There is no doubt that the digital revolution has fundamentally changed the world. It has also radically altered the expectations of consumers, who want a seamless digital experience – and they want it now.
This ‘consumer pull’ towards digitisation has been reinforced by a concurrent ‘technology push’ spurred by the growing influence of digital technology. The infrastructure backbone of the digital world has been bringing affordable broadband to billions of consumers. In parallel, low-cost connected devices are being deployed in every industry, and cloud computing, and the vast information-processing machinery it requires, has given further impetus to this movement.
In other words, what customers really want is a radical overhaul of your business processes. And thanks to digitisation, companies across industries are racing to migrate ‘analogue’ approaches to customers, products, services, and operating models to an always-on, real-time, and information-rich marketplace. As in any race, you will find those who are surging ahead and those who are lagging behind.
Where does your company stand in all this? Do you feel on top of the situation with the digitisation of your business processes? Or do you feel overwhelmed by the pace of change?
Perhaps the best way to view digitisation – and how this process could be accelerated in your business – is to view the journey to the future of process as beginning today, by imagining how work will get done tomorrow. Start with the simple questions first: “How do I eliminate paper-based process inputs and make my process truly ‘digital’ from the outset?”; “Is the way we are delivering processes today adding value or augmenting risk?”; or “How is the data being applied to process-level algorithms helping us understand our business value chain and making better decisions?”
The digitisation of information inception, such as e-invoicing or optical character recognition, can be considered essential ‘baby steps’ on the road towards the running batch process or presentation-layer macros that automate pieces of end-to-end workflows.
The infrastructure backbone of the digital world has been bringing affordable broadband to billions of consumers
Ultimately, automation at this level is mostly an incremental improvement on existing, internal processes, and therefore companies need to think beyond this stage. They must reinvent the entire business process, including cutting the number of steps required, reducing the number of documents, developing automated decision making, and dealing with regulatory and fraud issues.
Operating models, skills, organisational structures and roles need to be redesigned to match the reinvented processes. Meanwhile, better decision making, performance tracking, and customer insights will result from adjusted and rebuilt data models. Often, digitisation will require combining old wisdom with new skills, for example, by training a merchandising manager to programme a pricing algorithm. New roles, such as those of data scientist and user-experience designer, may be needed.
Truly digital processes can use Code Halos to automate processes right from the outset, but the real prize is the data that is produced as a result. Information and meta-data in processes at this level are inherently ‘born as digits’.
And as physical value chains digitise, process feedback and analytics become instant. Open process loops are closed faster. Insights come faster. Traceability, tracking and auditability are enhanced. The benefits are huge: by digitising information-intensive processes, costs can be cut by up to 90 per cent and turnaround times improved by several orders of magnitude.
Companies interested in accelerating the digitisation of their business processes can hit the ground running by learning from others. For example, start by designing the future state for each process – say, shortening a process turnaround time from days to minutes – without regard for current constraints. Once a desirable future state has been described, constraints can be challenged, discussed with stakeholders and often quite possibly resolved.
Consider tackling the entire customer experience from a holistic viewpoint, having cross-functional teams, and the customer, providing input to process-digitisation teams. Building in-house capabilities for digitisation will prove important in the long-term. Although using external talent might prove inevitable, having the skills available to build the required technology components in a modular way, thus ensuring that they can be reused across processes, will maximise economies of scale.
Digitising end-to-end processes one by one can deliver improved performance in just three to five months. Complex IT challenges, such as legacy-systems integration, can be harder to move along quickly. However, it is usually business decision making that is causing the bottleneck rather than IT development. Thus, digitisation programmes need strong board-level support to align all the stakeholders, while all other decisions should be delegated to the project team.
Finally, it might be easier to have a new organisational unit handle the new digital process, bringing other employees on board while increasing the volumes it handles in parallel. This ensures a much easier transition to the digital process by not expending extensive energy on changing old habits and behaviours. By the time all process volume has migrated to the new digital process, the new organisational unit will have integrated all the required employees from the supporting units.
www.beatconsult.com
David Galea is CEO at BEAT, a Maltese niche-based consulting firm specialising in the provision of project management, strategic advice and business transformation solutions.