How Digital Collaboration is Fragmenting, and Why It’s a Major Opportunity

A significant issue has been developing in digital collaboration for the last several years, and it’s now starting to become somewhat acute. I’m referring here to the pronounced trend towards app, environment, and channel fragmentation. Over the last few of years, I have been speaking with beleaguered IT managers who are struggling to cope with the sheer proliferation of software, systems, and applications that purport to help workers with collaboration. It’s not a new problem, and smart folks like Dave Winer have long worried about it, but it’s now becoming a vital strategic concern.

A variety of factors are contributing to fragmentation: Every department and function now seems to have existing vertical systems — such as their standard HR, sales, or customer care solutions — that have recently added social media, collaboration, sharing, messaging, shared content editing, document attachments, activity streams, rich user profiles, and so on to their feature sets. At the same time, many exciting new applications have emerged on the scene recently that seem nearly must-have to many of us: Dropbox, Box, Slack, even arguably IBM Verse. All of these in turn compete with the officially sanctioned collaboration applications already in the workplace currently, from e-mail and SharePoint to whatever enterprise social network and unified communications platforms have been selected under the CIO’s purview.

The Horizontal and Vertical Fragmentation of Digital Collaboration Tools

Some of these new collaboration applications are brought through the front door in by lines of business that feel they have special needs. Others are so-called “shadow IT” deployments by teams and departments who believe they require certain features or prefer the ease-of-use of alternative collaboration tools, but don’t want to go through the formal hassle of getting blessing. Finally, a good many come in via legacy adoption via mergers/acquisitions or through individual users using their own devices and app stores.

Note: User-driven IT itself isn’t the problem here, it’s actually a key source of opportunity if wielded properly in a network of enabled/supported change agents.

Related: What Does a Modern Collaboration Strategy Look Like?

Too Many Collaboration Tools, Not Enough Collaborative Reach

Whatever the source, this trend is creating dozens — and sometime hundreds, in large enterprises — of collaborative silos, where participants and their information are trapped, inaccessible and invisible to a broader range of potential actors. Worse, unlike the original communications tools in the industry — like e-mail — the walled garden trend that started with the great consumer social networks — largely to support business models and not to help users — has decisively shifted to enterprise collaboration software today. Thus, unless you have a license and are using the exact same app, chances are increasingly poor that you can collaborate with someone unless they are using the exact same toolkit and environment.

I’ve pointed this out in the past, the we have an urgent problem with our collaboration tools not talking to each other. I’d say it’s now a critical issue that threatens the very high-value, human-centric activity that we are supposed to be enabling: Better collaboration. In addition to the typical common issues, I can’t tell you how many times I’ve heard that users have moved away from a collaboration tool because they can’t easy work with customers, or business partners, who are usually outside the company and don’t have access to the same tools or environment.

Now the issue is not just that we have barriers, but that we have so many new applications that we are employing, very few of which are interoperable. The result is that we are creating a growing array of inaccessible bubbles of insulated collaboration within our organizations. Much of this is done in the name of achieving worthwhile goals: Accessing powerful new capabilities, modernizing our workplace tools, improving security, and/or making sure we have vendor stability. However, we’re learning that we are often creating a solution that’s potentially much worse than the problem we’re trying to solve.

Commercial Silos of Social and Collaboration

In Social, We’ve Moved Once from Open Federation to Silos. Now We Must Move Back.

One of the challenges of adopting new digital solutions for collaboration has been that they’re often championed by those for whom technology isn’t their primary background. Consequently, federated architectures, open standards-based technology, and interoperability usually aren’t high on the list of sought after features for collaboration tools by most business users. Partially as a result, growing islands of collaboration have become a very real problem today, as lack of decent connection between our collaboration tools is — instead of creating a large and growing body of collective intelligence accessible to all — is actually resulting in parochial backwaters where too few people use the tools to make them worthwhile.

Certainly, some of the latest additions to the industry pool of collaboration options — and yes, I’m talking about Slack here — are designed specifically to address this issue, as it becomes one of the largest — and most ironic — new obstacles to effective collaboration: Too many apps and channels for working, none of which share well with each other. Solutions like Slack make all the knowledge and content flowing through our many individual business applications, visible from one collaboration platform. And that’s certainly one major way to solve the problem. Certainly, approaches like OpenSocial have tried to tackle it in other ways, and now the W3C Social Web Working Group is looking at the issue as well. So perhaps we’ll still end up with an SMTP for collaboration, but we don’t have it yet.

In the past, I’ve exhorted our industry — especially the most strategic and important aspect of it, social collaboration — to stop the fragmentation and create interoperability standards. But vendors — who can only exist when there are enough customers — have little incentive to help others, nor do their users insist on it. In fact, I’ve steadily come to believe that the problem with not be solved by vendors, customers, or even standards bodies, each of which has a) corporate goals contrary to a real solution to making collaboration tools work together, b) don’t fully understand the details of collaborative systems and their management well enough, or c) can’t gain traction because of the first two issues, respectively.

A Quick Back-of-the-Envelope Proof

As a cross-check, especially since I’m seeing the flow of new collaboration applications increase rather than decrease, I took a look (results in first diagram above) at some of the top types of collaboration tools (content/document management, intranets, social collaboration tools, ESNs, unified communication platforms, e-mail, and mobile collaboration tools) and put them on another dimension against various leading corporate functions (marketing, sales, operations, customer care/support, research & development, HR, legal, IT, and supply chain), and I was able to quickly find many apps — often some just newly emerged — that could fit in each and every intersection between the two axes. This would not have been possible 2-3 years ago. In other words, everything we do is quickly becoming collaborative.

