One of the most destructive phrases of the 2010s was ‘Digital Transformation’. Not only was it a meaningless buzzword, it also managed to burn through billions of taxpayers’ and shareholders’ dollars while destroying productive capacity.
Frighteningly, it seems business leaders haven’t learned the lessons as they plunge headlong into repeating the same mistakes with AI.
The idea behind digital transformation was sound – use modern technology tools to reinvent and streamline processes. For a board or business owner looking to boost profits or a government department looking to reduce spending, this was an easy sell.
And an easy sell it was, for a whole industry of tech vendors and consultants – “hey, buy our product and you can slash cost costs by xx%.”
Plenty of gullible people with chequebooks fell for that spiel, overlooking the tech sector’s atrocious record of delivering projects.
A key part of the continued failures was management and their consultants not understanding the business, instead thinking the miracle IT tool will transform long- standing practices, procedures, and processes overnight.
In truth those long-standing practices didn’t appear out of nowhere, they almost always evolved to meet the organisation’s or customers’ needs.
Dropping a poorly conceived IT system on top of these just resulted in a Frankenstein’s monster as staff found workarounds or the support teams patched problems with short term undocumented fixes.
Pretty quickly digital transformation projects transform into an unholy mess of patches, workarounds, and shadow IT tools – my favorite being an industry association that quietly ditched the event modules of its expensive customer relations management platform and ran a free Eventbrite account.
This in turn created a process and privacy nightmare as staff manually transferred data between platforms with the help of spreadsheets.
Basically the not-for-profit had spent tens of millions of dollars to further complicate their business.
The frightening thing is that despite over three decades of these experiences, industry doesn’t seem to have learned as we see CEOs and Ministers declaring that AI tools will revolutionise their operations.
Already we’ve seen ten of thousands of workers fired just on those promises with share prices popping as greatful investors reward their visionary leaders.
The latest AI drive repeats what industry and investors should have learned long ago about IT projects – that big spending should have rigorous business justification, properly scoped contracts, and enforced delivery dates.
Sadly, it seems no lessons have been learned. But a lot of IT salespeople and their CEOs have done very nicely.
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