The Digital Transformation Triangle
We are in ‘The Innovation Economy’. Continuous and Sustainable Innovation is the new black. In recent years, digital leaders, digital natives and start-ups have bravely expanded and succeeded in tapping unexplored markets with right culture and IT capabilities to support it.
Exploring these markets requires three elements of Digital Transformation to form an equilibrium triangle. They are –
- Adopting a North Star or Overall Business Mission,
- Fostering Culture that connects employees seamlessly to the North Star,
- Building and investing in right Technological Capabilities for achieving the North Star.
Let’s explore each of this element more–
Adopting a North Star–Operational strategies like doubling profits, new product/service launch, adding workforce, etc are not-so North Star. Business vision like committing to continuous innovation, providing affordable solutions for consumers, and tapping sustainable profit-making opportunities are few examples of how your North Star should be defined.
Senior level management is the driver and facilitator of this top-level conversation of defining and adopting North Star. While adopting a North Star, top management should compare their existing offerings with the industry players. Equipped with rich industry experience and right consultation, top management can decide on the correct North Star.
Fostering the Right Culture–Aligning Cultural practices with the North Star is the most important task. Organizations are made up of their workforce and the set of unsaid cultural policies directing how organizations communicate with their employees, ideas are generated and received, and how organizations promote implementation and failure of ideas to innovate new things.
Transparent policies, feedback mechanism, leaders’ interaction, freedom to fail and innovate, and ways to deliver excellent customer experience builds the right culture. Imagine an organization that talks about innovating continuously but they don’t have tolerance towards repetitive failures and making incremental improvements. No wonder if their digital transformation program fails.
While there’s lot said about how a good, productive and people-oriented culture looks like, organizations fail at implementing it. There’s a simple way to do it – Leaders must discuss the strategy, provide logical and emotional arguments to get consensus from employees. They should empower people to ask questions by providing platform for free communication and continuous learning. These communication and learning programs will build interest and excitement leading to transparent and open communication culture. Any organization with positive, non-hierarchical, productive, engaging, and exciting culture is way ahead in their Digital transformation journey than the ones getting the technology right.
Investing in right Technological Capabilities–After adopting the North Star, and preparing employees for major cultural change, top management must invest in right technological capabilities (processes and tools). Often leaders have Flight Magazine Syndrome where they read about the latest technologies and how it is important for their organizations without knowing the exact details about implementation, integration challenges and budgetary constraints.
How they work together?
How these three elements support and drive each other?
Adopting North Star: Business strategy helps to find opportunity pockets in current business models or as a reaction to business crisis, changing leadership, disruptive competition or planning for a digital future. It is the primary driver for enabling culture required to achieve the transformed state and build technology capabilities to support the journey.
How and why it impacts culture and technological capabilities?
- Culture: Why? No strategy can be successful without organization wide adoption. How? It brings implicit and explicit reward systems together to define how an organization works. Culture is more elusive of the three elements and determines the success of the whole initiative.
- IT Capabilities: Why? Businesses enable new strategies using technologies as enablers. How? Technologies like cloud, AI, ML, Big Data, IoT are helping companies create new business models, improve financials, and reposition core offerings thereby bringing Agility into their day to day functioning.
Take an example of three dimensions of this modern customer experience are relevant. The first concerns the new-age Customer Experience and its definition for organization, the second concerns Customer-centricity culture, and the third is to equip employees with technologies to explore customer details and serve them.
It is easy to deduce how CEOs must be thinking about automating complete customer experience and enhancing employees’ capabilities to understand, interpret and act upon every customer detail but questioning the investments planned, or failing at fostering right culture.
The three elements when work in sync creates not only a successful Digital transformation program but also one that sustains over the long term. The North Star, enabled by technology advances, and right culture, creates sustainable value for organizations and their customers.
At Qentelli, we help companies to achieve balance between three elements of Digital Transformation. We follow a Culture-first strategy with adequate technological investment from the beginning of the transformation program. Write to us about your Digital Transformation Triangle at email@example.com