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Tuesday, August 13, 2019

Top 5 ERP News and articles: Week 2019-30: Digital Transformation - 2

Checkout my book 'Selected Articles on ERP' on Amazon.com 

The Short URL for this post is http://bit.ly/DigitalTransformation-2

Introduction

The theme for this week is #DigitalTransformation. I had already posted the first set of five articles in Week Four of this series. I have selected five great articles for this week. The first article by Linda Rosencrance identifies three critical challenges in #DigitalTransformation journey. These are Change Management, Data Integration and User Adoption. The second article discusses the importance of Change Management in #DigitalTransformation. An effective Change Management Strategy will involve Preparing, Managing and Reinforcing change. The third article is the case study of #DigitalTransformation by Condé Nast Inc. The message from this article is that for #DigitalTransformation to succeed, there should be clear and measurable goals. In addition, Organizations should have a clarity on their critical requirements.

In the fourth article, Rajat Dhawan gives seven pointers to successful #DigitalTransformation. These include not to forget the customer and fixing basic issues first before embarking on a the transformation initiative. I found them to be highly value adding. The final article is from a CIO who has been a part of #DigitalTransformation initiative in his Organization. He says that the most difficult part of the process is letting go of people who are interested in being a part of the process, but who do not meet the requirements of the difficult initiative.

Great articles all. Do give a read.

Top Five Articles

1. How to Overcome Digital Transformation in Finance Challenges: Linda Rosencrance for Techtarget
https://searcherp.techtarget.com/feature/How-to-overcome-digital-transformation-in-finance-challenges

The three critical challenges that Organizations faced in their #DigitalTransformation journey are Change Management, Data Integration (especially financial data) and User Adoption.

Finance leaders need to be able to collect and connect data across workflows and departments to draw actionable insights. They should consider establishing a data governance framework to set parameters for how common data, such as expense reports or invoices, is entered, which systems it is entered in and how it's collected across the business.

For #DigitalTransformation in Finance to succeed, the CFO should know how the data from different part of the Organization are connected. This overview is imperative in the Cloud world where new applications can be quickly implemented. This could lead to data disintegration.

Standardization is the answer. From the perspective of Finance, it could mean, for example, implementing a Global Chart of Accounts. Another option, for a rapidly expanding Organization is Process Standardization.

Since technology is becoming critical to manage Financial data, CFOs should put in efforts to understand their IT Systems and work with the CIO as a team. Since their priorities will be different, it is important to create a harmonious working relationship from early days.

2. The Importance of Change Management During Digital Transformation: Panorama Consulting Blog
https://www.panorama-consulting.com/what-change-management-methodology-do-you-need-for-digital-transformation/?utm_campaign=Twitter%20Promote%20Mode%3A%20ocm%20importance&utm_source=twitter%20promote%20mode

A detailed Change Management Strategy and a strong Change Management Methodology are required for the success of digital Transformation.

If your initiative is truly a digital transformation, that means you’re changing more than your technology – you’re undergoing large-scale change and fundamentally altering structures, processes and employee's day-to-day jobs. If new technology is merely enhancing one of these elements, then you’re likely experiencing small-scale change.

Whenever an organization implements new technology, it should consider the possibility of large-scale change. That’s not to say you can’t pursue a change management initiative without implementing new technology.

To implement an effective Change Management, Organizations must:
  1. Prepare for change: Do a readiness assessment and develop a Change Management Roadmap.
  2. Manage change: Develop a communications plan, a resistance management plan and a training plan. Do a stakeholder assessment to identify key messages to be communicated. Remember that every stakeholder has different perspectives on Change Management.
  3. Reinforce change: Celebrate successes. Take quick corrective actions to handle any challenges.
One way to reduce resistance to change is by involving employees in the initiative. Try answering Why, What and How or the initiative. Have a clear idea on how each stakeholder will benefit from this exercise.

In addition to employee resistance, other reasons for failure of Change Management will be lack of executive sponsorship and not having a dedicated Change Management team.

Nice article.

3. Condé Nast on the Pursuit of Customer Experience at Web Scale, with DataStax Enterprise: John Reed for Diginomica.com
https://diginomica.com/exclusive-conde-nast-on-the-pursuit-of-customer-experience-at-web-scale-with-datastax-enterprise?utm_campaign=meetedgar&utm_medium=social&utm_source=meetedgar.com

Condé Nast Inc. is an American mass media company founded in 1909. As per Wikipedia, there are 164 million consumers across its 19 brands and media. Publications from Ars Technica to Glamour to GQ to Wired are part of the holdings.

DataStax is a database management company known for its distributed cloud database, built on Apache Cassandra.

Condé Nast wanted to optimize their content, using multivariate testing to serve up different web page looks to different visitors. The goal? Maximize click-throughs and other engagement metrics. But this all had to be done affordably - and at web scale.

The company began by evaluating Cassandra versus Amazon DynamoDB. They saw that for their volume of traffic Cassandra fitted better. DataStax solution (Cassandra) was not only more effective in terms of performance, but also cheaper in terms of cost.

