Today Chris Howard, Gartner’s chief of research, shared his insights on the current state of digital transformation (DX) at the annual DX conference and awards, hosted by IT World Canada.
His grandfather, he reminisced, was skeptical back when the first automobiles appeared in 1915, in Yarmouth, Nova Scotia. In 1922 he ended up buying one, then, a few years later, he set up the first automobile driven postal route in southwest NS, replacing the oxen, horse drawn carriages and slaves that had delivered mail up to that point.
That’s the journey that organizations are navigating right now, he explained, “it’s the coalescence of all the trends that are real today, to a point that you can’t imagine them not being there before.”
The pandemic, he said, caused a shock to the system, causing us to re-evaluate the choices on how we worked, how decisions were made and how technology was deployed, to a point that now we’re thinking maybe we won’t come back to the office all the time.
But there is a process of experimentation that goes into reaching that point, and leaders are feeling the pressure to stabilize innovations and reach the stage of implementation, Howard explained.
ChatGPT is one example, where we see increased investment and expectation that the AI is going to produce results, but a lot of hard work is left to be done.
Reaching that point of implementation can start with you, however, he told attendees.
“I want you to become the go to person on this topic [generative AI] within your enterprise, because it’s hard to understand, and you should be the people that are helping your organization understand what the use cases are, prioritize those and then put them into pilot. It’s moving so quickly and you need to stay on top of it.”
But DX is “never that cut and dried”, Howard said, adding that “there is a bit of a dark reality here that we’ve uncovered over the last year or so.”
Some of the surveys that Gartner has done with CFOs and CEOs reveal “a little bit of fatigue setting in,” he added, noting that 81 per cent of them responded they are not seeing the kind of transformation that they expected from the investments they are making.
As a consequence, CFOs, for instance, are paying more attention to returns, meaning they are looking to establish the types of value-adds that they have to create by investing. Or it could mean that they are focusing on smaller scale investments to produce returns more quickly.
The language is also changing from “digital transformation” to “business transformation”, which, he said, means that digital components are just part of a broader strategy.
“What that means for you, is that you need to be really great at converting what you see as technology innovations into business outcomes.”
To get this done, Howard believes, you should focus on six things:
- People – What do you do with your new hires – convert them to the way the company works, or use their new thinking to help change the company from the inside out?
- Technology innovations, such as use of AI and ML – Assess use cases of where these technologies have been actually paying off
- Acquisitions – Take into account the time it takes to realize the value of an acquisition.
- Business models – Create an ecosystem of partners to help generate new types of value creation
- Data – Use and model the heaps of data stored in your environments to generate better business outcomes
- Compute – Experimenting and moving into the public cloud is a type of compute advancement. Quantum is another one, especially for harder, multivariate problems, like designing a better battery for energy storage. He added that quantum is one of those advances that is going to happen suddenly and will be available suddenly. Now is the time to start experimenting and simulating.