Businesses should catch up with digital transformation – here’s how and why

Aaren Quiambao  |  July 8, 2021

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Isaac Sacolick shares how to navigate a successful digital transformation in today’s business setting and the things that could set them up for failure as well. 

Editor’s note: This interview with Isaac Sacolick was recorded for Coding Over Cocktails - a podcast by Toro Cloud.

IT in business moves fast. According to CIO and digital transformation thought leader Isaac Sacolick, the way organizations have been operating and serving customers in the last five years has since changed, and the way things are now won’t last for long either. 

“The way you've been using data or not using data, the types of operations and workflows that you've been doing -- whether they've been semi-automated or using spreadsheets and emails in between them -- all that is going to get reinvented over the next five years.” he says in an interview for Coding Over Cocktails. 

As such, businesses need to catch up on digital transformation - much more now that we’re in a global pandemic. 

“When you look at what's happening in banking today, where much of the customer interaction used to be in the branch? All of a sudden COVID hit, and you can't go to your branch anymore. That’s digital transformation.”

And while digital transformation accelerates the processes and operations within the organization, what’s more important according to Sacolick, is it’s changing the way products and services are delivered to customers as well.

“We're enabling new ways for customers to interact with us. And that's changing the entire way we go to market - how we sell products, how we market them, how we service them, how we compete for new business.” he explains. 

Sacolick has been watching from a front-row seat how digital transformation grew out of its “buzzword” phase. 

“I got my front seat to digital transformation all the way back in 2000, watching newspapers going from a print world, where 85% of their revenue was coming from classified ads on newspapers, to seeing that business model erode significantly from 2001 to this day.” 

During this crucial time, Sacolick shares how businesses can keep up in the ever-changing landscape of technology and how they can map out a successful digital transformation strategy inside their organization. 

Digital transformation at the business level

In his book “Driving Digital”, Sacolick mentions that digital transformation is more than just moving to the cloud or deploying CI/CD pipelines or leveraging big data.

“I want to take everybody up a ladder a little bit and look at what's happening at the business level because of all these digital technologies, because of the state of where customers are going in terms of what they can do, their choices in front of them, what companies are able to do with data and analytics,” he says. 

Sacolick says that digital transformation is about learning from what technology companies have been doing for years and applying them in mainstream companies to keep them competitive. 

“So much of what business can do today comes from the innovation and the experimentation that's happening inside IT -- around platforms, around POCs that we do, around new ways of doing experiments and in experiences. And that's why things like DevOps and cloud become so important: it's because we want to do lots of experiments.”

He adds that these initiatives take on a top-down strategy, where the organization figures out how they can build skills, processes and platforms around technology to serve their customers better. It also requires a bottom-up approach where customer feedback is also taken into consideration.

Expecting both success and failure points

In his experience as a CIO and leading successful digital transformation initiatives, Sacolick warns that there are challenges ahead during the process. 

“[There were] certainly a lot of issues that we had to contend with to make transformations hit success points in their journey. And that's really what we're talking about, hitting success points in a journey,” he recalls. 

One of the challenges he mentions is failure to start. 

“The first thing is just getting to the starting gun, right? Just recognizing that what you're doing today and how you're operating isn't going to be sufficient for you to stay in business five years from now. You'd be surprised how many businesses are really reluctant to get to that starting gate.” 

He adds that the pandemic may have allowed organizations to get started on the digitization of their processes, but it doesn’t necessarily mean that their business models have changed.

“When you look at what's going to happen over the next two years, our buying habits [will] have changed. Our relationship with our customers [will] have changed and there's going to be a lot more transformation and disruption happening because of that.”

Sacolick says that the leadership of an organization needs to set the ground rules and the governance model for transformation to happen. Having an aligned set of goals and objectives from the top level can help getting started easier. 

“I think of the many times I had to go back to a CEO and say to them, ‘Look, we need to change something that we're doing in sales’, or ‘We need to change our way of doing accounting around a function’, or ‘We have to change our budget mindset,’” he explains.

Recognizing what needs to be changed and giving leeway to shifting the mindset at the executive level is what Sacolick says helped him become successful in instrumenting digital transformation in organizations. This is what he also calls “changing the incentives.”

“At Business Week magazine, we used to sell a hundred thousand dollars of print ads, and we went back to our sales group and said, ‘You have to start selling $10,000, $5,000 display ads with as much veracity and controls around them because we need digital dollars coming in as much as we do print dollars.’ It’s very hard for a sales group to recognize that when they're just not going to get the same commission. So, we have to change our commission structures.”

Transformation management

Sacolick shares during the podcast what really sets up digital transformation efforts for failure.

“You could see this when organizations come up with the MEGA strategy and they put their CIO or their CTO in charge of it. They come out with a nice deck and say ‘Here's everything we're going to do in the next five years. We’re going to be this great business. We're going to compete with this one and that one,’ but everybody’s going back to what they were doing before.”

While coming up with strategies to get the company to where it wants to be in the near future is good, Sacolick says that transformation truly starts with a group of people who will instrument the change needed. 

He calls the process “transformation management.” 

“It's really starting with a group of people who are going to be the instrumentors of that transformation, and that needs to grow over time to get more people in the organization involved in part of the process and having a role and understanding what their new job and responsibilities are going to be as the company is transforming,” he explains. 

“When you read 40, 50, 60% of transformations are failing, it's largely because they don't realize the people aspect of that transformation.”

He adds that having a vision statement for transformation is also important, as this will help the organization keep track of the goals they are trying to achieve during the process.

“I see this a lot in technology organizations. When there's a lack of vision statement, specifically articulated upfront, you get a lot of people working very hard every sprint, every release, doing the next thing that's on their list. And they sort of get lost. They lose sight of the problem statement.”

“The vision statement is really about taking one piece of paper that everybody can see, so that the organization understands who the customer is on one side, and what the strategy is on the other side.”

Listen in to more of Sacolick’s thoughts on successful digital transformation in this episode of Coding Over Cocktails — a podcast by Toro Cloud.

Coding Over Cocktails is a podcast created by Toro Cloud, a company that offers a low-code, API centric platform for application development & integration.

This podcast series tackles issues faced by enterprises as they manage the process of digital transformation, application integration, low-code application development, data management, and business process automation. It’s available for streaming in most major podcast platforms, including Spotify, Apple, Google Podcasts, SoundCloud, and Stitcher.

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