And as a result, the risk is that soon little will be, as collaboration is divided across hundreds of isolated systems that we mostly can’t see and don’t have access to internally, sharply limiting the rich results from collaboration that only open technology can uniquely provide: Working out loud, open and transparency business practices, a corporate body of knowledge, and reuse and learning from everything that the company knows, all lying searchable on the corporate network.

Related: A CIO’s Guide to the Future of Work

The Issue of Collaborative Silos Must Be Solved. And Because They Must, They Will. But When?

Instead, as the issue becomes a top one for many corporations, I now believe it’s more likely that we’ll see inclusive approaches (again like Slack and a few others like Xendo have done) that ensure these barriers don’t form, that are based on market drivers and ultimate customer value. In fact, I now see that some customers are increasingly frustrated that they can’t use their shiny new tools to work with everyone they want, or are cut-off from the communities, channels, and knowledge that they need to do their job. Fortunately, these stakeholders are the ones likely to drive the changes we need to see.

This may perhaps, at least for the smart software companies and open source projects that understand this increasingly urgent issue, be the next big opportunity for them: They must be the integrating force, the unifying center of collaboration for the enterprise, bringing all the major applications, systems, and data pools together — and make it easy for IT or others to bring in their own local apps — so that we no longer have such highly ironic digital isolation.

I fully realize this issue is not one that people can get as passionate about as the main topic of contemporary collaboration. But unless we fully understand what kind of results we are really creating, we’re going to be building as many walls and barriers as we are new modes and venues of digital collaboration. If we want, we can greatly accelerate a new and better way, a more unified way, and push for interoperability that’s as good or better than e-mail has, then truly create the collaborative worlds of our dreams.

Finally, it’s not up to someone else to make sure this takes place. It’s up to us.

Additional Reading:

The digital collaboration industry continues to flourish

Watching digital collaboration evolve: Key events in the last year

How to improve global workforce collaboration

How IT and the Role of the CIO is Changing in the Era of Networked Organizations

As I’ve examined the case examples below, and talked with many top CIOs about how they were operating their departments over the last several years, it’s become clear that the contemporary IT organization — at least ones that are successfully leading their organizations into the future — is now wielding a new kind of power.

I don’t mean power in the traditional, hierarchical sense through departmental mandate, titles, and the org chart. In fact, those don’t seem to mean nearly as much as they used to, as I hear more and more concerns about the growth of shadow IT and the lines of business increasingly going their own way with their budgets, all with minimal formal IT involvement.

Yet, looked at another way, these very trends — worrisome as they should be for most CIOs — might actually represent vital asset pools and change capacity that we could actually tap into and guide, as Red Hat CIO Lee Congdon strongly suggests.

Instead, I mean power in the sense of genuine, highly effective influence through trusted collaboration, proactive enablement, orchestration of bottom-up change agency, and new forms of digital leadership. We know that as our organizations update how they operate in today’s digital world, which has fundamentally different rules and highly effective new ways of working, the way we manage and achieve large-scale group outcomes is by leading through new networked models.

In other words, moving from inefficient hierarchies to self-organizing communities to deliver IT.

Legacy IT versus Next-Gen Contemporary IT: Change Agents and Networks of Enablement

The need to greatly augment our IT ‘metabolism’

Some would say that grassroots models of business change have always been with us. They would be right in a strictly literal sense, as the actual means and methods are different now. In my analysis this is clearly a new phenomenon in in terms of how new forms of influence are actually employed, how easily they can be scaled, how much fewer resources are required to marshal change, and how constituents can be cultivated, shaped, and self-organized more rapidly than ever before.

In the era of mass technology proliferation, with millions of new apps and billions of always connected devices and customers, the IT department in many organizations has become a tiny and badly outnumbered island of routine automation and application delivery. We’ve learned that such a small capability can’t possibly keep up with today’s truly vast digital change.

IT has also long been the primary guardian of data and infrastructure, along with its collective operational continuity and governance. Together all of these functions, given the nearly flat increases — or even declines — in IT spending for 2015 in a time of the all-time greatest amount of tech change, tend to wag the dog, making it very hard to focus on what IT needs now most to do: Lead the company through the increasingly urgent generational imperative for digital transformation and innovation.

Related: Is it IT’s last chance to lead digital transformation?

Blazing a new IT trail: Internal competition and change agency

Recently we’ve begun to see CIOs, and this includes CTOs with the same responsibilities, work with their organizations a very different way. We started to see it when Graham Holding’s Yuvi Kochar willingly decided to compete as an ordinary — albeit a highly informed, invested, and aligned — service provider to his own stakeholders using a lightweight and highly maneuverable cloud portfolio of solutions, instead of an iron-fisted controller of corporate technology pushing aging and difficult-to-maintain legacy on-premises systems:

As a result, I have structured my corporate technology team to be a service provider to our businesses. To ensure flexibility and agility required by our M&A strategy, I am pursuing a 100 percent SaaS technology portfolio. We acquire SaaS services, value add them with high-caliber functional support and project management and offer them as a service to the primarily functional teams at our businesses. We keep overhead costs to a minimum. Our businesses prioritize the agenda for our services by paying only for the ones they want and use.

