Digital Transformation and the Leadership Quandary

The data now shows that a near majority of organizations today are undergoing digital transformation in some shape or form. By digital transformation I don’t mean IT automation of the business of course, but wholesale rethinking of some or all of the business in digital terms. It’s the greatest game in the business world right now, and necessary for long term survival, but such digital reinvention is also one of the hardest journeys to make.

Moreover, just like startups have a high failure rate (8 out of 10 don’t make it typically) in trying to do something new that’s relatively unproven, digital transformation is a endeavor fraught with high hurdles for success in any organization.

Enterprises, however, do have vast assets they can assemble on deck to ensure a successful outcome — everything from existing customer bases and supply chains to current market share and the ability to fund loss leadership to success. This drives the failure rate down much lower than typical greenfield technology startups. But as commentators such as Christian Frei estimate that two-thirds of companies still won’t make the journey successfully, and others have put the failure rate much higher.

Modern Digital Leadership Unleashed by Network Effects: Digital Transformation

Better and New Types of Leadership = Effective Digital Transformation

As Christian also notes, leadership is ultimately the root cause, for both success and failure in re-imagining organizations digitally:

After all these discussions, workshops, and coaching sessions, one point came out very clearly as the biggest threat companies have in this transformation.

It is not technology.

It is not their people.

It is not their business model and products.

The biggest threat and reason why most companies will fail to adjust and most likely either end up bankrupt, acquired, or marginalized…
… is their leadership mindset, which is embedded in their company culture.

The diagnoses of the reasons for implicating leadership is many and varied but essentially boils down to the reality that leadership has the most resources and control in hand, but is often lacking in digital vision and/or competency to wield these. The reality is that most leaders of large organizations today have limited experience in successfully leading either large digital efforts or enterprise-wide change efforts, and much more rarely both at the same time. While it’s likely we’ll see far more seasoned executives in this space in the next 5-10 years, that will be much too late for most organizations.

what then can leaders do now to ensure they’re doing their very best tap into and truly marshaling the deep experience, fresh thinking, and effective action they need from across their organization and indeed, from across the industry? To help address leadership in digital native terms, I’ve been promoting the concept of network leadership for some years now (and I’m not alone), realizing that all leaders must much more effectively tap into the full measure of knowledge and innovation in new channels they need to deliver on what has become the most important and challenging transitions in the history of business.

Leading (and Acting) With and Through Your Networks

Leaders have always had to work through others — their workers, business partners, and their industries — to accomplish what enterprises do. But we now have new ways and methods of doing so that are far higher scale, have more leverage, and are earned, rather than owned. Leading through the network is the only way to tap into broad enough talent, diverse ideas, and local action to accomplish the large scale changes that must be achieved today. I’ve written much about the new CIO mindset emerging and the need to better design our organizations for loss of control needed to keep up with the pace of tech change, and that these must be baked most deeply into the leadership thinking (both on high and at the root) of our organizations.

Underscoring this, I recently receive a note from a friend (who was also previously one of the top CIOs in the world in my opinion) that made me reflect that while we can (and must) let much of the network do the work for us — if we only know enough to harness it — that leadership remains critical in ensuring the ultimate outcome:

The leadership part (for what I had) was always my “secret” weapon.” Key parts of that leadership is:
– Human (recruit, develop, manage, balance)
– Technical (new and old tech, ops etc.)
– Business (core business (new and incumbent), finance and accounting)

From this we can see that people are the key to driving actual change. Technology and business, combined, are the vehicles, but not the agents of change. Leaders must cultivate, build, and tap into the best networks of people, tap into their knowledge, and empower them to create change at scale. (See the growing and vital change agents industry conversation for more thinking on this.)

Thus the essential leadership quandary with digital transformation is that leaders — formal and grassroots — simply don’t know what they don’t know yet. And many — and likely most — are simply not taking sufficient steps to learn more and faster or unleash those that know a given answer and can act.

My good friend and CIO advisor Tim Crawford put this another way today. Leaders in digital — both on the technology and business side (though the distinction is starting to get blurry these days) — must establish their network effect. For those not yet familiar with this key digital concept, it means establishing sustainable value through connection. For the CIO and other types of leaders, this means building relationship capital in all its forms (personal, organizational, industry, and digital), and then using it effectively.

