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Digital Transformation: Don’t build a faster caterpillar!

By Kamal Das

Digital Transformation is a much used and abused word, with many users assigning multiple differing meanings to it. Often Digital Transformation is confused with Digitization or Digitalization. At other times, parts of Digital Transformations are implemented in a slipshod manner resulting in continued chaos rather than presenting a solution.

Dr. George Westerman Principal Research Scientist, J-WEL Workforce and Learning Senior Lecturer, MIT Sloan School of Management described it best: when digital transformation is done right, it’s like a caterpillar turning into a butterfly, but when done wrong, all you have is a really fast caterpillar”. 

What is the difference between Digitization, Digitalization and Digital Transformation?

Digitization is the process of converting a manual process to a digital one. For instance, some “paperless offices” move scanned copies of physical papers. These scanned copies still go through the earlier process. We have faster movement of the papers (“faster caterpillars”) but no improvement in process per se. The file still moves from one office to another, waiting for signatures and inputs, and the sender has to email the scanned document to the next person in the hierarchy or to other departments such as finance or legal for approval.  The elimination of paper has moved files faster but the process remains unchanged.

Digitalization is the improvement of a manual process using technology. For instance, all departments and people in an organization are connected and have access to an application that allows them to see the status of various items in the workflow. They understand where a particular file is stuck. Once a person has completed his work on an item, it automatically moves to the next required person for inputs and next action. The caterpillar (paper/files) will move even faster, but it is still a caterpillar. Adoption of databases, enterprise resource planning (ERP) tools, and Human Resource Management Information System (HR MIS) systems lead to digitalization. They do not always lead to Digital Transformation.

Digital Transformation requires as the name itself suggests “transformation”. The caterpillar doesn’t become a faster caterpillar, it needs to transform (or metamorphose) into a butterfly.  Digital Transformation needs to create value for the end-user or business. It needs a human-centric approach. It needs to add value and make the various stakeholders at the heart of the change.  Let us see this using an example.

As part of my personal medical insurance (no names as this is not to single any entity), I get semiannual free health checkups. I had one completed during the first weekend of September. The process was phygital (Physical + Digital), one could book online and get a confirmation from the health insurer over call before the actual checkup. I got a phone call, SMS and email confirming the visit. The blood samples were taken and the report was to be shared in a few days. I got an email sharing my previous health report (taken 6 months back).

The system did not for unknown reasons capture the visit and health checkup. After a few follow-ups, the medical insurance call Center executives informed me they had no new reports and were not aware the health checkup was complete! I still await the update on what went wrong.

Has the medical insurance company been transformed or did digitalization just make it a faster caterpillar? 

A digitally transformed experience would make the customer at the Center of transformation. There would be a handshake or feedback after the experience and a check if the health checkup was completed or not. In case, the health checkup was not completed (medical professional unavailable) it should be rescheduled. In case, the medical professional misplaced the blood samples, an apology and request to take a fresh sample may be taken. Customers realize that errors happen. However, the system in place was unable to transform into a customer-centric avatar.

As we look at digital transformation, too often we are focused on faster caterpillars. We do not envision the butterfly. 

In the public sector space (like in many other businesses), grievance handling remains a sore issue. Let us consider an example of an aged lady with a Below Poverty Line (BPL) card in a remote village. She has not received her old age pension. She could go from official to official figuring out what the status is. 

Now let us imagine what digital transformation can bring to the table. The lady could call a pension grievance phone number. A voice bot (or human) would answer her call and understand her grievance – she had not received her old age pension for the past few months. The voice bot would capture her details and promise an update in a couple of days. 

After a couple of days, the voice bot would call back and confirm the status. In case the issue was solved on record “and” confirmed by the lady, it would be closed. If the lady had continued concerns the system would automatically escalate to higher levels and ensure resolution. She would be annoyed that it was wrongly marked as resolved but would be impressed that the next steps in the resolution would be done without any additional effort from her end. A confirmation handshake/feedback would continue to be taken and acted upon till the matter is resolved.

Proactive citizen centric requires a transformation mindset which focused on the essence that resolution to the satisfaction of the end user is imperative. True transformation redefines the value offered and ensures end-user delight.

As we move towards more exercises in digital transformation, we look forward to more butterflies, not faster caterpillars!


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