It also happened when David Bray, the highly-respected and effective CIO of the FCC, needed to overhaul an increasingly complex technology landscape with antiquated applications. Bray’s open approach to the FCC’s IT strategy ended up with him listening to and then backing local change agents closer to the situation who suggested their own solutions, which ultimately led to considerably cost savings, faster deployment, and lower maintenance overhead. It wasn’t easy however, as this is not the way technology bureaucracies — especially in the public sector — have traditionally sourced ideas and direction. It was an struggle at first to work this way, says Bray:

There were a lot of skeptics to this new approach. Several who wanted to not make the change or even wanted to follow the much more expensive approach. My role was digital diplomat and ‘human flak jacket’ to help deal with any friction because this was a new way of doing things. With the SaaS approach, the data was not going to be kept onsite. We would be leveraging code and security provided by a cloud-based vendor. And in the end, it came together.

There are similar efforts in the queue with the Commission’s change agents for 2015. Working together, they demonstrate daily that positive change agents can transform how the mission and technology of the FCC best serve the public.

From this, and the stories below and other sources, we can begin to piece together a new mindset for modern IT and what I’ve previously called the New CIO Mandate:

Legacy IT Approach Next-Gen IT Approach
Impose tech decisions as faits accomplis Pro-actively collaborate on tech decisions
Lead all technology efforts Support tech leadership across the company
Sole source technology provider Confidently compete as a service provider
Hold stakeholders at arm’s length Collaborate with stakeholders on their turf
Wait for change champions to approach Actively seek out change champions
Occasionally listen to change champions Actively supply change champions with resources
Bureaucracy Diplomacy
Constrain IT to strict standards Enable local innovation within bright lines
Chokepoint for IT realization Coach and ombudsman for decentralized IT realization
Service delivery Learning and change delivery
Strategic initiatives, Center of Excellence Network of Excellence
Single or Bi-Modal Tri-Modal and beyond
Waterfall, ALM Agile, DevOps

Here are other essential stories of CIOs realizing IT in new, more decentralized, collaborative, and bottom-up ways:

  • AstraZeneca. CIO David Smoley remade IT at the pharmaceutical giant to be a learning and collaborative organization focused on the customer and technical leadership, he recommends, “that, in addition to embracing technology, they better understand the business, focus on behavior, be bold, and build their networks. People rely less on curated information, he explained, and more on networking and learning what other businesses are doing.
  • Houghton Mifflin Harcourt. The incoming CIO Brook Coangelo had to rebuild the entire IT brand from the ground up. Central to this was including internal customers closely in the process of technology change, often taking their lead, using an internal culture he calls Nimble.
  • Etisalat. Francisco Salcedo, senior vice president of Digital Services, at the telecommunications firm reports they have begun to “provide IT services within the organisation in new ways as opposed to traditional methods, and become a business growth enabler, rather than a bottleneck.” Key to this process: “Focus on adding value to the business, while leveraging IT expertise of partners to support business experts in generating new revenue streamlines.”
  • IBM. New IBM CIO Jeff Smith says that for him, “clarity is more important than certainty, course correction is more important than perfection, self-directed teams work better than command and control, and innovation is for everyone, not just the select few.” How does he enable next-gen IT? One key way: Smith created an internal Kickstarter-like crowdsourcing platform called ifundIT. With it, anyone can formulate a project or problem that needs to be solved, and raise internal funding to get it accomplish. I think this is a terrific example of how to use internal networks — social and otherwise — to rapidly engage, then actively enlist, change champions and supporters.

All of this certainly represents considerable and difficult changes for many IT organizations, yet the benefits are clear: A rate of internal change that more properly matches today’s operating environment. But there will be bumps, as with what Tony Hsieh has dealt with at Zappos in fundamentally remaking the organization into a holacracy — a somewhat comparable change to what is described here, but org-wide, well beyond technology — some creative destruction is almost inevitable.

However, as with almost everything with technology change and transformation, the CIO has an absolutely key role to play today, and can be a leader or a follower as the business has to move now and seize opportunity in today’s challenging markets. As Adobe CIO Gerri Flickinger recently said, we are entering a new golden age of IT, if you’re ready to move to the next level.

Additional Reading:

Going Beyond ‘Bolt-On’ Digital Transformation

Closing the gap between executives and digital transformation

How IT Can Change For the Digital Era and What Leaders Can Do About It

I’ve recently come to believe that we’re at a watershed moment in technology as it’s applied to business. The aging, creaky model of centralized IT departments has been increasingly challenged by waves of internal and external competition that it’s never had to face. It started with the outsourcing wave but picked up irresistible momentum with the arrival of SaaS, the cloud, app stores, shadow IT, and BYOD/BYOA/BYOT.

The reality is that IT is struggling mightily in most organizations to keep even basic technology up-to-date, dealing with critical cybersecurity issues, closing fundamental gaps between IT services and the business, and generally not guiding their business as a whole into the digital future. It’s time to call it like it is: The legacy model of IT is largely insufficient when it comes to modern digital enablement and transformation.

As I’ve said, the CIO has a new mandate today, and that is broad digital empowerment in scale.

But I’ve come to praise IT, not to bury it, as the saying goes. I explored yesterday on ZDNet the yawning funding gap between traditional companies and digital firms, the latter who spend just over two times what the rest of us do on IT. I’ve also explored how M&A has become a compelling model for companies to acquire digital innovation, instead of doing the hard work and taking the risks in updating their core businesses with the latest technology advances and new digital business models.