Addressing the Leadership Quandary with Network Effects

As I noted in a reply to Tim, this means:

  • Engaging both upwards and downwards. Establishing deep and wide social capital in the process. Done in digital channels especially, this creates an inherent network effect when combined with the the other items on this list.
  • Being the conduit for change. By ensuring you empower and enable others through their relationship with you.
  • Sharing knowledge. By setting it free to spread and work for you forever.
  • Enabling and empowering others. Proactively, especially with change agents (which are the ones, by definition, that will effect needed change anyway).

In short, digital transformation requires a new type of leader with a digital mindset that is broadly encompassing, fueled by growing network effects, and strategically turning over non-essential control to their network of change agents to drive the many hundreds, if not thousands of local microtransformations that will collectively result in a holistic and aligned overall digital transformation. It’s a more organic, pervasive, and sustainable way and, I believe, the only real way most digital transformation will ultimately happen.

Why? Because a rich network always beats a poorly connected system in almost any situation.

Additional Reading:

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

Using Online Community for Digital Transformation

How Should Organizations Actually Go About Digital Transformation?

When It Comes to Digital Transformation, Change Agents Matter Most

What is the most important factor in realizing technology change today? Is it having the right technology or tools? Perhaps leadership support, as that is cited by so many (including myself) as a top success factor. Maybe it’s the right strategy, or roadmap? However, when it comes to what actually matters most, I have found that it’s really none of these things, though they’re all important along the way, but not absolutely vital to success.

Instead, the single most important element in driving successful digital transformation, or whatever you call your large-scale or enterprise-wide technology change efforts, is the ability to execute. You can survive bad or lacking leadership, poor or no strategy, even mediocre technology, if you can actually get something done. And that requires a unique talent, though fortunately one that almost anyone can cultivate with effort. And when I mean get something done, I don’t necessarily meaning doing it personally (though sometimes it is that too.) Instead, it’s the ability to wield the environment around you to accomplish something.

The Attributes of Change Agents: For Digital Transformation or Any Business Change

Why this is so vital is something that we’ve learned the hard way over the decades from approaches like agile methods: Most of what we initially think we need to do in a technology project or change program is wrong. We can only find ground truth by acting and then seeing how it worked out. We then learn, adapt, and then try again. This makes action, or agency (see definition #2 in Merriam-Webster), the ultimate discriminator when it comes to getting things done. Without action, especially in a rapid sense-and-respond feedback loop, we can’t learn what we need to do and certainly can’t learn fast enough to matter, to ultimately drive the right changes.

What about the other components (leadership, strategy, tech?) The other pieces can literally be borne out of the proof points of real-world validation. Nothing succeeds like successful action, in other words.

The good news is that change is in the air in general. New ways of working are finding success. For example, organizations have widely (25% of all orgs by some estimates) begun using cross-silo collaboration, such as devops, to break down the long-standing sclerosis that has built up through the accumulation of technology in the proverbial Legacy Mountain. Trends like this poise change agents to have their voice heard and have impact like never before.

Who Should Drive Digital (or Any) Change? What Makes Them Change Agents?

The short answer is those who can. In a wide-ranging discussion I had recently with Gloria Lombardi, I noted that one of the biggest lessons of my career was not to try to change people who don’t want to be changed. Instead, find those that do and then empower them.

This post was inspired by an inspired Twitter discussion this morning between myself, Tim Crawford, and Jim Canto about what the attributes of a change agent are. My take is shown above in the visual, and can be summarized as:

  • Can identify or develop valuable new ideas. Change agents don’t necessarily need to have ideas about change, they just need to recognize good ones.
  • Has social capital to spread ideas. Change agents have some resources to take their ideas and convince others to join in to help realize them, especially as well-known CIO and industry colleague David Chou added to the discussion, to navigate the political waters..
  • Can communicate effectively. Having social capital is not enough however, one must also be a good communicator in order navigate the obstacles of change and ultimately gain buy-in, high low, for positive outcomes with the proposed changes.
  • Has ability to realize/drive org change. While change champions advocate for change, change agents actually are able to realize it through their actions and leadership.

