When it comes to driving growth in business, becoming a more digital company is simply table stakes these days. But that doesn’t mean it’s easy–or that it’s happening as quickly as organizations need it to happen.
In a new survey conducted by StrategicCFO360 and Amazon Web Services as part of a year-long initiative to help the nation’s C-Suites transform operations, few of the nation’s CFOs report their companies having completed basic changes to becoming more nimble digital players, such as defining new job roles/team structures (16 percent), breaking down silos (12 percent), updating internal processes (6 percent) and hiring/retraining talent (4 percent).
“Agility is the ability to react to change creatively, quickly, inexpensively and at low risk,” says Mark Schwartz, enterprise strategist at Amazon Web Services and the author of The Art of Business Value and A Seat at the Table: IT Leadership in the Age of Agility. “Since most enterprises haven’t set themselves up to be agile, they need to un-become some of what they are. When it comes to IT, for example, they may have to replace outdated legacy systems, move to the cloud, reduce technical debt, build new skills. They may also have to change their governance and investment oversight processes, their organizational structure and their culture.”
What’s standing in the way? Plenty, but talent and training issues top the list. In our poll of 198 CFOs conducted May 17-19, 2021, 88 percent rated training the workforce and filling skills gaps a significant or serious challenge to improving their organization’s agility. Other pain points include responding to market needs, using data and cultural resistance to change.
None of which surprises Schwartz, the former CIO of the U.S. Citizenship and Immigration Services. “Most of us have optimized our businesses for infrequent, extensively planned change,” says Schwartz. “Today’s model is no less risk-mitigating (more, in fact) but requires that we set ourselves up to move quickly. That means a change in how we govern and oversee, select investments, design technical architectures and plan initiatives.” (Schwartz lays out some tips to becoming more agile in a recent post, Mental Models to Clarify the Goals of Digital Transformation).
Meanwhile, nearly all finance chiefs we polled (95 percent) considered identifying strategic growth opportunities for the business a key part of their role—far beyond the traditional “playing defense” work ascribed to many CFOs, such as cost containment and stewarding capital. And 4 out of 5 CFOs said they played an active role in the strategic planning of their organization’s digitalization journey—with 75 percent saying their role includes approving initiatives, and 63 percent saying they also support enhanced data governance and visibility. The majority (54 percent) recognize their role includes empowering the workforce around the overarching vision.
Uncertain what digital transformation means for your business or your role? We recommend you read this article by Amazon Web Services on some of the mental models that can help you see and conquer digital transformation in its various aspects.