A high powered group of technology executives from government and the private sector say that in the fast moving game of digital transformation care needs to be taken with how traditional operational IT teams react with innovation leaders.
As Rob Le Busque, the Managing Director ANZ for Verizon Enterprise Solutions puts it: “There’s the operational IT organization and then there’s innovation, this concept of design of the future that sits completely separately.
“Does that model bear merit? Or are we simply de-aggregating and functionalising because we don’t know what to do otherwise?” asks Mr Le Busque, who led the discussion.
Participants in the roundtable discussion employed a wide range of strategies to manage the tensions between operational IT and innovation. The discussion has been captured in a Verizon paper titled Credibility, Impact and Influence in 2018.
Elmar Platzer, CSR’s Digital Transformation Leader reckons there is merit in having a two-speed business, where one side goes nimble and the other side provides stability.
“Personally, I think there is a lot of merit of having two modes of operation. One that is extremely nimble and is not hamstrung by bureaucracy and red tape and therefore is able to experiment with new tools, methods and structures,” says Mr Platzer.
The other operational mode provides a counterweight of stability and innovates incrementally. It adopts new tools and work methods that have been successfully tested.
Tolerance of honest failure and a willingness to adapt quickly are key for tech leaders managing this process.
“Some ideas will work and some won’t and it’s important to be able to keep a very open mind and to foster a culture with a curious mind, willing to iterate and if necessary pivot on everything, including technology, methodologies and organisational structure,” says Mr Platzer.
Kathleen Mackay, who is Head of Digital Delivery at Boral agrees.
“It is tricky and the most appropriate roles and structures will evolve as your capabilities in innovation, design and delivery improve,” Ms Mackay says.
Craig Said who is Head of Network Services for Big Four bank CBA believes the operational and innovation sides of tech probably work better as a single team where the operational piece can directly help the frenetic pace required of the innovation side.
“I think it depends on the size of the organization but if I just take CBA as an example, our digital group is separate from technology and one of the real problems we have is we don’t have enough infrastructure capacity to support the digital team, who have a weekly release cycle,” he says.
“I think on balance, conjoined teams probably work better because everyone gets an understanding of the total ecosystem,” he says.
Fellow Big Four banker Robert Wilson who is the CTO at Westpac warns of developing ‘loudest voice in the room’ syndrome when it comes to digital innovation.
“You’ve got technology, then you’ve got the customer and then in the middle you’ve got transformation and digital innovation. It’s almost ‘which is the loudest voice in the room?’ that gets to own or at least get a stranglehold on that digital piece of the customer side,” he says.
Mr Wilson often observes businesses struggling with this issue and counsels against over-reaction.
He says businesses can end up believing that digital types can fix everything and will go into a hire and fire cycle to get in a bunch of digital demigods.
“What is a digital person? What is the talent capability they’re going to bring to the firm? I think it is that paradox and to me what we’re saying is it almost use the loudest voice, which is not a great way to run the organization,” says Mr Wilson.
At the end of the day, disruption comes from losing revenue, not the latest, fancy tech.
“It’s not the technology that’s really disrupting you, it’s the fact that your customers have decided to spend their money somewhere else.
“That’s the ultimate thing that’s disrupting your business model. Really thinking meaningfully and deliberately about the impact that technology has on the customer experience, because it is whether the customer decides to continue spending with you or not that should determine the success or failure of any project,” says Mr Wilson.
Katherine Squire who is General Manager SEO Software Engineering at NBN Co tends to the customer-centric view and warns against getting too hung up on producing fancy digital features.
“Obviously the whole piece behind pure transformation is getting that sort of closeness, but I think also sometimes it can be used as a “let’s keep building features” routine. You’re not responding to the customer … so I think sometimes the KPIs and organizational purpose need to make sure that you’re building for the customer in a sustainable, strategic way.”
Tech leaders also need to keep a weather eye on the mid-term horizon.
“You also need to be an advocate for technology so that it will be there in five years’ time. It might be different because you’ve built a team that can change as technologies change, but if you’re constantly with the next latest feature request or whatever it is that’s coming down the pipe, because we love our customer, we also need to love them in five years’ time.”
In the swirl of action that surrounds most technology projects, Verizon’s Rob Le Busque argues there needs to be a customer advocate in the mix.
“There’s a role for someone that sits outside of technology and innovation that represents the voice of the customer, the view of the customer. I do wonder where is that third leg to the chair that truly assesses it without any agenda to understand what the customer is really going to think about this. Someone looking at it from the outside in,” says Mr Le Busque.
Checking back into the real world by doing proof of concept work with the customer is a strategy for keeping big projects on target with customer expectations, says David Williams, who is the General Manager of eCommerce and ERP Delivery at Metcash.
“A lot of technology I find gets too big before it actually gets launched. It’s too big and too hard. Which ends up in a disaster at the end because you’ve missed the point of customer experience,” says Mr Williams.
“What can you get in front of a customer in three months? It’ll be rough and ready … but what can you get out real early and say does this work?
“I think that learning is critical and that if you don’t get out early, you miss that opportunity of really going in,” says Mr Williams.
Finding common pain points during project development helps ensure a happy ending for customers, says Sonia Swansborough, Director Know How at Sparke Helmore Lawyers.
“In our space we find that working on shared process mapping with our clients and focussing on the overall customer experience is something that has had the most traction.
“We’ve identified the common pain points and then we’ve been able to go into a collaborative design cycle but with a shared understanding of where our pain points actually are,” says Ms Swansborough.
Digital transformation of work processes is all very well, but if the customer is not buying in and using the new tools, then you are wasting effort.
“Lawyers and many professions are very good at what they do and they’ve perfected that, so you’re coming in and tipping all of that on his head and you have to be able to prove that it’s really going to make a difference to their day – before they’ll adopt it of course,” says Ms Swansborough.
Verizon Enterprise Solutions partnered with InnovationAus.com to produce the Credibility, Impact and Influence 2018 discussion paper.