Regulated enterprises often sit on massive troves of data collected over a long time during their normal business operations. With no clear business requirement for this data, businesses could be missing opportunities to improve customer experience, readily prove compliance with regulators, understand customer behaviour, and increase revenue by up/cross-selling matching products, etc. With increasing innovation in data science and AI, enterprises are now having to holistically assess their technology estate, and their ways of working to understand how they can adapt their businesses to be more data-driven, and risk-aware, and identify revenue growth or cost-saving opportunities.
Over the past decade, digital transformation initiatives have been launched by different companies to increase revenue and reinvent their business operations. These transformations typically include changes to their ways of working – often involving the adoption of some degree of agility and implementing new technology capabilities, and subsequently moving towards deprecating obsolete hardware and software. Lloyds bank announced it will be investing £1 billion over the next 3 years in its digital transformation initiative and moving some of its services to the cloud. According to the CEO Charlie Nunn, “Lloyds wants to increase its digitally active customers by more than 10% by 2024 to in excess of 20 million, by adopting an agile software delivery method and using data and analytics to deliver personalised engagement, offers and pricing”. Cloud adoption strategy and agile transformation are integral parts of any enterprise’s digital transformation journey. These types of investments and changes would help drive revenue and profitability, track ROI, and understand risk dimensions using real-time analytics.
Companies are seeing the competitive advantages innovations in cloud computing and big data brings to their business and are investing to enable their transformation journey. An example can be seen in Harshicorp’s state of the cloud report, where 90% of large enterprises have already adopted a multi-cloud infrastructure and seen its impact in helping them achieve their business goals. And this is only going to grow as businesses become more ambitious and ROI is realised. Companies often seek to rethink their digital strategies due to different reasons including to:-
- Cope with the impact of remote working/Covid
- Show regulatory compliance through data eg GDPR, FCA/PRA, DPA, etc, in a quick and reliable manner
- Adjust to political changes e.g Brexit, Sanctions regimes
- Drive revenue and plug revenue leakages
- Gain a competitive edge over other companies
- Improve cyber resilience and mitigate risks associated with software/hardware obsolescence
Enterprises embarking on digital transformation, must have an agile product delivery mindset and view data as the core of their business operation. This change is often introduced with an API strategy, Data mesh model, cloud strategy, cyber resiliency planning, legal and compliance with regulators, DevSecOps, data analytics, visualisation capability, etc. This should be a multi-year journey where the risks are identified and a treatment/mitigation plan formulated throughout the process. As mentioned earlier, digital transformation will also involve changes to people’s ways of working and will require senior leadership sponsorship to drive the message across the organisation to gain traction and acceptance. Gaps in training and people should be identified and a hiring plan formulated to hire and retrain required people.
If you are an executive in a large enterprise sponsoring or leading the change, firstly formulate your objectives and milestones and ensure key stakeholders have a chance to key into your ambition – this is a sample test of the resistance or acceptance and will prepare you for any scenarios enterprise-wide. During a massive transformation journey in a previous company, the new VP of Engineering first sent books (Inspired by Marty Cagan) to all Directors and Engineering/Delivery managers to ensure they had a mindset alignment. This was followed by training and coaching by external consultants – he managed to sell his objectives and ensured the team had an alignment with his vision. They subsequently helped evangelise the importance and value the transformation will bring to the business.
If you are planning or already embarked on some form of digital transformation in your business, here are some key tips that could help you maximise outcome. Some of these could be broadly applied or adapted to fit the peculiarity of your business and goals/strategies.
Steps to take while transforming your regulated organisation:-
- Scope setting: As part of the transformation discovery efforts, a clear, ambitious but achievable scope needs to be in place. For instance, identify a major service(s) that needs to move to the cloud and the team it affects and set the measurable goal – for the initial phase. Have a clear understanding of the risks and owners of all impacted services or business areas – and work collaboratively with the teams to own the outcome.
- Governance and ownership: Implement a governance framework that assigns processes, ownership, communication plan and risks in the transformation journey. Empower teams to have oversight and responsibilities to deliver the desired outcome. Having the right governance will enable organisations to become strategic and give their program a competitive edge to achieve growth and success while remaining compliant with applicable regulations.
- Budget and roadmap: Having a clear budget allows the business to manage costs effectively and project its possible burn rate. Setting a clear roadmap and having a roadmap delivery strategy will ensure the risk of cost overruns is managed. Using a modern PM tool like Advanced Jira Roadmap could enable multiple teams to map dependencies and give a hierarchical view of the program across multiple teams to different stakeholders. A Delivery Director/Lead will be accountable for the outcomes and help track roadmap delivery status and risks.
- Stakeholder mapping and input: Mapping different stakeholders and understanding their criticality to the program outcome is important. Once the stakeholders are identified, the Delivery Lead should set up a short-meeting cadence with the meeting agenda set throughout the phase of the program. A RACI matrix should help in planning stakeholder roles to ensure all stakeholders understand the role they play in the success of the program.
- Outcome statement and success criteria: Set an ambitious yet measurable business objective. A good technique is using the Objective Key Results (OKRs) approach that adds measurable and quantifiable outcomes to a business objective. Teams will own the outcome of their specific work and are accountable for the specified key results which were agreed upon with the business. For instance, 90% of EU FX payments are handled by the AWS payment gateway.
Finally, at every level of your enterprise transformation journey, be outcome driven and use verifiable data to measure the financial and non-financial values these changes have brought or will bring to your business. Make assumptions and validate those assumptions (or dispel them), as this helps build confidence toward the next phases of the journey. Outcome-driven transformation helps in building business confidence and securing further funding for subsequent phases of your journey. Good luck!