Creating a Digital Transformation Roadmap
Digital transformation is a phenomenon that every company must deal with. Customers are demanding new experiences, partners want greater access, and employees want greater convenience and to be able to access systems from wherever they are. Business who choose not to take on digital transformation put themselves at a distinct disadvantage.
But how are businesses creating digital transformation strategies? MuleSoft surveyed 300 IT executives, many of whom were in the midst of addressing digital transformation, and certain trends emerged. One of those trends is that most organizations are thinking about or already investing in some sort of API strategy either in pockets or through a centralized initiative. More than 50% of them said they were generating revenue through their API or will be in the next year. What this suggests is that while APIs drive agility or are the next generation of service orientation, they are also becoming a key way companies deliver new products to market. Half of large companies with 10,000 employees or more are generating more than 10 million dollars a year through APIs. This shows the early signs of a shift through the digital transformation process. Companies are shifting some of their revenue share from traditional models or additive models into digital channels.
In addition, CIOs are finding that pressure to deliver IT services across the organization are increasing - in fact, two-thirds of IT execs surveyed said that pressure is becoming “drastic.” And the requests aren’t coming just from the usual suspects of marketing and sales; rather, departments as diverse as finance and operations, R&D, and the C-suite are asking for support in implementing new technology solutions.
It’s clear that current trends mean that IT can’t continue on its present path. A change needs to be made in the organization, and making that change can create very rich rewards. Seeing IT as a strategic partner for the business and as an empowering partner, rather than a gatekeeper, represents an extraordinary opportunity for CIOs, and one that can provide a rich and rewarding experience for internal and external constituents of the business.
Developing the Digital Transformation Framework
Enterprises and CIOs are completely rethinking how they structure themselves to deliver capabilities through APIs. The services that APIs make accessible have transformed IT at many companies from a centralized organization to an enterprise composed of hundreds or thousands of different applications.
Traditional IT, especially the integration piece, was always about connecting big, heavyweight applications with big, heavyweight middleware. The value got from that was essentially a fairly tight workflow processes and information being propagated between systems. It was very slow and heavy to perform.
Fast forward to four or five years ago. SaaS started becoming a predominant player, and now today, it is the de facto platform for many organizations who are looking to move most if not all their infrastructure to the cloud. The challenge with SaaS, of course, the landscape is much more fragmented. The applications that come out are purpose-built for specific business needs, so unlike the era of SAP and Oracle platforms where they try to serve everything on one platform.
Best Practices for Digital Transformation
What are the first steps to plan a digital transformation strategy? The CIO must transform his or her role and central IT must change the way it organizes itself to cope with and harness the opportunities digital transformation provides. The roadmap for both these transformations is clear. There are three trends that IT professionals must embrace in order to benefit the modern enterprise:
- Become a strategic partner to the business
- Embrace integration as the primary role of the CIO
- Create capabilities, not projects
Become a strategic partner to the business
First, IT must be a strategic partner to the business; it can’t be just the technology provider to the business, but rather the capability provider. The mindset must change to delivering capabilities not projects. Delivering capabilities is all about making the IT more consumable to other audiences inside the organization and then consistently evangelizing self-service technology to the rest of the organization.
Embrace integration as the primary role of the CIO
The “I” in CIO is now integration. CIOs now compete on how well you connect assets to audiences. Every enterprise, as they shift to the cloud, now have all the same applications and they are trying to drive the same experiences over mobile devices. Today, it is not about the backend systems that drive competitive advances and efficiencies, it is actually about how quickly you can propose innovations and make them happen in the organization to create new additional products and services
Create capabilities, not projects
IT must now understand and empower its consumers. This means not only does IT have to understand the business strategy for all areas of the business, but preempt what the business actually needs before it knows it needs it. IT has to know the goals the business is actually trying to reach. IT has to enable not only current projects but also future capability.