Companies are facing more complex challenges than ever, requiring a variety of disciplines to come together to set a future vision and strategy. Historically, these challenges have been treated as technology problems that can be solved simply by buying a better platform or solution.
However, that outlook often does not drive the outcomes or the value that companies are expecting. For large transformations, a business-driven, technology-supported effort is becoming an imperative, not a nice-to-have. The modular approach of KPMG's Technology Strategy and Selection (TSS) framework allows for the right services and business ideas to be brought in seamlessly and holistically—toward setting a future vision and choosing technology that truly drives change.
The first phase of KPMG’s Technology Strategy and Selection framework is all about setting the right course that aligns all of the key stakeholders around what a successful future looks like. This goes beyond collecting requirements from the business stakeholders and going technology shopping—instead, the process focuses on codeveloping business imperatives that anticipate today’s and tomorrow’s market pressures and disruptors.
“This really allows the business and IT to come together on a common vision of the future and decide what is expected out of this transformation,” Alec Binder, director, Advisory at KPMG explains. To that end, KPMG’s E-Brainstorming digital platform allows global stakeholders to interact and brainstorm in real time, while its U-Collaborate interactive multiday workshops bring stakeholders together to develop guiding principles and strategies around the future transformation. They can focus on target operating models for both the business and IT functions and apply design thinking concepts to understand and solve complex business issues.
Going through this visioning phase takes advantage of a very different approach and entry point for companies seeking transformation, says Donna Meshaka, managing director at KPMG. “Most companies can’t take this huge leap into aspirational things like predictive analytics, for example,” she says. “They really have to take a two-step approach, and this phase helps them through that journey.”
Building on the transformation vision of Phase 1, the second phase in KPMG’s TSS framework turns the visioning results into a blueprint for the future organization, including things like developing the business, functional and IT target operating models that will support the goals, and creating a technology landscape strategy.
“This is usually the first time we’re beginning to discuss specific technology solutions and how they can support this business-driven transformation,” says Binder. “When a large platform change is involved, be it ERP or a large move to the cloud, this is when we start talking about the technology selection activities.”
The TSS framework uses prebuilt operating models aligned to different industries and goals that are then adapted to the company’s specific needs and desired outcomes. “We also look at the standard requirements companies are looking at for a technology solution,” he explains. “What are some of the big differentiators?” This allows clients to make decisions that drive the future vision, particularly homing in on the technologies that can offer big competitive advantages, as opposed to focusing on tablestakes requirements.
Once a TSS blueprint is created, it’s time for a plan of action, says Douglas York, director at KPMG. “The third phase is all about how our clients take what they need to do and build around it towards a different way of working,” he says. That means defining and acting on all of the target state initiatives, including technology selection, to support the overall transformation—as well as creating a high-level roadmap with solution design and implementation initiatives.
There are several key accelerators that help on this front, he adds. One is Implementation Cost Methodology, which helps form the overall business case for change—what can the company expect to spend money on and what are those things they should look for to generate cost savings and cost avoidance? The second is a Technology Evaluation Scorecard, which takes all of the outputs from the initial visioning and feeds them into preset evaluation criteria related to the new target operating model. “This makes sure everything is appropriate for the client and what they need,” he says.
After going through the first three phases of the TSS framework, the company can finally mobilize its efforts, says York. All of the stakeholders need to ensure they are aligned and that commitments for a successful transformation are fully developed before embarking on implementing the new technologies.
“Our clients get finalized roadmaps with a list of detailed commitments required across all the groups,” he explains. This is also where they may create a Transformation Management Office, to provide short-term governance processes for the whole transformation effort—around program management, value management, change management, and enterprise architecture.
Companies don’t embark on a full-scale technology transformation every year, so any component of the TSS framework can be challenging. However, the advantage of a modular approach is that clients can adopt the process in steps, at a pace that works for the entire organization. This may happen only once every 10 years, so it’s not a repetitive activity companies are used to doing. Getting that business alignment and vision, especially across functions or divisions, can be one of the biggest challenges.
However, going down the TSS journey can create tremendous opportunities for driving transformation success, which makes the challenges along the way well worth it. “With the traditional process, you help a client select a technology and build a business case, but they are left wondering how they go about making it real and putting it into place,” York says. “The TSS framework really integrates that so they are prepared, ready, and can mobilize to start immediately—it really drives acceleration to achieve those outcomes faster and to a higher degree of success.”
This article is available for download below.