Characteristics of Stage-2
The first task in Stage-2 is coordinate Digital Requirement documents (from Production, Business, Human Resources, Marketing, IT, Process, Quality units…) into one unified Digital Masterplan. This plan should also be in line with the firm’s wider strategy work. Additionally, it is crucial to understand that producing the unified Digital Masterplan is not a one-time-task, but a plan that is continuously updated and improved based on organization’s and customers’ feedback.
Once the firm has created its first unified Digital Masterplan, it is time to implement it. For this reason, the leadership needs to empower a centralized coordination “organ” to administrate and orchestrate Digital Business Transformation. This “organ” is called Digital Governance and it normally includes three levels: Strategic, Tactical and Operational Governance (symbolized as a triangel).
3 levels of Digital Governance
While Strategic Governance (a team with leadership representatives) is responsible for gathering requirements for Digital Masterplan in Stage-1, Tactical Governance (a team with CDO/CIO and representatives from IT, Business, Production, Process, Quality, Marketing and Human Resource) is responsible for designing and implementing it with help of Operational Governance (project teams) in Stage-2.
Implementing Digital Masterplan
In Stage-2, the organization will need to learn to experiment with new technologies and ways of working. This will be done according to the firm’s Integrated Digital Masterplan (designed in Stage-1) either by:
- ALT-1: Streamlining the current services or work practices (of existing business model).
- ALT-2: Experimenting/developing entirely new digital services or work practices.
- ALT-3: Combining previous two alternatives and eventually after achieving more knowledge of new digital technologies, developing a completely new digital business model.
Dividing technological and administrative changes
Nevertheless which of above alternatives the firm will choose, there will be both technological and administrative changes in the organizational environment. These changes are implemented in two different tracks in Stage2:
- In Step-2a -track, the firm will plan and implement its digital technology projects (e.g. software robotic automation -, sensor technology -, data analysis projects etc.). Often these technological projects are divided into pilots- and expansions/rollouts and steered mainly by technology vendors.
- In Step-2b -track, the firm will plan and implement its administrative projects that have causal links to the technological projects. For example, technological projects, such as, the software robotic automation projects, usually trigger changes in several processes, work instructions, role descriptions and training plans.
Coordinating technological and administrative changes
In order to coordinate both of the tracks (Step-2a and Step-2b), it is vital to find all relevant causal links between technological and administrative changes. This requires an experienced staff with a powerful mandate as one technological change can cause a wide range of administrative changes in several units (e.g. in Human Resource, Production, Purchasing, Process, Quality, Legal, Marketing, Business units…).
Summarizing the main tasks of Tactical Governance in Stage-2
- to implement Digital Masterplan & Digital Governance into practice
- to bring unit specific digital requirements into one unified Digital Masterplan
- to implement Governance forums and agendas
- to implement Governance processes
- to build Project Portfolio (both technological and administrative projects and their connections, budgets and priorities)
- to administrate digital vendors
- to start running Digital Transformation activities
- to run Governance Forums
- to orchestrate Project Portfolio (both technological and administrative projects)
- to update Digital Masterplan (based on feedback, attained in Stage-3)