What Is Digital Transformation p3

The document discusses how generative AI is disrupting businesses and the opportunities it provides such as content generation and new discoveries. It emphasizes that value comes from understanding business goals and how technology can help achieve them. Building value with generative AI requires strong competencies like strategy, digital talent, and operating models. Companies must continually review how generative AI can support their goals.

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What Is Digital Transformation p3

Uploaded by

KIOM Civil

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AI, and particularly generative AI, is upending how companies operate and build value, presenting

huge opportunities including content generation, new discoveries (particularly in fields such as
pharmaceuticals and chemicals), and coding.

But it can be easy to get distracted by shiny new toys. The lessons of past technology innovations
still apply: value comes from having a clear understanding of business goals and how technology
can help meet them. It’s important to experiment and learn rapidly, but it’s also critical to resist the
temptation to develop use cases with exciting new technology that doesn’t end up creating value for
the business.

Building value with generative AI requires the same strong competencies needed for a successful
digital transformation, including a clear strategy, an in-house digital talent pool, and a responsive
and scalable operating model. And it’s not just a one-and-done: companies that wish to incorporate
gen AI into their value propositions will need to continually revisit their digital transformation road
maps and review prioritized solutions to determine how new iterations of generative AI models can
support their goals.

What are the key leadership roles in a digital transformation?

A successful digital transformation touches a broad range of an organization’s functions so they can
work together in new ways. This requires large-scale and coordinated investments. The only person
who can make that level of sustained change happen is the CEO. One of the CEO’s crucial jobs is
to ensure alignment, commitment, and accountability among the leadership team. Without any of
these, progress on digital transformations can rapidly stall.

Leaders at the C-suite and business unit level have crucial tasks as well. When it comes to tech, the
chief information officer typically focuses on improving the inner workings of the company with
technology. The chief technology officer usually works on improving customer offerings with
technology. Chief digital officers, in many cases, act as coleaders of the transformation and typically
work with digital and AI technologies to create new digital experiences for users. The chief human
resources officer plays a crucial role early in the transformation to secure digital talent and to put in
place the talent management practices that will develop and retain digital talent, while the CFO
oversees the transformation business case and the tracking of the value realization. Finally, the
chief risk officer needs to direct the integration of risk checks into the development process, and
understand how to respond to new risks, such as data privacy and cybersecurity, that a digital and
AI transformation may generate.

What companies are doing this well?

To be digital, every company needs to rewire how it works. Once upon a time, Amazon was just
another start-up: it had to invest in its technology, data, performance management, and talent
practices over years to become an industry leader. The good news is that successful digital
transformations aren’t just the purview of the tech titans. Established companies of all kinds can be
successful on their digital transformation journeys. Here are three examples:

1. The copper-mining giant Freeport-McMoRan unlocked next-level performance by building

and deploying an AI model at an ore-concentrating mill in Bagdad, Arizona. Leadership set
the aspiration to increase the site’s copper output without a massive injection of capital. The
company pulled together cross-functional teams to build, test, and iterate on the AI model,
shifting the culture to focus on rapid iterations and continuous improvement.
Freeport-McMoRan put a senior product manager in charge to help coordinate teams and
improve allocations across working teams, assigned a finance director to manage impact