Adapt or die! This is the mantra of digital Darwinism, where the evolution of technology and markets force organizations to survive or perish. As a response, digital transformation has become one of the biggest - perhaps the biggest - trend in business transformation. As Jack Welch once succinctly wrote, “If the rate of change on the outside exceeds the rate of change on the inside, the end is near.”
The “digital” in digital transformation is attempting to lead change on the inside because of what’s happening on the outside. Leading companies are learning to adapt by modernizing technology infrastructures and by experimenting with disruptive technologies. This usually means that the ringleader for orchestrating digital transformation is, most of the time, CIOs, with CDOs and CMOs also driving significant investments--not always in lock-step.
When you look behind the curtain, you see that most digital transformation investments are focused, across the board, on customer experience (CX). In fact, for the last several years in my research on the subject, it is most often cited as the number one catalyst driving early-to-advanced digital transformation initiatives. Companies are aiming to keep up with customer behaviours and expectations by updating touchpoints, as well as the marketing and systems that reach and support them.
But there’s an irony here. Investments in the “digital” part of the digital transformation isn’t always inspired by the “customer” in customer experience.Instead, most efforts are technology-first initiatives driven by technology bling or hype without looking at the human factors shaping digital Darwinism. Every year in the “State of Digital Transformation,” I find consistently that companies are investing millions in the name of CX without knowing why or for whom. For example, last year, and also in a forthcoming report, I learned that only 35 percent of digitally transforming companies had mapped out the customer journey. Yet, technologies are identified and implemented in the name of the customer. As you can imagine, this disconnect leads to wasted time, resources and also creates a divide that welcomes disruption.
Technology, the right technology, is important. It’s the foundation for effectively competing (and adapting) in digital Darwinism. But, so are people and how they use tech to discover, communicate, and make decisions. This is both a human and technological quandary - and an opportunity.
One of the most common challenges facing digital transformers comes back to Welch’s quote. Technology, by itself, isn’t the only outside change affecting the inside of your organization. Behaviour, norms, expectations, standards, et al., change as a result. Concurrently, businesses do not change as quickly and this is why technology investments need a human (and modern) touch. For the most part, any investment in digital transformation is still beholden to legacy perspectives, models and metrics that govern the organization. It’s normal, but not ideal. This means that new investments are linked to incumbent ways of using and measuring new tech and its impact. To change this, we need to introduce a new quotient into the equation. Like IQ (intelligence) and EQ (emotional) quotients, I believe we also need to factor in the human quotient (HQ).
The combination of IQ + EQ + HQ guides technology investments by humanizing change and giving digital transformation a face and purpose. This takes a special breed of what I call digital change agents who understand tech and also live the digital lifestyles that are contributing to digital Darwinism today. And they are in your organization. Maybe it’s you, attempting, as best you can, to convince decision makers how to see markets differently to guide digital transformation investments more wisely.
Digital change agents are the innovators, the intrapreneurs, your colleagues, those who believe in something so passionately, they take bold risks to open new doors.They strive to bring change from within their respective groups in the organization, but they aren’t necessarily seasoned or trained at navigating the cultural dynamics that drive change throughout an organization. All too often, they face challenges from those who still believe conventional mindsets are the strongest source for innovation strategies. They get stuck. They grow frustrated. As a result, they explore new opportunities. However, they are instrumental in maturing digital transformation.
For example, in a time when only 35 percent of companies are studying the evolving digital customer journey and the advancing behaviours, expectations and mindsets that define it, digital change agents see things through a different, more empathetic and focused lens. They also have the expertise and experience to analyze data through this lens to guide technology and strategic investments more accurately. Doing so reduces or eliminates friction, identifies opportunities for innovation and introduces “wow” moments in the journey that modern customers will value and in turn, contribute to business growth.
In these times of Digital Darwinism, legacy businesses need this talent more than ever. They don’t just represent a different way to work, they are the future of work. They don’t follow the conventions or beliefs of legacy mindsets, hierarchies and courses of action. They invent, create and discover alternate paths forward because they know no other way. They’re not misfits, renegades or rogues. They’re not problems, at least in tomorrow’s sense. They’re doing what they do and they could use your help. Without them, organizations are doomed to business as usual, attempting to compete by brainstorming and thinking outside of the box, which of course, is still business as usual.
With support and guidance from the C-Suite, change agents spread digital literacy, drive collaboration between silos, build internal bridges with executives, and help accelerate their organization’s progress across Altimeter’s “Six Stages of Digital Transformation.”
I was invited to present these ideas at Think18 in Arizona. I wanted to share highlights from that event here as a reminder that no path to innovation is paved through fear, ignorance or weakness. You have it in you to do something greater. And organizations that truly wish to compete, need you and people like you, to open new doors.