Digital transformation is much discussed by businesses gurus and according to many business surveys it is the number one item on the agenda of most CEOs. But how many businesses are succeeding with digital transformation? Again, surveys, like the Harvard Business Review report “High-Performance Sourcing and Procurement”, suggest that progress is slow, with few firms achieving a maturity score in terms of digital transformation implementation success.
For the beleaguered senior management in companies, there are few success stories to draw upon and finding suitable cases can be difficult. This two-part article attempts to redress this, in highlighting two examples of effective digital transformation success.
Digital transformation of utilities
The first example is with utilities. The utilities industry is experiencing a period of disruptive change. For example, economic and political trends are impacting heavily on both asset-heavy monopoly utilities and alternative energy solutions are proving strong competitors. Moreover, utilities are invariably affected by periodic disruptions to supply, which affects the customer experience and this can affect levels of profitability, especially when customers exit. To address such issues, some utility companies are using data analytics to improve the accuracy in forecasting the duration of power outage.
Xylem, success story
An example of digital transformation success is with Xylem, which works in the utility sector by providing water management solutions. Xylem incorporated is a large U.S. water technology provider. The focus is with enabling customers worldwide to transport, treat, test and efficiently use water in public utility, residential, commercial, agricultural and industrial settings. Xylem operates across 150 countries.
The CIO of Xylem is Nicholas Colisto, and his part of the company’s operations criss-crosses over includes five business units. These corporate subdivisions have, over time, added several disparate information systems over time. The net effect of this, Colisto told the technology site CIO, is that the degree of fragmentation was causing decision making problems: either delays in decision making or communication errors.
Single IT platform
The immediate focus of the Xylem’s digital transformation journey was to address this structural weakness. The company has consolidated its legacy IT and introduced a single platform. For other businesses facing the same challenges, this wasn’t easy and the process took several years.
The effect of a single platform, however, has led to many improvements for Xylem: better customer engagement, improved operational efficiency and stronger growth. Xylem reckon that the business operating platform has led to the company generating over $30 million of net value in one year.
The single platform is the Xylem Integrated System (also called Xylem One). The platform can collect and analyze social media, mobile communications, and Internet of Things data. The information is drawn into service-oriented architecture, which also assists in employees connecting with customers.
Next steps
The journey does not end, for companies like Xylem which have fully engaged with the digital transformation process do not slowdown. 2018 activities will see further emphasis on business simplification and developing a continuous improvement culture among employees.
For a further example of a digital transformation success story, see the Digital Journal article “DX success: Sprint focuses on telecom customer experience.”
