November 23, 2020
Digitalization and its impact on large organizations
The emergence of digital technologies is having a profound impact on businesses around the world. Enterprises are continually transforming with the advancement in technologies, potentially re-shaping every process within the organizational setup.
The Digital Wave has swept across industries triggering the most compelling changes, transforming processes which were previously intangible. This makes it imperative for organizations to have a robust strategy to digitize their operations in order to sharpen their competitive edge.
The automotive industry is evolving through significant digitalization. Subsequently, each of the business functions in the value chain, from product design to customer experience, needs a definitive strategy to maximize the potential from digitalization.
However, a winning digital strategy requires a shift in mindset. Large organizations are making this shift from traditional methods of working. Adapting to the rapid pace of change in the technological landscape requires agility, which can be challenging for organizations.
Persona of ‘Digital by Design’ Global Capability Centers (GCCs)
Reforming an organisation to meet the requirements of the new customer-centric era should be done by instilling fresh thoughts and objectives creatively. A new age Digital-by-Design Global Capability Center (GCC) offers opportunities for organizations to seed original ideas and new ways of working in the evolving ecosystem. It helps remove the encumbrances of the parent organization and streamline its operations.
In our view, the following would constitute the persona of a ‘Digital by Design’ GCC:
1. Driven by business outcomes rather than cost savings
GCCs of the past were measured on the cost-savings they brought in to the parent organizations. ‘Digital-by-Design’ GCCs are rather measured on the basis of the business outcomes (additional revenues, innovation, operational excellence, etc.) delivered to the parent organization.
2. Non-linear value delivery not just limited to scalability
Scale in ‘Digital-by-Design’ GCCs should only be incidental. They should focus on being able to “do more with less” by leveraging engineering productivity techniques.
3. Centre for new-age digital competencies rather than for legacy skill sets –
‘Digital-by-Design’ GCCs should consciously incubate only new age skill sets which would define the future of the enterprise rather than legacy skill sets which serve better when outsourced to third party service providers in hybrid models.
4. Delivery to have a product-centric approach which leverages agile and DevSecOps rather than the traditional waterfall models
‘Digital-by-Design’ GCCs should provide global organizations with a platform to adopt and experiment with product centric delivery methodologies. It should allow companies to drive innovation with a try and fail-fast approach to product development.
5. Centre for new age initiatives as against sundown initiatives
‘Digital-by-Design’ GCCs should be set up to work on initiatives involving upcoming technologies where GCCs can innovate and deliver faster value. Leveraging GCC to drive sundown initiatives limits their potential impact on enterprise outcomes.
6. The governance structure should allow aligned autonomy with the parent organization as against imbibing a conformist culture
A successful ‘Digital-by-Design’ GCC is one which can work with autonomy and with a shared sense of accountability with global teams rather than conforming itself to the legacy ways of working. Its culture should foster independent thinking and instil intrapreneurial spirit to drive the necessary innovation.
7. Teams should be entrusted with product ownership rather than just being leveraged as an extended arm
Over the years, the Indian GCC ecosystem has matured in a way that talent in India is increasingly capable to independently drive initiatives with full ownership.
A ‘Digital-by-Design’ GCC thus has the capabilities to transform the enterprise and deliver significant business impact across all its functions. It forms an inseparable component of organization strategy focusing on a proactive response to the industrial transformation.
ABOUT THE AUTHORS
Karim Lalani FutureFactor360
Head of FCA ICT- India Boutique Consulting Firm- India
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