Digital Business Design
Digital Transformation

Digital Business Design: Key To Success in Digital Economy

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The reality of today’s digital economy kicks in relentlessly shaking the foundations of organizations of all sizes. Business priorities are radically shifting and traditional business models are becoming irrelevant. Furthermore, the shake cascades through the whole organization yielding strategies and associated enterprise architecture that worked for years irrelevant as well.

[ Note: I’ve used the terms business design, business architecture, and enterprise architecture interchangeably in this article. ]

The digital economy demands digital strategies which in turn require a digital business design for execution. Businesses eagerly try to formulate new strategies, but soon realize that they are not designed for digital to execute those strategies.

[ Read also: Technology doesn’t make you digital: Here’s why. ]

What does the digital economy entail?

The digital economy involves billions of daily online connections between people, businesses, devices, data, and processes. It is characterized by ubiquitous data, unlimited connectivity, and immense processing power.

The speed of change has shifted the expectations of customers about the digital possibilities. They’re no longer amazed at new things like they did a few years back. On the contrary, they’re expecting them eagerly.

What does success look like in this economy?

To be successful in the digital economy, businesses need to place their customers at the heart of everything they do. Customers seek interaction with businesses whenever and wherever they want. In ways that are most convenient for them. They want to engage with them through direct, seamless, omnichannel, and personalized experiences.

To become so responsive, businesses need to constantly reimagine their value propositions for the digital economy. If they don’t do it, someone else will.

It is easy for the end customers to use digital technologies. But, it is not equally easy for organizations to use them to create new digital offerings. This is where you need that digital business design that embraces modern technologies and ways of working.

Digital business design is the key to success.

Let’s start with the fact that big, old companies are simply not designed for digital. To stay competitive in this economy, they have generally embarked upon two different transformation journeys. One that digitizes their organizations, and one that seeks new digital value propositions. The former is enhancing operational efficiency through the use of digital technologies. The latter is using digital technologies to innovate new digital offerings.

Both are never-ending journeys. Digital transformation is enabled today by megatrends like cloud, IoT, big data, mobile, and social technologies. Naturally, this positions IT as an important business driver and source of competitive advantage.

In turn, this positions IT service management (ITSM) as a key strategic capability for organizations in a broader enterprise architecture context.

While I say that I cannot skip but highlight that for years ITIL has been the de facto standard for implementing ITSM. It has got a new upgrade with its fourth edition to reflect the challenges of the digital economy.

Re-shaping much of the established ITSM practices in the wider context of customer experience, value streams, and digital transformation, it has embraced new ways of working, such as Lean, Agile, Design Thinking, and DevOps.

In a world where every new becomes easily a new normal, a business should be architected to adapt itself to innovate and stay relevant.

The authors of this paper have skillfully managed to come up with a holistic and easily adaptable digital enterprise architecture reference cube. Similar to ITIL 4, it supports digital transformation with new business models and technologies, like social software, big data, cloud computing, mobility platforms, security systems, and semantics support.
Digital Enterprise Architecture Reference Cube

Digital Enterprise Architecture Reference Cube

The paper emphasizes adaptation as a key success factor for the survival of digital enterprise architectures, platforms, and application environments. Especially when business and IT services are constantly evolving in the light of ever-changing market conditions.

In the end, a digital business architecture lacking the alignment between IT and business, cannot be effective. The architecture should be geared to the enablement of business priorities. It should be the responsibility of senior executives to steer this design. In the end, this is how you ensure you can execute your strategies in the digital economy. And remember, the digital business design is not an end state, has never been and will never be.

Adil Gurbanov
Adil is a managing technology consultant at Digital & Emerging Tech of EY Technology Consulting in Amsterdam. Well-versed in the cloud and emerging tech in general, he has designed and led the development of various strategic cloud-based SaaS solutions and worked extensively on large-scale transformation engagements with top-tier organizations.

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