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Time for digital transformation – again?


“Digital Transformation” Marketers – AKA “cookie jar consultants” – are at it again

It’s happening again: It’s widely claimed that digital transformation solves all problems. I don’t want to sound too boomerish, but we’ve been down this technology-solves-everything path a couple of times. And many leaders will believe the hype: transform your numbers, move to the cloud, buy a place in the Meta world, or any other fantastically tech-oriented claim that will fix all your ills without any pain.

Very few firms chose to do the hard work first during the latest transformation. They simply outsourced their problems to better technology, and what I call cookie jar consultants were willingly waiting to provide valuable assistance to businesses. Ask yourself: Are these cookie jar consultants done yet? I mean, the work started in the early 90s…

I understand the appeal of digital transformation as a solution to many business problems. Ultimately, AML Partners creates software solutions for RegTech and governance, risk and compliance needs. But can we start this time with a top-down review of all operational processes before embarking on a new digital transformation?

We at AML Partners are conducting end-to-end User Acceptance Testing (UAT) with a client who has just completed this process. The senior management team reinterpreted the term “woke” as they were completely unaware of some of the processes taking place in their overseas branches. By first reassessing their operational processes, they created a strong foundation for their new technology – quickly reviewing each job function, eliminating duplication and streamlining all processes. After this foundational work, we put our technology on top of these new business processes and workflows and automated every possible step.

Working together, we flipped the usual script. To optimize the effectiveness of advanced technology, management must first establish a strong flow of business processes, and then the digital system can be adapted to these processes. So-called “digital transformation” should never require an institution to operate within the boundaries of new “technology” rather than according to business needs.

Our client at UAT, in preparation for implementation, consolidated their global customer reengineering into a single location from which they could share results globally through a Joining Customer Registry. Foreign branches simply select from approved customers and the system automatically copies all legally permitted data into the local branch workflow before adding local requirements. This strikes me as a true digital transformation.

The antithesis—the default preference for superimposing new technology on bloated and broken processes—remains popular, however, because it’s easy, because it’s less prep work, because it’s convenient and familiar. And it’s also a popularity fueled by cookie-cutter consultants who can return again and again over the years in “support” of so-called digital transformations that pile on top of legacy operational processes one after the other.

But the “digital transformation” that cookie jar consultants feast on really only makes institutions more likely to make the same old mistakes. In contrast, business-driven digital transformations use operational process analysis as a foundation for leveraging technology to deliver superior results. In business-driven digital transformation, technology is aligned to the exact needs of the business through configuration.

For companies exploring new technologies that promise digital transformation, it’s easy to see what flavor of transformation someone is trying to sell you. If your digital transformation relationship manager (ie, sales person) can’t stop talking about how great the technology is at your first meeting, you should probably budget for a never-ending relationship in the “cookie jar” from the start of implementation.

In contrast, when conversations focus on what your business needs to win and how digital transformation can support that, it’s a business-centric approach that leads to successful digital transformation—and a more successful business.

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