Qatar’s National Vision 2030 aims to transform the nation into an advanced society capable of sustaining its development and providing a high standard of living for its people. The information and communication technology (ICT) sector has been leading this transformation with cross-sectorial programmes such as the Digital Government, TASMU Smart Nation, Digital Society and Industry Modernisation, and many other programs that are building new ICT infrastructure, automating and optimising operations, introducing new e-services or upskilling its workforce.
The COVID-19 pandemic has challenged traditional ways of working, with the pressing need for digital transformation becoming ever more apparent. Nowhere is this more widely felt than in Qatar which has been hit by the dual shock of COVID-19 and lower oil prices. Digital companies have overtaken the energy sector’s previous dominance in the global economy with digital companies representing five of the top 10 companies worldwide (Apple, Alphabet, Microsoft, Amazon, and Facebook). 10 years ago, Microsoft was the only digital company that appeared in that same list, largely dominated by the oil and gas industry.
It’s now widely recognised that in order to survive in the digital era, companies must have a strong digital presence. But many fail to go beyond this and to transform their businesses. Digital transformation is not just about implementing technology but about a company’s ability to develop agile and innovative business models to exploit new opportunities to maximise revenue and create value.
Given the complexities of implementing such a large scale transformation, it’s unsurprising that many companies fail to make the shift. Only about a third of major transformations meet all their project goals on time and within budget. Many others fail outright, as can be seen in Exhibit 1.
In this edition of Digital Beat, we’ll be examining what exactly it takes to successfully transform your business and how to avoid the many pitfalls that can derail a successful transformation.
1. Articulate a clear vision
When implementing digital transformation, businesses must articulate a clear vision of their future business model. Remember, your business model after transformation will not just be more profitable - it will be fundamentally different. Nobody would think of Amazon’s business model as the same as Carrefour’s - they are both major retailers, but there their similarities end. Before embarking on your digital transformation journey, align your digital strategy with a robust business case that will ensure all of your transformation efforts are worth it.
2. Clarify the Governance Structure
The relationship between IT and the business should be formalized through clear joint business and IT demand management and decision-making mechanisms. The relationship must be managed through specific control points, via forums attended by decision makers with a clear mandate to address major issues. All of this should be led by a single, accountable team to orchestrate and drive the digital transformation. Digital transformation is not always led by IT, but if it is to be led by IT, then dedicated resources must be allocated. Without this, your business runs the risk of duplicating efforts and producing conflicting results.
3. Create a Dedicated Digital
Transformation Office
A "check the box” approach isn’t enough to ensure successful progress. Instead, companies should implement a strong Digital Transformation Office (DTO)) to oversee the transformation and monitor execution and ongoing results. This office has a PMO role and must develop a complete transformation plan that addresses all elements throughout the technology stack, including their business impacts, dependencies, and known risks. The DTO also clarifies all the "transition states” during the implementation process. Without this, your transformation program is likely to be challenged, with different workstreams paralysed by dependencies and a lack of accountability in meeting timelines.
4. Manage vendors
Every transformation needs a strong vendor management function, skilled at analysing the performance of all vendors and partners and the quality of their deliverables. Organisations should create a system for defining the engagement model for each partner and vendor class, and make sure key vendors are already in place to fill gaps and bring in needed capacity and expertise. Without this, you could reach the end of your transformation journey having implemented poor quality systems.
5. Develop an implementation methodology
The methods for executing the transformation, including enterprise architecture, application development, and data governance procedures, should be formalised, and followed closely and consistently. Methods for conducting rapid test-and-learn cycles on new technologies and processes should be at the ready, including proof-of-concept exercises and pilots. New ways of working, such as agile delivery and DevOps, should be used to facilitate this. Throughout the process, you must consider the customer experience and how your implementation will match the vision you have for your digital business. To ensure success and reduce risk, the overall execution process should be managed in bite-sized chunks. Failing to operate with agility will increase timelines, costs and add additional deliverables which don’t meet your needs.
