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The Leadership Challenges of Digital Transformation - The Conference Board - February 2018 by Dion Hinchcliffe

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Presented to The Conference Board earlier this year, this is my most complete and up-to-date view of how we can accelerate digital transformation in most organization using outside-the-box thinking, and taking advantage of the inherent power of digital networks and people to collaborate, innovate, and scale.

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The Leadership Challenges of Digital Transformation - The Conference Board - February 2018 by Dion Hinchcliffe

  1. 1. Leadership Challenges (and Opportunities) of Digital Transformation Dion Hinchcliffe Constellation Research, VP & Principal Analyst ZDNet Columnist Executive Fellow, Tuck School of Business Center for Digital Strategies Twitter: @dhinchcliffe dion@constellationr.com
  2. 2. @dhinchcliffe#digitaltransformation Growth of Technology and Human Success: Hand in Hand 1 2 Technology Growing and Change Fastest in History Which Overall Has Been Very Good for Us Human Population over Time Emerging Technology Rate of Change At All Time High
  3. 3. @dhinchcliffe#digitaltransformation Insight: Linear Thinking Does Not Prepare us for Exponential Times More Change in Work and Business in the Next Ten Years Than the Last 50 Combined
  4. 4. @dhinchcliffe#digitaltransformation 1 2Insight: The Value of Digital is Driven by Power Laws That Pay Off Big Downstream But Most Organizations Only Change Linearly, or Logarithmically at Best The Payoff of Power Laws 
 (Like Moore’s Law) Over Time Understanding Exponential Tech Change Helps Us Prepare Enabling Us to Anticipate the Nearly Unlimited Value Potential
  5. 5. @dhinchcliffe#digitaltransformation And Yet Most Companies Are Far Behind
  6. 6. (cc) 2018 Constellation Research. | Creative Commons. Some Rights Reserved. | @dhinchcliffe Constellation Research Result: Technology is Wiping Out Companies Faster Than Ever 6
  7. 7. @dhinchcliffe#digitaltransformation The digital winners must adapt in all new ways All Organizations Are Being Impacted By Digital •The current life span of a Fortune 500 company is 15 years + falling •The challenges of adapting to today’s operating environment: - Rapid and disruptive technology innovation - Dramatic increase in expectations by customers and the marketplace - Gap between digital high performers and laggards growing faster than ever before - New business models blurring industry boundaries
  8. 8. @dhinchcliffe#digitaltransformation
  9. 9. @dhinchcliffe#digitaltransformation Organizations Will Need a New “Digital Metabolism” • That Can Change About as Fast as the World Does
  10. 10. @dhinchcliffe#digitaltransformation What Are Most of Us Trying to Do?
  11. 11. @dhinchcliffe#digitaltransformation What Are the Key Enablers of Digital Change? • Continuous Learning • Rapid Experimentation • Tolerance for “Eccentric Behavior” • Digital native thinking • High EQ • Comfort with Uncertainty • Unwavering Support from Leadership • Transdisciplinary • Data-driven <— Almost ready
  12. 12. @dhinchcliffe#digitaltransformation Key Insight: Moving from Push to Pull Based Models for Tech Change Implication: Digital Transformation Must Be Decentralized and Broadly Empowered
  13. 13. @dhinchcliffe#digitaltransformation Source: MIT Digital Transformation Survey It Takes Engaged Leadership to Overcome Key Barriers to Digital Transformation. That’s Leadership from Anywhere…
  14. 14. @dhinchcliffe#digitaltransformation Our Belief: We must find a different way of driving change What Have We Learned About Large Scale Change? •77% of change initiatives fail…HBR •Historically the adoption of emerging tech has left a wake of failed efforts… - ERP, CRM, SOA, etc. •Digital change programs that use traditional adoption approaches usually do not work - Most strategic change programs are project-driven and in today’s faster world outdated before being fully implemented - Traditional change programs are static, cascading one time events - Traditional adoption processes are technology centric while digital adoption requires a human centric lens
  15. 15. @dhinchcliffe#digitaltransformation Centralized Change Has Been Breaking Down for A While Which the Center of Excellence Model was Supposed to Fix
  16. 16. @dhinchcliffe#digitaltransformation At this point in the keynote, I ask the entire #CollabTechFest audience: “How many think your organization has a good model for digital change?” NOT A SINGLE HAND GOES UP I then say, “What we are doing right now isn’t working. 
 We need new and better ways for digital change. Here are some ideas…”
  17. 17. @dhinchcliffe#digitaltransformation It Was Technology Challenges that Forced Us to Look to New Models in the First Place
  18. 18. @dhinchcliffe#digitaltransformation At the Largest Scale, Industry Has Learned that Open, and Collaborative Driven Approaches Are the Most Effective • There has been revolution in how loosely-coupled but well aligned groups of people can drive change
 • Open Source • Agile, and now Devops • Open Innovation • Social Media • Crowdfunding • Disaster Relief • Network Leadership With a New Lens: Proof Points
  19. 19. @dhinchcliffe#digitaltransformation
  20. 20. @dhinchcliffe#digitaltransformation A way of scaling connections to shared expertise Access to expert facilitators to drive continuous shared alignment Shortest route to openness, transparency, and shared knowledge A vehicle for leadership to communicate and enable change A means to focus performance improvements locally enable broadly Easy integration of external SMEs to inform strategy & decisions A capability to inspire co-creation and innovation How Networks of People Tend to Mature in Terms of Use
