Crafting a Permacrisis-Proof Transformation

Andy Prinz, Shanton Wilcox October 1, 2023

Rising above digital, technical, and transformational debt to overcome permanent, on-going crises

TAKEAWAYS:
● Permacrisis challenges require innovation
● Address digital debt for meaningful transformation
● Cultivate culture, speed, and governance for successful adaptation.   

Enter the era of “permacrisis” – a state of continual, disruptive events resulting in an extended period of instability. Many organizations are currently facing continual disruption regarding digital and technology debts, as well as organization transformation latency. Often, efforts to address these areas have been largely ineffective or continually postponed due to timing, resource, and financial constraints.

Some companies have managed to adopt and implement digital tools for new ways of working. However, COVID-19, shutdowns, wars, inflation, and technology deficits have led to an environment where companies are constantly on edge. If disruption is the wave of the future, how can organizations rise above the deficits to drive a successful permacrisis-proof transformation?

Defining the Challenge

Digital and technology debt broadly refers to the accumulation of a company’s technology work that has been delayed or inadequately addressed with suboptimal, quick-fix solutions. Both elements lead to increased costs, inefficiencies, and risks.

Digital and technology debt causes vary, but often result from large technology efforts which, although planned, analyzed, and evaluated, are ultimately shelved or delayed due to resourcing and financial issues. Other debts can accumulate as interim solutions are built and persist as meaningful technology investments are delayed.

Part of the hidden cost of digital and technology debt is the parallel transformation debt resulting from inaction. By working around legacy technologies, organizations maintain ineffective processes, poorly structured organizations, and high operational costs.

With continued disruption and a focus on near-term thinking, companies will continue to accumulate technology and transformation debt. The answer is to adopt a new mindset with the link between transformation and digital and technology debt at the forefront. Evaluating the overall latency within an organization improves the understanding of the need to do something new, expands ownership across the entire leadership team, and enhances the desire to actively reduce accumulated debt. It also requires a prioritization of human factors and innovation at the heart of the solution.

Andy Prinz is a manufacturing and supply chain transformation expert at PA Consulting