments just isn’t good enough.

    — George V. Hulme

  • CIOs See Dramatic Change Ahead

    CIOs See Dramatic Change Ahead

    Driven by heightened competition and a rapidly changing business environment, many enterprises now find themselves faced with decisions that could make or break their future.

    Consider this: Within three years, 44% of respondents to the 2019 Harvey Nash / KPMG CIO Survey expect to fundamentally change their product, service offerings or business model. It’s a finding that spans enterprises both large and small, the survey said.

    This could explain why IT leaders reported their technology budget to be increasing the most in 15 years. The report found 45% of respondents favor budget increases for money-saving technology efforts, such as task automation. Interestingly, almost two-thirds, or 63% of organizations, report that considerable amounts of their enterprise technology efforts are managed outside of the control of their IT department.

    However, the survey showed those organizations where the IT team is formally involved in business technology decision-making have better business outcomes. These enhanced outcomes include improving new product time-to-market and employee experience to be better than their competitors. Still, four in ten companies are not formally involving IT in those business-led IT decisions.

    Increased investments in automation and artificial intelligence (AI) are expected to place considerable churn on the workforce. CIOs are expecting to witness one in five jobs being replaced by AI/automation within the next five years. However, 69% of CIOs also expect enough new jobs to replace those positions lost to automation.

    “Boards are asking their CIO and technology team to prioritize automation of jobs. How organizations adapt to automation will increasingly become a priority, and many are not at all ready,” said Albert Ellis, CEO of Harvey Nash.

    Despite CIOs enjoying a rising influence within their organizations, fewer CIOs have seats on the board of directors at their organization—having fallen significantly from 71% who held board seats just two years ago to 58% today.

    The 2019 Harvey Nash/KPMG CIO Survey, conducted between December 2018 and April 2019 across 108 countries, is based on the responses of 3,645 CIOs and technology leaders.

    While automation and AI may, or may not, displace workers in the future enterprises are counting on them today to help close their perceived skills shortage. According to respondent’s, enterprises continue to find it a challenge to obtain the talent they need. In fact, respondents reported skills shortages at their highest level since 2008.

    The employees most difficult to find are those in data analytics (44%), cybersecurity (39%) and artificial intelligence (39%).

    Finally, respondents surveyed who consider their organizations to be digital leaders (those who see themselves as very effective or extremely effective at using digital technologies to advance their business strategies, performed better than their competitors on every aspect surveyed.

    According to the survey, digital leaders outperformed in time to market (53% versus 34%), customer experience (65% versus 49%), revenue growth (55% versus 43%) and profitability in the previous year (50% versus 37%). Digital leaders, the survey said, are also more likely to introduce ‘major new changes to products and services’ in the next three years (55% versus 39%) and focus on profitability.

    — George V. Hulme

  • The Secret to Digital Transformation is Human Connection

    The Secret to Digital Transformation is Human Connection

    We know digital transformation is no longer an option for today’s organizations–it’s a requirement. End-users have come to expect an easy, digital-native experience, whether they are ordering a pizza or automating an entire network infrastructure, which is why businesses and governments are throwing trillions of dollars at new technologies and related services.

    Organizations must build and deliver exciting new software applications, faster than ever before. They must continuously innovate, adapt and stay ahead of the never-ending demands of digital data, experiences and channels. These demands have contributed to the meteoric rise of cloud computing, DevOps methodologies, open source technologies, predictive analytics, AI and many other innovations.

    However, even with all these investments, more than half of all new software or IT projects still fail. In fact, according to a study by Forbes Insights, 75% of executives say they’re still waiting to reap tangible benefits from disruptive technology. Here’s why: Technology alone does not solve digital transformation. It doesn’t address some of the most fundamental issues that inhibit or enable transformational success nor the most critical dependency, which is people.

    To truly transform, organizations must go beyond just technology to embrace the human elements of this evolution. We’ll look at six factors driven by the human side of the business, and how each of these can help, not hinder, digital transformation when properly addressed.

    Organizational Culture

    One of the biggest challenges for companies as they embark on digital transformation is the needed cultural change. The technology decisions, while daunting, are easier compared to the cultural shift organizations must undertake to truly become digital leaders. Top down mandates won’t work, because for it to be successful, digital transformation needs buy-in from all involved. People need to connect to the change and feel they can have an impact, or at the very least, know their job is safe amid the change. Also, to achieve the speed of change and innovation, organizations need to empower everyone to make decisions, not just a select few.

