To many people, the term "digital transformation" suggests software-defined networks, network functions virtualization and other sophisticated new technologies. That’s not wrong, of course. But it is only part of the story.
Andy Hicks, the research director for IDC's EMEA Telecommunications and Networking Group, told Telco Transformation that a remaining challenge for digital transformations, which IDC refers to as "DX," is the transition of processes and user approaches from old to new. That is as much a part of digital transformation as cutting-edge platforms and, in some cases, represents a deeper challenge.
In Part II, Hicks discusses the need for telcos to transform themselves en route to offering support for such things as autonomous vehicles and virtual reality.
Telco Transformation: How does IDC define digital transformation?
Andy Hicks: Digital transformation occurs on both the technology and the business sides. We look at things such as work sourcing. Where are you going to get your developers? Where are you going to get your business side people? They could be internal employees. They could be from partners. They could be from consultants or just sort of ad hoc coalitions of freelancers.
We look at things like leadership. Does the leadership really understand what the technology can do? Is it really pushing the organization to adopt new tools, to create new products and new experiences based on the information that it has?
We have another pillar that's around omni experience, which is sort of the super case of omni channel. When you go into a store -- let's say the retail store of a telco -- are you getting an experience that's being reinforced by your technological channels? Is it being reinforced by marketing? Do your systems recognize that customer and can they build on previous interactions and maybe even problems that customer has had in order to provide the best experience possible?
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TT: So we're talking about something that at its core is not fully technical. It's a business change in leveraging those new capabilities.
AH: I think that's right. People are tired of spending a lot of money on some big new technological platform and then finding that the business doesn't really change. When you talk about digital transformation, it's an attempt to close that gap, to take the final step.
That is where people are having some problems. If you'll talk to CIOs or to CTOs, they'll say some version of the following. "Look, I know how to address the technological challenges. They may be difficult but that's what I'm trained for and that's what my staff is trained for. Where I have the problem is in making sure that those technological changes address the business outcomes that we're actually looking for, whether that's increased efficiency, lower time to market, a better customer experience, what have you." They're having problems in precisely that last 20 percent of making sure that all the money that you're spending on technology is actually producing something that improves the business.
In order to really benefit from your technology, you have to let go of some things that people have trouble letting go of. A lot of those things are manual. When you really digitally transform, you almost have to automate to a much greater extent because you need to make sure that your employees, your people are devoting their efforts and their energies to the parts that produce the most value. To give you a practical example, we often see that when people integrate new technology, they often don't change their processes. The processes remain tied to an old, very loosely integrated set of systems where it takes manual steps to get information from one system to another. Perhaps it takes maybe too many manual steps to certify something.
You can automate a lot of that work now and enable people to really start focusing their efforts more on new kinds of experiences and new kinds of products, but you have to make sure that your processes go along with your technology. Otherwise, you've got people basically implementing an outmoded system within the new system, just by virtue of the fact that they're not changing their processes.
— Carl Weinschenk, Contributing Writer, Telco Transformation