The corporate challenge of digital adoption

Information Professionals is in the business of creating IT savvy organisations. The Brisbane head-quartered firm has offerings in areas such as strategic ICT, digital strategy, programs projects and change which includes transformation management and organisational change, enterprise architecture and management consulting.

Mark Nicholls, who started out as a programmer at Telstra while doing his Digitising products and services is the growth area for the Information Professionals ability to try these things. They may not always get an immediate return on investment so that can degree in mathematics, was set on a path to set up Information Professionals in 2005. While at Telstra, he was doing a lot of work in solving business problems with information technology. Initially at Telstra and then with other organisations in Australia and internationally, he was overseeing larger and larger projects, and larger organisational impacts.

Nicholls saw it as the space for Information Professionals, a business that would provide specialist advice and support for the successful delivery of business and information technology change.

In the space of 12 years Nicholls has built it up to a workforce spread down the east coast of Australia, keeping in touch with each other on Skype for Business, using cloud based collaboration tools, and plenty of interstate travel.

Of course things have changed a lot since 2005. Back then, much of the focus of many organisations was on creating internal efficiencies. Now they are focused more on digitisation of products and services.

“The core of the business was and still is around program and project delivery,” Nicholls says. “Today, a lot of the drive comes from organisations looking at the digitisation of their products and services, how they are responding to changing customer needs, in the case of government, how they are responding to changing citizen expectations, how they are keeping pace with competitors or their peers, all of which are changing the expectations of customers, staff and all stakeholders. That in turn is seeing organisations asking questions of how well their internal IT function is serving them.”

Many businesses still want to improve efficiencies. But there are now other things in the mix.

“That could be protecting market share, it could be the ability to deliver new products and services,” Nicholls says. “It could be increasing revenue. There could be a range of factors and I think the value opportunity for IT is better understood today.”

Digitising products and services is the growth area for the Information Professionals business.

“Organisations are challenging themselves around what that means to them, where the value proposition is to them and their clients, what technologies and approaches they can adopt to create benefits for themselves and their stakeholders,” he says.

“It includes working with chief information officers to help the IT function become more agile and responsive to its internal organisational needs and the organisation to be more responsive to its customer needs.

“And with the new IT services available in the market, it’s also about considering how the IT function operates, how it sources its own capabilities, internally or externally, how IT decisions are made and how performance is measured and managed.

“Ultimately, it’s then about delivering any changes successfully through programs and projects.

“Those are the core areas that are moving in terms of growth for us and generally across the industry.”

So how do organisations become IT savvy?

He says it starts with education. That means everyone in the organisation, from the top down, has to look at how technology is changing their industry, what the trends are and where the opportunities and risks lie.

“I don’t think anyone is excluded here,” he says. “We all need to be on a lifelong learning path.

“If you look at the annual briefing by the Australian Institute of Company Directors, you will see that since 2013 they have put a greater and greater focus on the digital and IT topics that they cover. Before 2013, IT topics weren’t even covered.

“Education is an important aspect of becoming IT savvy and that’s from boards and executives down. In the case of government, that’s from Ministers down also.

“Education creates the capability between the ears. But then it’s also about building capability within the organisation and being able to try different things and build more ability to try these things. They may not always get an immediate return on investment so that can be a challenge to stay the course.

Everything you try may not work, everything you try may not be suitable for the market place but if you play the long game, you  are building capability and your organisation is learning.

“Then as the big opportunities present themselves, or the big risks present themselves, you will have some ability to respond.”

Part of that education also involves looking at how digital disruption can affect industries more broadly.

“There are a few good examples when it comes to big changes,” he says.

“We have had enough time in the history of digital disruption after a couple of decades of seeing what happens.

“One of the biggest ones of course was the initial rise of Amazon and the demise of Borders.

“For a lot of people that happened very quickly but if you look back in history, Borders set the path that led to its demise some decades earlier by the choices it made.

“It’s an important lesson for all organisations. Borders set the path by not building the capability it needed to be able to deal with customers other than in a store. It failed to learn what business would be like when not in a store, that is either through mail order or Internet based ordering and how to relate to customers and understand them via these channels. When Amazon came into town, Borders was left behind with no capability to respond.”

What’s happening now is that business models are being disrupted and companies have to know how to manage it, and have the capability to respond.

“What we’re seeing is different types of business model disruption. There is a view that there is no such thing as digital disruption unless there’s a business model change. Uber is just one example of business model change in that industry,” he says.

“There’s a whole set of terminology surrounding business model changes. Terms such as “disintermediation” and “democratisation” describe the types of big shifts for any industry.

“If an industry is going to be seriously disrupted and if there’s a big shift in the structure of that industry and they’re a major incumbent, that’s where the threat lies for them.”

So do organisations need to manage this by looking at it as a business model issue rather than an IT issue?

“Firstly, it can be a mistake to focus on the IT rather than the business outcome,” he says.

“Some IT products and services can provide good bait to buyers. They have the promise of great tools and new ways of working but the IT tools can often be a solution looking for a problem rather than the other way around. They are also rarely a complete solution on their own.

“That’s the first challenge, staying grounded on the business outcome and a business problem is an important discipline.

“Secondly, if you’re a large incumbent organisation, you’re probably not too interested in radically changing the business model. It’s more a defensive strategy to consider how others might be trying to radically change that and then having the capability to respond.

“If you’re a start-up organisation or a new entrant it might be your objective to change the business model.

“Digital disruption is usually associated with business model changes and when there is massive change, incumbents can end up on the wrong side of the ledger if they are unable to respond.

“It’s both a defensive strategy in terms of being able to service your consumers better, meet their expectations and match the market offerings better,” he says.

“At the same you are building your own capability, learning what works and what doesn’t, and if there is major disruption, you are in a much better position to respond.”

How different is it for Government organisations that aren’t as exposed to competitive pressures?

“As service deliverers, they are still exposed to the changing expectations of citizens, and in all jurisdictions, Government policy is driving them in the same direction. Plus they can have some additional constraints.  Head count caps is one of many. It can be challenging to evolve capabilities and refresh skills when you are limited by how much fresh talent you can bring into your organisation.”

“As policy makers, they have big challenges given the implications of digital disruption. The current changes to media regulations are one indicator of how a disrupted industry intersects with policy. This will continue across many industries, and can either advantage or disadvantage us as a nation.”

Nicholls is also actively involved in the industry. He is on the board of the Australian Information Industries Association (AIIA) and inaugural Chair of the Qld Digital Industry Collaboration Group.

He says this industry work is crucial for Australia.

“This industry is one of the most important sectors for the future of Australia.

“Our AIIA board, Chair and CEO all believe in that. All the leading economies at the moment are moving past Australia and many of us want to stop that slide.

“If you look at Australia, as consumers, we are great adopters of technology. We have something like 30 million mobile phones in this country but we’re sliding backwards in our industries.”

He says the AIIA works with industry and governments across Australia addressing government digital capabilities and those of the community and industries. He also says that this has benefits for Information Professionals and its team.

“We understand much more intimately the current challenges of digital adoption in government and non-government, in corporates and small business and how organisations are going about dealing with it,” he says.

“It’s an important part of our own organisation’s education and  continuous  learning.  And it is an incredible opportunity for us to contribute to moving Australia forward in terms of how competitive we are as a nation on the global stage.”

 



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