Digital transformation is imperative today for all enterprises, given the technology-driven fast-paced change in the business environment. However, many fail to achieve the desired outcomes as research from a major consultancy indicates a failure rate of 70 percent. One of the key factors observed is an inadequate focus on improving technical agility.
Technical agility is the ability to adapt quickly to emergent technologies by incorporating evolutionary architectural approaches in order to achieve desired results of agile principles: greater speed to value, build quality upfront, and attain higher predictability. Technical agility also helps to keep the cost of change to a minimum, which is a huge enabler for catering to the dynamic requirements of customers and businesses.
Following are some key challenges that are impediments to achieving technical agility:
Obsolete legacy systems
Even though we are in the digital era, many organizations continue to heavily rely on legacy systems that have been utilized for decades and are often too outdated and inflexible to changing business needs.
Legacy systems are largely “systems of record”, i.e., systems for managing data and acting as the authoritative source for accuracy and consistency of information.
Since they are mostly built in the previous decades, the heavy customizations that have been done on top of it to respond to business needs and the foundation rarely refreshes, which creates complexity. In this era, relying on legacy systems with inherent complexity is a bottleneck and a business risk to organizations.
Moreover, as “systems of record” are built for accuracy and compliance purposes, they are not great at user experience. Therefore, modernizing it to become “systems of engagement” which enables seamless workflows while providing superior user experience is also another initiative to be pursued.
However, modernizing legacy systems is a complicated task, as many organizations see it as a big-bang activity while the requirements are usually dynamic. According to a study, “senior management hesitates to endorse digitally transforming older systems for a variety of reasons, including fears about cost, risk, and resource allocation, as well as poor past experiences with large-scale IT projects.”
To overcome this challenge, organizations should perceive the legacy modernization task as an incremental activity that incorporates the requirements of each time period accordingly i.e. adopting agile principles instead of preparing huge documentation that serves as an unmovable monolith. Thereby, enhancing agility and successfully modernizing the legacy systems to become “Systems of Engagement” that cater to the organization’s needs is ultimately the desired path to tread.
Lack of engineering practices
Many transformation initiatives focus on improving software delivery processes, with the aim to shorten the time taken to release software to production. However, when delivery practices are not supported by appropriate software engineering practices, the quest for speed often leads to poor quality, last-minute integration challenges, and increased technical debt.
The reasons for not adopting engineering practices appear to be not realizing the worth of internal quality — quality that is not visible at a surface level and requires some extra effort at the starting point but is a foundation that drives organizations toward their goals.
Some of the key engineering practices that most modern digital businesses adopt include, but are not limited to, vertical slicing with incremental delivery, test-driven development, automation across multiple levels (unit, integration, end-to-end tests, and repetitive tasks). Further practices that really help with speed and quality are infrastructure as code and security and compliance as code. These practices ensure manual steps are minimized, and functionalities are validated every time there is a change to the system.
A benefit of engineering practices that is often not recognized is they help to lower the cost of change, which is an important contributor to business agility. Engineering practices done right help to achieve speed, quality, and predictability over the long term without having to make any trade-offs between these outcomes.
Investing in enabling the adoption of software engineering practices should be given strategic importance, given that they are crucial for achieving technical agility. And technical agility is critical for digital transformations to succeed.
Tech talents shortage
According to Harvard Business Review: “You can pretty much buy any technology, but your ability to adapt to an even more digital future depends on developing the next generation of skills “
A major constraint that enterprises are facing as they embark on their digital transformation initiative is the shortage of talent having the required skills. According to Gartner, 64 percent of IT executives see the talent shortage as the most significant adoption barrier to emerging technologies.
Enterprises are also facing challenges in upskilling their current workforce, as well as in attracting talent having the appropriate aptitude and skills.
Not having the right talent/workforce is a huge risk to the success of digital transformation, as the lack of required capabilities to skilfully implement engineering practices will impact technical agility. Moreover, without the right culture and environment that the talent can thrive, organizations may not achieve success in retaining the acquired skills. Enterprises, therefore, need to build a culture of nurturing, growing, and retaining talent.
A robust digital talent strategy is a necessity to help realize digital ambitions. The strategy should address the entire talent lifecycle which includes a talent plan aligned with business goals, attracting talent, career development, retention, and engagement.
Business and technology misalignment
For organizations to collectively drive towards the right direction and avoid scattered investments, some of which may not be aligned with business priorities, all functions must be geared towards achieving the same outcomes. This is especially true for the Technology/IT function, as digital technologies are the core of products and services in many organizations.
However, IT is often not involved in the framing of strategies and directions. This leads to the technology and business functions and sometimes also the top management being ‘on the other side of the table’, which results in a ‘throw it over the wall’ mindset for all parties.
To achieve the desired technical agility, IT needs to be elevated to a strategic level, where the technology leaders get a seat at the table with the business stakeholders and top management. IT also needs to step up and partner with the business to achieve the business outcomes. Since technical agility can not be reached by only contribution from one function, it requires a collective effort for firms to be able to adapt and respond to change swiftly.
Treating IT as a cost center
According to the Oxford dictionary, “cost centers are a part of an organization to which costs may be charged; a part of an organization viewed as bringing costs rather than profits or benefits.”
Technology/IT function has been traditionally categorized as a cost-center alongside other supporting functions such as finance, HR, etc. as its primary role was as a supporting function.
The success of supporting functions is largely linked to optimizing the allocated budget. This creates a serious impediment to contributing to value creation, as the rigidity of the annual budget inhibits the ability to accommodate emerging business opportunities. Moreover, it leads to a silo optimization mindset, which discourages collaboration with businesses.
Therefore, treating the technology/IT function as a cost center is a huge deterrent to being responsive, adaptable, and flexible and thus can cause a drag on technical agility.
The senior leadership of the enterprise must commit to their support and work with the technology/IT functions to shift the focus from optimizing the budget to actively partnering with business functions and contributing to creating business value.
For digital transformation initiatives to succeed, technical agility is critical. Enterprises must give strategic importance to investments needed in terms of time and money to enable the technology/IT function to enhance technical agility. This is even more important, as technical agility is at the foundation of enterprise agility.
Sirapatsorn Trisuchon (Prow) is Senior consultant, Digital Transformation & Operations at Thoughtworks.
Sunil Mundra is Principal Consultant-ADVISORY at Thoughtworks.
TechNode Global INSIDER publishes contributions relevant to entrepreneurship and innovation. You may submit your own original or published contributions subject to editorial discretion.
More than digital transformation, consistent digital mastery is key to business resilience