Digital Transformation as a Service (DXaaS): An Introduction
Digital Transformation (abbreviated as ‘DT’ or ‘DX’) will realize over 100 Trillion US Dollars in value over the next decade. That, is an astonishing figure, isn’t it? Well yes, and it is predicted by the World Economic Forum.
The term ‘Digital Transformation’ finds its place in almost every boardroom discussion and has become some sort of aspirational cliché for new-age companies. And, not without reason. Digital Transformation has the potential to increase the competitiveness of a business and enhance customer experience. It also impacts various facets of the society, irrespective of the industry vertical.
The other side of Digital Transformation
However, there’s a flip side to this story. Majority of the organizations have begun their Digital Transformation (DX) initiatives but four out of five transformation initiatives fail to reach their desired goal. That’s a lot of wasted time, money, and effort behind something so central to the success of an organization.
The reasons for the failure of a Digital Transformation initiative may include not understanding the technology, opting for the wrong solutions, lack of proper skills and budget and simply the lack of collaboration among key business stakeholders.
Introducing Digital Transformation as a Service
Digital Transformation promises an ideal world but the ground-reality is far from ideal with a quarter of all digital transformation projects failing. Against this backdrop, there is a recent trend emerging. The discrete consulting and IT projects are now combined into ‘as-a-service’ model with multiple technology and service providers in the fray. Digital Transformation as a Service (DXaaS) model enables continuous, end-to-end transformations with the ability to adapt to changing business environments.
DXaaS model allows for flexibility, scalability and greater integrations among various tech and service providers, thereby allowing continuous improvements and increasing the chances of success for the DX initiative. So, to summarize:
- DX initiative is not just about technology. It is a people-centric, data-centric and collaboration-led initiative
- DXaaS involves seamless integration across various business areas, technology and service providers to facilitate data sharing and synergy
Shifting from DX to DXaaS
In the earlier days, when Digital Transformation was still in its infancy, organizations would decide to revamp or digitalize a particular area/ process of the business. This may either be Finance, HR, Logistics or any other business process for that matter. They would then purchase the technology and hire service providers to implement the change. However, this model had a major drawback. The improvements in such cases, even when successful, were isolated and did not reflect at an organization level.
A Digital Transformation initiative involves a large number of stakeholders, collaboration with various business units, requires continuous monitoring and adjustments to ensure success. Hence, it is becoming increasingly difficult to isolate an area of improvement. And that is why, the discrete consulting approach is becoming insufficient.
This is where Digital Transformation as a Service (DXaaS) comes into the picture. DXaaS holistically combines the technology and service components to provide end-to-end Digital Transformation encompassing strategy, implementation, culture and continuous improvements. With the latest advancements in technology like the Internet of Things (IoT), Machine Learning, Cloud computing, and Artificial Intelligence, DXaaS is no longer a one-time engagement. It is a continuous transformation journey and entails the following benefits:
- Continuous problem-solving and process improvement through seamless integration among various service, technology and hardware providers
- DXaaS is cost-effective as firms need not invest a lot of money upfront. The capital is spread across the course of the transformation
- More flexible and scalable
Succeeding in a DXaaS environment
DXaaS might be a new model or approach, but the guiding pillars of DXaaS remain the same. Following are the four essential facets to succeed in a DXaaS world.
Being a customer-centric organization is the first and foremost aspect to succeed in a DXaaS environment. Being customer-centric means customer experience and customer satisfaction becomes the absolute core of your organization. Every touchpoint has the customer’s best interest at heart. Customer-centricity also sets the scope for data collection and the other pillars of DXaaS.
The success of Digital Transformation depends largely on data, and this includes data collection, cleansing, accessing, reporting and data visualization. Firms that imbibe a data-centric culture focus on insights, optimization and innovation. These firms typically have an in-house data science team, a Chief Data Officer (CDO) and Head of Business Intelligence to understand and make sense of large chunks of data
Next, the top management of firms who are keen to adopt the Digital Transformation as a Service model should establish bold and clear strategies not just at the functional or business process level but at the enterprise level. Enterprise strategy typically deals with issues that affect the entire organization as a whole. An enterprise-level strategy helps top leaders to identify the co-relation between data and mobilize various units accordingly.
The final and yet the most important facet of making DXaaS work is the Culture. Culture is the values, customs, beliefs, and symbolic practices that the people of the organization follow. In today’s rapidly changing technology landscape and remote-work culture, defining multi-year investments and targets is becoming increasingly difficult. Hence, a culture of continuous optimizations, improvements and adjustments must be ingrained into the DNA of the organization.
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