Can IT get where it needs to be today? Yes, but not in its present form.

How Digital Enablement and Transformation Is Changing IT and What the CIO, CMO, CDO, and CEO can do about it

Moving Well Beyond Legacy Technology Enablement

This has all been said before, however. We need to take a hard look at where we are today, and where we can go. They say that the first thing you do when you need to fix a major problem is to admit that you have one. This then is the problem statement for traditional IT:

  • The rate and scale of external technology change now far outpaces IT investment in most companies
  • IT departments tend to be overly centralized, insular, and disconnected from the business
  • The traditional model of IT is to internally assume all the effort for digital enablement and transformation, instead of tapping into anyone who is able to help
  • Previous management solutions to “fix” slow change or innovation, such as strategic initiatives, tech incubators, “bolt-on” transformation, and Centers of Excellence, tend to recreate the problem they’re trying to solve
  • Those closest to the business often have the least role in applying technology to it
  • There is a one-size-fits-all mentality to most IT, making all parts of the business accept limited solutions
  • Once a technology solution is found, it’s rarely revisited until the imperative for change is unavoidable (and therefore late)

Whatever comes after existing IT, is going to offer a clean and consistent way to address all of these challenges, likely inherently though it’s very nature. The good news, is that I think we’re beginning to see the outlines of what that is begin to emerging from collective industry attempts at solving these challenges, going well beyond existing models of digital enablement.

Over the last few years, I’ve been involved in a number of attempts to solve these problems at an organizational level. What’s struck me, and this has been an absolutely fascinating pattern that I’ve now seen or encountered a number of times, is that the efforts that actually succeeded did something quite different: They enabled change at the edge of the organization, proactively seeking it out, and giving change agents and their champions toolkits, playbooks, and real support to drive local transformation. My explorations of the case studies at Enterprise 2.0 SUMMIT in Paris this year with social business realization programs at some of the largest in the world has only underscored this for me.

It’s time we realized that like so much with emerging technology, everyone is in the IT department. That’s not to say that everyone should have full responsibilities of traditional IT, but that digital needs are so pervasive and so extensive that we need to reverse the direction of solution develop. We must move, as John Hagel famously said, from push models of technology enablement, to pull. That’s the only scalable and sustainable way of accelerating change, deal better with uncertainly, maintain high levels of flexibility, provide a much more authentic and compelling connection between what we do as businesses and our technology, and almost completely eliminating the misalignment between business and technology.

Moving to Pull Models and Networks of Decentralized Change

As I collect case studies and permission from clients to talk about these things, you can expect me to paint a clearer picture of how digital realization in the enterprise is changing, but for now, the new model of IT that organically seems to be emerging is one of a distributed network of enablement, something that for complete lack of a better term I’ve previously called a “Network of Excellence.” I find the evidence for this model is increasingly compelling and I ask that you join me in exploring this approach, because as of right now, it’s virtually the only new model — other than bi-modal/tri-modal, which I think is important but insufficient — that seems clearly evident to me in the dozens of major IT projects or initiatives that I take a look at every year.

In other words, how leaders will create and use networks of digital enablement is the agenda for the rest of this decade. I’ve explored what leaders can do to start enabling this model this year, but we need a longer term plan based on evidence across multiple industries.

The good news: I still very much believe IT can lead this transition to a new service delivery model. But our organizations are no longer waiting. They have alternatives and choice, and they will use them.

An Urgent Industry Discussion On the Future of IT: Please Join In

I would very invite your commentary, local stories, and discussion on this topic as we look at how the role and purpose of IT is changing fundamentally as we fully enter the digital era.

Additional Reading:

Imagining the Future of the Enterprise

Businesses Have Digitized But Not Transformed

The Role of the CIO in Digital and Social Business Transformation

What is the Future of Work?

Much has been made recently about one of the stand out trends of the times we live in: Everything is becoming infused with technology. Software is eating the world it is said. Some have claimed that next it might even eat the jobs, which to some degree is almost certainly the case. With only a little bit of irony, Hugh MacLeod humorously noted this week that software may eventually eat all the people. But even that could be a bit closer to the truth than some of us might expect.

But the point is this: In the last half-decade alone, most of us would admit the societal and cultural shifts that technology and global digital networks have wrought is nothing short of astounding:

Social media is relentlessly chipping away at the power and control that companies and governments have long enjoyed almost exclusively over the rest of the world. Supply chains, talent management (hiring), customer service, product development, and just about every function of business is being transformed by things like 3D printing, social recruiting, customer care communities, crowdsourcing, to only name a few of the more important examples. That’s not even looking at the macro changes (example: Arab Spring), in which digital/social is impacting the fabric of entire nations. In all of these cases, the power and control is shifting to the other side of the network, to what many now call the ‘edge’, where most of us are.

Unfortunately, there remains a constituency that remains stubbornly in the back of the pack when it comes to the large scale changes happening in the world today. Surprisingly, this constituency formerly used to actually lead the technology world. Instead, it is now dragged along by consumer technology companies and their customers. Yes, I am referring to our corporations, to which I’ll add our institutions, including our governments and associated entities.

Related: Rethinking How We Transform Our Organizations for the Future

The Future of Work, Technology, Business, Culture, and Society

I’ve explored many times in recent years how traditional businesses have essentially lost the leadership mantle when it comes to technology. But finally now there is an increasingly concerted effort to take some of it back, to get back in the game, to use the realization that the methods we’re using in large organizations to apply technology to work is often failing, and badly.

