The convergence of software vendors and services providers foreshadows the challenges organizations face in the selection of digital transformation solutions.  The lack of pre-packaged, out-of-the-box solutions forces executives to focus not only on how the solutions are  designed but also on the desired outcome and business model.

As organizations struggle to differentiate their offerings in the market and jump start growth, market leaders and fast followers have partnered more closely with their technology providers and services firms for innovative solutions.  Why? Market leaders and fast followers understand that their success requires co-innovation and co-creation to deliver innovation from concept to commercialization.

By applying five success factors to digital transformation efforts, organizations can improve their ability to succeed.

Here are five things organizations need to do:

1.      Strategize with design thinking

2.      Commit to business model disruption

3.      Apply a form-follows-function approach to technology adoption

4.      Institutionalize and incentivize the process of going from concept to commercialization

5.      Craft a cultural renaissance

New York-based Infor is one technology provider who recently spun out a separate group to deliver business consulting and digital transformation.  The team that was spun out is tasked with enabling change at the client site by strategizing with the client on the solution, designing the approach, assembling the technology, and running the operation.  Early success includes work in creating new[MS1]  marketplace for a major retailer and a Waze-like network for transportation logistics for Caterpillar.

This report begins a series analyzing the software and services convergence in digital transformation projects. This report addresses all eight of Constellation’s business research themes.