Digital Transformation Or Digital Innovation: Where Should You Focus?


What new technologies, tools, processes – and, quite frankly, people – are required today to better serve clients, stakeholders, employees, and community? It is a question many businesses are asking themselves as they make the move to digital transformation.

For 8 in 10 organizations, digital transformation has been a focus over the past five years. Meanwhile, 84% see innovation as key to success. So it’s likely that either transformation or innovation will reach your whiteboard as a top initiative this year, if it hasn’t done so already.

But what do these terms really mean in practice? Aren’t they synonymous? Well, not really.

Once you analyze the definition of digital transformation, you realize it could lead to innovation. And if you can truly innovate, chances are you’ll need to transform your digital operations to follow through.

Where should you focus your efforts? That depends on the state of your IT and application teams along with your overall mission.

Innovation is Net New. Transformation is New for You.

Innovation is a needle mover – a net new idea, method, product, service, or process. It challenges the existing norms, rethinking what is possible. It can also be the use of improved solutions to meet requirements or market needs. In either case, it is about using or creating something disruptive – a product, service, or process that shifts your overall paradigm. Innovation is not always the technology being used or created. It is what results from that technology and how you solve your pre-existing problems in newly reimagined ways that benefit your organization.

Digital transformation, on the other hand, is new for your organization. It often means implementing someone else’s innovative processes or services to fundamentally change the way you deliver technology services or the way your technology supports your business goals. It might translate to catching up with leaders that disrupted the market in the first place.

Digital transformation is about implementing new employee roles, software, hardware, as-a-Service options (including cloud computing), automation, and agile processes in a combination that dramatically changes your business operating model. This often involves modernizing your technology, but digital transformation is not mere modernization. You should be auditing and evaluating overall workflows across all departments, integrating new technologies in ways that deliver more value to customers and stakeholders.

Where Innovation and Digital Transformation Overlap

Of course, many innovations either encompass digital transformation elements or lead to them. The opposite can be true as well. Being the first to successfully adopt digital transformation within your industry might translate into true innovation. 

One example can be found from our colleagues at our sister company, Deliveron. They worked with a medical contract staffing organization who was still using paper- and Excel-based tools and processes for tracking, scheduling, and even payroll. As they grew to over 800 contractors under management, they needed a more efficient operating model. We designed, developed, implemented, and trained them on an end-to-end custom application to capture and process their scheduling and help automate payroll.

This might seem like a simple step to take: moving off paper and Microsoft Office software to an industry-specific app designed around your precise needs. But don’t forget: digital transformation doesn’t require innovation. This relatively simple solution was completely transformative for this growing organization, helping them streamline their operations and deliver a better service to hospitals and caregiving organizations throughout the market.

While we have yet to implement the innovative step for this staffing organization, we do have some ideas on how we can take their existing application and make it truly innovative.

One example would be taking advantage of cognitive services on platform as a service (PaaS) platforms like Azure to automate and pre-fill forms for intake or processing. In this case we would design an application component that could take a picture of a staff member, match them to an existing record, and pre-fill any relevant information for the current scenario.

Another example would be using machine learning PaaS to identify patterns within the contractor pool and align opportunities with a good choice of staff candidates based on criteria such as previous experience, when they accepted jobs in the past, location, feedback from previous contracts, or other factors that might lead to a satisfied client and a strong contract employee performance. This machine learning algorithm could surface a list of solid candidates or even reach out to them automatically to alert them to the possibility and find out if they are available or interested.

Getting Your Team On Board

The first step for either digital transformation or innovation is to recognize your business goals and identify the obstacles or problems in the way of reaching them. By using (in the case of transformation) or creating (in the case of innovation) new digital products and processes aimed at streamlining your organization, you progress further along a digital journey that will surprise, delight, and satisfy clients or partners and lead to greater business profitability and market penetration.

Remember, with 80% of organizations looking to transform or innovate today, it’s important to clearly define your goals for transformation. Your employees must be ready, and willing, to adopt new tools and workflows in order to successfully reach them. This is a journey for your entire organization and it must come with buy-in and participation at every level. 

About 70% of those who have pursued digital transformation report failure, according to a McKinsey study. This is likely because they did not have a solid plan, nor the expertise to define potential obstacles and clearly outline how to address them. Embracing digital transformationisn’t a simple task. It’s a challenging journey of transformative steps that has the potential to pay off big in terms of net gains in an organization’s progress and profits. 

Shawn Mills, is CEO and a founding member of Green House Data, a managed and professional services organization that helps organizations with multi-cloud management, professional services, DevOps frameworks, data center services, and application enablement. Under his leadership, Green House Data has undergone consistent expansion, growing from a single location to data center facilities and office sites across the US and Canada. Mills has spoken at industry events including Data Center World, the National Center for Supercomputing Applications, Cloud Computing Expo, and DatacenterDynamics Converged. 

Edited by Maurice Nagle
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