Digital transformation — the use of technology to radically improve the performance of enterprises — is the hot topic at most companies these days. Leaders in all industries are using technology advances in analytics, social media, cloud services, mobile, and smart embedded devices to change customer relationships, internal processes and value propositions.
Seeing how fast digital technology disrupted media companies in the past decade, we know that no business is safe from disruption. So the pressure is on to stay ahead of the threat and perhaps gain a competitive advantage.
But such innovation does not happen without talent equipped with the right skills, tools, and mental models for idea generation and implementation. Creative people will get you a long way, but to truly leverage your innovative capability, addressing organizational culture, systems and leadership is also necessary.
Organizations leverage digital capabilities to enhance their business in different ways and at different rates. High performing companies have evolved their approach through a series of stages, becoming digitally mature organizations and enjoying all of the benefits. Similar to other maturity models there are 5 distinct stages:
The word "Digital" in this context does not refer to technology, but rather is an indication of speed and adaptability. Driving digital transformation requires leaders who can create strategy based on data. These leaders will lead teams who will work differently. They will constantly update their knowledge of how to approach challenges. And they will inspire continuous cycles of agile and focused innovation.
Strategy must be the starting point of any digital transformation initiative. But in the digital age, strategy must be adaptive and agile for it to be relevant. So strategy has to be reviewed and revised as new information suggest course corrections are required. Strategy building workshops should no longer be an annual even, but need to match the pace of change - to be lean and agile.
Innovative Leaders have a growth mindset, rather than a fixed mindset. They embrace diversity of thought, appreciate differences and see and seize previously unseen opportunities. They see, grow and share opportunities with courage. They play to win because they desire to be significant for the betterment of a healthier whole. Possibilities for transformation through a growth mindset are unlimited.
Digital transformation initiatives often reshape workgroups, job titles, and longtime business processes. When people fear that their value and even their jobs are at risk, leaders will feel the push-back. Thus leadership “soft skills” and messaging are key to success. During these challenging times, the inspirational leader will engage and inspire others to co-create the way forward. Knowing what messages are needed by whom at what time and from who is the key here.
Agile methodologies have transformed the software industry. Software development being an especially challenging form of innovation. But Agile is not just for software anymore. Agile is a unique approach to creative thinking and iterative prototyping. It’s a well-developed, comprehensive system engineered to overcome most common barriers to successful innovation. It’s also highly effective.
More and more companies are now adopting Agile methodologies in other parts of their organizations. Functions as diverse as R&D, marketing, operations, and corporate strategy are leveraging it successfully. Agile enables those companies to both develop and implement new ideas, not just create them. So Agile should be at the core of any digital transformation initiative.
Three types of innovation:
Digital transformation often begins with the customer: How to get to know customers better, improve your service levels, and digitize the customer experience. Innovative thinking techniques that involve the customer in a co-invention process are a proven way of delivering excellent customer experiences and improving business outcomes.
Design Thinking is one of the main collaborative innovation techniques and it can be applied to any product or service category. It is an iterative process, similar to Agile, in which we seek to understand the user / customer, challenge our assumptions, and redefine problems in an attempt to identify solutions that might not be instantly apparent. At the same time, Design Thinking provides a solution-based approach to solving problems. It is a way of thinking and working as well as a collection of hands-on methods.
Digital innovation is by its nature complex and crosses many disciplines and functions. The way forward is often uncertain and usually involves many experiments, setbacks, and mistakes. The Agile approach accepts this reality and applies a systematic trial and error and feedback methodology for making progress despite not seeing the whole picture. The Agile method, combined with an Agile consultant or coach can greatly improve the probability of success.
Ways in which new expertise is introduced into the organization - through new hires, internal training, external consultants, or acquisition.
All employees need the skills to ideate and innovate.
Jack Welch, the former CEO of General Electric (GE), popularized the concept of reverse mentoring in 1999. In his pilot project, he paired 500 senior and junior employees, so the latter would teach the former about technological advances and tools. Reverse mentoring has obvious benefits for the mentor and mentee, but in the age of digital transformation it may be the secret to success.
Digital transformation produces fundamental changes to how businesses operate and how they deliver value to customers. Beyond that, it's a cultural change that requires organizations to continually challenge the status quo, experiment often, and get comfortable with failure. This sometimes means walking away from long-standing business processes that companies were built upon in favor of relatively new practices that are still being defined.
To work effectively within an integrated and innovation oriented ecosystem, employees need to work together in a new way, breaking down silos and collaborating across different departments. Employees need to learn from each other in order to respond more quickly and consistently to changes in the market and within their own organization. So collaboration practices and skills become more important then ever.
One way to guarantee a transformation project will fail is by trying to transform a dis-engaged workforce. Dis-engaged people will resist making changes and destroy any momentum you may have created. So managers need to take into account the engagement level of their teams and work to address the motivational drivers of their people. Continuous data driven engagement surveys combined with live advice can support this.
When workers are comfortable with the status quo it is not such a bad thing. However, such a state of mind will not produce innovative solutions for the company or its customers. Conversely, if employees are restless, ambitious, and embrace change, they are more likely to invent. In other words, innovative solutions will result. Satisfaction and risk aversion both stifle creativity and innovation. But new ways of thinking can be learned.
The number one obstacle to success for major change projects is employee resistance and the ineffective management of the people side of change. *
Change Leadership includes the combination of all tasks, tools and activities that enable the transition from the current state to a new, desired state. The focus is on managing the “people side“ of a business change - aligning people with the desired change to ensure effective implementation and sustainability of the change in order to achieve the desired business results.
*Source: Prosci Research. Data from 327 companies undergoing major change projects
Human beings are uncomfortable with change. Especially when it is unexpected and unexplained or is seen to have a significant impact on ourselves. To create an environment for innovation and change we need to develop emotional resilience. We need to be able to absorb, react to and even reinvent who you are as a consequence of change.
Change efforts are most successful when the people on the receiving end of the change understand the need to change, the benefits of the change and what is expected of them. Although it is the responsibility of the change agent to communicate these messages, this workshop helps the participants proactively gain this insight and awareness.
Nurturing a new mindset and ways of working takes constant attention and effort. This is why many organizations will bring an expert to help guide them in their early innovation projects. An Agile coach can help plan and execute a pilot project that gets results.
Workplace diversity is critical to innovation and creativity. Successful companies understand that any challenge can be overcome when high-performing, diverse teams come together and collaborate to solve problems. Such diverse teams can benefit from a structured approach to solving problems and implementing solutions. Action Learning (AKA Group Coaching) is one way that a group can be supported by a trained facilitator and accelerate their problem solving and learning ability.