The Rise of Digital

Maybe I’m just not willing to suspend disbelief, but it feels like digital has been around for a long time to me; I mean, the transistor was invented in 1947 and since then we’ve had digital computing (1950’s and 60’s), digital music (1970’s), digital cameras (1980’s), digital cinema (1990’s), and digital communications and social networking (2000’s). But over the last 3 or 4 years, I keep hearing this idea of a “digital revolution in business” requiring companies to create Chief Digital Officers (CDO) to spearhead the initiative.

My hypothesis isn’t really that business is moving from analog to digital, but that the advancements in personal technology have finally cemented the fact that businesses need to start working and acting like we do in the rest of our daily lives. About 5 years ago, Microsoft referred to this as “the consumerization of IT”; employees demanded the same level of sophistication and elegance in their internal tools as they get from the tools they use in their personal lives, like iPhones, Facebook, Google Mail, etc. Where this really first took hold was in the marketing space where traditional means of engaging with customers was often “dumb” mass marketing that barely distinguished among the individuals it was reaching. Over time, marketing got smarter as it applied greater analytics to the problems, but not until the final leg of the digital revolution (mobile and social) did the practicability of individualized marketing become a reality.

The Business Reaction

While internal IT shops have been grappling with what to do with these advances, marketing and other business groups have been accelerating rapidly. Often, this means that bypassing IT is necessary to get things done quickly, leading to more expansive outsourcing that is taking advantage of even more evolution in digital: the Internet of Things (IoT), cloud computing, software as a service (SaaS), and Big Data / advanced analytics.

But, unencumbering your organization by outsourcing IT does not make the problem of complex technology go away, it merely shifts the responsibility to others. Often, that is okay given that running technology systems is a core competency of outsourcing vendors, but at the same time you don’t have a full understanding of all eventualities. Back when I was selling such services to CMOs, I created what I jokingly referred to as the “oh $#!T” slide. The intent was to make technology sound really complex so that they would want to buy my services instead. What did the slide consist of? Merely a set of 12 boxes that contained the following items:

• Business continuity
• Vendor management
• Release management
• Security and audits
• Data management and stewardship
• Backup and recovery
• Incident management and support
• Expense vs. capital planning
• Deployment methodology
• Technology talent management
• Configuration and change management
• Infrastructure and data center management

My favorite part of the slide is that I made it up one afternoon and never touched it again. It was a stream-of-consciousness inventory of the things that I didn’t enjoy doing myself, but that were necessary for the proper running of a technology organization.

The reaction of many CMOs was exactly as you’d predict; they didn’t want to do those things and they preferred to let someone else carry the burden. In fact, they didn’t even understand what was involved in most of them: agile versus waterfall? And, try having a discussion about the trade-offs of cost versus availability and avoiding single points of failure through the use of multi-cast IP clustering technologies or Hadoop domain nodes. Nope. To them, outsourcing sounded like a great deal; they are the experts, they have it all under control, and they always say “yes” while their internal IT department always seemed to so “no”.

The Warning

So, if it seems like an obvious choice, when all the big consulting firms are suggesting you take this route, and your CEO is telling you to go faster and faster, isn’t it an easy decision? What do you think? Doesn’t it sound a bit too good to be true?

It’s really not a simple answer. When creating a digital strategy, your organization must consider a number of factors, including which investments best align to your corporate strategy, which technology vendors really are good fits with your needs, how will you manage an end-to-end process that includes multiple-systems and hand-offs, and what skills will you need to be most effective? As I’ve seen over my 20 year career, there is a desire to jump too quickly into real cool technology or outsourcing (aka the “shiny object” problem). The advancing digital technology revolution is not immune to this yearning.

As with most complex problems, we at Thought Ensemble don’t look for silver bullets like: “You must hire a Chief Digital Officer”, “You should pursue Big Data”, “You should invest in social marketing”, etc. Instead, you should look at how technology innovations may be a huge opportunity for your business while also considering which components of your business have problems to solve. Put in place a strategy and start executing on it, which will include technology, process, and organizational considerations. This doesn’t have to be a 5 year effort – it can actually be done in a few weeks or months.