Last spring, we were inundated with headlines, tweets and Medium posts applauding the rapid digital transformation that businesses were going through—almost overnight—due to the pandemic and the shift to remote work. It made for an interesting feel-good narrative at the time, but it didn’t paint the full picture. Companies were thrown into the deep end; many barely staying afloat by implementing quick-fix, surface-level changes that they assumed would only be needed for a short time. Turns out, the “transformation” touted was just the tip of the iceberg.
More than a year later, the workforce is still in flux. The reality is, some form of distributed, hybrid work is likely here to stay. Employees will continue to expect remote options and customers will want seamless, digital ways to interact with businesses, pandemic or not.
As a result, companies must move past the temporary, band-aid solutions of last year and make those sweeping changes permanent. It’s time to move forward with true, sustainable change: Technical, experiential and, most importantly, cultural. Every company will need to become a modern technology company capable of delivering first-class digital solutions to customers, partners and employees—or risk becoming obsolete.
Transactional Vs. Transformational Change
The good news is just about every company understands the value of leveraging technology. A recent 2021 State of the CIO survey found that 82% of CIOs said they implemented new technologies, new IT strategies and/or new methodologies over the past year. The issue is how companies go about their technology deployments.
People talk about digital transformation all the time, but it’s been used so much that it has become an unhelpful misnomer. More often than not, the change that companies are implementing isn’t truly transformational, but rather transactional or just slightly incremental.
When companies have a transactional mindset, the focus is on immediate, simple and predictable changes. The purpose—or, more importantly, the outcome—is simply to continue business-as-usual. This is reminiscent of many companies last year turning to technology just to keep the lights on. A transformational mindset, on the other hand, aims to disrupt this business-as-usual and fundamentally change the paradigm in how the company operates through ways of working, use of technology and culture. It’s purposeful, aiming to solve business problems holistically and spur long-term growth.
To be successful in today’s climate and to gain a competitive edge with customers, companies must strive to be transformation-focused.
How to Move Toward True Transformation
Here are three examples of how companies can shift from a transactional mindset to a transformational mindset.
Cloud Migration vs. Modernization
Often, when companies talk about their use of cloud, they tout that they’ve “moved to the cloud.” But all too often, it’s treated as a one-time event; a destination to reach and a box to check. At the outset of the pandemic, we saw so many organizations quickly mobilize to shore up their digital strategies and ensure they were thinking about the limitations of doing business in a virtual context, but their cloud strategies didn’t evolve to rethink these paradigms, as well. They simply accelerated their migration strategies to get out of their physical data centers and into the cloud.
The opportunity to leverage the cloud is so much bigger than that. It can unlock greater efficiency, flexibility and growth and underpin new digital experiences and revenue opportunities—exactly the kind of strategies most companies envision. For example, health care leader InnoCare was struggling with outdated clinic management software. Instead of just moving the old bits to their cloud provider, they adopted a broader digital strategy to modernize their delivery capabilities and reimagine both the patient and clinician experience, setting new industry standards in the process. This is what we refer to as modernization and it is what leads to transformation.
Software Engineering vs. Product Engineering
With the rapid growth of software, it’s no surprise that software engineers are in high demand. The U.S. Bureau of Labor Statistics projects that software engineering job openings will grow 22% through 2029. And while software engineers will play an irreplaceable role in helping build innovative solutions, transformational-focused companies know to bring more people under the tent. By combining software engineers with other cross-functional experts who bring a different level of artistry, design and audience understanding, the end result is a more engaging, customer-centric product that evolves and grows over the entirety of its useful lifespan.
This is exactly what fitness giant Nautilus did. They brought together a team of engineers, data scientists and machine learning experts to help bridge the gap between their equipment manufacturing prowess and their digital experience and software development goals. Collectively, they produced a total platform that integrated hardware, software and data to create a dynamic workout regimen that impressed users and fended off competitors.
Moving Beyond Proof-of-Concept to Long-Term ROI
A proof-of-concept (POC) is a rite of passage in the tech world. It’s how a company or team demonstrates that their idea is feasible and can work in a real-world application. But POCs alone are insufficient; they are transaction-minded and don’t focus on achieving lasting business outcomes or generating deeper ROI. Rather, they mostly focus on technical feasibility. The key to upleveling toward transformation is by focusing on the processes, not just the end product. When testing features in a real-world setting, make sure that you’re proactively measuring not just that they work—but that they contribute to business imperatives, meet customer expectations and strategic outcomes. And if they don’t, go back to the drawing board and optimize with those higher-level goals in mind.
Culture is Key
As you can see, the difference between a transactional and transformational mindset is more about culture than technology. A culture of innovation and modern ways of working leads to transformation that fundamentally shifts the way technology is conceptualized and created. It isn’t solely about gaining efficiencies or cutting costs—instead, the focus is on making the lives of customers, employees and everyday users better. Transformation-focused companies believe in the promise of technology advancements, but they believe that it also can make operations smoother, customer relationships more meaningful and increase revenue when implemented with the right combination of skills, disciplines and organizational buy-in over time. It’s those companies who will thrive in this new era.