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If big picture is key for digital transformation, is 'starting small' on the way out?

CIOs taking the big data, cloud, analytics, digitization, [fill in the blank] plunge are often given this piece of advice: Start small.

But new research jointly conducted by MIT Sloan Management Review and Deloitte Digital found that businesses focused on “discrete problems” are at the digitally immature end of the spectrum while those on the digitally mature end (or, according to the researchers, “maturing” since businesses are still in the thick of this stuff) are focused on the big picture.

Here’s the exact language, from the report’s executive summary:

MIT Sloan Management Review and Deloitte’s 2015 global study of digital business found that maturing digital businesses are focused on integrating digital technologies, such as social, mobile, analytics and cloud, in the service of transforming how their businesses work. Less-mature digital businesses are focused on solving discrete business problems with individual digital technologies.

The statement begs the question: Is starting small still good advice? Absolutely, according to Gerald C. Kane, guest editor at the Review and associate professor of information systems at the Boston College Carroll School of Management.

“A lot of these technology efforts are more about culture, are more about changing the business, which is often really hard to do,” Kane said in an interview with SearchCIO. Starting small and proving the value of a new tech endeavor enables CIOs to build in a transition from business as usual to the business of now while generating buy-in from the business.

But it does something else: Because digital transformation won’t look the same from one business to the next (a disconnect between theory and practice, according to Kane), starting small gives CIOs the opportunity to experiment “so you can capitalize on those that take off and kill those that don’t,” Kane said.

That’s what BASF SE, a chemical producer headquartered in Germany, did with social media tools. During last year’s study, Kane and his team researched BASF’s social efforts and discovered that the company started at the project level by asking some employees to use a new social tool in place of email — as an experiment.

“They found the product team increased its efficiency by 25% as a result of that,” Kane said. The results were dramatic and eye-opening and apparently the result of team turnover, although not in the way you’re expecting. With email, “if someone leaves, they take all of their information, knowledge and communication with them,” Kane said. When the same kinds of discourse take place on a social media platform, “there’s a whole digital record of the entire team’s interactions for the new person to get up to speed,” he said.

Turnover, it turns out, was incredibly disruptive, and the social media platform minimized the effects. “But they were never going to [get buy-in] across the whole organization at once,” Kane said.

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I think you have to distinguish between individual technologies applied to discrete problem and small applications/pieces of functionality that support a larger transformative vision. The latter is what we (Mendix) recommend to our clients because as you write, it's as much about changing the culture, enabling rapid experimentation, and creating a flywheel effect for digital innovation.
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It all depends on what you mean by "start". I think you need to start by looking at the big picture and identifying the various opportunities. Then you should prioritise them and choose one or two small projects to start with as you can't eat the whole digital elephant in one sitting.. There will inevitably already be some digitisation in any organisation - accounts, search marketing, the use of email, a web site...so transformation is about extending existing activities as well as identifying new things to trial. 

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