My esteemed industry colleague, Eisenhower Fellow and the CIO of the FCC, David Bray, simplified this even further in the aforementioned discussion, noting: “#ChangeAgents are leaders who ‘illuminate the way’ and manage friction of stepping outside the status quo. Anyone can be a change agent.

Ultimately, in any organization, the only change happens through change agents, formal and informal, somewhere. Let’s learn how to cultivate them and enable them to help us create our digital future, at scale.

Additional Reading

In Digital Transformation, Culture Change Goes Hand in Hand with Tech Change

The digital transformation conversation turns to how | ZDNet

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

What We Know About Making Enterprise Social Networks Successful Today

It’s a little hard to believe that it’s been over ten years now since the first early enterprise social networks (ESN) emerged on the market to make their initial forays into our organizations. They showed us then — and I believe even more now today — the bright new possibilities for how we might work together in more innovative and effective ways by becoming fundamentally better connected organizations.

We’ve certainly learned a great deal along the way through thousands of ESN deployments around the world since that time. I have tracked or been involved in a good many of these types of efforts over the years, and so I thought I’d revisit what I believe that we’ve learned so far from the more successful efforts. Sharing this knowledge is vital now, as I still see many practitioners starting almost from scratch. That’s because there is still no single source of knowledge on what works best when it comes to being successful in crafting a next-generation digital workplace with an ESN.

Note: We do have a useful body of industry knowledge now, but it’s currently spread out and must be put together to create a fully integrated picture. The three sources I that think are the most valuable currently are a) the Community Roundtable‘s annual State of the Community Management report, the latest edition of which I explored on ZDNet a little while back, b) Jane McConnell’s excellent Organization in the Digital Age report, and lastly, c) Vanessa Dimauro’s various work at Leader Networks, such as her new Business Impact of Communities report.

Making an Enterprise Social Network Thrive

Looking in the ESN Mirror: Far Too Much Attention on the Tools

Early makers of enterprise social networks such as Jive, Newsgator, and Socialtext blazed the trail initially, making it possible for workers to engage in truly open and self-organizing collaboration by adapting the social networking model that had worked so well in the consumer world to the enterprise. In particular, these early offerings were based on the early successes of consumer social media and social networking, namely services like Facebook and MySpace, as well highly successful online communities for business like the SAP Community Network. While wikis and blogs were the first genuine contemporary social software used in businesses (groupware, and arguably e-mail were actually the very first social tools), it was the social networking model that ultimately became the leading one.

Eventually, the hard knocks of marketplace competition ultimately led to the domination of the top part of the industry by a few players that executed well: IBM (with Connections and a host of associated platforms), Microsoft (with Yammer, Sharepoint, and now Groups, and probably Teams as well), Salesforce (with Chatter/Community Cloud), and finally Jive as the only truly dedicated enterprise player still standing from the inception of the industry.

But as useful as these platforms were and are in helping enable the right changes in digital workplace mindset and behavior, it was never the technology that was the hardest part. In fact, one of the clearest lessons from the first decade of the rise of the ESN was that virtually all of the major challenges with ESN success are about people, not technology. Making enterprise social networks thrive by fostering stronger, richer connections across organization silos while spurring widespread knowledge sharing and co-creation is an activity that is almost entirely made successful by how you situate the tools among the people involved, what skills you develop amongst them, and the type of goals, encouragement, support, and leadership you establish.

Thus, in the realm of digital collaboration, people come first and technology is second. In fact, I’ve often argued that organizations can actually become effective social businesses without any additional technology at all, like W.L. Gore (10,000 employees, $3.2B revenue) with its famously flat, open and self-organizing culture which was a social businesses long before the technology arrived. (They have since adopted the ESNs as one of their core tools.)

A Signature Lesson: People Must Change with the Tech, So Guide Them

I’d even go as far as to say this (to borrow a concept from the Internet of Things): The enterprise social network actually creates a side-by-side virtual “twin” of your organization, one that is more natural, organic, collaborative, scalable, and self-organizing. The digital twin represented by your ESN must therefore be nurtured in the same way as your business is (because it is the business too.)

