Technology has become a key pillar in driving daily operations and in future proofing consumer centric organizations (Banking, Travel, FMCG, Logistics, Government services etc.) and B2B enterprises (Manufacturing, IT, Capital goods). The average spends on digital/IT technology in Indian firms range anywhere between 1 and 3% among emerging firms and between 4 and 8% among mature firms. In addition, 1500+ GCCs set up out of India over the last few years have the mandate to drive innovation and digital, among others for global organizations. It is therefore imperative to drive the Technology function in a most structured way to reap maximum benefits and to achieve competitiveness.
Technology/digital transformations begin with customers and the business model of a company. Once business functions pin down all key processes that drive sales, operations, customer support, human resources and finance, the pillars to establishing technology enterprise gets set in five stages. The steps below are indicative and may vary depending on the organization’s state of digital adoption.
Stage 1: Setting the enterprise platforms at the core
Platforms are typically developed by the large technology OEMs (E.g.: Microsoft, Salesforce, SAP etc.) and they digitize key organizational processes (e.g.: procure to pay, order to cash in operations or call to resolution in customer support). The decision to choose a platform generally depends on the platform’s ability to speed up transactions, data processing, and how much digital would percolate within an enterprise.
Common pitfalls include organizations selecting platforms offering partial capabilities needed by business or having multiple platforms that over engineer a process. A common way to resolve is by digitizing core functions (operations, finance, sales) by a certain type of OEM platform and building ancillary solutions for others.
Stage 2: Building ancillary solutions for efficiency
Once platforms are set up, they become the systems of record and systems of transaction for all business processes and evolve into an underlying infrastructure for further developments. For example, once a procure to pay is set using the ERP, one can automate the purchase requisition using an RPA bot over the ERP platform or build reports from data obtained from transactions, to facilitate business decisions. The focus of stage 2 is to achieve automation or efficiency.
Stage 3: Enterprise Database – the intelligence backbone
Once platforms or automation is established, it is important to connect the data from various systems in a centralized database to achieve business intelligence. Having this database in cloud offers flexibility in terms of speed and the ability to transact data at scale. For example, using an SQL query or Power BI reporting, an order produced and recorded in an MES system of a factory can be traced for invoicing and revenue recognition from the Receivables System, if data are available from both platforms in a central cloud.
Stage 4: Achieving business intelligence
Once the data hub is set up in stage 3, one can run reporting engines or even deploy GenAI models to obtain insights in real time. Technology architectures support depositing data from platforms or ancillary systems in regular batches, or in the form of events that are generated after each transaction. Event led architectures generally become favourable for AI deployments subsequently.
Stage 5: AI
Once stages 1 to 4 are sailed through for a set of business activities, companies become ready for AI adoption since the key to AI is having training data sets obtained from inter-connected digitalized processes. With the onset of agentic AI, startups are coming up with low-code platforms that can help deploy AI in microcosmic ways covering select activities. For example, an order refund can be processed with basic checks and balances done by a bot without having to connect all systems at once.
Organizational set up
Implementing enterprise scale digital transformation successfully requires an executive driving the digital agenda from the top and an organization consisting of five key departments.
- Strategy and PMO team: This team holds a view on external trends, the internal technology landscape and prepares the overall delivery plan based on business requirements. Strategy teams also facilitate the change management, thought leadership and open innovation to facilitate the cultural change.
- Architecture team: Enterprise architecture team is the enterprise technology knowledge repository (E.g.: platforms, APIs, events, database and software etc.) and can provide views to building ancillary systems and new platforms in the most effective way.
- Delivery teams: In general, enterprises’ driving revenue functions using technology (E.g.: banks, airlines, travel tech, ecommerce) should look to in-house the technology delivery, as product design, user experience, data analytics capabilities achieve a competitive differentiation. Whereas, platform deployments are largely buying decisions that can be outsourced.
- Cybersecurity team: This team’s mandate is to protect from all kinds of cyber risk across various touch points of the enterprise. (E.g.: Website, hardware devices, software, edge)
- Risk management team: To build resilience by studying the interconnectivity between various platforms and systems, and planning for worst case scenarios in IT operations due to internal or external factors. (E.g.: Assessing the maximum load a system or a server can undertake).
In conclusion, enterprise technology transformation is a journey involving digitizing key business processes, having a cloud infrastructure for data storage, processing and adopting AI, while driving a systematic cultural shift throughout. It is important to note that the scope of enterprise technology transformation will only expand in the coming years as AI matures and having stages 1 to 4 well set will lead to a strategic advantage.
Avinash Ramachandran is a strategy and technology leader with14 years of experience in driving transformations in energy, industrials and B2C verticals. Avinash can be contacted on LinkedIn.
