Is your digital platform fit for purpose?

When it comes to succeeding in the digital space, it is rarely about having the latest and greatest of tech, nor is it to have an “if it is not broke, don’t fix it” mentality. Just like rocking a suit, having the right fit is essential, but how do you go about determining what is fit for purpose for your organization?

Having the wrong fit comes in many shapes and configurations, and while the most common one is incumbent companies that have grown out of their digital capabilities, still sticking with some things that were once bleeding edge, but went out of fashion several years ago, it is not uncommon to see smaller companies struggling with an oversized digital platform. Another category of having the wrong digital fit is being ahead of your time by overinvesting in tomorrow’s technology while neglecting tending to present needs.

No matter the cause, having the wrong digital fit will eventually slow down your company’s overall performance. In order to transition from an incompatible digital platform towards something that is fit for purpose, it is imperative to do a thorough assessment of your current capabilities as well as future needs before embarking on a transformation journey.

According to an often-cited study from McKinsey state that 70 percent of digital transformation efforts fail. The reasons are many, and not surprisingly, McKinsey lists lack of management support, poor or nonexistent collaboration across silos, lack of employee engagement, and accountability as some of the main culprits. This is supported by Bain, which in a study of 100 companies states that 75 percent of those surveyed settle for dilution of value and mediocre performance. A mere 5 percent of companies involved in digital transformation efforts reported that they had achieved or exceeded the expectations they had set for themselves.

Despite statistics that repeatedly show the need for a different approach to digital transformation, resources are still flowing into digital transformation initiatives. According to an Accenture study of 1350 global businesses, investments in digital reinvention exceeded $100 billion between 2016 and 2018. Not surprisingly, the majority of respondents reported that their investments failed to materialize and resulted in poor returns.

While the reasons for failure may be many, the need for a structured approach to assessing your digital platform is integral to making sure you have the necessary fit.

Architecture

The natural starting point (at least from my perspective is to get a good overview of the overall architecture and how this corresponds with the companies overall operating model. I find Conways law, which states that any organization that designs a system (defined broadly) will produce a design whose structure is a copy of the organization’s communication structure as a useful analogy to this comparison.

In order for your architecture to evolve alongside organizational changes, the architecture should be composable in a way where each component works interchangeably with each other. Having an API-first digital strategy where all systems, components, and processes are API-enabled is a prerequisite to achieving this architectural state.

Breaking down which technologies are deployed and the reason for the choice is another exercise that is valuable to assess the technological fit for the company’s digital platform. One way to do this is shown in the example table below:

Further on, evaluating whether the code structure is consistent across the various parts of the overall architecture will give some pointers toward future scalability as well as potential red flags toward technical debt issues.

Make vs. buy

Make vs. buy is the age-old question of any IT-department, and while there will probably never be a definitive answer, a rule of thumb should be that the less you develop yourselves, the more room for innovation. Make sure to stay on top of the future roadmaps of the technologies deployed and make use of the inherent functions on your cloud platform of choice rather than attempting to re-invent the wheel Save your precious in-house development capacity towards what gives you a unique competitive advantage rather than building infrastructure.

Development

Once you have come to the point where your prioritization process allows you to do the right things, it is equally important to do things right.  Defining a development methodology that is right for the task at hand should never be underestimated. Different problems require different approaches, and while agile is perfect for innovation and feature development, traditional waterfall methods have their strength when the path from state A to state B is set in stone. Once more, fit for purpose is the key to choosing the right approach to software development.

A rule of thumb to nurture high-performing teams is to allow sufficient autonomy for the teams to choose their own path as long as they deliver upon their business goals. 

However, this is not possible unless IT shares the same goals as the rest of the organization. Unless you have an operating model that places IT as a core function of the business, IT will always be playing catch-up and never release the full potential of your company’s digital aspirations.

Data platform and strategy

No matter which industry you belong to, becoming data-driven is crucial in how you run your organization going forward. Although the use of data in everyday business is nothing new, becoming truly data-driven is imperative for success in a rapidly changing world.

No matter your aspirations and well-thought-out data strategy, data is only valuable if data quality is accurate. Data quality need to be based on a single defined source of through, and just like the overall data strategy, someone needs to be accountable for data quality and governance of all time. Poor data quality could result in systemic errors if injected into machine learning algorithms or automated processes without proper human supervision.