This has led us generally to a broader global discussion on the future of work. With our institutions, expectations, and behaviors undergoing a steadily increasing rate of change, where is all this taking us? What will the workplace of the end of the decade look like and work like? That has been a question that’s been coming up more and more frequently. The answers are often focused purely on the externally obvious — and their easily determined — differences, such as the wide range of disruptive new technologies moving into the workplace today. While the technology is certainly a subject of fascination and I’ve been talking recently to audiences around the world about it, it’s not enough. We must move the conversation up a level and talk about the changes to us, the people that make up our workforces and our customers, and which are taking place as our businesses move deeper towards a very different 21st century model of work.

When then does the the future of work look like? Nobody has the full picture of course, but I am increasingly sure it broadly looks something like this:

The Future of Work: The Key Aspects

  • The evolution of the business/worker compact We are on a trajectory that has taken us well away from lifetime employment, guaranteed pensions, and single careers where largely benevolent, parent-like corporations looked after their workers, to a model where the principle actors, both companies and individuals, are much more autonomous, self-interested, and dynamic. Like all things this has trade-offs, but in the large this directly facilitates more rapid evolution of those involved and potentially creates a richer, more rewarding — if seemingly riskier — work environment for us, especially if we’re self-actualizing. There are other implications as well.
  • CSR/social enterprise and the need for business to go beyond a basic value proposition. It’s not good enough just to sell products and services anymore. Companies and their workers must be thinking about the bigger picture as the marketplace is increasingly demanding that the businesses they work with are concerned about overall global outcomes. Sustainability, environmentalism, corporate social good/responsibility, and other urgent qualitative matters of policy and governance are going to increasingly infuse how we work. Doing this successfully will require a very different mindset in our workforce than our traditional organizations typically have cultivated in the past.
  • New modes of management and workforce collaboration. The management theory — or more likely theories, plural, as there are probably several good ways of thinking about it as I’ve recently explored — for the future of work is starting to emerge. The same with team, department, company-wide, and mass collaboration. Then there is the collaborative economy that is genuinely remaking very concept of how business works for the digital era. Read some of Harold Jarche’s latest musings on work to get a sense of what the mechanics might look like, as well as Stowe Boyd’s recent thoughts on going back to the fundamentals with social business thinking.
  • New transformative workplace technologies. Everything from wearable tech to mind/machine interfaces and increasingly commonplace social business tools are changing how we will work. This will further change expectations and possibilities. I’ve explored the important technologies to watch this year, but there are many others in the wings and they will only come faster and be increasingly impactful. Our businesses are also becoming platforms in every sense of the word, becoming technologies in their own right. As Fred Wilson observed yesterday, it’s increasingly urgent for organizations to find — and become — the next platform.
  • New approaches for addressing diversity and inequality. While still I’m on the fence about the best ways to address these, you can be sure there will be enormous investments made through the rest of the decade by businesses, government, and other institutions to start tackling the structural issues in the global economy. We’ve increasingly learned and come to accept how much they impact business performance and the bottom-line.
  • A shift in the fundamental relationship between workers and business. This can be most clearly seen in the inversion of the traditional model of business, realized directly by the flourishing of vast numbers of self-organizing online communities. Now people can just come together online and create shared value without an intermediate organization that would otherwise have to the resources required to meet their needs. What does this mean for how important the traditional model business and work will be to people? The classical enterprise clearly isn’t as necessary as before for many purpose. Now we need to look ahead and see how these trends will affect how we structure, manage, and operate our organizations.
  • Co-evolutionary changes in society and global/regional culture that impact the workplace. Technology improves what’s possible by dramatically lowering the effort, time, or cost of doing something, or even makes something entirely new possible that was simply impossible before. This sets expectation and enables/encourages new types of behavior in people and society as a whole. These soft changes in us then drive the exploration of new technologies guided by behavior changes and new norms. We need to better understand where this co-evolutionary process is taking us, as well as anticipating how these new directions will impact it will affect our businesses.

Surely, this list is fairly incomplete. Unfortunately, more change is taking place now than we can really individually know (and is one reason why I believe locally autonomous adaptation is essential to the future of work.) Given how disruptive change has been in the last 20 years, remaking industries, creating giant new entities (Internet, Web, and cloud ecosystems like Amazon, Google), and dramatically changing what’s possible, the next-generation of work is likely to be almost radically different, while also being incredibly interesting. It’s worth it for us to find out as much as we can so we can prepare and anticipate the future, with the goal of avoiding unnecessary disruption — preferably being the author of your own disruption — while capturing increasingly historic opportunities.

Additional Reading:

Ten strategies for making the “Big Leap” to next-gen enterprise | ZDNet

What Most Digital Strategy Underestimates: Scale and Interconnected Change | On Web Strategy

Does technology improve employee engagement? | ZDNet

Can technology improve business innovation? | ZDNet

What Most Digital Strategy Underestimates: Scale and Interconnected Change

Over the last couple of years, I’ve been advising IT and business leaders that they need to gear up their digital/social/mobile strategies to match the advances taking place in the technology world today. On its face, this only makes sense. Technology change continues to accelerate and the growth in the cloud, social media, mobility, big data, and just about everything else is increasingly off the charts as I recently presented to a group of CIOs. As JP Rangaswami once said, we have to design our organizations now so that change is an integral function of how they operate.

