The far reach of internal digitalisation

Internal digital transformation in the corporate world isn’t merely a side note to overall strategy, but an actual business imperative.
Outlook 2022

The far reach of internal digitalisation

by S. Samal, A. Ardito and J. Benghiat

With global turbulence caused by Covid-19, internal digital transformation in the corporate world isn’t merely a side note to overall strategy, but an actual business imperative. There is no second opinion about how internal digitalisation has become pivotal in these current times where operations must carry on, oftentimes with a remote or reduced workforce. On the outer shell, we strive to enhance our customers’ respective journeys so that they can benefit from personal and real-time experiences, no matter where they are in the world. And yet internally, to navigate through these changing times, corporate teams seek to operate more efficiently, to better collaborate in real-time, to drive costs down, to ensure future scalability, to address cyber-security risks before they become threats, to achieve a low carbon footprint… They do so by digitising information, digitalising internal process, introducing automations, or perhaps even by shifting subsets of their system landscape to cloud or hybrid infrastructures.

It is not to say that internal digital transformations are merely a means to navigate through changing times. Such internal transformations often pave the way for external opportunities and for enhanced customer journeys. Examples abound:

From a B2B perspective, we’ve seen numerous advancements in the biotech and pharmaceutical industries. The adoption of highly connected and scalable knowledge repositories, coupled with robust and efficient internal digital processes, have transformed the way in which these industries update and communicate Medical Information in a timely way to medical authorities and relevant stakeholders. Supply chain logistics have also greatly evolved: To gain efficiencies in monitoring and controlling external conditions throughout the supply chain, RFIDs have been a phenomenal tool to track cold-chain logistics, to better manage drug recalls, or simply, to better manage drug inventories. The benefits achieved extend further and now allow pharmaceutical companies to better adjust production in line with their demand. Ultimately, the internal digital transformation has enabled smoother journeys for customers and 3rd parties all along the supply chain.

From a B2C perspective, internal digital transformations have equally paved the way for superior customer journeys and extended opportunities. The utilities and energy sectors are no exception. Internal digital transformations are making it easier for utility providers to extend their service offerings to actual product proposals and incentives. Energy consumption is now remotely checked in real-time, allowing for accurate invoicing, which is in stark contrast with yesterday’s “estimated and later adjusted” invoicing model.

The pandemic and its ensuing lockdowns, that have affected the world population, have been an incredible boost for companies to digitalise internal processes. McKinsey reported that throughout 2020, companies accelerated their implementation of digital capabilities 20 to 25 times faster than their executives ever thought could be possible.

Gartner acknowledges this change of pace but stresses that the acceleration towards such internal transformations is more about digitisation than it is about digitalisation. While digitalisation concerns processes, digitisation focuses on the data and the technology. Internal digital transformation, on the other hand, concerns a higher level, longer-term view of the big picture, and primarily deals with people (thus completing the People – Process – Technology trinity).

During the first European lockdown, we helped a multinational manufacturing company to reshape their internal digital processes with the aim to improve collaboration amongst their personnel and to maintain business continuity. The journey to achieve a full digital transformation in a very short timeframe was based on 3 key principles:

  • Be proactive (and not reactive) to both market and societal change. We set up a three-month base initiative, to collect regular feedback from employees, partners and clients.  The aim of the collected feedback was first, to better understand the immediate needs of the latter individuals at the onset of the pandemic;  and secondly, to assess and plan digital actions that would either directly meet these needs or support these individuals in addressing their needs.
  • Think out of the box and look beyond your traditional IT components: Promote and advocate (evangelise) the digital transformation paradigm throughout the company culture to embrace new digital ways of working, and measure the impact. There’s a massive potential benefit to adopting a digital corporate culture, and the speed of adoption is proportional to the historical benefits: So, measuring the benefits against a set of carefully defined and agreed KPIs is vital.
  • Start small, to validate and confirm the effectiveness of your digital transformation (and to mitigate risk) – basically, consider it to be a pilot. Once proven effective, scale up quickly to extend and maximise the benefits to the next pilot groups (as a phased rollout). For each phased iteration, we planned and rolled out the change to at most two selected departments at once. For each of the pilot phases, we collected feedback and fine-tuned the program before we scaled up for a company-wide rollout.

This internal digital transformation was driven by the pandemic “urgency” to quickly adapt the client’s internal operations to exceptional circumstances. This is not always the case though: CTOs and CIOs are constantly seeking to stay ahead of the technology curve in ways that support their businesses to become more resilient to imposed change and to lead the change with more agility.

We are entering the age of “Facebook is history” and “Meta is the future”. The next wave of internal digitalisation is coming through new frontier technologies including blockchain, automation, and a large set of smart, artificial-intelligence (AI)- based technologies. How this will propagate and open doors to enhanced customer journeys is being defined in these current moments, and the future appears to look very bright.