    Embracing an open culture can help with this. In an open culture, digital leaders look at their organization more like a community of individuals, all contributing to something bigger than themselves. Anyone can participate, lead and suggest a change or improvement. This methodology helps for the best ideas to win out, regardless of where they come from. Employees feel part of the process and ultimately, it empowers them to work toward the shared goal. Let me be clear, this isn’t a democracy or a lack of clear decision making power. However, it is using more open decision frameworks that move everyone toward a common goal, which brings us to the next big human factor.

    An Inspiring Vision with Metrics of Success

    It is often said to start with the end in mind. With digital transformation, this is absolutely true. For digital transformation to be successful, everyone in the organization needs to understand, and ideally agree with, the destination. Visions are not just words—they are driving the priorities, investments and decisions made by every team and employee. Without a clear vision, organizations can’t create an executable business strategy. The key is to make sure you have a vision that clearly describes what your organization will be like in several years–and then make that vision measurable.

    All good visions come with goals attached to them. Yet according to research from Gartner, 50% of organizations have no digital transformation metric or way to measure progress for digital transformation. Set up clear, ambitious targets–stretch goals the entire company can work toward. These metrics allow organizations to clearly check on how they have progressed and where they still need to get to.

    Cross-Organizational Teams and Processes

    Another cultural barrier to digital transformation is siloed behavior and workstreams. Often, teams refuse, or just don’t know, how to break out of their silos. Digital transformation requires collaboration and breaking down boundaries, as data, insights, applications and processes need to flow seamlessly throughout an organization. It all goes back to having a vision and an open culture. Without a culture of trust and a shared agreement on the end goal from across the organization, you won’t be able to break down these silos.

    With the vision and culture in place, adopting DevOps and agile processes is a great way to initiate this. It helps bring together business, technical and other people from across an organization to solve a specific problem or figure out how to better work together. Often, this takes a courageous leader, who doesn’t measure their value by the power or budget they hold, to broker these cross-organizational relationships and new teams.

    People Development

    In talking to IT and business leaders all over the world, they are faced with a common challenge: skill set gaps. This includes both soft skills, such as communications or management, and hard skills, such as technical capabilities. According to Red Hat’s survey on Global IT Trends & Priorities Research, the biggest blocker to an organization’s digital transformation efforts is people. More specifically, the survey found IT talent or skills gap was preventing organizations’ efforts from being successful. Technology and digital processes are changing so quickly, it’s hard to keep up. This is creating a digital skills gap in organizations across industries and around the world.

    Rather than hoping to hire people with the skills and talent you need, I encourage organizations to develop the people you have. Take your loyal employees who already fit your culture and believe in your vision and invest in them. Also reward them for taking risks. Digital disruption does not happen by standing still or encouraging small moves–it takes big bets. Leadership must also be willing to stand up for employees who try new ideas and push the boundaries.

    User Experience Focus

    According to CareerFoundry, which manages a Web UX design school, the cost of a bad user experience is high. Really high. Its research estimates bad user experience costs e-commerce companies $1.4 trillion in lost revenue.

    As we focus on the human connection part of digital transformation, user experience takes the front seat and is a top priority. We need to start with the user. What are they trying to do? What is the pain we are hopefully solving? Too many times organizations start with the cool technology and slap on the user experience as almost an afterthought. By starting with the user, projects are more likely to give users the feeling they are interfacing with a human being rather than a digital thing—and ultimately, will succeed because of it.

    Personal Connections

    One of the downsides of the digital era is we don’t have enough face time. We believe video conferences provide the same benefits as face-to-face meetings. We put our trust in digital handshakes instead of the real thing. However, to succeed at a company-wide digital transformation, you can’t rely on digital communication alone. Ironic, right?

    One key reason for making face time is to build trust. As humans, we need to see someone, look them in the eye, shake their hand, respond to their cues. All of this helps us trust the other person. To put your organization through a major transformation takes trust–across the organization, but especially of the leadership. This means leadership needs to get out there and talk to employees, customers, partners and users. Take the time and the effort to make your transformational efforts relate to the humans doing the work and buying your products or services.

    The Bottom Line

    The most common mistake organizations make is believing technology alone can solve their problems. Technology is still needed for a successful digital transformation. In fact, I am not in any way advising we all sit around and have a lovely conversation and hold hands to solve these massive technology issues. However, technology must be combined with human connection.

