A paper by DXC Leading Edge
Business and technology are in harmony. Organizations seeking business agility and growth in 2022 and beyond will be those that achieve convergence across all parts of the business and the technologies that underpin operations. This will be achieved through five factors of accelerated change:
- Technology investments that suit the hybrid technology environment
- Emphasis on software engineering and platforms to run the business
- Strong data metabolism to generate insights and streamline tasks
- Continued and meaningful focus on people
- Continued and meaningful focus on the environment
The events of the pandemic delivered a near-instant harmony for many organizations as new working methods and technologies were deployed in response to the emergency. Barriers were dropped and silos disappeared. CEOs and senior leaders now expect the rapid accord that was developed to deal with the pandemic to continue unabated. This is the Accelerated Now.
CEOs and senior leaders now expect the rapid accord that was developed to deal with the pandemic to continue unabated. This is the Accelerated Now.
This rapid accord will be the drumbeat that leads the organization toward business agility, growth and innovation, harnessing the power of people and data while reducing the organization’s impact on the planet.
Out of tune: Outdated technology and processes get exposed
The pandemic is credited — rightly — with accelerating digital change in organizations. But it is important to remember that the pandemic demonstrated that business was out of tune before the virus disrupted daily lives. Too many business improvement programs were called transformational, yet hybrid technology environments — on-premises and cloud — were deployed without full exploitation of the possibilities of enterprise cloud computing. As a result, legacy technology and outdated business processes that supported the continued use of these technologies remained in place. Data was hoarded in silos that prevented a true business-wide analysis of the situation an organization found itself in.
Sadly, it took the ultimate form of disruption to shine a light into these dark corners of the enterprise. Faced with a complete inability to carry on as normal, organizations and team members found they could work in different ways — that the technology they had been using was, in truth, not fit for purpose. In addition, old business processes are not helpful when the business is being operated from a kitchen bench, spare bedroom, dining table or even the garden shed. All of these had the potential to lower the security threshold of the business — and unfortunately, those less scrupulous in our societies exploited those weaknesses.
Evolution of business and technology harmony
The future of business and technology harmony is bright. Enterprise technology has been on a journey from poor alignment in the early 2000s to today's technology-empowered business lines, and to a near future where business and technology changes are one and the same. When business and technology are in harmony, they jointly adapt and change according to business need, customer expectations or opportunity. No longer is change, in either business process or technology, a discrete project with expectations and outcomes. Change becomes a constant state of business and technology.
When business and technology are in harmony, they jointly adapt and change according to business need, customer expectations or opportunity.
In the near term, that means dealing with the current state of mid-transition as new technologies and methods adopted during the pandemic become established, made robust and industrialized with security. This can only be achieved when the organization repositions technology to be part of the overall vision for the enterprise and business agility, rather than a tool to deliver an outcome that is often not fully understood. To return to the musical metaphor, technology has, to date, been treated as the venue for change and business outcomes; instead, technology must be one of the instruments in the orchestra, harmonizing with all elements of the business.
Therefore, technology should be examined through the lens of its stage of evolution:
- What is emerging (i.e., R&D)?
- What should you be experimenting with (i.e., minimum viable product)?
- What is established (i.e., industrialized)?
This will guide the organization on how it invests in and uses a particular technology, orchestrates adoption, and manages its people, talent development and overall business change.
All this is happening at a quickened pace. Unlike previous disruptions, whether the dot.com crash, the financial crisis of 2008, or the September 11 terrorist attack, the post-pandemic economy is accelerating technological and business change. The earlier disruptions temporarily slowed technological adoption and change before the pace picked up again, as each time technology played a role in the recovery.
The current pace of change is being driven by the five interconnected factors, the arrival of new technologies, and one of the most profound changes in societal attitudes to the world of work and the environment around us.
Let’s explore the five factors of accelerated change.
Investing wisely in a hybrid technology world for business agility and growth
Forward-thinking organizations will not seek a return to the ways of 2019, but instead will develop a new approach. Technology adoption has been at the heart of enterprise strategy and society in the 21st century and will remain at the forefront of business agility and growth for the remainder of this decade. Now, the hard stop and drastic changes brought about by the pandemic are an opportunity for the organization to completely rethink technology’s purpose. We are in a hybrid technology world of both on-premises and cloud, operating in a hybrid work environment of in-person and remote. Both must be taken into account to invest wisely.
Technology adoption will remain at the forefront of business agility and growth for the remainder of this decade.
Analysis by DXC Technology demonstrates that there is a gulf between organizations that adopt technology and those that adopt the right technology. This is about more than choosing the right enterprise resource planning application, sales automation platform or cloud infrastructure. The gulf has been created by those organizations that have truly understood how making the right technology investments allows an organization to remodel itself, move into new sectors and adapt with comparative ease.
In the years before the pandemic, and of course, throughout the global lockdowns, Amazon has demonstrated this capability. This is a business that has evolved from e-commerce bookseller to technology services provider and now has moved into healthcare services. These moves are not the ducks and dives of a fast-but-average player. This is the behavior of a grand-master of situational awareness, creative thinking and technology. This is business and technology harmony writ large.
Mastering software engineering and platform-driven business
That harmony will be best achieved through the adoption of a software engineering ethos. Again, this is not new; over the last decade, software-driven organizations have disrupted retail, financial services, media and other sectors.
