Welcome to The Week in Digital Transformation, our regular look back at the most noteworthy ideas, analysis, and news from the world of digital transformation over the past week.
This week, we’ve got some interesting ideas on digital transformation from Michael Fauscette, Chief Research Officer at G2 Crowd, who argues that we’re in the “second generation” of digital transformation; from Mark Hassenplug, former principal at KPMG, who has proposed renaming digital transformation; and from Dhaval Sarvaiya of Intelivita, who makes a case for the importance of apps.
Plus, how can businesses keep themselves secure while shifting their operations onto the cloud? Neil Thacker of Netskope has a solution.
(Don’t forget that Econsultancy offers fast-track digital transformation training to help you advance your digital transformation know-how)
14 digital transformation trends for 2019
Learning hub G2 Crowd has taken an interesting approach to the 2019 trends round-up. Author Michael Fauscette opens the piece with a look back at 2008, when the conversation about digital transformation first began. “In the naivety that was 2008, many believed that the journey was just about technology and had a beginning and an ending—at least one that would come before 2018,” he recalls.
Fauscette posits that we’re currently in the “second generation” of digital transformation, which he defines as being “focused on the business as a platform that enables agile and flexible global operations.
“More and more, for digitally savvy businesses, the technology is so intertwined with the model and the operations that they aren’t easily separated, which supports the concept that a business is an integrated platform—or at least should be.”
So, which trends does Fauscette believe will dominate digital transformation over the next year? He starts by highlighting the five that will be “most powerful and support the continued expansion of DX”:
- AI & ML: Artificial intelligence and machine learning will be “embedded in the business platform” and enable “smart” business operations
- Blockchain, which Fauscette predicts will “continue to expand ‘out’ of cryptocurrency transaction management and become a part of the core business platform” – though he believes it will still be used for recording transactions
- Internet of Things, whose adoption will accelerate among mid-market and enterprise businesses
- Cloud platforms, which will be adopted by the majority of enterprises and drive a shift away from “off the shelf” Software as a Service back towards tailored solutions
- Conversational UIs, which Fauscette predicts will become “the pervasive method for interacting with enterprise systems”.
Fauscette takes a deep dive into each one of these trends and their probable impact, before concluding with a summary of nine other, less prominent, trends that he nevertheless believes will be significant in 2019.
Many of these are digital transformation staples, like cybersecurity and ERP (Enterprise Resource Planning), but one unusual outlier was agtech: trends in agricultural technology. Fauscette writes,
“Like any other industry that’s transformed by tech, the agriculture space must keep up with changing work styles, updates in equipment and mobile devices, and the demand for speedy results. Agtech trends will be heavily influenced by millennials in 2019, and will have the biggest impact on small farms.”
Should we rename digital transformation? Thoughts from the Digital Business Transformation and Innovation Summit
At a recent Digital Business Transformation and Innovation Summit in King of Prussia, Pennsylvania, a group of healthcare, life science and chemical executives discussed what the future holds for healthcare in 2019.
Mark Hassenplug, former principal at KPMG and a current board member at ZH Healthcare, made a radical declaration: that the biggest problem with digital transformation is the word “transformation”.
“We’ve used [the word ‘transformation’] so much,” said Hassenplug. “It implies a radical change.” Instead, he proposed, “you’d be wiser to avoid the term and talk about a ‘digital initiative’ — how it aligns with digital and business strategy and delivers results in the near-term.”
Hassenplug isn’t the first to propose changing the language around digital transformation in order to bring about a change in attitude. Regular readers of this column will remember that in our 9th November edition, we covered a piece by Industry Week in which John Hitch made a case for calling digital transformation “digital metamorphosis”.
While changing the name by which you refer to the process might seem insignificant, it’s true that “digital transformation” has acquired a number of weighty connotations that would intimidate anyone hearing that their organisation was about to undergo. At best, it promises a challenge; at worst, instability, layoffs and the potential collapse of a business.
This goes hand-in-hand with a point made by keynote speaker LaVerne Council, national managing principal for Grant Thornton LLP and former CIO in the US Department of Veterans Affairs. She argued that the biggest challenge in digital transformation is “the people and their ability to embrace change. It has nothing to do with technology.”
