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Digital transformation or digital evolution?

There is no doubt that customers are changing and moving to a more digital world – but perhaps this is better described as an evolution rather than a transformation?

This article can also be found in the Premium Editorial Download: MicroScope: MicroScope: Exploring digital metamorphosis

What is digital transformation? Wikipedia describes it as “the adoption of digital technology to transform services or businesses, through replacing non-digital or manual processes with digital processes or replacing older digital technology with newer digital technology”.

Is that really transformative? IT has been doing that for years, replacing manual or non-digital processes with digital processes. In pretty much all cases of “digital transformation”, businesses and services are being improved by implementing newer technologies.

SolarWinds MSP president John Pagliuca recently described digital transformation as “a dumb phrase”, arguing that “digital evolution” was much more suitable. Was he right to say that?

The transformers

Simon Aldous, global head of channels at DropBox, doesn’t think so and he uses the events of the past year to make his case. “When looking back at the past year, we’ve seen technology move at a pace that can only be described as transformational,” he argues.

The way people adapted to work through Covid-19 will have a lasting impact on how we approach the future, he claims. “We have no intention of wasting this opportunity by going back to the old ways of working. We want to take the best bits of pre-pandemic work and the aspects we’ve learned over the past year to develop a more enlightened way of working. That, at its core, is transformational rather than an evolution.”

“When looking back at the past year, we’ve seen technology move at a pace that can only be described as transformational”
Simon Aldous, Dropbox

That’s a reasonable argument, but you could just as easily say that what occurred merely accelerated a trend that was already developing.

Bhushan Patil, senior vice-president for Europe, the Middle East and Africa (EMEA) at Tech Mahindra, believes new technologies “can be truly transformative” and says it would be doing its customers a disservice to downplay the enormous impact they can have on their businesses.

He thinks transformation is the right word. “All technology is evolutionary in some way, as it is built upon what came before it. What is transformational, though, is the impact that technology evolutions have on businesses,” says Patil.

Andrew Corcoran, director of UK and Ireland partner and channel sales at VMware, concurs, disputing the notion that this is just “a question of semantics”. He cites conversations with partners and research which “suggests customers already see the need for transformation”.

Looking at the past year, he acknowledges that the changes companies made to business models to meet the challenges of the pandemic “were likely already tabled for development and implementation as a ‘natural progression’, but Covid has disrupted business as usual, and accelerated the introduction of digital investments”.

Jeff McCullough, global vice-president of channel at Park Place Technologies, believes that describing it as a digital evolution “understates” the significance of the challenge and opportunity. “It undersells the chance for dramatic business growth and gives customers a free pass to accept marginal improvement over transformative results. Partners owe it to their customers to show them solutions that give them an opportunity to visualise another, better path to success,” he says.

But Sanjay Castelino, chief product officer at Snow Software, claims the term digital transformation has been over-used. “That doesn’t make it obsolete or wrong for the right types of business initiatives,” he says. “We are fortunate that technology can fundamentally transform the economics of a business. For example, online banking has changed the nature of bank branches, and online shopping the nature of retail.”

He defines transformation as “a risk with great reward, and to reduce it to evolution fails to recognise and focus a team on the real outcome – not the technology, but rather the business”.

The evolutionaries

Mike Starnes, head of client services at Foundation IT, admits to using the phrase digital transformation, but adds: “I don’t particularly like it because it’s a little misleading.” 

To him, it suggests “there is a journey to complete – you transform, and that’s it. Until the next transformation, of course”. Changing and improving technology is a key component for businesses to adapt to customer and market demand to stay relevant “but it is most certainly a journey, not a destination”.

“There is a lot of legacy in the market that was once transformed and transferred into business as usual and then left alone because it had done its job,” he points out. “Could the hassle and cost of changing these legacy technologies be avoided if changes were seen as iterative improvements and not wholesale changes; I’d have thought so.”