    In other words, it’s not just what you use to transform, but the how and the why of your transformation. The human elements require hard work across culture, hiring, people development, leadership and communication.

    Human connection is the killer application for digital transformation.

    — Margaret Dawson

  • Three Insights from the World’s Leading IT Organizations

    Three Insights from the World’s Leading IT Organizations

    IT is in a state of change on a consistent basis, but never more so than now. With the increasing importance of the digital customer experience across all industries, technology is at a new inflection point in how it can fundamentally impact executive priorities. And while nobody can speak for the direction of IT as a whole, there are a few resources so comprehensive that they’re worth reviewing when they’re released.

    Take, for example, the 2019 Harvey Nash/KPMG CIO Survey. It’s the largest global survey of CIOs with data from 3,645 respondents across 108 countries. IT leaders who participated in the survey controlled a whopping $250+ billion in annual IT budgets. The CIO survey examines how board priorities, technology adoption, skills gaps and IT leadership is changing in the age of digital business.

    Here are three insights that explain the tectonic shifts occurring in enterprise IT teams today.

    Digital Leadership: Three Steps to Becoming a Digital Native

    The 2019 Harvey Nash/KPMG CIO Survey shows only 30% of IT organizations are digital leaders. These organizations are unusually adept at “using digital technologies to advance their business strategy,” and can launch innovative solutions that generate new revenue streams, enable faster time to market and cut down operational costs. Here are three defining characteristics of what it takes to be a digital leader in 2019:

    • It’s All About Data. Data management and analytics is a core competency of leading IT organizations. Digital leaders are in a strong position to maximize the value of their organizational data by extracting, aggregating and curating the right information. This data is then used to train machine learning models, create high-value assets and deliver customer value on an ongoing basis.
    • Speed of Execution. Digital leaders are willing to either quickly double down on successful experiments or pull the plug on products that don’t deliver expected value. They are also more likely to leverage agile and DevOps practices to increase software release velocity and iterate rapidly on solutions using fast feedback loops.
    • Expansive Mindset. Digital leaders have transitioned from project thinking to product-centric innovation for creating enduring value from their software investments. They also build cross-functional teams across their business and IT silos for better collaboration and faster decision making for digital transformation initiatives.  

    What Does This Mean? CIOs will need to embrace big data analytics, agile delivery models and product-centric teams to create the right foundations for digital business. Without proper foundational investments, IT leaders will struggle to meet business demands, gain customer trust and withstand competitive pressures in the face of escalating customer expectations.

    Business-Managed IT: How Shadow IT Finally Became Respectable

    In the last decade, the adoption of cloud services led to the phenomenon of shadow IT where business units would directly buy cloud solutions without consulting IT teams. CIOs resented their growing irrelevance and tried their best to bring shadow IT under their control.

    The 2019 CIO survey confirms 64% of enterprises have made peace with business-managed IT investments. In fact, 10% of IT leaders actively endorse this approach. What factors have led IT teams to change their mind on shadow IT?

    The survey shows organizations with business-led IT scored better on key metrics than organizations without any mandate for business-managed technology spend. Business-led IT organizations delivered “better customer experiences and faster time to market for new products (52% more likely) as well as positive employee experiences (38% more likely).”

    For business-managed IT spending to be truly successful, CIOs will require the right guardrails in the form of central IT oversight. The 2019 CIO survey makes the case that organizations without IT team involvement are twice as likely to have multiple security issues and are also less likely to build customer trust with their technology investments.

    What Does This Mean? Instead of actively opposing shadow IT investments, CIOs should partner with their business counterparts to create effective governance and operating models for business-managed IT spending. Central IT oversight will ensure the right support for digital business initiatives, reduce the risk of unauthorized breaches and minimize wasted spend.

    Influencing Without Authority: What It Takes to Be an Effective Technology Leader

    Board membership for CIOs dropped this year, with only 58% of IT leaders being part of the executive team in 2019 as compared to 71% in 2017. Does this mean CIOs no longer have executive backing for orchestrating and executing digital business strategies in their enterprise?

    The 2019 CIO Survey indicates board membership, headcount or annual budgets are not the right indicators of the power and influence of technology leaders. Instead, CIOs should focus on building trust across organizational boundaries, creating partnerships with the right executive stakeholders and ensuring the success of critical initiatives. CIOs working for digital leaders are comfortable exerting influence without authority and are driving organizational growth, by being “three times more likely to collaborate strongly with business leaders.”

