Businesses need to keep pace with the rapid rate of technological change. That means developing a digital transformation strategy. Fortunately, most IT and business executives are already thinking about digital transformation. In a recent Microsoft survey, executives said their number one concern (86%) was “technological advance.”
Unfortunately, the other 14% is not likely to stay in business very long, according to Sam Sharma, senior partner and development manager at Microsoft.
“Companies that are not evolving, not innovating technologically, are at risk of being phased out,” he warned.
Sharma moderated a panel on digital transformation at the 2018 BraveIT conference in Chicago. The participants were Rob Carter, senior vice president of product development for TierPoint, Maryann Byrdak, senior vice president of information technology at Potbelly Sandwich Works, and Charles Osborn, vice president of enterprise technology at Enable Midstream Partners.
Three essential digital transformation strategy considerations
During the session, Bravery in The Midst of Digital Transformation, they discussed the three main elements they believe essential to a transformation strategy:
Hybrid infrastructure facilitates digital transformation
Organizations need flexibility in their IT infrastructure. Different applications and workloads have unique security and performance requirements, as well as end user needs. Flexibility often translates into a hybrid mix of IT architectures, each best suited for the application it serves. A hybrid IT infrastructure may include private cloud, on-premise legacy systems, collocated servers, and various public cloud services, from software-as-a-service (SaaS) to cloud infrastructure services.
The majority of organizations already use one or more cloud services. RightScale’s State of the Cloud Survey 2019 reports that 94 percent of organizations use cloud services and 84 percent have a multi-cloud strategy. Companies usually migrate their non-mission critical workloads–such as backup, development and testing, and productivity applications—to the cloud first, said Sharma. As an organization becomes more confident about using cloud services, it may migrate more complex or more sensitive applications.
Cost savings is often a key consideration for cloud migrations. However, Carter cautioned against prioritizing cost over business and end-user requirements: “The bottom line may look good, but you have to think about how it will work for employees and customers.”
Data and analytics improve efficiency
Businesses have accumulated volumes of data on their sales, operations and customer buying habits. IDC estimates there will be 163 zettabytes by 2025. That’s 163 billion terabytes, and 60 percent of it created by businesses. With advanced analysis tools, businesses can mine this data to uncover useful intelligence on their operations and markets. For example, Enable Midstream Partners, an oil and natural gas producer, analyzes data to improve efficiencies in various aspects of its operations.
“We use data to make operations more efficient, such as predictive maintenance [on pipelines], improving driver safety and reducing travel times,” said Osborn. “We want to make better decisions with our current assets.”
Microsoft is also using analytics to reduce caller wait times at support centers.
“We get hundreds of thousands of [incoming] support calls every week, so we are using data to identify [caller] trends. We aim to resolve 70 to 80 percent of those calls upfront, without human interaction,” explained Sharma. “That saves a few hundred million dollars a year.”
Partnerships with service providers
With a shortage of skilled IT workers in areas such as cybersecurity and cloud development, organizations have learned to work more closely with their partners to fill the gaps. At Potbelly Sandwich Works, partners are providing more of the IT support that in-house data center staff use to provide.
“We no longer have our own data center and software development team like in the olden days. Our job has changed from managing in-house teams to managing partners,” explained Byrdak. “To troubleshoot an issue, I may have to get five partners on the call. We collaborate with our partners to ensure we understand each other.”
Partners are becoming a critical element of digital transformation as companies strive to master emerging technologies with limited in-house expertise. Skilled IT partners can not only take on IT operations and consult on projects but also provide knowledge transfer on new technologies.
“There is definitely a skills gap and we can’t hire fast enough to fill it, so we work closely with partners such as TierPoint,” said Sharma. “Partners are a force multiplier for us.”
A deeper dive into Digital Transformation
Learn more about digital transformation and how leading IT executives are achieving it by watching the full session video, Bravery in The Midst of Digital Transformation. Continue your journey to IT transformation and register for BraveIT 2019, September 19 in New York, NY.