Will SARS digital transformation be part of the 70% that fail?

SARS recently announced it had embarked on a journey of digital transformation that will see its operations “informed by data-driven insights, self-learning computers, artificial intelligence and interconnectivity of people and devices”.

When a national institute like SARS voices a commitment to digital transformation, it’s a clear indicator of the profound effect the Fourth Industrial Revolution is having on trade, industry and government.

Yet, industry analysts, like McKinsey, report that 70% of digital transformation projects fail. So what should the country’s tax authority – and every other organisation – do to ensure its own efforts succeed?

Successful digital transformation projects get several key steps right from the start.

They operationalise data

In its 2018/2019 Annual Report (page 60), SARS states that it has already cleaned its data and implemented generic analytics. It has now entered the next stage of advanced and predictive analytics. While clean data is critical, organisations must also ensure their data is fully operationalised.

Operationalised data is not only clean but continually and automatically extracted from enterprise-wide data sources, and formatted and stored in a centralised Cloud-based repository where it is readily available for use in data analytics and machine learning.

By building a continuous, independent process, organisations ensure the data for their analytics and AI systems are always fresh and reflects the latest trends in their business, without manual intervention.

This will accelerate their innovation programmes.

They digitise and automate workflows

To add value, data needs to flow efficiently through an enterprise or across its supply chain, creating a seamless link from customer requests through to final delivery and strategic review.

Workflows define how transactions are passed from one business activity to another, whether manual or computerised. Modelling this digitized representation of the way work is performed is at the heart of digital transformation.

Failing projects attempt to replicate human input, keystroke by keystroke. However, digital organisations minimize manual processing and pursue highly automated workflows that exploit integration between systems, and standardise problem analysis and resolution.

They embrace a digital mindset

Finally, successful digital transformation requires that executive stakeholders attain an understanding of what data is, and how it can be utilised to propel innovation initiatives and make systems intelligent. This can be very difficult for those accustomed to a traditional style of business management and may require intense change management to correct.

With a solid grasp of digital concepts, like Cloud computing, mobile apps, or IoT, they can reimagine the way their products and services are delivered to an online market that already embraces disruptive technologies. A digital mindset will help them envision services that extend past the physical business, reaching customers, suppliers and employees, and making essential business processes available to them on their devices.

Whether it is SARS or any other organisation that commits itself to digital transformation, these key steps will help them achieve better results.

• Michael Cowen is a transformation director at Teraflow, a data engineering firm with offices in Johannesburg, Cape Town and London.