Unfortunately, most organizations largely haven’t done this effectively for a variety of reasons. For one, it’s surprisingly difficult to do if your business wasn’t built around high technology from the outset. Frankly, since so many other organizations are having a hard time with it as well, the competitive implications haven’t always been severe.

However, that also doesn’t mean that some organizations aren’t failing outright through poor digital adaptation. Some clearly are, and the closer technology is to how you do business, the riskier slow digital transformation is. Just ask Blackberry, AOL, Borders, R.H. Donnelly, or a long list of companies that haven’t adapted to how digital innovation transformed their industry.

In the last few years, consumerization has emerged as a leading force in most organizations that is driving emergent, grassroots-led tech change due to increasingly pent up internal demand. The signs are all there: Bring-Your-Own-Technology (BYOD, BYOA), Facebook as the largest enterprise collaboration platform, app stores as the easiest + cheapest IT department alternative, and the list goes on. This pressure — combined with the inherent complexity in moving more swiftly towards adopting new technology — by the various stakeholders of most businesses has become increasingly untenable, even with consumerization taking some of the pressure off around the edges.

Technology Change and Proliferation: The Shortcoming of Enterprise IT Models

Yet somehow, many large organizations are currently sustaining it, despite being greatly outmatched by the growing chorus of “more” they get from their workers, customers, business partners, and the marketplace. To keep their spot on the treadmill, some organizations are now looking for new models to keep all of this sustainable. But I believe that we’re now starting to realize what one of the core obstacles is: Identifying the best way for businesses to leverage the vast existing resources they already posses, and then devising and realizing fundamentally new ways to use them to engage at scale across today’s digital channels and ecosystems.

Thus a fundamental mismatch between how our enterprise resources are connected to the digital world lies at the root of poor digital transformation. And the solution is likely a deeply engaged, muli-faceted, multi-channel digital approach sized to the scale of the challenge.

To address this mismatch, businesses have started to make significant changes in how they are organized around technology. The whole conversation about the new role(s) of the CIO, the CMO, and the new Chief Digital Officer are taking place in many industries today. Some of this discussion has started to be effective, and with so many companies struggling to successfully grapple with the torrent of digital innovation today, the window perhaps hasn’t closed.

So now I believe it’s time to tell a more nuanced story. Technology famously drives the leaders and laggards apart. For every Apple, Google, or Facebook, there are many generations of legacy enterprises trying to adapt their old businesses to the new digital landscape. A few lucky ones are protected by regulation, geography, or other happenstance, but most are exposed to the raw digital winds of change. Only a few are making it across the digital divide, while most have reached the limits of growth given the lens through which they originally built and now operate their businesses. But I believe there is a little breathing room, despite the hundreds of digital startups being launched each year to reinvent how we live our lives and conduct our business in radically improved new ways that also upend our existing business models (see the fast growing and rather exciting collaborative economy story for more examples of imminent disruption for many traditional enterprises.)

Large companies still retain very significant ecosystems, resources, and network effects if they are willing to use them. While it’s later than many companies think (just one example: a quick look at what’s most popular in the Apple or Android app stores right now shows little presence by today’s Fortune 500, despite mobile’s dominance in today’s world), there are ways to close the opportunity gap with digital. However, at this point, these must be major initiatives at the top of the organization, being led by new business units and IT both. They will have a high rate of failure (just like startups do) but by addressing the scale of the challenge head on, and applying the now many lessons learned we have at our disposal. A great new piece of research from McKinsey highlights this challenge, by asking “how [enterprises can] get beyond the small share of the prize they are capturing today in digital by looking for impact across the whole value chain.”

Most organizations need to update their digital strategies much more often than they are, revisiting their core business models, and making the resulting outcomes far more highly interconnected and organically structured. They also need to inject the solution to digital scale and velocity deeply into their operations. Those that do this well can become the digital leaders and not the legacy laggards.

This Year’s Ten Digital Strategies for the Next-Generation Enterprise

It’s time for most organizations today to uplevel their technology stance: They must become profoundly proactive about external change and innovation. That’s because technology change is currently happening much faster than most organizations can readily absorb, at least how they’re doing it today. But that doesn’t mean they shouldn’t try. More importantly, they should begin putting in place the processes and structural changes required to begin adapting and co-evolving more quickly.

Technology is an enormous amplifier of human effort. However, because it also uses itself as a ladder, it changes more and more quickly as time goes by. Add in the fact that anyone, anywhere can now innovate on top of the current technology curve and distribute their efforts to the world at practically zero cost, and you have a near-perfect recipe for disruption of the traditional status quo for IT in the enterprise. So how can a central bureaucracy that is greatly outnumbered by its customers ever help bring in enough new technology to satisfy the increasingly voracious demand for apps, data, devices, and more?

In short, it’s much later than most IT departments think. Disruption is coming fast in a mobile, cloudy, social world.

Fortunately, there are indeed some ways that might work to address this headon as I’ve explored recently. But as organizations implement these strategies, they also need to bring in the fundamentals of the biggest and most important advances right now. Falling too far behind and becoming a technology laggard means significant and sustained loss of competitiveness that’s very difficult to recover from. With change happening so rapidly, and technology creating a widening gap between the top performers and the 2nd tier, it requires organizations to run a bit faster just to stand still while they make the changes needed to have a more sustainable future. What’s needed is a short list of specific high-impact changes that will also lay the groundwork for future growth and digital transformation.

