Digital Transformation — like every IT development project — carries an element of risk. That’s true of any investment, really. In fact, it’s estimated that around 70% of Digital Transformation projects fail due to a variety of different dynamics. But a good Digital Transformation risk management strategy can effectively guard against failure, resulting in a DT development project that brings a healthy ROI for your business.
What is Risk Management for Digital Transformation?
Risk management refers to activities and policies that are designed to minimize risk factors, neutralize threats and address vulnerabilities that exist within the scope of a project. In the context of Digital Transformation, an organization’s DT risk management strategy would center around the new technology and the operations that have been impacted by that Digital Transformation.
Effective Digital Transformation risk management requires a thorough documentation of the different vulnerabilities and threats that exist. Once these issues are identified, you must examine the dynamics surrounding each one to determine why that vulnerability or threat exists; only then can you develop an effective risk mitigation plan.
To succeed with risk management and mitigation on a long term basis, an organization must form a risk management task force that can periodically evaluate new and existing risk factors, in addition to overseeing risk mitigation activities. This task force also exists to deal with new risk factors that arise. Risk mitigation must be viewed as an ongoing effort, otherwise you’ll sustain losses due to the emergence of new issues and the evolution of risk factors.
What’s an Example of Digital Transformation Risk?
Digital Transformation risks take many forms and they can impact every aspect of a project and the related operations.
One example would be an enterprise software development project, whereby you build and deploy an ERP platform that’s integrated with a variety of data sources and enterprise systems. But a couple of those integrations are faulty and only a segment of the data is being ported over, resulting in faulty data visualizations. This is problematic because those data visualizations serve as the basis of business projections. They’re also used for budget development. There’s significant potential for downstream adverse impacts and that represents a major risk because this organization would be using a fragmented data set to make essential business decisions. The consequences could be costly both in terms of time, and money.
A risk mitigation strategy ought to be in place to prevent this sort of scenario from becoming a reality. Measures such as verifying the accuracy of data integrations immediately after deployment would help to close up that area of vulnerability, effectively mitigating risk.
Another example would be the security vulnerabilities and the new cybersecurity threats that are constantly emerging. New technology — in any form — brings with it new risk factors and new areas of vulnerability that need to be addressed. Beyond this, cybercriminals are perpetually coming up with new tactics and strategies for exploiting vulnerabilities. They’re targeting companies in all industries, both large and small. This creates a cybercrime landscape that is always evolving and changing. Combine this with new vulnerabilities and risk factors associated with your new Digital Transformation project and you have a complex risk management challenge on your hands.
Your risk management task force must identify what new risk factors and vulnerabilities exist in association with your new technology. Also keep in mind that peripheral systems — such as those that are integrated with your new technology — may also be affected and therefore, you must consider those platforms as well when you evaluate risk. You must look at those vulnerabilities and risks relative to new and preexisting cyber threats to develop an effective risk mitigation strategy.
Focusing on Digital Transformation Risk Management to Maximize ROI and Success
By successfully mitigating risks, reducing vulnerability and neutralizing threats, you can go a long way toward maximizing both ROI and your overall chances of long term Digital Transformation success. The odds of a Digital Transformation failure are dramatically reduced when you cut out those risks. Meanwhile, the chances of achieving a maximum ROI from your Digital Transformation project see a marked increase.
Achieving a Solid ROI With Digital Transformation Development Projects
The right Digital Transformation development partner is another ingredient in the recipe for success. But finding the ideal developer is much easier said than done. To achieve your Digital Transformation goals, you’ll need an experienced team that knows how to develop technologies that will capture your unique processes and workflows, while simultaneously improving efficiency and productivity.
At 7T, we take a collaborative approach to enterprise development projects. We engage the client from the discovery phase to deployment. Our many Digital Transformation service offerings include process automation solutions, enterprise software development for ERP and CRM systems (among others), along with SaaS development for web apps and mobile apps, amongst others. We work extensively with cutting-edge technologies as we strive to help clients solve pain points, improve efficiency and achieve their business goals.
We’re guided by the approach of “Digital Transformation Driven by Business Strategy.” As such, the 7T development team works with company leaders who are seeking to solve problems and drive ROI through Digital Transformation and innovation. We then provide collaborative, multi-phased and impactful Digital Transformation solutions.
7T has offices in Dallas, Houston and Austin, but our clientele spans the globe. If you’re ready to learn more about Digital Transformation and what we can do for your business, contact 7T today.
