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Digital Transformation: The challenging balance between innovation and stability

Oct 26, 2023

lean startupThe eternal struggle between the realms of transformation and innovation, operations, and in recent years, cybersecurity is nothing new. While the former continuously seek out new technologies and services to offer novel or enhanced offerings that drive business growth, operations remain focused on upholding the continuity and stability of services vital for the business.

Meanwhile, the cybersecurity sector aims to develop increasingly stringent security measures that mitigate potential risks for the business. In the same vein, organizations have created various positions – such as chief technology officers (CTOs), chief information officers (CIOs), and chief information security officers (CISOs), among others – whose main function is to align these worlds and find a common ground. Each approach has its merits, and this article does not aim to discredit any of them.

However, can you imagine a world where innovation thrives without any room for mistakes? Where new solutions or services are launched flawlessly, operations run without a single incident, and human errors are completely eradicated? A world where security is invulnerable? It may seem far-fetched, but it is the philosophy we embrace when approaching projects, processes, products, and services, aiming for nothing less than perfection. This is the serious challenge that organizations face. And it is not a matter of roles, structures, or individuals that prevent them from creating environments conducive to business innovation. Rather, it is the absence of a clear philosophy and business vision on the part of those responsible for information technology. This unfortunate reality perpetuates a vicious cycle that prevents us from achieving true innovation. Worn-out ideas, but which we unconsciously trample upon in our everyday lives.

Out of every ten startups, only one manages to survive

This might appear obvious but unfortunately it is not. Consider these figures: a mere 10% of startups survive beyond their third year[1], 95% of products launched by businesses end up failing[2], and 52% of customers are willing to pay more for a superior experience This begs the question: what causes these failures?

One of the biggest culprits lies in the relentless pursuit of perfection. Often, the downfall begins with excessive planning or delays in launching the product or service. Another contributing factor is becoming too attached to a single idea, without properly validating it with customers. Additionally, seeking multiple advice from experts and keeping the product or idea under wraps can hinder its success.





Alternative methodologies for innovation

In today’s landscape, methodologies like Agile, Kanban, and Scrum have gained traction for their proven ability to enhance software development processes. However, while these methodologies prove valuable in improving efficiency, they may not necessarily guarantee the success and customer adoption of a product or service in the market. This had led me to revisit the LEAN STARTUP definition[3] and apply it to our IT environment.

Before we delve into why LEAN STARUP helps us be more effective in launching products or services, it is important to distinguish between two aspects: Do we want to compete? Or do we want to innovate? These concepts can sometimes be confusing as there is a natural assumption that competing requires innovation. However, it’s not a straightforward path. When we aim to compete, it means we have identified an existing market with a product that can be improved upon. On the other hand, when our objective is to innovate, we are entering the realm of creating something entirely new for a market that either doesn’t exist or for a market that exists but where we want to introduce a radically different value proposition. A real-life example of this distinction can be seen in the traditional taxi industry versus ride-hailing platforms like DIDI cars and the UBER brand. Both operate in the same market, but the latter disruptively offers a unique value proposition LEAN STARTUP methodology

The LEAN STARTUP methodology is particularly useful when embarking on processes that resemble entrepreneurial ventures, such as launching new products or services that will be marketed or adopted in a completely novel way. These processes are characterized by a high level of risk and a significant creative component. Consequently, operational teams may feel uneasy and perceive their stability as threatened.

Implementing the LEAN STARTUP methodology enables us to continuously validate the features and functionalities of our products or services throughout the entire launch process, in collaboration with potential customers. As a result, the likelihood of failure decreases significantly, and the transition to full-scale operation becomes smoother.

The method consists of an iterative cycle: idea à hypothesis à minimum viable product à learning à idea. When formulating product hypotheses (“we believe that…”), the aim is to develop a solution to a problem and validate it with customers to test the hypotheses (e.g., does this prototype meet your requirements and effectively resolve the problem?). This process allows for documenting the lessons learned and generating new ideas that truly address customer needs.

The great challenge lies in instilling awareness among technology and digital transformation teams that innovation does not require the launch of a flawless product or service. It will not fulfill all customer needs, nor will it eliminate all incidents or fully comply with all security requirements. Such maturity will be attained, but not during the initial stages of innovation and transformation.


Adopting an entrepreneurial mindset

In short, to approach innovation processes, we must adopt an entrepreneurial attitude. Additionally, we must build a close relationship with the customer and not be afraid to showcase an unfinished product. This invites customers to contribute and actively participate in shaping the final product or service. By working on prototypes, risks are reduced. Furthermore, incorporating input from operational and security departments can offer valuable perspectives and insights for subsequent stages, but without losing sight of the fact that the ultimate goal is to develop a solution that best serves the customer’s needs.

By implementing these strategies, we can reduce development costs, minimize time wastage, and most importantly, increase the likelihood of successful innovation initiatives resulting in prosperous products or services. I encourage you to delve further into LEAN STARTUP, exploring its concepts and incorporating them into your work to embrace a more entrepreneurial and successful approach.

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