Having a software-driven engineering capability allows organizations such as Amazon and Ocado — which launched as an online grocery retailer and is now rebranding itself as a tech company with its smart ecommerce platform for grocery retailers — to quickly respond to change according to customer demand. These are organizations that understand that software engineering is central to value generation in their business. The ability to engineer the software and platforms that form an organization’s central infrastructure allows the likes of Amazon to move from retail to a pioneer in public cloud services and beyond.
The ability to engineer the software and platforms that form an organization’s central infrastructure allows the likes of Amazon to move from retail to a pioneer in public cloud services and beyond.
The engineering skillset and the platforms created for business value drive the speed at which these businesses can make decisions. Dramatic as Amazon’s move from retail to healthcare via cloud computing may sound, it is its technology platform that carries and simplifies data collation and analysis that allows it to move seamlessly into new or adjacent sectors successfully. No matter the new market, platform-oriented organizations are able to continuously integrate, deliver change and deploy new products and services.
Boosting data metabolism to improve decision-making
Often, organizations that are over-reliant on repetitive tasks also suffer from poor data management and, in turn, poor decision-making. DXC has concluded that a strong data metabolism needs to be at the organization’s core — that is, tools and practices that make data-driven decision-making essential to the success of the business.
A robust data metabolism breaks down silos, drives efficiencies and facilitates better-informed decision making.
DXC uses a data metabolism framework that views decision-making in terms of three states: Discover, Develop and Defend. Discover, Develop and Defend become a mechanism for organizations to manage teams according to outcomes and to present the appropriate type and level of data for each state. This approach enables organizations to develop the necessary data metabolism. Currently data quickly builds up into silos, and departments compete for funding to pay for the resources they're creating; all too often, this accelerates data generation and duplication. A robust data metabolism breaks down silos, drives efficiencies and facilitates better-informed decision making.
Committing to the human experience
With skilled talent becoming harder to find, an organization focused on the human experience will be better placed to respond to the needs of its people and customers in the dynamic and individualistic ways that will be required. This will benefit the enterprise, enabling the organization to develop its skills by promoting personal growth and having deeper and more personalized insight into customers and partners. In addition, organizations that focus on the human experience become more adaptable; this business agility has been a holy grail for business and technology leaders for the last two decades.
An understanding of the emotions that drive human experience will enable organizations to better relate to customers. Increased physical and digital human experiences drive the acceleration that is taking place; therefore, if an organization is to develop a new rhythm, it needs to improve its understanding of humans and their need to be social and connected, and to have a sense of community.
Increased physical and digital human experiences drive the acceleration that is taking place; therefore, if an organization is to develop a new rhythm, it needs to improve its understanding of humans and their need to be social and connected, and to have a sense of community.
Another central demand of the human experience is to think and create, which can be bolstered by automating repetitive tasks. Too often, valuable front-line team members of the business are deployed to carry out repetitive tasks that do little for the customer and fail to help the business grow and innovate. This undervalues the human experience for both the employee and customer. In an era of accelerated demand for change, organizations that fail to tackle wasteful practices will decline.
Achieving (truly) sustainable sustainability
Sustainability is now becoming a long-term pressure point on the business, with rising regulatory demands. But possibly far more impactful are demands from the customer in the immediate and near term. Employees will join customers in expecting that the organization will reduce its impact on the natural environment, and only partner with organizations that have the same standpoint. Failure to tackle environmental, social and governance (ESG) priorities — notably climate change — will damage organizations.
Sectors such as fashion and agriculture are returning to and re-inventing circular economic models. Technology has a real opportunity to drive the adoption of circular economic models, and with 130 countries making commitments to net-zero carbon emissions, ESG issues have moved from buzzword to action. Most CEOs (99%) of companies with $1 billion in annual revenue stipulate that sustainability will be important to the future success of their business. The challenge will be to measure the point in the acceleration of this trend from championing of values to sustainable sustainability.
DXC believes that digitizing the circular economy is the only reliable route to achieve net-zero goals. That digitization will see the data metabolism of the organization become vital to meeting compliance and carbon emissions reporting. Analysis of the current position by DXC indicates that just as the born-digital businesses have disrupted finance, retail and many other sectors, so too will born-circular businesses (reuse and recycle) quickly erode the market position of traditional linear businesses (build-sell-use-dispose).
DXC believes that digitizing the circular economy is the only reliable route to achieve net-zero goals.
Government bodies across the world predict that in the near future, climate events will disrupt economies on a scale similar to the pandemic. Just as the pandemic demonstrated the weakness of those businesses that were not digitally adept at coping with disruption, environmental events will disrupt linear businesses to much the same degree, while circular and environmentally aware organizations will weather the storm. Similar to the move to digital business, those organizations that adopt circular economic models will reap financial benefits more easily and sooner than slow adopters. In the Accelerated Now, the very structures of the Industrial Revolution are being undone.
Like an anthem building momentum, the five factors of accelerated change were taking place before we entered the 2020s. However, the dramatic disruptions of the initial years of this decade have added a level of pace to the accelerating change. Unlike the disruptions in the economy, the technological acceleration will not decrease once the full impact of the pandemic subsides. Technology is increasing the pace of demand for business agility, and particularly for human and environmental change.
Organizations cannot focus on just one of the five demands — technology investment, platform engineering, data metabolism, human experience and sustainability; they are all linked to each other and to business operations. Therefore, the transformation journey will have to encompass all. Just as a sheet of music challenges all but those taught to read it, organizations will be challenged to orchestrate these five factors and business processes to create a common harmony that grows in volume, and delivers results in concert.