Posted  March 15 2022

Digital Transformation versus IT Modernization.

Digital Transformation
Written by Jerônimo do Valle
Many companies have been pursuing digital transformation for years, but there is not always a consensus on what it means. Even the most experienced IT executives use the term very generically, even referring to the simple modernization of certain applications. So, how to truly determine the difference?
Digital transformation changes business models and can open up new revenue streams, while modernization means taking your technology to the next level, either through upgrades or a total renovation. The latter shares some key benefits with the former, such as streamlined processes, new efficiencies, and automated productivity, but that's where it ends. Application modernization will never change your business model or put you in a new category, while digital transformation certainly will.

We've all seen top-notch companies implement true digital transformation to succeed and this is a paradigm shift that's taking place in companies of all sizes, however, what does it take to emerge victorious from this battle?

First, before taking any step in this direction, all the main stakeholders – end-users, customers, executives from the business and management sectors – should be brought together to discuss desires, frustrations, goals and tastes, thus carrying out a brainstorming of digital solutions. Once this process is complete and a solution is developed, you can test it, through a design sprint.

Digital transformation is a huge leap forward, so it requires strategic thinking and incremental steps that shouldn't be avoided until a full implementation is actually possible. So, the next natural step would be to define ways to deal with one of the biggest problems of the human being; the resistance to change.

Every change can be difficult for employees and customers who are used to doing things in a certain way, so regardless of who implements it, the initiative needs to address everyone's fears, concerns, and reservations. Digital transformation can be disruptive; it changes traditional processes, roles and expectations, and by doing so can cause “corporate chaos” before it becomes operational. Especially when a digital transformation involves AI or automation, employees may fear it will take away their jobs, so it's important to address those fears and introduce changes gradually.

The penultimate stage of the process that guides the path of a true digital transformer is learning to lead by data and apply analytics to discover the insights hidden inside of it. In fact, most digital transformation initiatives today are centered around this.

Knowing where your company's data resides, how that information can be enriched, and how to apply analytics and AI to leverage the results are key steps to the success of the endeavor.

Last but not least, it is worth mentioning that one of the main goals of any digital transformation is to improve the quality of customer and employee experiences, products and services and corporate image. At the start of such an initiative, ask this key question: Can we maintain the highest levels of quality throughout the journey?

This requires an incremental approach to the project, testing and validating the results at each step, improving processes, and adjusting or streamlining where necessary.

Today, AI, automation, IoT, cloud migration and other advanced technologies are changing the way companies operate, requiring a complete shift in corporate mindset, culture and business model. However, no matter how you define it, digital transformation, while often fraught with unknowns and some level of risk and disruption, is changing corporations for the better; across the entire planet Earth.