Digital Transformation - The Dark Side

Conjecture, an opinion or conclusion formed on the basis of incomplete information 

Digital transformation is about killing conjecture. Replacing conjecture with a more complete picture as a result of networking systems together, deploying sensors, connecting fleets with telematics, mobilizing workforces, collecting online data in real-time, employing omnichannel strategies, collaborating, analyzing and managing it all with an OILS (optimized information logistics systems) in real-time. 

In the past most enterprises operated on a conjecture or estimate basis, but today reducing the amount of conjecture is one of the top goals of digital transformation.  Conjecture comes with a high price.  It requires enterprises to spread budgets and resources across many different areas with unknown returns.  With the availability of massive volumes of new data, however, many missing pieces of the business and marketing puzzle can now be discovered and budgets and efforts focused on areas with positive returns.  Digital transformation is about recognizing which pieces of the puzzle are missing, and finding ways to use digital technologies to fill them in and complete the picture.  Without digital transformation, enterprises continue to ask questions like, where in the path to purchase journey is the person visting my e-commerce site?  Have we seen this customer before on a smartphone or tablet? Is this an existing loyal customer with a new computer, or a new prospect with an old computer?  What has this visitor purchased from us before, and how can we personalize in the future?

In addition to networked systems, equipment and people, digital transformation requires data security.  In fact, in a recent survey we conducted of 2,000 executives across 18 countries, digital leaders reported cybersecurity was the digital technology having the biggest impact on their businesses today. Digital transformation initiatives are guaranteed to attract hackers and those with nefarious intentions.  Professor Paul Virilio, a famous French cultural theorist, posited all innovations include guaranteed negative consequences.  I agree.  All digital transformation initiatives introduce new problems, software bugs, guaranteed network vulnerabilities, new competitors; new business challenges and new stresses.  The elimination of all negative consequences and vulnerabilities are impossible, so our focus should be on limiting and containing it, not eliminating it. 

Today, the retail giant Target, is recognized as an innovative digital transformation leader, but just a couple of years ago they were suffering the negative consequences of a massive customer data breach. Leadership is often synonymous with trailblazing, and trailblazing is guaranteed to have challenges. But like Target, the rewards of overcoming those challenges can be tremendous.

Digital transformation leaders should avoid the use of the word risk, as risk means a chance of something going wrong.  In digital transformation there is no risk, there is a guarantee of things going wrong.  The goal is to ensure that the potential benefits of digital transformation are recognized, and that the benefits outweigh the guaranteed negative consequences.   

Our most recent research at Cognizant’s Center for the Future of Work reveals digital leaders, those already involved in digital transformation initiatives, report far more challenges and obstacles related to digital transformation than digital laggards, those not yet involved in digital transformation.  For digital laggards, digital transformation and associated problems remain a theoretical discussion not a reality.  Although theoretical, there are no excuses today for not understanding and planning for the guaranteed negative consequences, limiting them and recognizing the importance of cybersecurity.