In my professional opinion, the list below represents the absolute minimum that enterprises should be building skills in and piloting this year. However, most of these are really must-haves now, to have at least in the experimental phase in your organization today. I also realize, from working with hundreds of companies in the last few years, that you’ll typically have less than half of these represented in your organization today. But that’s the point of the list, to find the gaps in your next-generation IT arsenal. I’ve omitted obvious items like BYOD and Big Data platforms like Hadoop, since virtually all organizations have these on their lists already. Note that this is a more tactical viewpoint that what I usually provide. For example, I pick out key planks of new approaches, such as Social CRM and employee social networks, instead of the entire view of social business. Organizations need clarity on where to start to become a next-gen survivor, and this breakdown will help I believe.

Visualizing Next-Generation Enterprises: Social Business, Consumerization, Gamification, Employee Social Networks, Unified Communication, Open APIs, Cloud Computing, mobile CRM, Smart Mobility, Social CRM

First though, what’s a next generation enterprise? My definition is this from my recent breakdown of emerging enterprise IT for 2012:

A next-generation enterprise describes organizations that are proactively moving into the present by changing how they assimilate, architect, apply, and maintain their technology solutions in the context of updating and transforming their processes, structure, and business models to effectively align with and work natively in today’s networked and highly digital economy. While that may be a mouthful, it also accurately describes what most organizations must do to ultimately avoid disruption in the marketplace as technology increasingly defines how our businesses engage with and provide value to the world.

How do organizations start moving into today’s technology present? Below are the top ten digital strategies I believe more enterprises are behind in and need to begin addressing this year:

  1. Mobile customer self-service. This is an official company mobile app that lets your customers engage in (at least) the top ten most frequent customer service activities. The best of these won’t copy the features from your web site but enable new models of customer interaction made possible by mobile device capabilities. Example: The financial services firm USAA turned every one of their customer’s smart mobile device into a mobile bank branch, allowing customers to deposit checks by taking a picture of them inside their app and transmitting it, saving them a trip to the bank.
  2. Open supply chains/APIs. If you aren’t strategically opening up your business for the world to build break-out new products and services on top of, then you should start and start this year. Organizations like the World Bank, Best Buy, and many others are doing what the Internet giants are doing: Building ecosystems. You must too. Get a sense of where the fast moving world of the Internet is heading with this from an overview of my good friend John Musser’s talk at Glue last week.
  3. Employee social network. There are many genuinely potent ways to apply social media to significantly improve outcomes across any organization — see the detailed case studies in Social Business By Design (Wiley, 2012) for game-changing examples — but it’s now clear that every company is getting its own social network. While some will not be strategic to the business or have low levels of use, the data increasingly shows that most organizations get value from them. We already see that organizations are finding social networks proliferating with Chatter, Yammer, Socialcast, SharePoint, and many others. Enterprises much take charge, provide clear leadership, and anoint official social network(s) as appropriate. Bonus points for understanding where ROI in social business comes from and focusing on it with this effort.
  4. Gamified business processes. Perhaps the least important sounding of all of these next-gen enterprise trends, yet I’ve been surprised at how fast some Fortune 500 companies have adopted this. I spoke with the CEO of Badgeville recently and he indicated that nearly 150 of the Fortune 500 were using their gamification platforms. I recently wrote a detailed breakdown of the enterprise gamification space as well that explores some truly impressive results.
  5. Community-based customer care. Organizations like SAP, Intuit, American Express, and others have all demonstrated that customers can support other customers (in general) far better than a company can. Companies have limited resources, customer care is considered overhead, and other customers with similar backgrounds and needs already have better insight they can share. While Social CRM is the official buzzword for this approach and is the industry where you can find the most applicable technology support, you really only need some community software, a simple strategy, and some community managers. Don’t wait, start now. This is where some of the easiest and quickest returns are on this list.
  6. Unified communication. After years of languishing and with market penetration hovering around 30%, unified communication is set to explode this year to help address the channel proliferation problem today. UC is also incorporating social media and otherwise moving beyond the telephony and IM space to become much more strategic. While I’ll be exploring the intersection of UC and social business soon, the latest data from IDG shows that 90% of organizations are looking at unified communications in 2012, a huge leap from last year and one that should be on everyone’s next-gen roadmap.
  7. End-user led IT and competitive #CoIT. Users are going to help lead the technology adoption for next-generation enterprises. Collectively, they have the resources and bandwidth to explore, evaluate, and apply new forms of IT. These include SaaS, disposable apps, mobile devices, and much more to their local technology problems. IT departments will become the curators and enablers, collecting and disseminating best practices across the edges of organizations. As part of this, IT organizations will deliberating put themselves in a competitive position with outside suppliers and 3rd parties. They’re already facing stiff competition from app stores and outsourcing firms, and now they must demonstrate they can effectively compete. You can read up on the CoIT model in my explorations on the topic over the last year.
  8. Mobile IT reinvention. You must be mobile-first for most of your future IT deployment. Mobile is also going to require rethinking IT. Most organizations already know this now, so I don’t need to belabor this point, other than simple translations of legacy IT to tablets will be woefully insufficient and will drive users to 3rd party apps. Read two great cautionary stories about this from Gartner’s Andrea Di Mao.
  9. Migration to the cloud I currently see less focus on moving to the cloud these days. Part of this is because it’s just happening and being baked into many of the services we now use in the enterprise. But I also see a lack of understanding of how strategic the cloud can be. Start moving the edge of IT into the cloud to reap the benefits that go far beyond cost containment and into business agility and innovation. The cloud really does enable entirely new solutions to old problems.
  10. Digital business leadership and transformation. Start laying the groundwork to drive the business when it comes to moving to digital business models, where the future of most companies lies. CIOs and other IT leaders should be moving away from an infrastructure focus and to a business innovation focus as quickly as possible. While this is far easier to say than do, the very future of IT is at stake as CFOs increasingly focus on moving infrastructure out to the cloud. The future of IT is digital leadership, and less in technical plumbing, even though that will remain vital at a strategic level.


