Home / Opinion / Columns /  Lean digital enterprises make organizations relevant in the digital era

The fusion of information, operational, collaboration and communication tech has created a modern cyber system, which provides unimaginable capabilities such as potent virtual brains (algorithms), real-time communication and collaboration systems, and an immersive work environment, optimizing human interventions, connecting intelligent things, elastic supercomputing, elastic super storage and elastic networks.

Digital immigrants like manufacturing, healthcare, banking, retail and other industries, which have been there for many decades, have been sandwiched between digital dragons like Google, Apple, Facebook, Amazon and Microsoft, and digital lizards like tech startups. Digital dragons and lizards have been leveraging the modern cyber system to introduce innovative products, services and business models to encroach on traditional businesses.

The only choice left to digital immigrants is to digitize their organization’s anatomy beyond business and industrial processes. Digital enterprises are also fat to build and manage. Hence, we must nurture lean digital enterprises, which are future-proof and future-ready and are cost-effective.

Today, almost everything is injected with software—from a baby diaper to a car. A car has 10 million lines of software code. Customer services and information are expected to be offered anywhere, anytime and using any device. All this is possible only with the modern cyber system. Digital execution with traditional thinking ensures successful failure. Hence, organizations and employees must acquire new thinking called ‘lean digital thinking’, a manifesto for organizations that want to sail through the digitization journey effectively and efficiently.

With the modern cyber system powered by lean digital thinking, organizations can acquire new capabilities that help digitalize the organization’s anatomy covering vision, business models, business strategy, business outcomes, products, services, processes, workplaces and operating models. As a result, the board of directors, chief experience officers and other senior executives worry about their future. They are not sure which unknown competition would displace them and how to improve their business outcomes in the uncertain and unknown digital era.

Organizations are now expected to drive two-speed businesses. That means their current business is being driven at marathon speed and digital businesses at sprint speed. It requires much change in culture, skills and behaviour to manage two-speed companies effectively.

For the first time in the century, technology (the modern cyber system) has become a driving force than an enabler as it significantly impacts the whole organization’s anatomy. To avoid the path of Nokia, Blackberry and Blockbuster, digital immigrants must design a digital business blueprint, innovate digital products and services, and introduce autonomous business operations. Digital immigrants must increase their technology budget by 15-20% of revenue, without which they will fail to survive and become irrelevant in the era of the fourth industrial revolution and digital economy.

Hence, business executives have been asking chief information officers (CIOs) and chief technology officers to build a sophisticated digital technology strategy, governance and architecture to help establish a modern cyber system. As a result, CIOs have to re-engineer and re-imagine their whole technology landscape, without which they will fail to support the organization’s digitization journey.

Like chief marketing officers have been driving the technology budget of marketing and customer experience initiatives, in the future, other business executives might also own the digitization budget. For example, chief human resources officers would own and drive employee experience initiatives; chief operating officers could drive autonomous operational initiatives.

CIOs are expected to become digital innovation champions, strategic advisers, part of the board and organization’s digitization steering team. That means CIOs’ key performance indicators must be beyond infrastructure availability, reliability and applications stability. CIOs also are expected to own and contribute for improving business outcomes.

To build and manage digital businesses, organizations must design, develop, deploy and manage different types of software applications like systems of records (processes), systems of engagement (people), systems of things, systems of body, systems of brains and systems of intelligence. This is a huge change and requires new digital technology infrastructure like multi-clouds, edge computing and programmable networks.

In summary, every enterprise is a digital enterprise; every digital enterprise must be lean. Lean digital enterprises make organizations relevant in the digital era and ensure business success. Organizations must acquire lean digital thinking and find their lean digital quotient to know the current digital state and design transformation programmes to reach a benchmark digital state. Organizations must also embrace the lean digital business excellence model and integrated business tech skills to succeed.

V. Srinivasa Rao is CMD and chief digital consultant at BT & BT Management Consultancy Pvt Ltd, and author of Lean Digital Thinking - Digitalizing Businesses in a New World Order.

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