Nowadays you hear the word “digital” at every corner. New digital products and services are increasingly essential for any company’s market differentiation. Plus, more and more customers chose a service provider based on its “everything, anywhere, 24/7” capabilities.
In this new digital world, many large enterprises are still serving the needs of digital natives by tweaking 20 year old IT systems that were built when physical branches in banks were the predominant means to serve customers.

A few years back executive boards decided to remove "technical debt" and replace core IT functionality with new systems. Cool new functionalities were developed to cater for the needs of future customers. Millions were spent… unfortunately, too often legacy systems couldn’t be replaced and many large “digitalization projects” have failed.

As a CIO you ask yourself, what shall I do now? You won't get another chance to invest many millions while there remains a huge risk of non-delivery. The board wants to see results - patience and money are gone. Well, your next steps depend a lot on the type of manager you are.
A. The administrator: You will try to squeeze your organization, optimize the P&L and balance sheet of your IT and present healthy figures as soon as possible. Probably you will keep your job, at least for another few years.
B. The digital entrepreneur: You recognize that the organization is not capable of replacing a legacy core IT system in one big step. However, you recognize that ‘no change’ is not a viable option.

Let’s forget about species A and focus on B. From my experience, after a large digitalization project failure, the digital entrepreneur can choose from two options:
“Green field”: Forget about everything and start the future “digital business” from scratch. Once the project shows successful results you start to migrate, integrate or close down existing business parts. In the green field approach you would follow a “lean” approach to reduce risks. However, you have to convince the board to assign business resources and give you time to prove the model. If everything fails, you might have to find a new job – but at least you have learned a lot.
Note: I will write about the “green field” approach in a separate blog post. In my opinion, this approach is the right way to go in a strongly shifting industry in which the classic business models are heavily challenged by customers, new entrants and disruptive technologies.

The second approach, “Enterprise Architecture ++”, is less radical and is about improving your digital assets in smaller steps. With this approach it takes longer (5+ years) until you achieve your ultimate goal of replacing your core IT with future-oriented solutions. Nevertheless, if done right there is still a good chance that you will succeed before your competitors do. You must ensure that you are able to create business value with each single step and replace legacy functionality by a system that is better, more flexible and will help your company gain a competitive advantage.
Why do I call this approach “Enterprise Architecture ++”? You can only take small steps if you understand in detail what these are. This requires thorough analysis and structuring. For example, what happens if you replace your CRM-functionality in the legacy system but want to leave the rest "as is"? In old systems data models are often very much intertwined, so if you remove the customer objects you probably will also heavily impact related booking account objects. In order to avoid another big bang replacement you will have to follow a structured enterprise architecture (EA) approach. This includes, amongst other things,

  1. Proper understanding of which functions and processes are covered in the legacy systems and which of these you want to replace by a new system.

  2. Understanding which data and services of the remaining legacy code are needed for the new system to work properly.

  3. Separating those services from the underlying intertwined data models and offering them in a way everyone understands (i.e. which functionality is covered).

As an executive manager you don't have to know the details of EA. However, to solve your dilemma, you should remember that the EA discipline has the potential to improve large IT landscapes continuously and gradually. Tell your EA team to come up with a roadmap consisting of rather short phases. Each phase is followed by a critical business milestone that is called a “proof of the pudding” (POP). If one pudding is not digestible you have to reevaluate your organization’s skills and adapt the roadmap accordingly.

In conclusion: if you are finding yourself in an IT-mess after one of your large digitalization projects failed, you might choose to act like a digital entrepreneur and improve your IT in smaller, risk-reduced steps. For this approach to be successful you first have to do a proper analysis and structuring of your landscape – which is what a professional “Enterprise Architecture” (EA) team typically does. If you manage to focus the EA team primarily on the business problem instead of theoretical issues and all-encompassing frameworks (e.g. TOGAF et al), then the EA discipline could be the essential tool for you in your digital entrepreneur role.