One of the biggest challenges I see in business today, is not the implementation of technology, but the way that technology is exploited to bring about business success. Already this year, I have helped two businesses implement major new information systems, but just implementing a new system is not enough. In both these businesses the new systems have the potential for significant transformation, but it is the people that hold the key to unlocking this potential.
I have come across several articles in the past week, which highlight this same issue. This article by Paul Taylor titled Digital Transformation is Failing. Why?, aligns with my experience that anyone can introduce a new IT system- but as digital organisational models emerge, it’s leadership that needs change. He goes on to say:
We are at a crossroads – at the intersection of paths towards a new digital economy or an adherence to the traditional world of work.
Being a leader in the digital era means casting aside old strategic frameworks, processes, relationships and values. It also means being brave and bold enough to step into the fray: challenging every aspect of tradition.
Digital transformation isn’t really anything to do with digital tools.
It’s about redefining the concept of work itself.”
The fundamental problem I see in many businesses is that the current leaders and managers are generally the ones that put in place the systems and processes that need to be replaced. There will be a (sometimes unconscious) attachment to these old ways of working. This is summed up by a quote I often use in presentations and you will see on my website.
Change is hard because people overestimate the value of what they have – and underestimate the value of what they may gain by giving that up.” Source: Flight of the Buffalo by James Belasco
The other related factor with a lot of organisation that I work with in the Channel Islands (which is also applicable to other areas where there is almost full employment and good job security) is that staff turnover is relatively low and senior managers have often come up ‘through the ranks’. Through no fault of their own, these people are in organisations that have entrenched cultures of ‘we’ve always done it that way’ which can make change difficult. Where staff have spent more than ten years within the same company, they forget what good processes and systems look like and accept the status quo.
This is not an uncommon problem; Britain has an estimated 2.4m accidental managers, who were elevated to managerial roles because of their skills in the job, not because of their aptitude or experience managing people. You have probably seen this too in firms you have worked at, where very technically competent people are promoted to manager with little or no training. This is also the view of Ann Franke, chief executive of the Chartered Management Institute (CMI), who believes one problem is that in the UK, as opposed to Germany and the US, “managerial skills are not being taken seriously and not being valued”. See this article that appeared recently in the Financial Times: David Brent and Basil Fawlty personify Britain’s hapless managers.
Leadership is the most important element of any digital transformation. I’m not talking about the inspirational, charismatic ‘follow me, I know best’ sort of leaders. But the leaders who have a strong professional will to succeed, coupled with personal humility that allows them to channel their ambition into the company rather than themselves. They give credit to others in times of success and accept responsibility for failure, when times are bad. These leaders surround themselves with the right people and make sure they are doing the right jobs. In terms of digital transformation, this means hiring talent from outside if necessary and making sure their boards and management teams receive the advice from those with experience and a track record of success. They also take calculated risks.
With the right leadership team in place the digital strategy can be defined and aligned towards the business strategy. Even where the organisation only has an organic ‘business as usual’ strategy, a strong digital strategy can be developed to enhance the organisations position in the market, reduce cost and enhance customer value.
Communication of the digital strategy is vital to its success. Communication needs to be two-way and must describe the benefits and value rather than the technology itself:
If you want to build a ship, don’t drum up people together to collect wood…teach them to long for the endless immensity of the sea.” Antoine de Saint-Exupéry
I have deliberately left the technology itself until last, because in many ways this is the easy bit. Creating the right environment for change will enable your people to grasp new digital tools much more easily. Having said that it is very important to select the right technologies and the right vendors. In most situations, when selecting new technology there will be choice in the market. I have seen many organisations regret their decision because they have focused too much on the features of the software rather than considering how the vendor and implementation process aligns with their strategy and culture.
I have written before about the successful implementation of technology in this series of 4 articles: Understanding IT Systems Change, so won’t repeat these points again. Suffice to say it is the process of implementation and how you go about closing the gap between the current state and desired state that is critical to your success.
Contact us, if you would like help ensuring that your people can keep up with the pace of technology in your business.