Digital World Class® Technology: Bridging the Performance Gap With Gen AI

What distinguishes Digital World Class^® technology organizations from their competitors? In this episode of the Business Excelleration^® Podcast, Kyle McNabb and Mike Fuller tackle this question, drawing from The Hackett Group’s recent Gen AI research. They reveal that the key lies in providing high-value services, while aligning closely with business objectives and enhancing customer service. Additionally, they explore how cutting-edge technology functions are leveraging automation and setting the stage for Gen AI advancements.

Welcome to The Hackett Group’s “Business Excelleration^® Podcast,” where week after week we hear from experts on how to avoid obstacles, manage detours and celebrate milestones on the journey to world-class performance. This episode is hosted by Kyle McNabb, vice president of Research and leader of Technology Advisory at The Hackett Group. He is joined by Michael Fuller, Technology Transformation lead at The Hackett Group, to discuss what we see separating Digital World Class^® technology organizations from their peers.

To begin, Michael highlights the three main factors that differentiate these organizations. First is superior business value delivery, including enhanced customer experience and operational efficiency. Second is cost advantage because these companies deliver services at 18% lower costs on average. The final factor is their unique ways of working, with operating models that align more closely with business goals, embracing advanced technologies like artificial intelligence (AI) to drive efficiency.

Regardless of the chosen operating model, organizations leverage agile methodologies to ensure efficient delivery of value. They emphasize minimizing redundant applications and embracing transversal technologies such as cloud services. Michael highlights the growing trend of decentralizing decision-making and embedding technology talent closely within business teams to enhance the effectiveness of technology integration. Digital World Class^® organizations focus on reducing the resources spent on maintaining legacy systems, allowing them to invest more in new technologies. They achieve a balanced approach by embracing AI, automation and other existing technologies that improve operational efficiency. Michael emphasizes that the real difference lies not just in adopting new technologies but also in optimizing and fully utilizing existing ones to drive business outcomes.

Application rationalization remains a significant challenge because many organizations continue to manage outdated legacy systems. Digital World Class^® companies prioritize cost transparency and alignment with business capabilities to rationalize their technology portfolios. This approach allows them to demonstrate the value of consolidation and modernization to business leaders, making it a strategic priority. By streamlining operations and reducing technical debt, these organizations free up resources to invest in new capabilities and technologies.

In closing, Michael leaves listeners with a reminder of the importance of operational excellence in achieving Digital World Class^® status. Organizations are encouraged to embrace continuous rationalization, focus on cost management, and adopt emerging technologies to drive innovation and differentiation. The Hackett Group offers further resources and advisory services for companies looking to transform their technology landscapes.

Time stamps:

0:12 – Welcome to this episode hosted by Kyle McNabb.

0:30 – What sets Digital World Class^® technology organizations apart.

5:44 – Operational alignment and technology integration.

9:18 – Leveraging emerging technologies.

14:22 – The challenge of application rationalization.

15:23 – Closing thoughts.