Digital transformation

As Ram Charan says, digital transformation is hard. Many firms have spent millions of dollars with very little result to show for it. Even defining what digital transformation is for a given industry or company is a challenging question.

The digital transformation of an asset manager must cover multiple dimensions and will evolve. It will impact the business model, client relationships, the supply chain, and the organization. Some elements of the digital transformation to consider:

• Client experience, focusing on the client, digitalizing their experience, and giving them access to data and self-servicing;
• Data, becoming a data-driven organization, leveraging new technologies like but not limited to data science, natural language processing, and artificial intelligence. For incumbents, data is often a significant challenge. There is data all over the place, with different definitions and formats, and minimal abilities to extract the value of all this data;
• Process automation, trying to achieve the highest possible straight-trough-processing level, eliminating manual work and potential errors;
• Digital disruption, identifying how Fintechs, pure digital players, and others will impact the industry, and defining required changes.

The digital transformation does not have to be a big bang. On the opposite, it should be a step-by-step approach. A company can quickly achieve results and deliver business impact by leveraging digital enablers with limited financial means. A key obstacle is often the company’s culture and mindset.

The digital transformation must come from the top (the CEO or the executive suite) and it must embark people even before it starts. Do not “outsource” your digital transformation to one individual or your IT organization. It’s a team effort that must engage people with sound business knowledge, deep operations expertise, and in-depth technology knowledge and expertise. Having the right talent is part of success. Finally, educating your senior management team about technology and digital transformation would be best.

Key to the journey is to identify the first, right step. Ensuring that it is feasible in a way it can quickly deliver business value. A good place where to start is usually the value chain. Map it, identify key pain points, and prioritize deliveries. Part of the journey is to find a pragmatic approach and not just dive into the digitalization hype.

Constantly revisit your target and the steps you are taking. If you are failing, recognize it quickly, and start again.

Recommended reading: “The digital leader“, Ram Charan and Raj B. Vattikuti, 2022.