The Perils of the Digital Strategy Anti-Pattern

I started writing the "Way of DAU" because of my experience with a few CxO individuals. The problem was that they saw Digital Adoption of Big Data and IoT technologies as a sort of business elixir which would magically provide them with new insight and enable them to change their business models.

Increasingly these individuals became more impatient as they expeced IT to magically "deliver the goods" and transform their businesses. They talked far and wide at business forums and in the press of how transformational digital technologies are and they decided to develop big enompassing digital strategies. The trouble was, they never actually articulated where the value lay or what the actual value proposition was. So it was difficult to understand from a technological perspective, where to start with credible opportunities and business cases which might succeed. Trying to separate genuine opportunity (which justified the investment) from fluff was impossible.

Two years later they were still waiting to implement anything tangible and still talking, whilst other companies were starting to pass them by. Little wonder then that Thomas Davenport and George Westerman published an article in HBR on why Digital Strategies Fail. Basically, companies like GE have gone full tilt at implementing digital business models and capabilities without stopping to identify and prioritise value, and expecting to get everything right first time.

Unfortunately this is the problem with innovation. It's difficult to get things right at the first attempt. Just look at Dyson, it took him thousands of experiements and years of development to crack the physics behind the bagless vaccum cleaner and he had the advantage of knowing what problem he wanted to crack. When trying to introduce ground breaking new digital products, there's a lot needed to understand what the real problem is before you try to optimise the solution. Then, as a former CEO of Intel said, you may still need to pivot in the market place to find where the real sweet spot is and fulfill the dreem of market disruption.

George Westerman has even gone so far as to say in a new article in the MIT Sloan Business Review that your business does not need a Digital Strategy, it just needs a business strategy which takes cognisance of Digital Opportunities. He talks about Building Leadership Capability, Not Abandoning Digital Transformation to IT, Avoiding Siloed Thinking and Not Pushing the Envelope too Far.

These are some good common sense starting points and pre-requisities for focused action. Let's hope that the C-suite start to listen.

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.