A Systems Thinking Approach to Digital Transformation

The digital age is also interpreted as the age of networked intelligence. As data becomes more easily accessible, in the right format, and at the right time – organizations gain new capabilities to re-engineer business operations for faster and more efficient service delivery.

Throughout the lifecycle, a comprehensive system thinking approach addresses not only the complex product and its diverse subsystems but also the wider systems of which it is a part. At the systems level, users, the environment, other products, and processes impact the product throughout its lifespan. Organizations who design considering these factors excel in their operation

The concept of systems thinking is not new. The principle of “the whole being greater than the sum of its parts” can be traced back to Ancient Greece. Systems thinking is a comprehensive approach to modern business operations that focuses on how a system’s main constituents correlate and how they work overtime and within the framework of bigger systems. Applying this approach to the current technology stack will demonstrate its utility. No division in an organization is an island; how else does each section of the business communicate and merge? And, how do the systems that each department employs interact and integrate? It is the combinations of different processes that make a huge difference. Interactions result in new, more efficient actions, which streamline and facilitate efficiency.

An Era of System Thinking
Today digital transformation is about connecting various devices and systems that can provide value. It is about building a network of intelligence through the use of technology. It is not solely concerned with meeting customer demand but also with restructuring organizations and how they are managed to increase capital and value creation through process efficiency and effectiveness in a broad sense.

In other words, the current era has taken a proactive approach to changing the entire system rather than a specific aspect, as businesses do not have a dedicated digital department and instead incorporate digitalisation into their organizational culture and strategy.

System thinking allows people to use their awareness of modern systems to improve a situation. Unlike the traditional system, which focuses on separating individual pieces of what is being studied, systems thinking focuses on how the subject of study interacts with other elements of the entire system. In today’s world, digital transformation is a synthesis of customer demand, technology, and overall business goals.

Employing Systems Thinking to Your Digital Roadmap
Building a digital roadmap starts with a set of objectives. It starts with bringing key stakeholders from each department to compile a list of needs, differentiating between those that affect the entire business and those specific to one department. Broad goals are to be considered rather than specific ones.

After creating a list of business-wide and department-specific needs that must be met by systems thinking of digital transformation, one must discuss how the department needs to intersect. This is significant for two reasons. The first is the interconnected nature of system thinking advancements. The second benefit is that it sets the tone for the solution; from the start, the company should focus on discussing connected solutions and collaborative thinking. It’s critical to start on the same page, and ensuring company-wide buy-in will lead to better development and adoption.

With a clear understanding of what the business and each department want to accomplish, it is time to define the solutions that business intends to implement in the coming months and years. Collaborating with a digital transformation partner can help the business see what is possible and the range of options available. The goal is to demonstrate that digital transformation is a journey, not a race. Take a crawl, walk, run approach; always consider the potential cross-business impact of a particular solution.

In the short term, the organization should aim to implement a series of digital proof points, each of which addresses a key business goal. The digital roadmap is not fixed. The company will have compiled data on each of the digital solutions implemented; they should learn from the insights and adapt its own approach. It is especially important to put in place a system that shares this insight, allowing both department decision-makers and automated programmes to learn from cross-business actions.

Systems Thinking is essential for the design of complex systems as well as the execution of a company’s long-term digital strategy. Whilst using the systems thinking approach, the organizations will almost certainly be swimming in seemingly disparate data, making quick and simple modelling critical to ensuring the digital roadmap is on track.