In summary, a data strategy should (at least) consider the following:

• Define clear goals and aspirations
• Make sure you have the necessary skills
• Stay secure and within the boundaries of regulations
• Data quality is a key prerequisite
• Map your data sources
• Have an active approach to the necessary freshness of your data
• Make use of the data you already have before hoarding additional data
• Define clear KPIs and metrics for success

Cyber security

Think like a crook and be constantly on the lookout for potential vulnerabilities. Does your organization have the sufficient skillsets to keep up with the increasing sophistication of cyber threats?

Malware is no longer innocent pranks, and traditional antivirus is not enough to stop the threat. When software is developed, it is crucial to understand how malicious organizations think and make sure security layers are inherent in the code. Creative hackers are well educated when it comes to understanding the possibilities and limitations inherent in the technology. Hackers work purposefully, long-term, and systematically and explore and gather information well in advance of the attack itself. What may appear to be an averted attack is in many cases only a test of the defenses of the companies concerned. Make sure to analyze system logs whenever you experience what may look like an attack to uncover potential future attack vectors

It is important to be aware that criminals only need to succeed in breaking the security once, while you as a business must succeed in keeping the security 100 percent of the time. This recognition should lead to continuous work with digital security.

A system’s system portfolio is constantly changing, and changes mean potential misses that can be the subject of attacks. A hacker will constantly look for vulnerabilities and often have an overview of the system architecture of the next victim. The introduction of something new means a potential new opportunity to break security.

Understand how the total scope of IT infrastructure contributes to potential angles of attack. Printers, scanners, telephony systems, in short everything that is connected to the web can be a way into critical systems. Deploying a zero-trust environment will help mitigate the potential risk of intruders having the keys to the kingdom if someone manages to sneak past the outer defenses.

At the same time, business leaders need to be aware of the risks they are exposing you to in the choices that are not made. Outdated software is a goldmine for hackers, and the best-known example of this is the Wannacry ransomware virus, which affected businesses in over a hundred countries, including Norway. The British NHS was one of those affected when they considered it too expensive to upgrade from an outdated version of Windows XP that had security holes in it. The attack ended up costing the NHS over £ 92 million.

Operations and infrastructure

Needless to say, having a robust, reliable, and scalable infrastructure is the entry ticket to mastering digital. User satisfaction is as much defined by what the users don’t experience as what they are exposed to. Reducing load times, keeping downtime to an absolute minimum, and making sure everything runs smoothly are all integral parts of delivering an unprecedented user experience.

Talent

Lastly, and perhaps most important, having the right team is crucial to success. Which skills and personalities are required to solve the challenges ahead? Make sure you create a diverse team in terms of both skills and personal/individual traits. Even with the right skills in place, creating a team consisting of a collection of carbon copies of the team leader is worthless. A good team should be balanced in terms of gender identities and backgrounds. Diversity done right creates positive friction and the ability to analyze a problem from various angles.

When your team is in place, establish a common understanding of where you are heading. A shared long-term vision of the journey ahead as well as shared goals define which steps you need to take together. Shared goals have become somewhat of an obvious remark when it comes to team dynamics, but are not sufficient.  You need to make sure you all have a shared understanding of your surroundings as well. Common goals have no value if the map does not match the terrain.

Define clear roles and responsibilities – even though roles and responsibilities must be clearly defined, there must also be a certain level of flexibility as change happens in a dynamic environment. When outside factors change, one should be wary of letting internal governance limit potential opportunities. Keep it as simple as possible, and always makes sure to double-check that authority and responsibility are coherent. Few things feel as fatiguing as being responsible without the authority to do anything about it.

However, even more, important than formal roles and governance, identify and implement the desired behavior in your team. Since team behavior is a product of the team’s collective personalities, getting to know each other on a personal level is a prerequisite to identify and adjust desired behavior.

The founding principle of any high-performing team should be trust. Without trust, none of the other desired behavioral traits is possible. Trust is crucial to know that you will receive support from your peers when needed as well as receiving constructive criticism in knowing that the intention is towards a common goal. This brings us into another behavioral trait that ensures progress and team dynamics. Challenge each other – The value of a diverse team is to see things from various angles. Allow a constructive level of friction to occur when opposing views intersect.

Great teams encourage openness and information sharing. In a digital world, knowledge is power, only when shared openly.