Starnes argues digital evolution is a more fitting description because “it suggests ongoing, iterative steps to improvement versus having a transformation destination, as that destination is going to be a moving target if it’s approached in that way”.

“Most of the time, technologies are not groundbreaking in and of themselves. But there has been a fundamental change in the application of existing solutions, and this evolution has delivered huge benefits for both resellers and customers”

Scott Harrison, Vertiv

Robin Scholten, general manager for Belgium, The Netherlands and Luxembourg (Benelux) at HeleCloud, agrees that digital transformation “often suggests businesses commit to adopting or updating IT infrastructure once and never thinking about it again. However, given the almost completely digital economy, businesses can’t have a one-shot view of their IT infrastructure”.

He warns that businesses should not cut themselves off from their past. “Digital transformation advocates tend to encourage businesses to think of the process as ‘Year Zero’ for their organisation – what came before is irrelevant and to focus only on the future. While the future is important, looking back and learning from mistakes and experiences allows a business to understand what it wants and needs from its digital tools going forward,” says Scholten.

Scott Harrison, UK and Ireland channel sales director for Vertiv, agrees that digital transformation is a misleading term. “Most of the time, technologies are not, in fact, groundbreaking in and of themselves. But there has been a fundamental change in the application of existing solutions, and this evolution has delivered huge benefits for both resellers and customers,” he says.

Matt Coughlan, director of channel sales at GitLab, describes digital transformation as “an overused term” that serves to scare organisations into using a specific set of technologies. “It doesn’t mean transformation is never necessary to keep pace with one’s peers or gain industry superiority, but an evolutionary approach is often sufficient,” he says.

Is disruption good or bad?

Digital transformation is often associated with disruptive technology, but Mike Lloyd, chief technology officer (CTO) at RedSeal, questions whether the popularity of “disruption” is a positive thing, noting that in most other areas of life it’s a negative term.

“So why is ‘disruption’ seen as cool when it comes to tech?” he asks. “In part, it’s how you get your new idea noticed – the media and investors are always looking for the new-new thing, and see something like a tune-up or improvement of an old thing as boring. Customers see it the other way around – disruption is bad, what most people want to buy is incremental efficiency.”

He argues there is “a bell-shaped curve of interest” in the new and disruptive, with most people somewhere in the middle of the curve. “For digital transformation, it’s too late to change the name – this label has gone mainstream with businesses in the middle of the bell curve, where it’s shorthand for ‘everyone else has gone digital, so it’s time you did too, even if you’re scared of it, because you’re turning into a dinosaur’,” Lloyd adds.

Going back to Pagliuca’s original comments, Richard Blanford, CEO of Fordway, tries to draw a distinction between the two terms. “I view digital transformation and digital evolution as separate things,” he says.

He describes digital transformation as “a business transformation process, of which IT is a key enabler, aimed at increasing revenues”.

“It’s where organisations digitise previously physical products and create new products and services from data,” he says. “It needs to be led by the business or customer themselves, with the channel helping once the customer has decided what they need to do.”

Digital evolution, on the other hand, “is the adoption of new technologies and services to improve business efficiency, reduce costs or increase capability, such as migrating to cloud services and implementing flexible working, which is what the channel provides our customers”.

Digitisation goes beyond technology

Alan Jacobson, chief data and analytics officer at Alteryx, says most people “get enamoured with the word digital” when talking about digital transformation. “The problem, however, is that often there is not enough of a focus on how to achieve the actual transformation part. The transformation process is a big challenge for the whole company – both for individuals to transform themselves and entire departments to overhaul their approach,” he says.

Digitisation has been around for 50 years, but many companies “still think that simply adding new technology into a broken process will add value”. The real change is not the use of technology in business processes or the use of automation or analytics. “The real change is the shift in who is able to implement these solutions and systems,” he states.  