Just like you’d never let your organization operate without a well-articulated vision, a relentless focus on growth and development, regular investment in better performance, careful strategic oversight, and passionate involvement by leadership as well as the rank and file, your ESN can’t lack for these elements either.

Thus, here’s the short list of the top factors I now believe drive success with enterprise social networks today. By and large, these factors are not technological in nature, though they often are highly reflective of — and can be directly aided by — the technology environment in which they operate. Instead these success factors represent the foundational types of human activities and skills that helps organizations more readily tap into the increasingly well understood benefits of operating as a social business. Lack more than a couple of these factors, and your ESN isn’t likely to be much of an improvement over say, an e-mail or unified communications system, in terms of the truly differentiated impact it can have.

The Hard Won Lessons of Thriving ESNs

  • Purposeful use case design. Unlike generic communications systems, enterprise social networks perform at their best when they’re designed around specific business activities. While having user profiles, activity streams, groups, and posts at a basic level is useful in itself — and that’s what ESN platforms offer out of the box — it’s designing for specific use cases like budgeting, recruiting, supply chain exception management, and dozens of other key activities where the real business value and impact comes in. For example, I am seeing a strong push in many ESN efforts this year to help teams collaborate more effectively in the field, particularly with sales teams, as that function matters a great deal to most businesses and is one of the best ways to demonstrate value early on. But the user experience of the ESN must be extended to natively support these use cases and make them better. This generally means bespoke experiences that extend and expand the ESN to realize the highest value use cases in an optimized way, instead of hoping that generic, out-of-the-box ESN functions will somehow enable them. While most ESN platforms have tools and APIs that make this relatively straightforward, I find that most practitioners expect that their ESN will do most of what is needed out of the box.

    This is simply not the case today. In fact, some of the most compelling examples of ESN solutions are found when specific high impact use cases are enabled through purposeful design, such as with custom-designed Plus Relocation’s Elo community, which lies at the very core of how they run their business, or the Milwaukee School of Engineering’s Bridge platform, which greatly accelerates the admission process via a carefully designed and gameified experience. All of this began to be understood back in 2011 when a widely discussed post by Laurie Buczek noted from her efforts at Intel were far too disconnected from the actual work of the business to matter very much. Well-known analysts in the ESN space such as Constellation’s Alan Lepofsky identified purposeful collaboration as a key success factor back in 2013. Attached below are a sample of the some of the functional use cases that enterprise social networks can be dramatically improved through open collaboration, which I’ll be exploring in more detail soon:
    enterprise_social_networks_business_use_cases_for_social_business