    What Does This Mean? Formal board membership or the size of the IT team is not the best way to assess CIO influence. The best technology leaders ensure successful enterprise transformation by garnering strong commitment from the board, building digital capabilities with cross-functional teams and creating a sense of urgency for rapid innovation.

    — Deepak Jannu

  • 4 Traits of High-Performance Digital Leaders

    4 Traits of High-Performance Digital Leaders

    Businesses that have retooled their culture, their hierarchy and their business mindset toward the use of technology are consistently outperforming their more traditional peers. According to the newly released Harvey Nash/KPMG CIO Survey 2019, digital leaders are the top 30% of businesses that are extremely effective at leveraging digital capabilities to advance their business strategy. The survey showed that digital leaders are beating the competition more handily than their cohorts on some of the most important business metrics followed by CEOs, including time to market, customer experience, response to change and profitability.

    As the report explained, organizations don’t spontaneously become digital leaders and they don’t create their success by “pedaling harder in their traditional IT function; in fact, for many organizations the concept of a traditional IT department is an anathema to them.”

    The study showed that organizations that have established themselves as digital leaders tend to have incredible support and commitment from the top of the food chain. Whereas only about 58% of CEOs at most other firms want their technology projects to make money versus save money, 78% of CEOs at digital leaders see technology capabilities as their proverbial goose laying golden eggs. In the same vein, digital leaders are also much more likely to have a top technology leader—be it CIO or chief digital officer—reporting directly to the CEO and sitting on the executive team.

    “There is a chicken and egg question–is the technology leader influential in these enterprises because the board supports them, or does the board support them because they are influential in their own right?,” ruminated report authors on the board access and influence that CIOs have at digital leader organizations. “The truth is, it’s probably a mixture of both.”

    Regardless of how that relationship evolved, the tone from the top is helping digital leaders to hone themselves through some common winning practices and modes of operating. The report found that these organizations tend to exhibit four common traits, many of which have significant cross-over with the practices and principles of technology organizations that have embraced DevOps transform their IT delivery models:

    An Emphasis on Modern IT Delivery Speeds

    In fact, one of the most stark differences between digital leaders and everyone else is that they are far more likely to have leveraged DevOps to accelerate innovation. The study showed that these organizations are more than three times as likely to use agile or DevOps methodologies enterprisewide to speed up feature delivery. What’s more, digital leaders are also fully buying into the old DevOps ethos of innovating fast and failing faster. Digital leaders are similarly almost three times as likely to pivot quickly from small experiments, scaling up quickly on success or stopping quickly on failure of these small pilots.

    Strong Business-to-IT Collaboration

    “Digital leaders are swapping control for influence and investing time in business relationships,” according to the report.

    The report showed that whereas only about 18% of most traditional technology functions work collaboratively with business leaders to deliver technology change, that spirit of cooperation is alive and flourishing at 54% of digital leaders. In fact, technology executives at digital leaders are less likely to look down on business-driven spend as rogue or shadow IT, but instead as business-managed IT that’s sanctioned and even encouraged. At the same time, technology decision-makers are more likely to influence and govern these business-managed IT decisions than at other organizations.

    Focus on Value Rather than Technology

    The report showed that digital leaders have an “expansive mindset,” meaning that they’re much more likely to think of technology in a big-picture way. So they look at technology delivered as long-term products rather than short-term projects. And success is not viewed through traditional technical SLAs, but instead “… through the lens of business performance, often tied to measures like customer or employee experience, lifetime value, loyalty, uptake and time to market.”

    Additionally, this expansive mindset combined with high levels of collaboration with the business has most digital leaders putting together cross-functional digital teams that combine IT and business staff. These organizations are three times as likely to invest in training non-IT people in IT skills.

    Fanatical About Data

    Finally, all of that experimentation and work is driven by data. The report showed that “data is at the heart” of digital leader organizations. Digital leaders are more than three times as likely to maximize the value of all of the data they hold, and almost four times as likely to maintain an enterprisewide data management strategy than other organizations.

    This use of data is helping them provide business leaders with actionable customer insights, to improve operational efficiency and to get a better line on risks and opportunities the business will face in the future.

    “Digital solutions are the oxygen that allow a business to breathe and run at market speed,” said Steve Bates, global lead of the CIO Advisory Center of Excellence at KPMG. “This year’s survey provides compelling evidence of the transformational progress digital leaders are making. It is up to the rest to catch up and join them.”

