siliconindia | | August 20209Organization leaders are averse to risking disruption on account of long payback periods, and as a result, digital transformation is often seen as a marketing gimmick· From Efficiency to Productivity Gains: The value proposition of replacing capex with opex is now dated. Managers are using cloud solutions to make productivity gains as well. For example, a CRM solution doesn't just mean an efficient way of lead management; it is also a way to potentially increase revenue per user, through interactive leaderboards. Besides these tangible benefits, cloud technology is driving management to bring about a revolution in organization culture. With massive computing power available, employees are encouraged to innovate; strategies are becoming truly customer-centric and `failure' is rewarded. This is best exemplified by big internet companies like Google, Amazon, Facebook, Apple and Netflix. Facebook, for example, runs around 10,000 different versions of the social networking app, at any given point in time. Software engineers are given autonomy to launch and test versions of Facebook to assess changes in user experience. Versions with significant results are adopted and less-significant ones are documented as lessons-learned. This is a unique and powerful way to empower employees.Cloud technology is also promising to solve the chal-lenges of digital transformation by providing the essential building blocks for any successful digital transformation journey. Certain industries like BFSI, Education, Telecom and Media have been pushed into the early adoption of dig-ital transformation, owing to the evolving, new customer segment called the `millennials'. Leadership in these in-dustries have responded to this change by investing in the right technologies and people; so much so that organiza-tions now have a new designation, that of the Chief Digi-tal Officer (CDO). In the case of Kotak Mahindra Bank, Deepak Sharma (CDO) is busy building an `open-banking' platform which will integrate fintech startups that provide superior customer experience.However, benefits of digital transformation are not being felt enterprise-wide, particularly in old-economy organizations. Firstly, this is because of a complication called `legacy' systems which take time and investment to migrate to a cloud environment. Secondly, organization leaders are averse to risking disruption on account of long payback periods. As a result, digital transformation is often seen as a marketing gimmick. According to Forbes 2016 report, 84 percent organizations failed at digital transformation. We believe this is set to change. The biggest indicator is not from a high-profile survey of CXOs, but IBM's $34 billion acquisition of Red Hat in October 2018. This acquisition has the potential to deliver agile digital transformation using open-source cloud solutions. Additionally, the advent of machine learning is disrupting the way data (DataOps) and applications (DevOps) are engineered and migrated. This will increase the pace of digital transformation, even as we speak. With shorter and less risky payback periods on digital investments, managements will respond positively to these changing dynamics. After all, it was Diane Greene of VMware who articulated a simple and extraordinary vision, `We could serve every company in the world, in every geography, in every type of organization'. This ushered in the age of cloud computing. It is now up to the leadership and their vision to drive agile digital transformation.
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