  21. 21. @dhinchcliffe#digitaltransformation Eventually, All Types of Groups in the Enterprise Will Be Working Primarily in Digital Networks Indeed, the Process Is Already Advanced in Most Organizations
  22. 22. @dhinchcliffe#digitaltransformation incremental change IT IT as support unit, enabling centrally, “Doing it all” Limited external competition/enablement service providers outsourcing firms faster change IT as support unit, CoEs driving innovation More external competition service providers outsourcing firms app stores IT CoE CoE cloud fastest change network of IT enablement, broadly innovating decentrally Most external competition service providers outsourcing firms app stores cloud CoE = Center of Excellence | NoE = Network of Excellence | = Shadow IT NoE CoELoB LoB CoE LoB dev partners dev partners APIs Back to the CoE. What’s Next?
  23. 23. @dhinchcliffe#digitaltransformation We Need a Model that Will Scale Up and Move as Fast as Digital Change
  24. 24. @dhinchcliffe#digitaltransformation Because Most Organizations Aren’t Becoming Digital Nearly Fast Enough - Lack of skills to enable changeDon’t have time - Disengagement (at all levels) - Lack of curiosity in new ideas - Insular management culture - Unfamiliarity or dislike of technology - Lack of empathy & caring - Not-invented here - Shareholder vs family driven - Lack of humility - Fear of looking clumsy - Commitment, but only superficially Source: Change Agents Worldwide (@chagww) & Dion Hinchcliffe Top obstacles to digital change The Majority of these Challenges are People Issues
  25. 25. @dhinchcliffe#digitaltransformation So, a Few Years Ago I Began to Notice a New Pattern on Projects… That Change Teams were Becoming Change Networks
  26. 26. @dhinchcliffe#digitaltransformation Next-Gen Case Example: Beyond the CoE
  27. 27. @dhinchcliffe#digitaltransformation Another Proof Point for Communities of Change • Dr. David Bray (@chief_ventures) • Recently CIO of the Federal Communications Commission • Faced the Daunting Prospects of Moving 300 LOB Apps to the Cloud to Reduce Rampant Complexity and Cost • Used Internal and External Change Agents to Accomplish in Less Than One Year with Existing OpEx
  28. 28. @dhinchcliffe#digitaltransformation Further Proof Points of Communities of Change • Washington Post Company • AstraZeneca • Houghton Mifflin Harcourt • Etlisat • Travelex • Tesco
  29. 29. @dhinchcliffe#digitaltransformation
  30. 30. @dhinchcliffe#digitaltransformation Digital Workplace Transformation Results Change Agents There Was Another Missing Piece to the Puzzle Changing Everyone Was Too Hard and Was Going to Fail Under Those Rules
  31. 31. @dhinchcliffe#digitaltransformation The Key Insights Were With Us… • It’s always a people problem. - Gerald Weinberg • Productivity of Digital Teams Varies from 1:10 • Existing Models that Focused on Changing 100% of Everything Were Doomed to Fail What if we could plan a self-growing seed of change?
  32. 32. @dhinchcliffe#digitaltransformation We Have a Growing New Audience to Tap into Pent Up Desire for Progress and Improvement: Digital Change Agents
  33. 33. @dhinchcliffe#digitaltransformation Digital Org Structures are the Natural Platform for Change Agents
  34. 34. @dhinchcliffe#digitaltransformation
  35. 35. @dhinchcliffe#digitaltransformation Community ManagersChange Agents Your Executive Leadership Your Business and Technology Stakeholders strategy collaboration & formulation strategy communication Lessons Learned Online Community Platform Latest Digital Business Concepts & Techniques Digital Strategy Decision Maps Detailed Roadmaps Digital Workplace Strategy Co-Creation Enterprise Change Plan 45-60 day cycles, delivered using secure online platforms Using Digital Networks for Transformation of the Enterprise
  36. 36. @dhinchcliffe#digitaltransformation The Biggest Lesson of Digital Org Structures: Let The Network Do The Work....
  37. 37. @dhinchcliffe#digitaltransformation BECAUSE SOMETHING DEFINITELY WILL BE DIGITAL ORG STRUCTURES A KEY STARTING POINT FOR DIGITAL TRANSFORMATION
  38. 38. @dhinchcliffe#digitaltransformation Key Point: Mature social collaboration initiatives have 3x the community managers of low maturity efforts Network-Based Change Requires New Forms of Management Community Managers Have Always Been Change Enablers at their Core
  39. 39. @dhinchcliffe#digitaltransformation Staffing for Collaborative Disruption + Community of Change Agents
  40. 40. @dhinchcliffe#digitaltransformation PREMISE: THE ENTERPRISE-WIDE SCALE OF COMMUNITY ONLY CAPACITY THAT CAN TACKLE BUT THE SINGLE BIGGEST OBSTACLE TO MODERN COLLABORATION: ORG CULTURE
  41. 41. @dhinchcliffe#digitaltransformation Using Digital Org Structures for Transformation • We have incredibly powerful tools in our online communities and digital workplaces • If we have vision, we can use them for very ambitious change efforts that scale far better • That go well beyond simple comms/collaboration • They are giving us access to influence, orchestrate, and guide organizations at a mass scale level • We need to build new change skills and network leadership through communities • Change agents and community managers are the future of sustainable change • It’s a competitive imperative now to find these new models • I encourage you to explore the possibilities, as it’s what we’ve always intended to do with digital workplace anyway • Truly enable human potential to its fullest

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