The human work of solving problems, facing challenges and
overcoming obstacles tends to share a common goal: creating stable, secure and
predictable environments. The tendency for most humans is that once we solve a
challenge, we want to be done with it. That propensity, however, does not
fit with today’s reality of perpetual change.
In the digital business world, organizations have no choice
but to operate in an unclear, uncertain and continuously shifting environment
that requires a new mindset and approach to formulating business
strategies. Digital winners recognize that change is part of the
game, and that they need to develop ways to exploit
continuous ambiguity. In fact, in our surveys of
high-tech professionals, when we asked how long they thought digital
transformation initiatives would last, about one-third of the surveyed technology
professionals answered “forever” – and as we all know, forever is a long, long
time.
In the Fourth Industrial Revolution, change is not something
to be solved; instead, change is the energy that propels organizations
into perpetual motion – creating new innovations, designing new
business models, identifying new threats and opportunities. Business
leaders must continuously recognize new trends, competitive forces and markets,
and then retool, reprioritize, re-educate, culturally align and retrain
employees to capture new opportunities profitably. They must constantly fight
“normalcy bias,” which is the desire to keep things the same. They must
foster an environment that embraces change and recognizes competitive
opportunities reside in every instance of change.
Three Cultures that Block Change
Our executive interviews revealed the extent to which
company cultures can block or restrict change efforts. One
healthcare executive listed his organization's culture as his biggest challenge, ahead of resistance
to re-engineering workflows and outdated technologies. Additionally,
about 20% of the surveyed technology professionals revealed cultural issues
were the biggest challenges they’ve encountered with digital transformation.
In our research, we’ve identified three different cultural
types that can impact an organization’s ability to engage in digital
transformation:
Leadership Culture
A culture of change at the leadership level is one that embraces the use of digital technologies to compete, and defines the high-level digital transformation doctrines and strategies from the very top of the organization. If business leaders don’t convey a full understanding of how digital technologies are impacting their industries, markets and customers, and then acting upon it, they are a detriment to their organization’s future. Executive interviews for this report revealed the following insights:
Leadership Culture
A culture of change at the leadership level is one that embraces the use of digital technologies to compete, and defines the high-level digital transformation doctrines and strategies from the very top of the organization. If business leaders don’t convey a full understanding of how digital technologies are impacting their industries, markets and customers, and then acting upon it, they are a detriment to their organization’s future. Executive interviews for this report revealed the following insights:
- Leaders
struggle with accepting change - adjusting their mindset, and appreciating
the true significance of digital transformation on their business and
future.
- Leaders
often require a major failure event to wake them up to the need for
decisive action and digital transformation.
- Leaders
must realize that different segments within their workforce view digital
technologies in different ways, and they must be managed, educated and
trained differently as a result.
Institutional Culture
A company may have insightful leaders, but if the organization does not follow, even the best leadership efforts will be ineffectual. Here is a few insights from executives that we surveyed:
A company may have insightful leaders, but if the organization does not follow, even the best leadership efforts will be ineffectual. Here is a few insights from executives that we surveyed:
- Digital
transformation means it’s not only the IT infrastructure that must change,
but all segments of the business.
- Digital
transformation and organizational agility must be embedded deep in the
culture of an organization.
- Without
continuous education and engagement the workforce will resist change.
Customer Culture
It’s critical for businesses to understand the culture, practices and fast changing behaviors of their customers and align with them quickly enough to matter. Among the surveyed technology professionals, 65% reported the prime motivation to engage in digital transformation was fast-changing consumer behaviors. Further, the executives we interviewed repeatedly credited customer requirements and demands as a top motivation for digital transformation:
It’s critical for businesses to understand the culture, practices and fast changing behaviors of their customers and align with them quickly enough to matter. Among the surveyed technology professionals, 65% reported the prime motivation to engage in digital transformation was fast-changing consumer behaviors. Further, the executives we interviewed repeatedly credited customer requirements and demands as a top motivation for digital transformation:
- Customers’
are adopting digital technologies and changing their online behaviors
faster than many companies can change their business processes and models
to compete.
- Customer
demands are interrupting organizational priorities, budgets, strategies,
investments and plans.
- Digital
transformation is unevenly distributed and some customer and industry
segments are far ahead of others, which creates opportunities and
competitive advantages for fast movers.
Our research revealed a need to purposefully monitor
and develop our digital mindsets. Accept that digital technologies and a
connected world are here to stay, and that the path to business success resides
in and through them. Understand digital technologies and their capabilities,
and rethink every aspect of our business with a digital mindset.
Recognize we don't control our digital customers and we cannot dictate their
behaviors. Our role is to observe, support and align with them faster
than our competition.
Our research revealed a need to purposefully monitor and develop our digital mindsets. Accept that digital technologies and a connected world are here to stay, and that the path to business success resides in and through them. Understand digital technologies and their capabilities, and rethink every aspect of our business with a digital mindset. Recognize we don't control our digital customers and we cannot dictate their behaviors. Our role is to observe, support and align with them faster than our competition.
Our organization's culture plays a big role in our ability to compete in the digital age. Our leadership, institutional and customer cultures all have an impact. It's important to purposely develop a digital culture built to support the continuous and rapid changes that comes with the Fourth Industrial Revolution.
If you find these articles valuable, I am available to provide in-house workshops and analyst briefings. Visit my website at the Center for Digital Intelligence.
Read more from the Center for Digital Intelligence here:
Our research revealed a need to purposefully monitor and develop our digital mindsets. Accept that digital technologies and a connected world are here to stay, and that the path to business success resides in and through them. Understand digital technologies and their capabilities, and rethink every aspect of our business with a digital mindset. Recognize we don't control our digital customers and we cannot dictate their behaviors. Our role is to observe, support and align with them faster than our competition.
Our organization's culture plays a big role in our ability to compete in the digital age. Our leadership, institutional and customer cultures all have an impact. It's important to purposely develop a digital culture built to support the continuous and rapid changes that comes with the Fourth Industrial Revolution.
If you find these articles valuable, I am available to provide in-house workshops and analyst briefings. Visit my website at the Center for Digital Intelligence.
Read more from the Center for Digital Intelligence here:
************************************************************************
Kevin Benedict
President, Principal Analyst, Futurist, the Center for Digital Intelligence™
Website C4DIGI.com
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***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I work with and have worked with many of the companies mentioned in my articles.
