Are You as a CxO The Real Culprit?

Digital Impacts on Business

In a recent article in the Sloan Management Review, it was mentioned that 87% of executives think that Digital will affect their market place. Yet out of the 75% who thought that their enterprises are adequately prepared, only around 10% saw it as a potential threat to their business.

This is only one symptom of the many aspects of CxO behaviour which are affecting the success of organisations which want to adopt a digital business model. Overall, there is often a lack of realisation that the CxOs themselves are inadvertently sabotaging their organisations' efforts.

Executive Behaviour Can be a Problem

In many cases, in the same manner that many executives don't understand what it means to be a project sponsor, CxOs have failed to actually engage with the issue. They don't seem to think that they should spend the time to get involved in deep market analysis and identify real game changing opportunities. They just want to automate yesterday with some sexier technology.

Additionally, they don't get the need for acting as a joined up team or building a positive culture which supports experimentation and innovation. In fact, many executive teams don't seem to understand that innovation means doing something that no one else has done before, so there are bound to be a few issues along the way as a product team discovers what works and what does not.

David Snowdon provided a great framework with the Cynefin model to explain what is involved with emerging practice and chaotic conditions.

This is why the DAF (Digital Adoption Framework) places significant emphasis on cultural change as promoted in The Way of DAU. Culture is a known inhibitor to strategy implementation, as witnessed by the well known quote that Culture Eats Strategy for Breakfast. Culture change starts with the C-Suite and ripples down. So any CxO looking for digital success, should be asking whether he or she needs to reach out work with C-suite peers to build a better team. Otherwise, failure beckons.

Executives Need To Learn How to Promote Innovation

On another tack however, a research based article on innovation and executive behaviour published in the Harvard Business Review, outlines some personal behaviour characteristics of entrepreneurial CEOs and other top executives: 

• associating, 
• questioning, 
• observing, 
• experimenting, 
• networking.

Their observation was that CEOs in successfully innovative companies take more ownership of innovation, look outwards and provide leadership to the innovation process and get personally involved.

Digital's Impact on the C-Suite

One of the interesting things about Digital Adoption and Transformation is the way in which it is impacting roles in the C-suite.

In some early adopters, the default leader for digital transformation was the CMO, as digital marketing initiatives picked up and marketing ran away with the ball.

In second wave adoption there has been a bit of a split between whether a specially appointed person, the Chief Digital Officer, should manage the business's strategic response and run all things digital. In others they have handed this to the CIO. Though occasionally the CEO has decided that this is too important and grabbed the reins him/her-self. The longer term trend does appear to gradually hand this back to IT and CIO (as discussed in previous posts).

However, there is a growing realisation, as discussed in a recent Forbes article, and in my book that culture is crucial to success. Culture needs to be aligned to a number of positives:

• Collaborative working across functional siloes
• Product and value focus
• Opex Thinking
• Tolerance of Experimentation and alignment of Risk Appetite with Value and Learning from Failure/Experience
• Customer Focus

Apparently, this is now leading to the situation where enterprises are beginning to appoint Chief Culture Officers.

Additionally, some are also appointing Chief Customer Experience Officers to reinforce the idea that the key value proposition of Digital is Excellent Customer Experience. Although in design led organisations this may be Chief Design Officers who are also interested in the customer engagement by design thinking.

One of the questions that we have to ask is how will this mature? at the end of the 19th Century as electricity started to be adopted, some organisations flirted briefly with Chief Electricity Officer roles, but they did not last long.

Will Chief Culture Officers be subsumed into Chief HR Office roles and will this change the face of HR for the better? will customer experience revert to the Chief Marketing Officer, or will CIOs hybridise and pick up aspects of these roles as part of the CDO element of their job as they delegate more technical aspects to CTOs. Or will CTOs have to become more human?

Whatever happens, CxOs will all have to rethink what their core attributes and operating models should be. Digital required disciplined team play, as well as skills and flair.

Is Your Enterprise Digital Ready? - Summer Time Reading Recommendations

Sometimes it is better to make sure that other people think that they had the idea first. As Information Professionals are not always believed when they try to persuade their business colleagues that they need to change their ways, if they are going to get the best out of their Digital Strategies and Investments.

The truth is that there are some fundamental issues to address which separate Good or Average performing companies from Excellent ones when it comes to exploiting IT or Digital investments and transformations. Proponents of Digital Strategy, Agile and DevOps often raise them, but due to the fact that these issues are being raised in a technological context, non IT colleagues tend to either listen and not hear or just dismiss them as the mad ravings of techno boffins.

Key among these are:

1. Having a "Real Business Strategy" based on deep market insight and how to disrupt or exploit it in your favour;
2. Working as a Team within a healthy Business Culture;
3. Adopting Design Thinking to help empathise with customer needs, really understand what you are trying to address and then to creatively address options and iterate design to create elegant and well targetted solutions rapidly, whilst embracing leraning from failure as a critical part of the approach;
4. Systems Thinking to understand the end-to-end process, identify and manage critical business bottlenecks and organise around product or work delivery, instead of hierarchical functional silos.

A large part of this is really concerned with taking an ego-less multi-functional team approach to addressing what is really needed and then pursuing continuous delivery, automation and improvement in small steps. 

Fortunatley there are some great business books on some of these subjects which evryone should be encouraged to read as they address the issues from a more general business perspective and introduce the key concepts that all the Digital Geeks are so keen on.

My recommendations are:

Good Strategy Bad Strategy is a great expose on how to do Strategy properly. Most readers will recognise many of the bad examples which are lacerated by Richard Rumelt (one of the leading fathers of Business Strategy) in what is a fairly easy and entertaining read.

Winning Teams Winning Cultures  - addresses a lot of the key issues in building a positive enterprise culture. This comes from Larry Senn (of Senn Delaney a culutural change consultancy) and Jim Hart who are long time practitioners in the field of cultural change. It's an interesting book, because just like democracy it is difficult to bomb culutural change from 40,000 feet into an organisation. It requires authenticity, long term commitment and sytematic sweating by the management team to achieve.

The Human Constraint - the author (Angella Montgomerry) takes the principles advocated by Demming and Goldratt and updates them to apply to all businesses (not just manufacturing) in the practical adoption of system thinking and the Theory of Constraints to business in general.

Finally there are plenty of sources on Design Thinking available on the internet. The UK Design Council publishes the Double Diamon model which provides a simple model for explaining the process. I recently saw a great webcast by Ileana Stigliani, fom Imperial College Business School, on the subject Unleash Innovation Through Design Thinking

(see: https://www.ivyexec.com/professionals/classes/details/unleash-innovation-through-design-thinking ).

Digital Adoption Framework

A lot get's talked about Digital, but there are few comprehensive approaches to adoption available for reference. 

This is why I was interested when I came across Vadrim's DAF diagram, reproduced below. Enjoy!