Through effective planning and execution, these common pitfalls can be avoided. At PwC Middle East, we offer a range of services to ensure your digital transformation efforts are successful. Talk to us today to understand how we can help you transform your business.
(Bassam Hajhamad is country senior partner and consulting leader at PwC Middle East)
The COVID-19 pandemic has challenged traditional ways of working, with the pressing need for digital transformation becoming ever more apparent. Nowhere is this more widely felt than in Qatar which has been hit by the dual shock of COVID-19 and lower oil prices. Digital companies have overtaken the energy sector’s previous dominance in the global economy with digital companies representing five of the top 10 companies worldwide (Apple, Alphabet, Microsoft, Amazon, and Facebook). 10 years ago, Microsoft was the only digital company that appeared in that same list, largely dominated by the oil and gas industry.
It’s now widely recognised that in order to survive in the digital era, companies must have a strong digital presence. But many fail to go beyond this and to transform their businesses. Digital transformation is not just about implementing technology but about a company’s ability to develop agile and innovative business models to exploit new opportunities to maximise revenue and create value.
Given the complexities of implementing such a large scale transformation, it’s unsurprising that many companies fail to make the shift. Only about a third of major transformations meet all their project goals on time and within budget. Many others fail outright, as can be seen in Exhibit 1.
In this edition of Digital Beat, we’ll be examining what exactly it takes to successfully transform your business and how to avoid the many pitfalls that can derail a successful transformation.
1. Articulate a clear vision
When implementing digital transformation, businesses must articulate a clear vision of their future business model. Remember, your business model after transformation will not just be more profitable - it will be fundamentally different. Nobody would think of Amazon’s business model as the same as Carrefour’s - they are both major retailers, but there their similarities end. Before embarking on your digital transformation journey, align your digital strategy with a robust business case that will ensure all of your transformation efforts are worth it.
2. Clarify the Governance Structure
The relationship between IT and the business should be formalized through clear joint business and IT demand management and decision-making mechanisms. The relationship must be managed through specific control points, via forums attended by decision makers with a clear mandate to address major issues. All of this should be led by a single, accountable team to orchestrate and drive the digital transformation. Digital transformation is not always led by IT, but if it is to be led by IT, then dedicated resources must be allocated. Without this, your business runs the risk of duplicating efforts and producing conflicting results.
3. Create a Dedicated Digital
Transformation Office
A "check the box” approach isn’t enough to ensure successful progress. Instead, companies should implement a strong Digital Transformation Office (DTO)) to oversee the transformation and monitor execution and ongoing results. This office has a PMO role and must develop a complete transformation plan that addresses all elements throughout the technology stack, including their business impacts, dependencies, and known risks. The DTO also clarifies all the "transition states” during the implementation process. Without this, your transformation program is likely to be challenged, with different workstreams paralysed by dependencies and a lack of accountability in meeting timelines.
4. Manage vendors
Every transformation needs a strong vendor management function, skilled at analysing the performance of all vendors and partners and the quality of their deliverables. Organisations should create a system for defining the engagement model for each partner and vendor class, and make sure key vendors are already in place to fill gaps and bring in needed capacity and expertise. Without this, you could reach the end of your transformation journey having implemented poor quality systems.
5. Develop an implementation methodology
The methods for executing the transformation, including enterprise architecture, application development, and data governance procedures, should be formalised, and followed closely and consistently. Methods for conducting rapid test-and-learn cycles on new technologies and processes should be at the ready, including proof-of-concept exercises and pilots. New ways of working, such as agile delivery and DevOps, should be used to facilitate this. Throughout the process, you must consider the customer experience and how your implementation will match the vision you have for your digital business. To ensure success and reduce risk, the overall execution process should be managed in bite-sized chunks. Failing to operate with agility will increase timelines, costs and add additional deliverables which don’t meet your needs.
Through effective planning and execution, these common pitfalls can be avoided. At PwC Middle East, we offer a range of services to ensure your digital transformation efforts are successful. Talk to us today to understand how we can help you transform your business.
(Bassam Hajhamad is country senior partner and consulting leader at PwC Middle East)