Roadblocks to digital transformation
A recent survey published by enterprise software company IFS has found large enterprises are finding their digital transformations are being hampered by a surprising problem: an inability to define and measure value from investing in software.
Or perhaps it is not so surprising after all. Leaving aside the fact that the definition of ‘digital transformation’ has expanded, blancmange-like, to become nebulous to the point of meaninglessness, precisely how should return on investment in software, or even technology in general, be quantified?
We know that it matters, and we know that when technologies are implemented for the right reasons and in the right way, there are measurable benefits in terms of efficiencies and profit margins. But getting to that point requires a deep understanding of both the technology and the business in question, and this is an obvious sticking point.
Put simply, information technology is a broad field composed of many specialisms, and it is not necessarily the case that someone with deep tech experience understands the world of business.
Moreover, given how IT pervades our everyday lives it can feel like the water in which we swim, but the reality is that much of our engagement with technology occurs on a fairly superficial level.
Even the tech savvy are unlikely to understand some core enterprise technologies. Few enough IT people have ever encountered a mainframe, for instance, and yet the entire financial system is built upon them. Customer relationship management (CRM) software is fairly self-explanatory, but many of us never actually encounter it. Enterprise resource planning (ERP), meanwhile, runs entire businesses, but is opaque to the vast majority of us, so how can it be judged?
Add in deep technologies such as containerisation and, all of a sudden, businesses are drowning in a torrent of jargon, leading to a kind of impostor syndrome where people are making decisions – or farming them out to consultants – with only a dim understanding of what a successful outcome would actually look like. This is an obvious recipe for failure (and, cynically, the need to have someone to blame may explain the popularity of hiring consultants to develop strategic plans).
But perhaps putting the brakes on digital transformation, or at least some of the less popular aspects of digital transformation, might be a good idea. This week, AIB told the Committee on Finance, Public Expenditure & Reform that its plans to shunt account holders from branches to fully-digital services were now “off the agenda”, following a revolt by its customers.
In its defence, AIB was likely the victim of wider discontent at the digitalisation of many basic services in society. While digital service provision is very much wanted, there is obvious and growing frustration at businesses using technology to paper over a retreat from customer service.
One way to measure the success of enterprise software, then, might be ‘does this make our customers happier or does it make them angrier?’
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