“It’s easy to forget that digital transformation does not equal technology – that’s only part of the equation. Digital transformation is about changing culture and process within an organisation, as well as technology”
Neil Thurston, Logicalis UK

This is a distinction that others, such as Neil Thurston, chief technologist at Logicalis UK, are keen to comment on. “It’s easy to forget that digital transformation does not equal technology – that’s only part of the equation,” he states. “Digital transformation is about changing culture and process within an organisation, as well as technology – those other parts are arguably the hardest changes to adopt and are typically where the real transformation challenges are.

He accepts that technology changes “could be an evolution” but says it would be a “disservice to the cultural and process upheaval to refer to the whole as an evolution”.

Steve Chad, EMEA customer engagement manager at PFU, describes digital transformation as “the use of digital technology to achieve strategic, business-driven competitive advantage, not just improving current processes, but creating a new way of working that delivers the opportunity for repeated gains across many different areas. In some cases, the scale of transformation can end up reshaping whole business models or even markets”.

He accepts that digital transformation “could suffer from over-exposure in the same way that ‘green’ or ‘healthy’ bandwagons have been exploited and, as a result, many users will make the classic mistake of implementing technology as a standalone project – sometimes just because ‘everyone is doing it, so we don’t want to get left behind’ – and expecting the results to automatically follow”.

Ben Field, regional director at Radware, makes a similar point, warning that some companies make “the mistake of believing that technology by itself will deliver a better outcome, whereas it may be the people, a process, the technology or a combination of the three that’s required”. He is clear that “technology in itself isn’t transformative, it’s simply a part of the puzzle”.

“What’s disruptive is the change a business often goes through when incorporating new technology that’s disruptive – it’s the resulting changes in process, people’s roles, ways of working, the new customer outcomes and interactions and the culture of the business that are transformative,” adds Field.

On the subject of technology’s disruptive capabilities, Thurston remarks: “Technology is only there to deliver an outcome – it’s those outcomes or experiences that tend to disrupt, not the technology components. In other words, it’s what you do with it that counts.”

DropBox’s Aldous disagrees. “For technology to make lives better, it needs to be disruptive. It has been obvious for a long time that how we work needed to change, and the technological advancement we have seen in the past year was pushed forward at breakneck speed due to external circumstances,” he says.

Dan Pitman, principal security architect at Alert Logic, takes the opposite view. “Technology should not be disruptive,” he says. “Ideally, it should provide a path of least resistance for an organisation to achieve transformation. It is the business that should be disruptive within its market to gain a competitive advantage.”

Pitman suggests businesses considering digital transformation “need to make a choice between technology and services to ensure the best balance without overly increasing complexity”.

Focus on outcomes

James VyVyan, vice-president for EMEA sales at Datto, isn’t taking any sides, arguing that digital transformation “can be both transformational or simply an evolution of existing processes – it really depends on what the customer or partner is trying to achieve”.

Like others, he says technology can evolve business processes, but it can’t create them. “The result could be transformative for your business by allowing you to reach new markets or focus your scarce resources on areas of greater opportunity, rather than the mundane processes that can take up so much time. This is particularly true for small businesses,” he says.

“The technology landscape is so diverse and changes so rapidly now that I don’t think you can look at this from a singular perspective. If we view evolution as small steps and incremental changes, and revolution or transformation as big leaps or major changes, then there are arguments for both”
Trevor Lovelock, BT Wholesale

Trevor Lovelock, senior manager for transformation at BT Wholesale, takes a similar view. “The technology landscape is so diverse and changes so rapidly now that I don’t think you can look at this from a singular perspective. If we view evolution as small steps and incremental changes, and revolution or transformation as big leaps or major changes, then there are arguments for both,” he says.

In the end, it’s about the use case and customer-specific challenges. “You don’t have to transform everything all at once, but every business should be thinking about how they can use and exploit new technologies to optimise their operations and maintain market relevance,” adds Lovelock.

Channel partners and vendors need to ensure technologies are presented in that context. “It can’t be technology for technology’s sake. That’s also critical to ensure the trust between customers and suppliers remains, and suppliers can help businesses go on the journey,” he concludes.

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