How to Be Successful with Digital Transformation Spending
Digital transformation technology spending continues to grow across all geographies and industries. IDC predicts that digital transformation spending will increase 42 percent between 2017 and 2019, hitting $1.7 trillion by 2019. Much of that spend is likely to come from the rapidly-evolving financial services industry, but many of the projects it funds will go over time, over budget, or even fail.
This happens time and again, and it often comes back to a single issue—stakeholders across all facets of the organization need to be aligned for a technology project to be successful. Contrary to common belief, digital transformation is not just about technology, it’s also about business process and organizational changes. Digital transformation can’t happen in a vacuum—the organization’s people still need to keep the core business up and running during the digital transformation process and be seamless for customers.
This raises a question: How do you manage stakeholder expectations and evolve employee workflows, all while keeping your digital transformation schedule on time and spending within budget?
Aligning Key Stakeholders Around Business Goals
“Innovate or die” has been drilled deeply into organizations’ minds, and they are trying to translate what that means for their business. In the world of innovative technologies, the fear of being left behind is growing, as is the challenge of figuring out what technology to invest in.
In this environment, misalignment can reveal itself in many forms. Internal stakeholders may have one vision, while the project is actually delivering something else—the business goals lost in translation. With so many new technologies to choose from—cloud, big data, artificial intelligence, internet of things, etc.—the pace of change can leave teams leaping before they look. Stakeholders may want to update and transform everything at the same time, or change their minds about a project’s direction mid-execution.
Project teams are left to work out how to make digital success happen—keeping everyone happy, while also staying on time and on budget. As a result, they end up spending time that should be used on implementing change, struggling to align and re-align expectations from internal stakeholders. Project managers are often asked for small “tweaks” throughout the process, which can derail their timelines and budgets after the project has already begun.
These derailments also impact app developers, who are under the gun to deliver projects on time, but often have little or no visibility into the ultimate business goals of the projects they’re working on.
So many small misjudgments early in the process can spiral into a full-on derailment as projects progress. To avoid that, it’s crucial to have a process for getting everyone on the same page—understanding the business goals and situational realities, as well as which pieces of the project are flexible, and which are fixed.
Recognizing Technical Dependencies and Creating a Realistic Timeline
An essential step in making sure your digital transformation project stays on track is identifying the true scope and setting up a realistic timeline.
Although organizations want to undergo dramatic digital transformations and implement innovative technologies, they are now dealing with the realities of their legacy applications and technical debt. These dependencies can’t be ignored—businesses need to figure out exactly what they already have, and what they need to work with in order to complete the project.
Without looking deeply into legacy infrastructures that might slow down the process, project managers and developers tend to overestimate their efficiency, leading to timelines that are shorter than realistic. Assumptions and ambiguity can put even the best developers off track.
Nearly every project that goes over time, over budget, or even fails, comes back to miscommunication of realities among stakeholders, and setting up unreasonable deadlines and expectations as a result. Therefore, having a realistic scope and timeline for execution is one of the keys to success. This timeline, assigned to resolve any dependencies, will help you inform stakeholders on the process and keep all parties accountable. Although the result may be that a 4-month development project will actually now take 6 months, this realistic timeline allows your development team to work at full velocity – instead of hitting dependency blocks that leave you paying them to sit idle while those issues are resolved.
Identifying and Addressing Derailments Before They Put the Project at Jeopardy
In addition to ensuring all stakeholders are being realistic about the project requirements and scope, the timeline also makes it easier to see how small changes along the way will impact the overall project timeline and budget or catch any derailments early. If stakeholders want to make a change, however small, they will see how that impacts all other components down the line. Once the project starts, the timeline makes it easier to see if any components are falling behind.
In the process of developing a project and timeline, suggestions and input often come in from multiple stakeholders. Figuring out the essential features needed to meet the key requirements of the application—what we call the “minimum viable product” (MVP)—is a great way to keep the project in check. More bells and whistles may add to the application you’re developing, but oftentimes at the cost of its core functionality or development timeline. A good product owner will listen to these ideas, but will ultimately distinguish between core functions and “nice-to-have” add-ons. Later on, the team can iterate on a backlog of additional features, but the top priority is getting the core MVP functionality working first.
Focusing on the MVP features ensures that the ultimate business goal of the project will be achieved as quickly as possible. Other features can be addressed further down the road, but the core of the project, what really matters, will be completed with top priority.
Even with the MVP and timeline agreed upon, it is important to understand your senior stakeholders, and how they historically have given feedback when planning your schedule. To mitigate middle-of-the-project changes or conflicts, consider releasing prototypes of your application throughout the development process that give stakeholders limited sets of functionality early enough where changes can be made without jeopardizing your timeline.
In the end, business stakeholders need to be realistic about their expectations with digital projects—understand exactly what you’re asking for, and communicate why this is an important project for the business. Understanding your goals with a project will help your development team deliver what you want. Development teams should also be more transparent about the process, and all the complexities involved, with business stakeholders. Aligning on the project realities, timeline and budget, can help avoid unwanted surprises down the line, keeping projects running smoothly and on time, and surfacing spending issues before they become insurmountable.
Josh Collins bio:
Josh Collins is a Technical Architect at Janeiro Digital and is responsible for designing scalable solutions to meet client needs and exceed their expectations. Over his career, Josh has been part of multiple high performing teams and has built significant hands-on expertise across a wide variety of technology stacks. He has a rich history of designing and implementing enterprise-grade solutions at scale across multiple industries including financial services, insurance, and energy.
Prior to joining Janeiro Digital, he was a Senior Technology Manager at Bank of America where he led several transformational initiatives. Projects included a multi-year transformational program aimed at streamlining their Wholesale Credit business processes (underwriting, fulfillment, servicing, and monitoring), and implementing a new modernized platform (BPM, Service Bus, REST, Rules Engine, UX/UI, HTML5).