12 Secrets of Digital Transformation: Part 2

In this 12-part blog series, Dr. Jim Walsh (CTO, GlobalLogic) explores how businesses can effectively embrace digital transformation. Read "Secret #1: Stop Digging the Hole Deeper" here.

Secret #2: Define and Become the Competitor You Fear Most

When we work with companies to design their next-generation product architectures, there’s an exercise we like to do. We get the smartest technical people we can on the company side together with the smartest technical people we can on the GlobalLogic side. We sit them down face-to-face in a big room with lots of whiteboards. We then ask a simple question:

“Suppose all of us in this room left your company today and did a startup together. We take everything we know with us—all the domain knowledge you’ve acquired, all your expertise about what works and what doesn’t, GlobalLogic’s expertise on the technology side, everything. HOWEVER, we are not allowed to use any existing code at all, because we’re no longer in your company—we’re now a startup. What system can we design and implement that would start to put your current company out of business in, say, 6 months?”

Removing the constraints that exist in your current system unblocks a lot of thinking. In every case I can think of, we ended up with a next-generation system architecture that’s simpler, faster and cheaper to develop, as well as far more flexible and powerful than the existing system. It’s often disappointing to the team when they have to come back to reality and face the “real world” of the system as it currently exists.

The software you have today gives your company huge benefits. It’s probably very feature rich, your end users are familiar with it, it generates revenue and gives you market presence and, most important, it exists in the real world, not just on a whiteboard.

However, it also places a lot of burdens and costs on you that your competitors may not have—and which startups in your space certainly don’t have.

The competition that established companies in transition generally fear the most is, and probably should be, the “technology upstart” who comes from left field and disrupts the entire market. Their traditional competitors are, by comparison, known quantities and therefore manageable. In retrospect, Tower Books and Blockbuster Video had nothing to fear from their competitor Borders; their disrupters were Apple Computer, Amazon Kindle, and Netflix streaming. Similarly, competing pharmaceutical companies today don’t really worry so much about each other—they worry about Google and their massive DNA repository and data science capabilities.

It is nearly impossible to evolve incrementally into a great system without first visualizing where you want to end up. Even if your end goal is fuzzy and changes from time to time, starting with some sort of end in mind helps organize your efforts and get people aligned.

It seems like open-ended incremental evolution should work, but in practice it just doesn’t happen unless your activities and thinking are focused toward some type of end goal, however imperfect. Biological evolution works because it uses a massive number of trials. Millions of mistakes and dead-ends over long periods of time, together with ruthless pruning are required to achieve a relative handful of successes. In business, we generally don’t have the option of using a pure biological process. We will, of course, evolve as we make mistakes and learn from them, but in general we can’t afford to make enough mistakes to drive a truly and exclusively evolutionary process. Instead we need to start with a goal in mind to create enough alignment to focus our evolution.

Thinking about how you could become the competitor you would fear the most helps you envision the software you really need to have. There’s a lot of work after that to figure out how to get from where you are to where you want to be—and even more work actually doing it. This thinking needs to take into account not only your long-term business goals, but also the intermediate goals and constraints you need to accommodate along the way. Start out by visualizing where you’d like to end up; it’s a major step in getting there.