New technology is changing everything in increasingly unpredictable ways. Every senior leader in every organisation everywhere must be able to answer a simple question: ‘How do we evolve?’
No Leader, worthy of the title, is unaware of the challenges and opportunities that rapidly developing technology presents in their attempt to design and execute strategy. We know that whole industries have been, are being and will be disrupted by the application of new technologies. It is a heady time.
A quick spin around the internet tells us that all organisations need to prepare for a ‘new normal’ of increasingly disruptive change, that we need to be agile, collaborative, challenge our assumptions and create new routes for innovation practice that create the conditions where we can ‘fail fast’. Or something.
It feels to me that all of this isn’t much help. For example it leaves me with the sense that there is a lot of talk out there but all too few practical guides to action.
One of the things that I think I know for sure is that organisations putting someone in charge of ‘digital strategy’ isn’t going to work. Why? Because that’s old thinking of the “We have a problem, let’s make someone responsible for solving it and we can all continue as usual” kind. I have seen senior executives learning to code, opening Twitter accounts and going around telling everyone who will listen that the future is mobile (is it?). None of this is wrong (apart from the mobile bit probably) it is just a response on a scale wholly inadequate to the context.
The context is that we are seeing wave after wave of technology that is transforming our capabilities and trashing our assumptions about how the world is and how it will be next year. There are a million examples (that’s part of the problem). Here are two.
A few weeks ago Google’s Deep Mind Artificial Intelligence tech AlphaGo beat a top human player at the game of Go. This represents a significant breakthrough for two reasons. Firstly, Go is a very sophisticated game and requires a technical capability beyond just brute force processing power (there are more potential positions on the board than atoms in the universe!). This is a powerful self-learning AI. Secondly, and most importantly, it was only a year or so ago that the leaders in AI research predicted it would take 10 years or so before an AI could beat a top rated human player at Go. And yet here we are, 10 years ahead of schedule. What does it tell us about the pace and scale of change when even the experts predictions on development timescales can be so wrong so quickly?
Second example is that we are now a significant step closer to being able to use 3D printed body parts for regenerative medicine. Again the speed of progress in this field is beyond the expectations of experts. Prof Martin Birchall, a surgeon at University College London, said "The prospect of printing human tissues and organs for implantation has been a real one for some time, but I confess I did not expect to see such rapid progress.”
One of the drivers of ‘unexpectedly rapid progress’ is of course technology itself. Some commentators talk about exponential levels of progress largely citing the fact that as technology gets better we can use better technology to make further progress. Others have called this The Law Of Accelerating Returns.
The other driver of rapid progress is the where technological developments are connecting together in new unexpected ways. For example where materials science connects to synthetic biology, to AI, to robotics, to virtual reality to internet of things, to the computational power to crunch huge datasets at speed and to the ability to communicate all of this to everyone on the planet quickly. All of these technologies are morphing and progressing rapidly and creating unpredictable outcomes. We remain therefore deeply uncertain about what the future holds and how it will affect things we care about, like the future of our business.
My core message is that leaders can’t afford to leave really important stuff like the future of an organisation to someone in charge of digital strategy. Instead leaders need to see themselves as primary actors in a period of highly turbulent transition that affects the organisation as a whole.
All organisations are being forced to evolve, to become something different than they were in the face of this transition by responding to both the challenge and the opportunities that technology will bring. If our organisational leaders don’t think that they need to evolve then, in my view they are almost certainly wrong.
Our research suggests that there are seven preconditions for organisations to successfully evolve in the digital age. These preconditions provide an agenda for change for leaders to focus their effort and intention. They are:
1. From Unintentional Autopilot to Intentional Strategy: Too many organisations are on ‘autopilot’, driven by short-term numbers and doing things the way they have always done them. Some of this relates to unexamined goals and poor connection to deeper purpose, some of it is just being very poor at strategy generally. Connecting strategic intention to meaningful purpose is the way to turn off the auto pilot and start leading for real.
2. From a Bias to Leadership Inaction to a Bias for Leadership Action: we hear a lot about speed in relation to digital specifically and technology generally and the need for organisations to move quickly. This is true. But the difference between a fast organisation and a slow one is largely down to how quickly (and effectively in terms of follow through) decisions are made. Too many leadership cultures in organisations preference inaction over action largely because it is safer. The more uncertain the environment the more conservative our leaders become; we want evidence, low risk and high reward. We need to transform our leadership capability in ways that cut through and create a new bias for action.
3. From Money to Value: in a digitally enabled, increasingly open and transparent world customers are less interested in a company's quest for profits and more interested in the value provided for them and for the world. Chasing the numbers doesn’t usually lead to a great customer experience and poor customer experience can easily and quickly be socialised. The search for value is also threatening the premium power of brands. Brands were powerful in an information-poor age where consumers needed guidance to reduce risk. We are in a different world now with some experts suggesting that companies can no longer rely on a brand led strategy to drive sales.
4. From Internal Focus to External Focus: too many organisations remain introspective and introverted, especially when there is a perceived threat. Leaders need to resist the temptation to close their doors and cut themselves off while they think and instead they need to bring the outside in.
5. From Structures to Processes: we can be obsessed with organisational hierarchies, reporting relationships and bureaucracy with leaders continuing to tinker with reorganisations. Instead we leaders need to move towards intentional workflow to speed up outputs and outcomes. Here it is the work that drives the structures and methods.
6. From Past to Future: we need to let go of the past. As the saying goes ‘it wasn’t like you remember and it isn’t coming back’. Too many organisations are seeing the past as a guide to the future. We need new maps and leaders need to boldly create them.
7. From Opaque to Transparent: leaders now need to accept that all information about the organisation will be and should be increasingly available to all. Leaders cannot depend on the power of privileged access to information and instead need to facilitate the democratisation of knowledge and information so that many people can use it to inform and stimulate action. All organisations will be increasingly accountable to an informed, educated and organised public.
These preconditions are, in themselves, no guarantee of success. But without them we believe success in evolving successfully through these turbulent times is unlikely.
Perhaps the greatest challenge in all of this, for all organisations and for all leaders is that we need to reinterpret and reimagine the idea of a ‘learning organisation’. The ability to learn is the key meta-skill that underpins a successful evolution of our organisations and our willingness to embrace the uncertainties of the future will depend on how quickly we can adapt our thinking as much as our behaviour as leaders.