What’s on your list of the top digital strategies for organizations this year? Please add your thoughts in comments below.

See Also:

Connecting Digital Strategy with Social Business and Next-Gen Mobility

Reconciling the enterprise IT portfolio with social media

How Are CIOs Looking at Today’s Disruptive Tech Trends?

Last October I was invited as a guest to participate in the Tuck School of Business 10th anniversary session of their Roundtable on Digital Strategies. This diverse group of senior IT leaders is comprised primarily of CIOs of some of the world’s largest enterprises. The roundtable members came together to discuss what was termed the present “mega trends” in technology, including the effect they are having in how their businesses currently operate and evolve. It was an eye-opening experience, not the least because of the transformative changes that were evidently taking place in the companies represented.

One fact stood out: Many of these tech trends are happening with or without waiting for information technology departments to embrace them and bring them into the organization in an orderly and controlled way.  I’ve spoken about shadow IT for a few years and it’s clear, particularly with mobility, that loss of control is firmly entrenched in a growing number of large IT organizations.

The mega trends that we discussed that day were the usual suspects. They are the ones that I’ve been exploring in detail recently: Next-gen mobility, cloud computing, social media, consumerization (#CoIT), and big data. In attendance were the CIOs from American Express, Bechtel, Chevron, Eastman Chemical, Eaton Corporation, the Hilti Group, Holcim, Nestle, Sysco, and Time Warner Cable, as well as executives from CompuWare, the Dachis Group (myself), Dell|KACE, and ViON. The Roundtable itself was hosted by the Directors of the Center for Digital Strategies at the Tuck School of Business. The session was moderated by Maryfran Johnson, Editor-in-Chief of CIO Magazine and hosted by Adjunct Professor Hans Brechbuhl, who also wrote his own summary of the day.

Disruptive Megatrends in Technology: Smart Mobile, Social Media (Social Business), Consumerization, Cloud, Big Data

The discussion itself was far ranging and explored all of these megatrends in detail. The resulting outcome, a new 17 page report that has just been issued by the Center for Digital Strategies at the Tuck School of Business, confirmed that companies fall across the spectrum when it comes to adoption of these disruptive technologies. While virtually all the companies represented were feeling the full brunt of smart mobility, others had widely varying experiences with areas such as enterprise social media (aka social business in this context), big data, and cloud, though the first two had the most votes I believe in terms of the trends with the longest term and farthest-reaching impact.

Six key insights about new disruptive tech were derived during the back-and-forth discussions that took place at the roundtable session. These are:

  • “Consumerization of IT” is a core catalyst for other IT mega-trends. The spread of social media and BYOD are clear outcomes, but “consumer” expectations play a surprisingly large role in the development of Big Data and cloud-based applications.
  • Mobility is forcing new approaches to data security. User expectations of anytime/anywhere access to enterprise data conflict directly with IT’s charter to secure and protect the same data; this conflict is one of the sources of the rise of rogue IT.
  • Both mobile and social applications are (finally) adding definable value to enterprises. Social media apps with definable ROI are primarily customer-facing; high-value mobile apps are still mostly internal.
  • Big Data” will affect every aspect of business. From plant operations to stock trading to predicting terrorist behavior, the combination of huge data volumes and massive compute power is beginning to answer questions never even asked before, particularly with respect to predictive analytics.
  • “Designing for loss of control” is one of IT’s key challenges. Between consumerization/BYOD, rogue IT and the cloud, centralized IT can’t keep up with demands yet will still be held accountable for security, reliability and performance.
  • IT’s future differentiation is far more about insight than about operations. With technology so widespread, the ability to compete on IT operations has vanished. IT’s future value lies in delivering immediate, actionable knowledge.

What companies are going to do in order to embrace these trends effectively is going to be the signature generational challenge of our era. I’ve explored the various possibilities (ten strategies to be exact), and no doubt others will discover other routes to success. But the fact that so much of the change is externally imposed on IT departments and the lines of business outside of traditional channels is what makes the transition to them so disruptive. Thus, consumerization may ultimately be the underlying root cause of the rest of the trends as well as the primary driver of enterprise technology for the foreseeable future.

Tuck School of Business CIO Roundtable in October 2011

Tuck School of Business CIO Roundtable in October 2011

Be sure to read the IT megatrends report itself for full details directly from the original sources.  In the meantime, I’ll keep exploring these trends and how companies are planning, coping, and hopefully enabling them for their internal and external customers as IT gears up to have its most exciting decade in a very long time.

Related Reading:

Consumerization in 2012: Cloud and mobile blurs into other people’s IT | ZDNet

The “Big Five” IT trends of the next half decade: Mobile, social, cloud, consumerization, and big data | ZDNet

CoIT: How an accidental future is becoming reality | ZDNet

Dion’s Defrag 2011 Keynote on CoIT | On Web Strategy

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