2018 has been a good year for digital healthcare overall: Christopher Knerr, CEO of Mareana, shared that as much as $10 billion has been spent on the acquisitions of 800 to 1,000 startups, with per-deal prices rising.
However, Denise Hatzidakis, CTO of ChenMed, believes that in many ways, healthcare is behind the curve when it comes to digital transformation.
“I get concerned that we lose sight of the basics: What are we trying to accomplish?” she asked. “I think we still don’t know the problem we’re trying to solve with all this data.”
The importance of apps to digital transformation
If you’re like me and read a lot about digital transformation, by now, you’re probably used to this or that technology being hailed as integral to digital transformation – it’s why the “key to digital transformation” is a regular feature in these columns (more on that a bit later).
But I must admit, I did a double-take reading this piece by Born2Invest which argues that native apps are key to a digital-first strategy. While apps are still an indispensable part of our everyday lives, treating them as a revolutionary technological development seems quaint, even old-fashioned – especially in the face of newer innovations like progressive web apps.
However, writer Dhaval Sarvaiya makes a number of interesting points to back up his argument, including:
- Apps offer a level of customer service and experience that is a cut above the norm. “In liberalized economies, every business needs to ensure that the existing and future client base remains satisfied with the levels of customer service. And nothing can do it better than apps.”
- Apps also offer a level of personalisation that websites cannot achieve, making the experience again more appealing to users.
- The growth of ‘aggregators’ – businesses that draw together services or offerings from a number of different operators – could only have come about thanks to apps. “It is hard to imagine Uber or other famous aggregators succeeding without apps,” writes Sarvaiya.
- Apps can handle customer requests in a cost-effective manner. “For instance, in-app chat facilities can be handled by AI-assisted bots that will quickly handle queries that are simple and straightforward. This reduces the amount of time that a user will have to spend to receive information.”
- Apps offer a “single touch” experience. “Rather than having to log in repeatedly, an app permits users to tap once and enter just the relevant details,” Sarvaiya points out. This means that apps can offer services to users at high speed – something that all businesses aspire to, especially on mobile.
Why the cloud is the key to digital transformation – and how to keep it secure
Cloud technology has cropped up more than once in our “key to digital transformation” feature that typically concludes these round-ups. Few would deny that it has an extremely important role to play in transformation; but there are also very real concerns about its security.
That’s why I’ve chosen to highlight an interview with Neil Thacker, CISO of cloud security firm Netskope, published this week on compelo.com which talks about the importance of the cloud to digital transformation: not because the subject is unusual, but because it contains practical advice on how to use the cloud in a secure way in your business.
Thacker’s conversation with Compelo’s Felix Todd touches on a number of different points related to digital transformation that are worth reading about: Thacker opines on when the phenomenon of digital transformation first began (he pinpoints its start as early as the 1970s, with the advent of digital automation), and talks about the sectors which face the biggest challenge with transformation.
But the most informative sections deal with how to improve security as businesses move more of their operations onto the cloud. Thacker advises deploying a Cloud Access Security Broker (CASB), a security technology that sits between the business’s devices and infrastructure and those of the cloud provider.
“A CASB can make a big difference as it takes the strain of gate-keeping away from team members and adds additional data protection pervasively across the business,” he says.
He also emphasises that working with a major cloud provider like Amazon Web Services doesn’t mean that security is “guaranteed or enabled by default”.
“For instance, 71.5% of CIS Benchmark violations in Amazon Web Services (AWS) occur in the identity and access management category, potentially allowing unauthorised access to these systems.”
Thacker also makes the point that while the term “innovation” is almost exclusively associated with positive developments in the technology space, “we should never forget that threat actors are innovators too.”
For this reason, Netskope’s founder and CEO, Sanjay Beri, contends that without security transformation, digital transformation projects are bound to fail.
“There is no doubt that evolutionary business enhancement lies in the various facets of digital transformation, but the increasingly sophisticated threats posed by threat actors mean that technology and business innovation must be intertwined with security innovation,” agrees Neil Thacker.