Digital transformation is not just a project, it is a continuous journey

In discussion with Michael Wade, Professor of Innovation and Strategy and Director of the IMD Global Center for Digital Business Transformation NTT DATA Former Senior Executive Vice President Shigeki Yamaguchi
Shigeki Yamaguchi

Shigeki Yamaguchi
President and Chief Executive Officer of NTT DATA Institute of Management Consulting,
President and Chief Executive Officer of QUNIE CORPORATION,
Former Senior Executive Vice President of NTT DATA

Michael Wade

Michael Wade
Professor of Innovation and Strategy and Director of the IMD Global Center for Digital Business Transformation

Digital transformation is not just a project - it is a continuous journey, one which allows you to constantly find new ways to deliver value for your customers. As digitalization changes the way companies interact with their customers, organizations must be able to continuously manage and organize customer value from their solutions.

At NTT DATA, we believe in a people-centered approach to digital transformation. The customer, the end-user, or the client must always come first, with companies leveraging advanced technology to solve their problems.

To find these new opportunities and provide additional value to the customer, we believe that organizations must employ a "Customer Value Reinvention Strategy" (CVRS) - combining the existing strengths and data needed for the company to succeed.

The Digital Transformation Journey

Michael Wade, Professor of Innovation and Strategy and Director of the IMD Global Center for Digital Business Transformation, and author of the fascinating book "Hacking Digital", argues that to make digital transformation a success, managers should understand a three-step process for digital transformation.

Managers must know whether their company is in the"initiation," "implementation," or "establishment" stage, and this will show them how to update their to-do list and priorities as they continue.

To see my conversation with Mr. Wade, please watch the video below.

What is the Customer Value Reinvention Strategy?

At NTT DATA, we have developed the concept of the "Customer Value Reinvention Strategy" (CVRS) - helping organizations to reinvent the way they approach changing customer value.

Under this framework, we group digital technology and development into four categories:

  • Convert
  • Connect
  • Algorithm
  • Cognize
NTTDATA's Digital Transformation Framework

With this system, we help our clients identify the issues they have with their present customer experience and develop the right technology to solve them.

The CVRS' unique offering is its ability to analyze what strategies, organizational capabilities, and organizational structures will be needed for any given company – based on the economic impact of digitalization. To execute a successful Customer Value Reinvention Strategy, there are three key themes that managers must understand, addressed in Mr. Wade's book:

  1. External Collaboration
  2. Business Model Transition
  3. Organizational Structure and Leadership

The Three Key Themes of a Successful Digital Transformation

External Collaboration

Collaboration with external partners is critical to create successful customer experiences in the digital age – rather than the traditional model of a single company working alone to sell its own products. This enables you to expand beyond the bounds of your existing products and services.

Partner collaboration in Customer Value Re-Invention Strategy

In our discussion, Mr. Wade introduced the concept of Corporate Digital Responsibility, which is born out of the intersection between digitalization, ethical considerations, and sustainability. Most digital transformation journeys will require close collaboration with external partners, but this is not an easy process.

Issues related to data protection and diversity, fair revenue generation, and global greenhouse gas emissions present key challenges to those looking to promote Corporate Digital Responsibility. To effectively tackle these challenges, organizations must create an internal governance mechanism that connects ethical and sustainability aspects together.

Wade, M Corporate Responsibility in the Digital Era, MIT Solan Management Review, April 2020

Business Model Transition

To deliver value for customers, many organizations will need to transition to new business models which have often been made possible by digital transformation. Take, for example, subscription models: a new business model created by digital transformation.

Thriving in this business environment calls for companies to build a balanced portfolio of digital initiatives and align them with the firm's overall strategy. The outcomes of digital transformation efforts can be broadly divided into two categories: "Customer Value Reinvention" and "Value Chain Reengineering."

Key outcomes of digital transformation

"Customer Value Reinvention" involves personalizing customer contact points and services by understanding and analyzing customer journeys. Meanwhile, "Value Chain Reengineering" aims to reduce losses due to uncertainty, automate processes, and reconstruct the value chain using data.

To reengineer the value chain using process optimization and personalization, managers must establish a system infrastructure that delivers flexibility as business models change.

System image of Outcome Based Service

Mr. Wade presented the following insightful thoughts on the business model transition. Digital transformation means a number of different things. Some of those include radical, major change, but not all of it. We think of it in terms of a two-by-two, where some elements of digital transformation are actually quite small. Fundamentally, the benefits of digital tools and technologies are enabled by scale. So, you really only get the true benefits when you scale across the organization and across the value chain. Unfortunately, the more complex the project, the more difficult it is to achieve.if you really want to make fundamental change through digital transformation, you have to look to change the organization, and that requires much higher level of organizational change.

Organizational Structure and Leadership

When it comes to leadership, a successful digital transformation requires a different approach to traditional leadership principles.

NTT DATA's Customer Value Reinvention Strategy emphasizes the importance of creating a shared vision, aligning activities, data-driven management, fostering a culture of thinking, and taking responsibility for success. It has become essential to build a "Learning Organization". By creating a culture of self-study, we can drive digital transformation by adapting to new technologies and processes, whilst at the same time digital transformation changes the way we learn.

Digital transformation and Learning Organizations

Mr. Wade asserts that organizations need flexibility, data reliance, active listening, and shared power to succeed. Both traditional and new leadership styles are necessary, depending on the situation, and the flexibility to switch between the two will be a key differentiator from the competition.


We've worked with some of the world's largest organizations to realize their digitalization ambitions, and in that time we've made significant investments into understanding how companies can implement digital transformation while remaining focused on customer value.

Through this research and experimentation, we created the Customer Value Reinvention Strategy to be an effective system of management and organization - supporting large corporations in their digital transformation journey and re-engineering the value chain.

Michael Wade, Shigeki Yamaguchi

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