Digital transformation: making it work

Digital transformation has had a significant impact on government, and other organisations in recent years. However, for large organisations, it is hard to find examples of where this transformation has yet gone beyond a few transformational digital services, and deep into the heart of the business.

There is a simple reason for this: large, established organisations have been accumulating digital technology for decades, and it is going to take time to transform all that technology.

In fact it’s even harder, because as the years pass, the technology ages. Over time costs and risks grow because the technology becomes:

• Vulnerable — hackers or researchers discover new security flaws
• Unsupported — suppliers or open source communities stop giving the level of support needed
• Unknown — the organisation’s system knowledge that is not recorded, hard to find, or hard to understand, becomes lost

Technology transformation

For digital transformation to truly succeed, it needs to include technology transformation — transformation focused on making technology an enabler of change. This area needs to be better understood, and to become an established part of any transformation process.

By combining technology transformation with digital transformation, a more enduring, and more effective form of transformation will be possible. And in many cases, without this combination, digital transformation will eventually fail.

Technology that enables change

Technology transformation seeks to improve key enabling metrics. If improved, these act as a catalyst for digital transformation, and all forms of change.

1. Lower cost of operation: It’s cheaper to sustain existing technology
2. Lower cost of change: Less is spent whilst delivering technology
3. Higher throughput of change: More change delivered per day, week, month or year
4. Lower latency of change: Less time for an idea to become a reality for users

(If you’re familiar with the term ‘technical debt’ then technology transformation is a way of describing work dedicated to reducing the kind of debt that holds back change.)

Some examples of technology transformation are:

• Moving systems from physical infrastructure to public cloud
• Introducing continuous delivery pipelines to existing systems
• Replacing proprietary components with open-source equivalents
• Upgrading major components like databases, operating systems etc
• Refactoring to enable change, e.g. monolithic to microservice architectures
• Decommissioning systems

Counter-intuitive transformation

Unfortunately, technology transformation has several characteristics which make investment in it counter-intuitive for business leaders:

1. Not user-centred
2. Focused on metrics that aren’t the organisation’s priority
3. The real-world ‘savings’ or ‘benefits’ are often enabled, but not achieved directly
4. It competes for resources with other change
5. Harder to categorise as capital expenditure over resource expenditure, making it harder to fund

These pressures lead to the frequent avoidance of technology transformation, and the emergence of two common anti-patterns.

The anti-pattern of technology preservation

Technology preservation is accepting the inevitable ageing process of technology, and only remediating when the most serious problems emerge e.g. critical security vulnerabilities.

Unfortunately, it is very challenging for digital transformation alone to outpace a large, ageing technology estate. This entrenches technology preservation, and eventually suffocates the organisation with old, ineffective technology — increasing costs, holding back change, and ingraining poor practices.

The anti-pattern of accumulative technology

Many organisations have inadvertently shut out the possibility of technology transformation through the creation of large digital transformation programmes focused on intuitive ‘business change’ through the delivery of new technology alone.

These approaches too often fail when they attempt to integrate with or migrate away from old, untransformed technology. The failure to fully replace existing technology leads to an accumulation effect: new technology layers on the old, year after year. This increases the complexity, risk and cost of the overall technology estate.

Deep transformation: digital & technology transformation together

To ensure that you have a sustainable digital and technology strategy, technology transformation always needs to be part of a balanced portfolio of work alongside digital transformation.

For larger, established organisations there should be a recognition of the breadth of technology used, old and new. Investment to modernise the older technology should be balanced against creating more new technology.

The ideal situation, for modern organisations, or forward-thinking areas within large organisations, is to try to keep the natural aging process of technology at bay. In these teams, the concept of technical debt is recognised, and is not allowed to grow too large.

However, it is challenging, and expensive, to maintain low technical debt, particular across a growing estate of applications, components, libraries and infrastructure. The aging process for technology is to some extent inevitable — meaning that technology transformation is relevant to even the most modern technology companies.

Transforming culture and practice

When digital transformation and technology transformation are done together, it creates a healthier environment to change practice and culture. Digital transformation leads the way, and technology transformation makes sure no-one is left behind.

Digital transformation creates new high-performing teams acting as exemplars to the rest of the organisation. Technology transformation can go deeper, and change the practice and culture of pre-existing teams too.

Each in isolation would not be sustainable. Digital transformation alone creates a ‘two-tier’ organisation, with increasing misalignment between the future technology, and past technology. Technology transformation alone would never deliver anything new, exemplary or user-centered.

Making it happen

The first step to introducing deep transformation is to be conscious of how your organisation currently invests in technology — tracking the major products/projects, and understanding if they are digital or technology transformation, or combining both.

If the anti-patterns can be identified, and the absence or shortfall of technology transformation demonstrated, it creates a case for rebalancing what the organisation is delivering.

Organisations must find the right balance for them, to ensure that the technology they deliver does not begin to hold them back.