    — Ericka Chickowski

  • Break the Rules and Win at Digital Transformation

    Break the Rules and Win at Digital Transformation

    The rules of the game have changed.

    In today’s digital world, it’s not about the big eating the small. It’s the fast that beat the slow and the nimble that outmaneuver companies constrained by old systems and business models.

    What’s more, the finish line is always moving. The rapid pace of innovation and disruption means businesses must continuously transform themselves to stay ahead of competitors.

    The takeaway for CIOs: Speed and agility are the name of the game.

    IT must respond faster than ever to shifting business needs. To succeed at digital transformation, companies must rethink how they design, build, deploy and source enterprise applications. They must adopt new approaches that accelerate delivery and anticipate, even bake in, ongoing changes.

    It’s time to update the IT playbook. Here are five best practices from digital leaders that are breaking with the past to deliver a successful future.

    Accelerate and Iterate Software Delivery

    Digital leaders outpace their rivals by adopting methodologies and mindsets that shorten software delivery cycles. They’re also really, really good at rapid, iterative change.

    Shift to Speedier Methodologies

    Digital leaders rely on Agile development methods—short sprints, scrum teams and user feedback loops—to accelerate the design and development of new applications. With its emphasis on rapid iteration and continuous improvement, Agile methodologies are a proven way for companies to churn out new innovations quickly. Studies show Agile approaches average 50 percent faster time-to-market than waterfall ones.

    DevOps is also a catalyst for speed. Automation and tighter collaboration between development and operations make it easier to put new code into production. Led by such companies as Facebook, Google and Amazon, the world is moving away from “that 10-year-old solution everyone’s afraid to touch” to flexible platforms that are updated multiple times a day.

    Adopt an Agile Mindset

    Of course, being agile requires more than just new methodologies. It also demands a willingness to take risks, learn on the fly and adjust continuously. Digital leaders don’t just respond to change; they embrace and design for change.

    Digital leaders test and then invest. They fail fast and then swiftly course-correct. The most successful experiment rapidly and incrementally so if they do stumble, they fall from the first floor, not the 10th. Digital leaders also think big. They don’t just digitize current processes. They completely re-imagine business models and technology systems—as Pitney Bowes did with its transformation into a digital commerce powerhouse or as GE did with its launch of the Predix industrial IoT platform.

    Adopt New Application Architectures and Infrastructure

    Digital leaders are building in flexibility with new application architectures and deployment models. They’re leaving legacy systems behind as they take to the cloud with microservices-based solutions.

    Move to Microservices

    Monolithic applications are hard to change, costly to maintain and ill-suited to today’s dynamic business environment. That’s why digital leaders are moving to an agile, microservices-driven architecture. Converts include Netflix, eBay, Amazon, Twitter, Gilt, Liberty Mutual and the UK Government Digital Service, to name just a few.

    Assembling applications from small modular services—each a self-contained building block—allows digital leaders to transform quickly and at scale. They can mix and match services to fast-track new digital offerings and processes. They can tweak and scale services to adapt to changing business models and customer expectations. And they can push innovation across the enterprise by reusing services—all without adding armies of developers or getting locked into any one technology.

    Step Up Cloud Migration

    The cloud is increasingly the preferred foundation for digital transformation. Digital leaders gain speed and agility by plugging into on-demand services and computing resources. They short-circuit long design and procurement cycles; focus on innovation, not infrastructure; and deliver differentiated capabilities and customer experiences at a fraction of the time and cost.

    Digital leaders are betting big on the cloud. According to IDC, at least half of IT spending will be cloud-based by 2018, reaching 60 percent of IT infrastructure spending and 60 percent to 70 percent of software, services and technology spending by 2020. Organizations across industries—such as Nike, Xerox, General Mills, Liberty Mutual, and the U.S. federal government—have migrated mission-critical workloads to the cloud to support new, more digital ways of doing business.

    Use Novel, Unexpected Sources of Innovation

    Digital leaders rely on open-source innovators and third-party collaborators to shorten development cycles. They’ve also abandoned long RFPs in favor of shorter, more effective proofs of concept (POCs).

