Humanizing the Digital transformation

An organizations core value should capture its unique identity – the essence of an organization that distinguishes it from competitors. The key point is to get employees to identify with the distinctive culture, as they will be more likely to incorporate the core values in their daily activities and pursue the organization´s goals. A distinctive culture fit for humans can also differentiate an organization from competitors and provide a source of sustainable competitive advantage, as seen with organizations like Google, Nike, Novo Nordisk and more cool and meaningful companies to work for. 

From my perspective organization should embrace a Growth Mindset across the organization, drive change at speed enabled by Agile performance systems, and see invest in capability building as the new Innovation Hub.

1) Embrace a Growth Mindset across the organization

The mindset we adopt for ourselves affect the way we lead our lives. That is what Stanford Psychology Professor Carol Dweck has proven in her research. She discovered the power of two mindsets – the growth mindset and the fixed mindset, both relevant for individuals and organizations. A know-it-all (fixed) mindset will perceive their abilities as being fixed and with a limit, whereas a learn-it-all (growth) mindset is the ability to see a problem as a challenges and an opportunity to learn more. Microsoft has as an organization truly integrated this as part of their corporate culture and the mindset. Embracing it in their ways of working and collaboration with clients, partners and colleagues. The change is ongoing and from my perspective Microsoft is a great example of an incumbent that has succeeded in integrated three important elements to facilitate ongoing adaptability:

-       Never stop learning: Microsoft has a large proportion of mandatory (role specific) and voluntary learning available, making sure employees continue learning at all levels of the organization.

-       Learn from the past – but keep looking forward: Often when an organization has achieved a measure of success (sales, productivity, cost savings…) the tendency is to simply rinse and repeat, however if you keep your eyes focused on the rearview mirror, you are going to crash. Instead stay focused on what´s ahead.

-       Experiment: Learning happens when you try something new and make mistakes. It is critical that people feel safe to share new ideas and try new stuff, as the result will be a culture of learning and growth.

The above elements are truly embedded in Microsoft´s culture and ways-of-working supported by hardcore adaptable performance measures to drive change at speed. One key measurement is the ability to stay compliant with conduct of business.

2) Drive change at speed enabled by Agile performance systems

For organizations transitioning to agile structures and ways of working it also essential to rethink your performance management systems to support and enable the transformation. Performance measures are by far the most powerful tool to drive change, however with the magnitude of impact, it also comes with major risks if the measurements are not set correctly, leading to unintended and maybe conflicting behavior in the organization. Following it is crucial for organizations to link their employee’s goals with well-defined business goals for the individuals to experience a strong sense of meaning and purpose. Is an organizations succeed, the adaptable measures will be an enabler to navigate the volatile, uncertain, complex and ambiguous conditions organizations are facing. The second critical point is to make the performance measurement visible across the organizations to surface interdependencies among teams and units – often seen practiced done in the BigTech organizations (Google, LinkedIn, Microsoft…) and the actual performance transparent for the employees through individual dashboards. 

3) Capability building as the new Innovation Hub

Succeeding with a digital transformation presents both an opportunity and a requirement to develop and capitalize on people´s capabilities. Research shows that most organizations underinvest in Technology education and training, allocating on average about 2% of the typical IT budget to employee development. Worse still, when an economic downturn occurs, training is often one of the first areas to be cut. I would argue that companies should transition their investments from non-core innovation hubs and similar activities to upskilling and training of their most valued and skilled employees. Introducing new technology and digital capabilities to the people knowing the business, operations, and foundation best will foster a new funnel of ideas for growth. Still combined with bringing in the right talent from the outside to support adjacent business areas and digital capabilities.

Why you and your organization should see Cloud as a collective opportunity – bringing it all together

In my previous articles I have discussed elements essential for organizations to harvest the benefits of their digital investments covering: Strategy, Execution Foundation, [Agile] organizations and ways of working, and Culture & Capabilities.   

I believe organizations with a holistic view on their digital transformations will, as a stand-alone digital strategy won´t do the job. In summary, I have the following advice for you and your organization:

•       The CEO supported by the Board of Directors to orchestrate the digital efforts supported by a flexible funding model

•       Cloud is relevant for all organizational units – you need to understand the business opportunities for your area

•       The design and choices for your operating model will be the compass for the future business model

•       Humanize the organization and invest in upskilling and talent as an engine for innovation

Feel free to connect, comment and share new perspectives.