BrazilWhy companies are transforming into a Digital Enterprise
In today’s digital world, companies of all shapes and sizes are rushing to become a ‘Digital Enterprise’. But what is that exactly? Gerard Wijers, director at Anderson MacGyver, discusses how the concept can help companies adapt to the changing needs of customers, and make the most of emerging technologies.
Founded by Gerard Wijers and Rik Bijmholt in 2013, Anderson MacGyver is a consultancy firm which advises business leaders on how to shape and drive their digital agendas. The firm works to co-create digitalisation strategies with customers, before offering pragmatic and committed support to delivering those plans. The firm operates with offices in the Netherlands, Germany and Sweden.
Having co-led the firm’s journey for all 13 years, co-founder Wijers has seen the dominant themes driving clients to consider digitalisation. And more than ever, as AI and its associated technologies open up even further potential, they are going further, to become what he calls “Digital Enterprises”. But what does that mean?
Defining Digital Enterprise
According to Anderson MacGyver, a Digital Enterprise is an organisation which has “a unified and distinctive digital-driven customer experience”, enabling swift and energetic change in response to evolving needs.
In order to achieve such a level of excellence, an “integrated mix of digital propositions, products, channels and services” is required, and at the same time, the operational backbone has been automated, standardised and simplified. A stable and well-integrated IT system supports the primary operational business processes and staff functions such as finance, HR, and procurement.
Finally, leading on from this, Digital Enterprises need to boast a cutting-edge digital infrastructure. Accounting for “as much as 30% to 40% of total IT spending” at leaders such as Schiphol Airport, this preconditional foundation does not provide direct business functionality, “but without solutions for areas such as integration, data platforms, identification, information security, you can do nothing at all as an organisation,” Wijers emphasizes.
The main drivers
“In our work with leaders, we are seeing leading companies transform to Digital Enterprises because they want to access three key benefits,” Wijers states. “They want to stay ahead, because superior digital capabilities outpace competitors. They aim to enhance their customer experiences, to stand out in a crowded market. And the transition enables them to excel operationally: a modern and simplified operational backbone powers a scalable, connected and efficient organisation.”
By developing superior digital capabilities, companies can stay ahead of competitors, create exceptional customer experiences and all while being efficient, flexible and connected. But saying a firm is going to become a Digital Enterprise, and actually doing it, are two very different things – and there are significant pain-points on the road which can trip up a transformation.
Wijers cautions, “Most of the pain is in an overly complex and outdated IT landscape. Also at play are too high costs due to inefficient operations. A word of warning: be well aware of where you are going to cut. Anyone who wants to improve margins or achieve higher sales will really have to invest more in IT. The high-performing organisations prove this.”
Meanwhile, another key pain point relates to a company’s talent. With skills shortages relating to digital roles persisting in the labour market, attracting, developing and retaining digital talent requires attention – and can see firms forced to rush outsourcing processes to keep up with their digital ambitions. But with the right planning and resourcing, Wijers argues that companies can move beyond these teething troubles swiftly.
Kickstart the journey
Wijers suggests, “My recommendation is to start thinking like a Digital Enterprise: holistically and end-to-end. Based on governance and personal leadership, create business strategies with explicit digital ambitions, leveraging technology and data to differentiate yourself from the competition.”
“Build strategies that are scalable, while keeping the overall IT landscape as simple and fit for purpose as possible – and place ownership and responsibility within multidisciplinary teams. Ensure tech and data capabilities within management teams and the board. Also recognise that there is no one type of IT, but embrace a multimodal approach.”
Wijers contends that this multimodality will enable different aspects of business operations to acquire the right, specific kinds of IT change they need. Meanwhile, leadership and ownership of the changes can make sure that “the plan is scalable and fit for purpose”, to a clearly communicated deadline. But first, that plan must be carefully drawn up.
At the start of that process, Anderson MacGyver distinguishes five building blocks that must be considered when becoming a Digital Enterprise – as they “give the organisation its right to exist”. From front-end to back-end, “digital infrastructure, shared data and digital smartness” must be designed to serve these interrelated needs – ensuring smooth internal processes and the desired interoperability with the external digital ecosystem.
“In terms of customer experience, or front-end, companies need to think about how digital change can enhance customer engagement and experience, through innovative front-end technologies that drive market adaptability and consumer interaction”, Wijers explains.
Meanwhile, in the operational backbone, or back-end, firms need to focus operational efficiency and scalability, relating to how leveraging digitisation can automate processes and integrate systems for streamlined operations within its ecosystem.
Then comes digital infrastructure. Again, companies need to consider the basic facilities that are necessary to function, and how they have evolved. In the digital age, “everything is connected to everything,” so integrated cloud services, cybersecurity, and extensive connectivity solutions need to be considered as “part of a modern digital foundation” supporting business needs.
“Companies need to think about shared data too. Centralised and integrated data management is crucial for enabling distinctive customer experiences and efficient operational processes in digital enterprises.”
And finally, comes what Wijers describes as ‘digital smartness’, with Digital Enterprises optimising both customer interactions and back-end operations through advanced analytics and automation. “For this, depending on the situation, utilising AI and machine learning to enhance decision making and operational efficiency may be necessary.”
“Organisations across the board face stubborn challenges and aspire certain benefits: pains and gains. But regardless of what their dominant pains are, leading organisations distinguish themselves by how they navigate these issues. Leaders are working towards a Digital Enterprise, while the rest is playing catch-up,” Wijers concludes.
