However, cloud is not mandatory to get into the digital world. Often, in fact, organizations are hesitant, for various reasons, to jump into public cloud services when initiating digital channels, processes, or analytics. If anything, they may only move to private cloud first, then gradually adopt public cloud services. That's the view of Jim Sinur, pre-eminent BPM expert, author of numerous books, and former Gartner analyst, who joined Software AG’s Matt Green for a panel discussion at the recent CeBIT event in Hannover, Germany.
"People ask, 'should I be on the cloud or not to go digital, and is that a requirement?' As a matter of fact, it's not," Sinur explains. "Some organizations are doing these earthshaking, great processes, or even IoT processes, without being on the cloud. They're concerned about data security and accessibility. A lot of customers I talk to like to start on-premises cloud first, so they're not taking a lot of risks. Then later on they go to full cloud."
While going full-throttle into the cloud isn’t necessary to go digital, “but it can help in a couple of ways,” he explains. “One is to fund the digital effort by reducing costs and using the savings as a capital fund. The other would be to share target models and experiments across many regions, divisions and departments especially in large-scoped efforts.”
While the cloud often offers a path of least resistance, "some balk at running their crucial and differentiating processes and applications on someone else's computer," Sinur observes. "When critical data, policies, rules and practices are somewhere else, some organizations want to phase cloud in slowly. Once confidence can be established a private cloud solution could go public. Many times cloud solutions offer a way to try things in a separate experimental sandbox without impact on traditional production outcomes."
The key to evolving to digital channels, processes and analytics isn't entirely in the technology one chooses -- through it helps, as Sinur also explains -- but is more an outcome of an organization's readiness and willingness to embrace a digital mindset. “There’s a couple of things you have to do. One is you have to take a good look at yourself,” he relates. “That means you have to change your culture, goals and principles.”
Digital is a long-term evolution, not an overnight project, Sinur cautions. Sinur says he sees different approaches among organizations "under duress" -- meaning they face a disruptive digital competitor -- versus those in less-competitive situations. The under-duress enterprises tend to attempt big-bang approaches, which are fraught with risk. “The big bang doesn’t work unless you’re under duress," he states. "You start with a large gulp and take a piece at a time. It’s a lot like eating an elephant a bite at a time." Instead, he urges an incremental approach, with rapid development. "Add a rad approach to that and you can cycle through very quickly. “
There are three distinct goals to any digital effort, and Sinur says he sees a common pattern among the organizations with which he's worked. The first goal is "to have a better customer experience -- not about customer relationship management, but about the overall feeling that the customer has. They have control; they feel they can get things done."
The second goal is around operational efficiency and operational excellence -- "the idea of getting more with less," Sinur continues. Often, this is how digital transformation gets funded as well -- the money saved by digitizing goes to building new digital channels and applications.
The third goal of digital transformation-- seen among more advanced efforts, or among upstarts -- is to create new digital services and products.
(Disclosure: Software AG assisted me with travel expenses to the CeBIT event.)
