The end of digital transformation and the rise of business model innovation
4) Past: Lack of leadership support, cross-functional collaboration, and proper governance kept silos not only intact but fortified.
New: Now leaders are all-in, at least according to earnings calls. Hold them to task. Push for vision and desired outcomes. And make the case for ongoing support to bring tech and business decision-makers together.
5) Past: Roadmaps underestimated the complexity of integrating new technologies with legacy systems. GenAI offers so much opportunity in everyday and also game-changing applications. Now, things will only get more complicated because you are automating yesterday and augmenting for tomorrow.
New: Platform players now make it possible to connect the dots across systems to buy time, and extract value from legacy systems, while allowing cross-system workflows and data to inform AI how to optimize. Find your trusted partners. Build against a vision for business model innovation while finding opportunities to solve for 1) quick wins, 2) differentiated use cases, and 3) transformational initiatives.
6) Past: Most companies possess a deep inability to adapt to disruptive innovations or cling to legacy business models by design. But in an era of AI, businesses do not have the luxury of surviving by digitizing yesterday’s models or work.
New: It all comes back to leadership and strategic change management, i.e. ‘transformation.’ Digitization didn’t challenge business-as-usual conventions, processes, or mindsets. That all must change, and that requires definitive, innovative, leadership and a culture design initiative to support transformation and bring people along (willingly).
7) Past: Employee adoption of new digital tools faced opposition for a variety of reasons including difficulty and cognitive biases of people wanting to work their way. There’s no room for that behavior or mindset. Disruption happens with doing new things, making the old things obsolete.
New: AI requires an ambitious investment in people. In its DAI Study, BCG found that winning companies are upskilling their workforces. For example, 21% of organizations spending upward of $50 million on AI and GenAI next year have already trained more than a quarter of their people on the relevant tools (versus just 6% of companies overall). BCG’s research found that leaders too need upskilling with 60% of leaders possessing limited or no confidence in their executive team’s proficiency in GenAI.
With a changed mindset and concrete actions, true business transformation is possible. Reimagine outcomes beyond optimizing the task at hand or yesterday’s work. Use AI to transform systems of record into systems of action, connecting the organization and work.
Invest in everyday AI to improve productivity. Supercharge work. Remove the routine and mundane robotic work and empower people to be more efficient, effective, and focused on more value-added work.
Rethink critical functions for enhancing efficiency and effectiveness. Explore opportunities to create new outcomes and value.
Foster innovation! Innovate toward genAI-powered business models to build and hone competitiveness. Start with customer and employee experience.
Let’s rethink digital transformation as business model transformation. Doing so will disrupt not only ourselves but entire industries. Not doing so will leave us open to disruption. It’s a gift we either give ourselves or our competitors.
