Experts foretold 2018 as the Year of Digital Transformation. Were they right?
In 2015, former Cisco Chairman, John Chambers famously startled a roomful of C-level executives by predicting that “At least 40% of all businesses will die in the next ten years…if they don’t try to figure out how to change their entire company to accommodate new technologies.” Nearly three years later, as we march into 2018, do Chamber's words ring true?
As it turns out, this is not an easy question to answer.
“Every company in this world has to be realistic…Out of the private sector, companies in this room, regardless of where you are in this world, 87% of you will have a major financial shortfall in the next 15 years, and a little over 10% of you will ever come back from it. And of all the enterprise companies in this world, only a 1/3 of us will exist in a meaningful way in 25 years.”—John Chambers
In the last five years, we’ve witnessed the increased digitization of the enterprise and the disruption of organizations and industries at the hands of agile startups. Take a look at businesses like Uber or AirBnB and you’ll quickly realize that much is true.
What isn’t as clear is how in the long run, slow-moving businesses will fare against their agile competitors—those who have embraced and prepared for digital transformation. Will they grind to a halt in the face of innovation or will these companies move along at a snails pace, slowly losing market share until they are forced to make a change or shutter their doors?
Fear has been a popular marketing tactic to inspire enterprise-level executives to modernize their network infrastructures in preparation for digitization. As is typically the case, marketing hype and buzzwords present only half-truths and the reality of digital disruption is more like a steady stream than the fast-moving river we’ve been led to believe it would be.
Still, there is an undercurrent of fact behind the doom and gloom marketing campaigns, and most of today’s executives believe that digital transformation is disrupting their business or soon will be. That being said, recent studies have shown that fewer than half of business leaders have enacted a digital strategy or modernized their networks, making the tech industry’s predictions of an impending wholesale digital revolution seem only slightly premature (emphasis on the word ‘slightly’).
Some enterprise-level executives have taken a delayed approach to digital transformation by design, favoring what they consider to be a posture of flexibility over formal planning. Others simply struggle with understanding the idea of what it means to be a digital business and are hesitant to invest time and money in something they’ve yet to figure out. If your business lives in either of these buckets, it’s time to centralize your digital efforts and develop a formal business strategy to prepare for the rising tide of digital transformation.
“We…have been talking for the last few years about IT budgets moving to lines of business, and I think that while the lines of business may be spending more on technology, for us to be successful in the future, IT and the line of business have to come together. We have to be aligned and there has to be a strategy. What does this technology do? What does it change? How does it change how I think about my business and my business model? Does it change my company from selling a product to selling it as a service?”—Chuck Robbins, Cisco
This should not be a ‘wait and see’ moment for your business—it’s coming in more like a lamb than a lion, but sweeping digital transformation is on the horizon, and as rapid speed to market and innovation become increasingly critical to long-term success, business leaders need to strategize for the future and modernize their network infrastructures and organizational culture.
Have you developed a digital business strategy for your organization? Do you know what your network needs to prepare for digital transformation?
Get in touch if you’d like to learn how the Lighthouse Independent Discovery and Analytics engagement (IDA) could help to provide you with detailed knowledge that puts you in control over what you spend, how you manage, and how you achieve your technology and business goals, and set the stage for digital transformation within your organization.