    Embrace Open Tech with Open Arms

    Open technologies—including open source, open standards and open APIs—dominate the digital landscape. According to a study by North Bridge and Black Duck, open source software makes up more than 50 percent of the typical enterprise and application stack. Digital leaders including Ticketmaster, Box, eBay and Goldman Sachs rely on open-source software to speed solution delivery and draft off the innovations of millions of developers worldwide.

    Digital leaders also innovate openly with others. They hold hackathons. They crowdsource. They co-create with customers and partners. They also contribute back to the community with projects such as Walmart Labs, Ericsson’s open-source hub and GE’s Industrial Dojo for the Cloud Foundry ecosystem.

    Say RIP to RFPs

    Digital leaders have pulled the plug on massive RFPs for complex, multiyear development projects. Instead, they favor faster, more flexible procurement processes that reward innovation and accelerate vendor selection. They conduct POC tests to evaluate alternative technologies. They use iterative prototyping to refine requirements and determine the best solution for the job. They keep their options open with shorter timelines and smaller deliverables.

    Digital success calls for a more collaborative relationship with technology providers. It’s the whiteboard sessions, technical conversations and joint problem-solving that yield breakthrough results. That’s why progressive companies now approach the RFP like a “request for partnership.”

    Integrate Data and Systems in Transformative Ways

    Digital leaders use open platforms and APIs to integrate information, people and processes across their extended value chain. These connections lay the foundation for faster business flows and new digital products and services.

    Connect Quickly with APIs

    APIs (application programming interfaces) enable diverse applications to connect and share data. Digital leaders use API-led integration to combine services and expose information in ways that deliver unprecedented customer and business value. Within days and without lots of coding, they can roll out service innovations, revamp internal processes, enliven customer interactions, extend their digital reach and enable entirely new business models.

    This year, 2017, has been dubbed the year of the API economy. ProgrammableWeb lists more than 17,700 APIs and hundreds of digital leaders are opening up their APIs so others can easily integrate and innovate with their technologies. API marketplaces from Mastercard, ADP, Ford and FedEx are just a few examples.

    Achieve Digital Flow

    Silos slow the flow of business. Disconnected processes, departmental barriers and gaps in information all impede speed and agility.

    Digital leaders excel at silo-busting. They integrate disparate systems. They connect processes from end to end, across all customer touchpoints and organizational boundaries. They use open platforms to ensure that information—structured data and unstructured content—flows to the right person, at the right time, in the right context.

    The seamless integration of information, people and processes allows digital leaders to be much more nimble and responsive. They can also leverage these connections to make huge improvements in customer experience—such as the bank that slashed loan origination steps by 70 percent or the insurer that processes claims 25 percent faster.

    Bring Business and IT Closer Together

    Digital leaders treat digital transformation as a partnership between business and IT, with a shared focus on meaningful outcomes and better experiences for customers and employees.

    Engage and Empower Users

    Digital leaders put people—customers, citizens, employees and partners—at center of their transformation efforts. They prioritize design thinking, a user-centric approach that shifts the focus from adding features to adding value. They take advantage of platform tooling to involve users in solution design and invest in dedicated UX teams to deliver better experiences faster. Capital One, for instance, regularly solicits customer input at its three innovation labs. Other proponents of design thinking include Citrix, Airbnb, BMW, DHL and Procter & Gamble.

    Another winning strategy is to empower users with self-service tools that add business agility. Examples include self-service analytics for rapid decision-making and process services that make it easy for users to modify workflows as business needs change.

    Take a More Strategic Role

    Now that every company is a software company, IT is increasingly strategic to the enterprise. Successful CIOs have seized this opportunity and are making the most of it.

    Forward-thinking IT leaders have recast IT in the role of business partner and change agent for digital transformation. They look for ways to drive growth, deepen customer engagement and shorten time to market. They help colleagues understand and realize the value of digital initiatives. They build bridges and buy-in by adopting a service mindset—what one CIO calls “ego-free IT.” The new measures of success aren’t IT-specific metrics; they’re meaningful business outcomes such as dollars saved, customers added and market share gained.

    Conclusion

    Every digital transformation is different. But the underlying challenge is the same. How can IT accelerate the pace of delivery and change simultaneously? By following the lead of digital trailblazers, any organization can gain the speed and agility needed to compete in a digital-first world—and win.

    About the Author / Chris Wiborg

    Chris Wiborg is Vice President of Product Marketing at Alfresco Software. In his role, Chris is responsible for setting and executing the go-to-market strategy for Alfresco’s Digital Business Platform. Connect with him on Twitter and Linkedin.