Here are some benefits generated over an year. 
  1. Improved digital click-through rates by 30%.
  2. Sped up personalization in its ‘Feature Store’ by 650%.
  3. Improved backend system performance of 1,800 reads per minute in less than 4 milliseconds, and 1,800 writes per minute in less than 10 milliseconds.
What I liked about this article is the #DigitalTransformation approach that the company followed. They had clear and measurable goals and understood their critical requirements. The benefits achieved with a lean team is commendable.


4. Seven Ways to Implement a Digital Transformation: Rajat Dhawan for Forbes Technology Council
https://www.forbes.com/sites/forbestechcouncil/2018/01/19/seven-ways-to-implement-a-digital-transformation/#1c4024382be9

The article lists seven principles that are applicable to every Organization that is embarking on a #DigitalTransformtion journey.
  1. Identify what Digital means to your Organization: With many options available, it is important to identify those that will meet your specific challenges. Follow a two pronged approach. First identify those solutions that will resolve your challenges. Second, uses these solutions to create new business opportunities. Identify at least three challenges / opportunity areas before you go in search for a solution.
  2. Blur boundaries between technology, marketing, sales and operations: Ensure that solutions are not developed / delivered in Silos. Bring together experts from every department to evaluate every solution to decide how they will be impacted by the solution or evaluate how they can benefit from the solution. The 'Connected World' expects 'Connected Organizations'
  3. Don't forget the customer: Ensure that the #DigitalTransformation solutions solve specific customer service challenges or help improve customer experience. It is very easy for an Organization to 'miss the woods for the trees' in their digital initiatives.
  4. Fix technology basics first: Before embarking on #DigitalTransformation, it is important to fix the basics like Change Management, Sub-optimal Website and other issues that bug the departments. Without solving the basic issues, you will not get their bui-in for a wider initiative.
  5. Prioritise initiatives conservatively: Identify a few quick wins, simple projects with high impact, before embarking on a major initiative. This will help build the momentum.
  6. Define a roadmap, and be prepared to redefine it: This is a critical step in a transformation program. This will determine the list of projects, their scheduling and identify the common resources required. Since a #DigitalTransformation initiative will span over a few years, this roadmap will undergo changes based on the changes in environment / technology / opportunity landscape etc.
  7. Define outcomes and tie them back to your overall business strategy: Realize that any Technology initiative is intended to achieve certain business outcomes like cost reduction, increased conversion, higher profitability, greater revenue or a potential loss/higher costs. This keeps the initiatives relevant and helps internal teams to align on a shared objective.
In summary, it is very important to have a large #DigitalTransformation vision and divided it into small actionable initiatives with identifiable outcomes.

Initially I thought it was another article with a few bulleted points but this article is filled with wisdom gained out of experience.

5. Matson CIO: The Most Painful, Gut-Wrenching Part of Leading Transformation: Peter Weis for Enterpriseproject.com
https://enterprisersproject.com/article/2017/3/matson-cio-most-painful-gut-wrenching-part-leading-transformation

The skills required to transform are dramatically different than those required to operate. CIOs who fail to recognize the organizational disruption caused by transformation early on will quickly learn some painful lessons.

#DigitalTransformation will lead to disruption and turnover in all nearly all areas.  The most difficult decision is to handle the people part of transformation. Author divides the employees into three groups, Intellectually Curious, Disinterested but honest and the Messy middle. Intellectually curious adopts and adapts to the challenges of the transformation. This group automatically fits in the transformation team. The Disinterested expresses their lack of interest in experiencing the uncertainties of the transformation process. This group should be honourably transitioned to other areas where their strengths could be better used.

The third group, Messy middle, poses the greatest challenge. They are willing and committed but do not have the capability to make the transformation. CIO should spend more time addressing this group. Those who can make the transition should be accepted and those who cannot should be honourably let go.

These are tough calls to make but they have to be made for the following reasons.
  1. Speeds up transformation
  2. CIO has fiduciary responsibility to the company
  3. CIO will earn credibility as a leader
  4. People will understand that these decisions had to be taken in the best interests of everyone.
Optimism is important. #DigitalTransformation is a multi-year process with many hurdles. Act quickly but compassionately. Don't ignore your instincts and do not hesitate.

Nice article. From a person who has 'been there and done that'.

Additional Readings

1. Seven Steps to Start Your Digital Transformation Roadmap: Sonata-software.com blog
https://www.sonata-software.com/blog/digital/7-steps-start-your-digital-transformation-roadmap

2. What Absolutely Won't Work When it Comes to Digital Transformation: Minda Zetlin for Enterpriseproject.com
https://enterprisersproject.com/article/2017/3/what-absolutely-won-t-work-when-it-comes-digital-transformation

The Year at a Glance

The articles that we have so far covered in this series in Year 2019 are:

26. Week 2019-28: ERP for SMBs
27. Week 2019-29: Selected articles on ERP
28. Week 2019-30: Digital Transformation - 2

Disclaimer:

The articles in this blog post are those that I found interesting and relevant to the topic of ERP and technology in general. I have no commercial association with any of the entities mentioned in this article. I may be following a few of these entities on LinkedIn and even some of these entities may be on my LinkedIn or Social Media network. These articles are selected purely based on their relevance to the objective of this blog, to promote ERP. Finally, the summary is mine. While I stay close to the points in the articles, I also elaborate a few of them based on my understanding.

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