IT Procurement

What is IT Transformation Procurement & What Are the Challenges

Athena Commercial
June 18, 2021

Beyond procuring simple IT needs, an organisation IT transformation is a much larger procurement task – one which often requires the acquisition of multiple new suppliers and also presents additional challenges such as integration and implementation across an entire workforce.

This article explores what IT transformation means, how it is beneficial to organisations and the challenges associated with it.

What is IT Transformation?

Before diving into the details of IT transformation procurement, it’s important to understand was it is. IT transformation is the process of implementing new technology into businesses to improve their organisational activities. IT transformation is typically a large scale project that helps to provide solutions across a number of different areas within the company. Owing to the company-wide impact that IT transformations have, it is advised that IT transformations are always precipitated with a thorough requirements capture. This involves mapping out all organisational capabilities and requirements to fully understand where processes can be adapted and improved through the implementation of technology.

Unsurprisingly, IT transformation has become an increasingly important focus for businesses within the last five years with disruptive technological capabilities rapidly outdating manual procedures.

Are Digital Transformation and IT Transformation the Same?

Though both terms are sometimes used interchangeably, digital transformation and IT transformation are not the same. At its core, IT transformation is about offering next-generation solutions to an organisation’s internal processes – with the newfound efficiency ultimately designed to drive shareholder value. On the other hand, digital transformation takes a more customer-centric approach and is more concerned with the customer’s experience with an organisation. Whilst they have separate focusses, digital transformation usually requires an organisation to have already undertaken an IT transformation.

Why is IT Transformation Beneficial for Organisations?

There are a huge range of benefits to organisations who undergo IT transformations. Below we explore three key areas:

Organisational Transparency & Strategy: IT transformations can offer IT teams and key business stakeholders much more clarity over the organisation as a whole. In turn, this can then be used to make strategic decisions about the business – using SWOT analyses to identify the existing strengths and weaknesses in the business and the corresponding threats and opportunities to improve activities.

Agility & Efficiency: in a rapidly changing landscape, the ability for businesses to bring about new changes or roll-out new products and / or services with speed, is essential. IT transformation unites the different aspects of a business (such as different departments within the supply chain) to improve inter-party communication. Such agility has proved essential in the last year – with many businesses having to adapt their activities to a remote-working environment which could only be facilitated through IT transformation solutions.

Further to this, IT capabilities are essential for growing organisations that need the infrastructure in place to scale their operations.

Your Bottom Line: IT transformation has long-term cost benefits. This is for a variety of reasons including directly associated benefits – such as through automating processes that would previously have been undertaken using manual workforce. As well as indirect benefits - such as strategic developments resulting from greater organisational transparency.

The Challenges of IT Transformation Procurement

If you have already read our recent posts of IT software procurement and IT hardware procurement, you may be wondering what is different about IT Transformation Procurement? Whilst some aspects remain the same, there are some unique challenges involved with IT transformation procurement:

Employee Adaptability: Unlike simple software or hardware acquisitions, IT transformations are usually much larger projects that have a much wider impact on everyday organisational activities. As such, the ability for employees to swiftly adapt to new procedures can cause operational disruption – especially for organisations who undergo drastic transformations from legacy systems to complex, integrated IT solutions.

How can you mitigate this issue? Whilst implementing new procedures will always cause some level of disruption, through proper planning and training this can be minimised. Organisations should look to offer employees comprehensive training on new technologies ahead of implementation. Such training can be organised internally or through an IT Transformation Consultant.

Implementation Timeframe: As explored within ‘employee adaptability’, implementing new IT solutions can cause disruptions – this is especially the case when a number of new solutions are being implemented at once. Whilst it can be tempting to execute a full IT transformation within a short timeframe, businesses should look to implement transformations in a multi-step approach. This allows employees to adapt to new technologies at a more manageable pace – and also allows business to iron-out any implementation issues in a controlled and organised manner.

From Legacy to Cloud: In an era where business agility is essential, Cloud has become an essential aspect of business scalability and flexibility (and this will undoubtedly continue to be the case in post-Covid world). Nonetheless, many organisations are still holding on to legacy computing systems, concerned with the security implications associated with migrating data to cloud. This largely inhibits implementation of new IT solutions.

Businesses can alleviate these concerns by adopting a staggered migration to cloud servers, allowing their IT expects the time and needed to ensure that data is sufficiently protected and accessible to the relevant members of the team.

Supplier Acquisition & Management: In IT transformation projects, businesses will rarely need to seek a single supplier for all of the required IT solutions. Typically, IT transformation will necessitate a number of software suppliers, hardware suppliers and system integrators. Further to this, planning requires a full analysis of existing business operations and input from a number of organisation stakeholders. Unsurprisingly this can be time consuming and supplier decisions can be difficult unless one has a strong understanding inter-system compatibility. To mitigate this, some organisations opt for a Managed Service, in which a System Integrator is contracted to organise and oversee the whole process.

Do You Need an IT Transformation Expert?

Ultimately, the majority of challenges that surround IT transformation stem from poor preparation and management throughout the transformation process. Of course, successful management largely depends on experience, and this is something that can most easily be gained through acquiring an IT transformation specialist.

Where we can help you

We can help your business understand what your true requirements are before you make any decisions. Our expertise allows us to assist you when it comes to utilising proper procurement practises that will pay dividend. We can guide you in reviewing your existing technology contracts and what to look for in new ones, so you avoid any automatic price increases, capacity limits, cancellation restrictions and beyond.

Choosing the best vendor for your business can be an overwhelming process. We can help with market research and negotiating price to get you the best deal because we have an extensive knowledge of the market. Once you have decided on your IT requirements and defined the products needed, we can assist with researching appropriate suppliers, contacting them for formal proposals, negotiating your terms and ensuring that penalties are in place if a supplier doesn’t perform. We also offer to oversee the project from start to finish – managing your contracts and leading the transition process to ensure that new systems are delivered on time without supplier disputes.

For further advice or an initial consultation please get in touch at info@athena-commercial.co.uk.

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