Solving the technology modernisation dilemma – The Australian Financial Review
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In 2024, new technologies like generative AI will continue to dominate boardrooms and headlines, ushering in a period of transformation that will redefine the way businesses operate for the next decade.
The technology acceleration we have seen over the past year is unprecedented. In less than a year since its launch, ChatGPT has reached mass adoption. To put this into perspective, the internet and smartphones both took nearly two decades to reach the same level of penetration.
The flipside of modernisation is a that it can leave a wake of operational and technical issues that can have a huge impact on a business, says Seelan Nayagam, DXC Technology’s president, Asia Pacific, Middle East and Africa. DXC Technology
While the pervasiveness of new technology is unavoidable, businesses leaders are still trying to navigate the myriad of complex challenges that modernisation presents.
The question a lot of leaders are asking themselves is – should I invest in new technologies now, even when we’re not ready, or risk falling behind?
The reality for most leaders is that they are locked in a perpetual cycle of meeting short-term financial targets and delivering quick results. This means, they are incentivised to invest quickly in technology that maximises assets or revenue and minimises operational costs.
However, the race to modernise can often come at an unexpected price, not necessarily from the technology investment itself but from the lack of strategic planning around its implementation.
The flipside of modernisation is a that it can leave a wake of operational and technical issues that, if gone unchecked, can have a huge impact on a business. This is often referred to a “technical debt” or “tech debt”.
These costs are often caused by multiple small changes made outside of the organisational strategy or roadmap and therefore don’t fit neatly under a single line item. When forgotten or ignored, tech debt can become toxic and divert funds, use up resources, create complexity, compromise security, impact the organisation’s ability to grow, and even worse, hamper its ability to function on a day-to-day level.
Imagine if you knew that 20 per cent – 30 per cent of your company’s resources were being diverted or tied up in unnecessary processes and you weren’t addressing it.
According to recent research from DXC Technology, 46 per cent of executives acknowledge that tech debt impacts their ability to innovate. This means that while business leaders might recognise the value and opportunity of new technologies, the reality is that many of them are not able to implement it.
Tech debt isn’t just a financial burden, it also impacts an organisation as a whole. It’s a universally recognised truth that to retain the best talent you must give people meaningful work and create an environment where they can succeed. However, if an organisation is limited by legacy technology, lack of integration and outdated organisational processes, it will hinder employee motivation and drive key talent to competitors.
Alongside this, badly managed modernisation can be a productivity killer. Employees end up spending more time navigating poor processes than doing their job, leading to bottlenecks throughout the organisation.
It also puts a business at risk because fragmented systems and silos managed with ad hoc, purpose-built processes and tools make it very difficult to consistently and proactively manage and protect data.
The first step is to expand the circle of accountability beyond IT. While the CIO and CTO can lead the modernisation process, the entire executive team should be responsible for its success. Educating and empowering division leaders and ensuring co-ordination between the business side and technical arm of the organisation is crucial.
While modernisation can come at a cost, it doesn’t mean business leaders shouldn’t continue to push for quick to market solutions or hold off on new innovations until it is “perfect”. They must think beyond just the implementation of new technology to stay ahead.
In order to realise the full potential of modernisation, tech debt needs to be reframed from a problem that needs to be “fixed” to an essential element of the organisations ongoing business strategy.
Governance is key to tackling tech debt by bridging business objectives and technology strategies to establish policies for better decision-making and risk management.
With this mindset, business leaders can ensure that technology investments contribute directly to the success of modernisation efforts and growth.
Seelan Nayagam is president, Asia Pacific, Middle East and Africa for DXC Technology.
This content has been funded by an advertiser and written by the Nine commercial editorial team.
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