By: Ashwath Nagaraj, Scott St. John - Pipeline

Transformation has now become paramount for every enterprise across virtually every industry. What was once a slow-roll, nice-to-have, or even utopian scenario; quickly became mission critical in the wake of the global pandemic.  The pandemic not only quickly brought to light the necessity of digital transformation, but it also demonstrated the incredible benefits and resulting impact it had on efficiency, automation, customer experience, profitability, and the ability for companies to survive.

Pipeline’s Managing Editor, Scott St. John (SSJ) recently had an opportunity to explore enterprise transformation with Ashwath Nagaraj (AN), co-founder and CTO of Aryaka Networks. Ashwath brings a keen perspective on enterprise transformation with years of experience helping enterprises transform before and throughout the pandemic, and is armed with a recent survey that explores the heart of digital transformation initiatives across a variety of enterprises.

SSJ: What are the key drivers for digital transformation?

AN: Before 2020, it would have been the classic pillars of cost reduction, agility, and efficiency. Based on the experience of the past year, agility and other aspects of being able to very quickly adapt to a changing environment, even in a lights-out setting, which now applies to the office as well, are top considerations.

SSJ: Why do enterprises need to transform and what happens if they don’t?

AN: The world is increasingly competitive, and it is becoming a mostly level playing field. Enterprises need to become more agile—quick to adapt—as a competitive differentiator and to drive efficiency. Digital transformation needs to be part of their DNA and not just a one-off. Those that don’t successfully transform will go the way of the woolly mammoth. We saw this as part of the pandemic, but many of the tactical changes need to be codified and made permanent.

You may remember when supply chains were impacted last year due to the pandemic, and manufacturers looked to relocate some of their suppliers. Closer to home, we have a good example of a company that failed to effectively transform. For decades, we had Fry’s Electronics, the go-to store for everything electronic. But they had a very difficult time moving to an online model, in contrast to Best Buy, which people had written off a few years back. Well, the tables turned, and it wasn’t the pandemic that led to Fry’s shutting down all of their stores at the beginning of March. It was a failure to transform.  More agile companies can quickly adapt to change and have actually profited from the fact that their competitors fell by the wayside!

SSJ: What would you say is the primary benefit of digital transformation?

AN: Digital transformation enables the enterprise to adapt to changing environments more quickly and dynamically, which in a broader sense spans everything from customer preference, preferred buying behavior, climate change, political concerns, M&A or divestitures, cost of goods and services arbitrage, material availability – such as the current shortage of auto chips – and yes, the pandemic. The nature of the impact can’t always be known in advance, so the enterprise must be ‘wired’ to adapt.

SSJ: How does Aryaka define transformation, and how can enterprises get started?

AN: At Aryaka, we define transformation in the context of business—and it is occurring at multiple levels. Companies are transforming their businesses to be more agile and efficient. To achieve these goals, they need to eliminate aging and obsolete legacy applications, cumbersome processes, and other obstacles. They need to eliminate expensive infrastructure (CAPEX) and move to a usage-based OPEX model.