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While most organizations are still tracking along on their journey to digital transformation, early adopters may feel like they've already crossed the finish line.
But those sitting comfortably on their digitalization accomplishments may want to ask themselves whether those then-cutting-edge tools have since become outdated or even obsolete, and whether laying new tools on top of them is the most strategic approach — or does it risk creating a Frankenstack?
An Ongoing Process
Digital transformation has been a part of the business landscape since the first document management (or enterprise content management) systems back in the 1990s. Being aware of this means understanding that digital transformation is an ongoing, long-term process that requires continuous change to keep on top of emerging technologies and capabilities.
Over the years, organizations seeking to gain an edge on the competition have been investing millions of dollars in technology. This level of ongoing investment is expensive and arguably unsustainable for most companies, particularly in the current economic environment and with the pace of tech disruption today.
There are two approaches to digital transformation today. Appian SVP of Product Management Adam Glaser said some organizations are under the impression that their digital transformation efforts must move at the speed of the fast-paced technology landscape and that they must leverage the latest, innovative technologies to be effective. Under that assumption, the early adopters that were once ahead of the digital transformation curve are no longer reaping the benefits of their efforts and are back at square one.
Then, there are those who wait on the sidelines to see which investments will come out ahead — and risk falling behind in the process.
“I have noticed that some CIOs and transformation teams hold themselves back unnecessarily because they are waiting for the stars to align where they have the right infrastructure, expansive budget and ample time to dedicate towards a complete, enterprise-wide transformation,” Glaser said.
Those organizations tend to believe that legacy applications cannot be modernized and that data sitting on them will suffer from poor visibility and retrieval across siloed systems. As a result, they assume that “rip and replace” is the only way to effectively transform and achieve ROI.
The reality is that a shrewd digital transformation strategy is neither of those extremes.
It is best done incrementally, so that organizations can begin reaping the benefits of their efforts even if they still have legacy applications or have not yet cleaned and consolidated all their data. With architectures such as data fabric, organizations can connect data across the enterprise wherever it resides. This means that accessing legacy data is no longer an obstacle to the development of modern applications, even if the data resides in a “frankenstack” that has been cobbled together over a period of years.
“While there will certainly be instances where early adopters of digital transformation have to cut their losses on certain investments,” he said, "the reality is that modern solutions, particularly in the data landscape, are purpose-built to bridge the gap between legacy solutions and the new world.”
Many of the early pioneers of digital transformation recognized this and forged ahead, and that work has formed a useful foundation for today’s transformation projects.
Related Article: Don’t Cause a Rift With Your Digital Transformation
Untangling the Early Adopter Mess
For some early adopters, proceeding with the rapid implementation of new technology on top of legacy systems has caused somewhat of a mess.
Luc Perard, VP of CAST Imaging, said that in their attempt to keep up with the pace of change and mitigate the risk of obsolete technology, some organizations have been adding layers upon layers of new tech and code, resulting in custom software that modern developers struggle to decipher due to the many moving parts connected inside. This also makes the custom applications increasingly more difficult to adapt, leading to a gradual loss in that first mover advantage.
As a result, what Perard is seeing today is that quite a few of these first movers — such as Generali, ManuLife, MMC and Wells Fargo, he said — are embracing software intelligence technology that can automatically extract knowledge about the inner workings of these complex custom applications, the brains of the digital business. They use such automated software intelligence to augment the development teams and help them make digital transformation changes faster – from small tweaks to refactoring those applications for cloud or full-blown modernization, Perard said.
According to Bob Rogers, CEO of Oii, the problem is getting rapidly worse for early adopters of digital transformation strategies. He said most will face increasing challenges in upgrading their tech stacks as more technology becomes available and systems fail to communicate properly with one another.
The good news, if we can call it that, is that the latest AI technology is heavily focused on text and documents, which most early digital transformation efforts ignored. This means AI can still leverage text stored in older databases and data lakes, though it increasingly depends on new tools like vector databases to allow indexing and targeted use of the documents most important to the enterprise.
When asked whether this will hold early adopters back or not depends on how they manage to extricate themselves from their "frankenstacks." The main hurdle? Their tech teams.
Knowledgeable, efficient teams stay on top of evolving technology that is relevant to their industries. Many enterprises are turning to a cloud-based data fabric approach in which most of the tools for storing data, building analytics and deploying AI are deployed via services. That means, if your stack is on-premises, you will be behind, but if you are already leveraging the cloud, you will be able to add services and integrate them more easily.
The result, Rogers said, is that with the right planning, early adopters won't have to go back to square one. Since AI is primarily about text and documents, they will need to do two things: add modern text storage (e.g., with a vector database) and enable AI services on the cloud to integrate them with their applications.
Related Article: Anything-as-a-Service Moves the Needle on Digital Transformation
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Early Adopter Wins
Two of the primary goals of digital transformation include improving customer experience and lowering costs. Those who undertake digital transformation as a one-off miss the point of digital transformation. Technology is ever evolving, and so should digital transformation.
David Johnson, CTO of Mulytic Labs, said early adopters have first-mover advantages in this space. They have already undertaken the effort and produced gains. They know what works and what doesn't in their culture, and they have modernized parts of it.
While they may have "frankenstacks," those stacks will be smaller and less complex than companies that have not yet undertaking digital transformation in the first place. Early adopters will also benefit from the knowledge acquired from past efforts to help guide them on making smarter decisions.
“Early adopters will need to start again, digital transformation is an ongoing process, but the early adopters will move faster, be more accurate and be more effective than those companies just starting today,” Johnson said.
“Those lessons learned in the past, no matter how incremental or how small, will serve them well in the future. Like planting a tree, the best time to start digital transformation was 10 years ago; the second-best time is today.”
Related Article: Is Your Digital Transformation Headed for Trouble?
Next Step: Integrating Systems
For early adopters to move forward with their first-mover advantage, they will need to focus on integration.
Many early adopters undertook digital transformation piecemeal, at the departmental level, Darcy Mackay, SVP, HR and client services at Rippling, said. Instead of approaching digitalization in a holistic way, they instead adopted whatever point-SaaS solution seemed necessary at the time.
Inevitably, different lines of business adopted different solutions that did not work together. For HR departments at those organizations today, this siloed approach means that no one has a comprehensive view of the employee. Finance knows what employees are paid and what they expense. HR/Talent has details on their goals and performance. IT tracks their logins and equipment. And so on. It is a real problem, Mackay said, pointing to the disjointed onboarding and offboarding processes of numerous organizations.
“Many companies end up hiring consultants to patch it together — and in the end at great expense," she said. "It is much more effective to run a business on a fully integrated, all-in-one system. They will gain greater insights into their company and employees, spend less time manually updating multiple systems and focus on the work that matters."