  • Professional community management. I am sometimes surprised how often I still encounter a poor appreciation of the vital importance of capable community management — see TheCR’s skill wheel to understand how involved a job it is — in ensuring the long-term growth and success of an ESN. Last year I even wrote an open letter, aimed at the IT department which often does the technology implementation for an ESN (and gets charged about half the time with actually operating it), about the criticality of developing this strategic social business capability. Short version: Digital communities are a new type of entity requiring a new form of support and enablement. Do not use interns for this, don’t use the inexperienced, don’t add it to someone’s already busy day job. Instead, use experienced professionals, like you would with any other important business function. Outsource if you have to (what I call Community Management as a Service.) Invest early and plan for the long hual as the Community Roundtable has correlated it directly with the maturity level of an ESN effort.
  • Working out loud. Of all the digital skills that workers should be developing now, perhaps the one that most naturally is an onramp to most of the others and leads to both positive outcomes and compelling emergent results is the act of working out loud (WOL) in digital channels. John Stepper’s Working Out Loud book and his push for organizations to create WOL circles to build skills around the technique is probably the best place to start. My industry colleague Michelle Ockers recently posted some fascinating insights into how WOL can work with actual results from a large organization. In short, working out loud will develop vital network leadership skills, cultivate social capital, and produce higher level of knowledge sharing, collaboration, and institutional knowledge, to name just a few of the benefits by virtue of simple and straightforward daily activities in the ESN.
    Working Out Loud Fundamentals for an Enterprise Social Network
  • Network leadership. As organizations become more virtual, decentralized, and digitally-enabled, it will be in social tools that leadership will soon be wielded most effectively. Managing our organizations through digital networks has become an essential skill, just not one that we’re training for in most organizations yet, and now we must. The majority of ESN deployments spend very little time developing these skills or educating team leaders, managers, and executives in the basic skills of network leadership, yet are often surprised when highly meaningful and impactful activity to the organization doesn’t take place there.
  • Digital collaboration skill development. In general, organizations are not developing the human skills as much as they are developing their digital workplace technologies. Almost every ESN effort I have encountered is under-delivering in some way on building the new skills required to get the most from social collaboration, as it depends on very different thinking such as letting the network do the work and designing your work processes for loss of control. These needn’t be — and shouldn’t be — complex digital skill education programs. Collaborate with your learning and development team and build some lightweight digital collaboration skill development content (videos, quick starts), add ESN education to new hire onboarding, cultivate WOL circles, and then evangelize and educate at every opportunity across the organization.
  • Supportive and engaged senior stakeholders. Perhaps the fastest and most effective way to get traction and sustain success with an ESN is to have active and fully participative leadership. This means both support and sponsorship as well as active presence in the enterprise social network itself. One of the first thing ESN practitioners should focus on is landing at least two senior executives willing to lend their reputation and standing in the organization to the effort. How important is this really? In the Community Roundtable’s survey data, year-after-year, it generally comes in as a top two factor, so it’s high on the importance scale.
  • Guardrails on activities that impede being a connected company. There are some easy ways that organizations can inadvertently reduce the benefits of social collaboration. One of the top ones is making it too easy to create private groups in the ESN. This is easy to remedy, if you’re aware of it: Leading social business exemplars like Bosch require users to submit a business case for private groups as a “tax” to place friction on keeping information hidden. Not retiring aging digital channels that are less open and participative can also be factor, as workers will initially tend to gravitate back to the tools and channels they know. In general, be diligent in not breaking FLATNESSES, which is a more detailed mnemonic I adapted from Andrew McAfee’s initial SLATES mnemonic describing what makes social tools different and more powerful than what came before.

ESNs are about people + digital technology: Focus in that order

Are there other success factors? Sure, and they vary widely depending on the organization, its culture, inclinations, and level of digital competency. If you want a deeper drive, I previously explored in detail, by pulling from several dozen client studies and industry case examples, what early adoption success patterns for ESNs were, since that phase was what most organizations were focused on then. We’ve learned some additional lessons since then — most of which are summarized above — but it’s still a useful breakdown if you need more techniques to drive success.

Does all of this sound overly complex? Not really. Social technologies themselves are getting very good at making the fundamentals easier, while there is a growing body of knowledge that can be used as a template for the structures and processes one needs to put into place. I’ve previous explored the structure side several times, both in terms of specific roles and organizational capability, while the process side is well-depicted in aforementioned community manager skill wheel.

In short, never before has it been easier to adopt enterprise social networks and achieve significant impact. It just takes a focus on what matters most, which is a steady choreography that consists of shifting human skills and supporting collaboration technologies together towards business goals. I now believe that most organization can get to ESN success quickly and repeatably, but only if they assess and adequately address the full dimension of people and technology concerns required.

Additional Reading

How Social Technology has Emerged as an Enterprise Management Model

Can we achieve a better, more effective digital workplace?

It’s Time to Transform ERP into a System of Engagement

The IT industry has steadily been moving beyond its roots in data management and record keeping for a few decades now, approximately since the advent of corporate e-mail. As I’ve tracked over the years, this trend is more broadly known as the shift from systems of record to systems of engagement. Over the years, we’ve witnessed how the value of IT systems grows dramatically when they focus as much on connecting people and systems together with as little friction as possible, as they do on storing and retrieving information.

We’ve also collectively learned as an industry that one-size-fits-all technology, especially in the enterprise, often ends up fitting the needs much fewer people than we expect. Put simply, despite all countless industry lessons learned, enterprise systems are still far too unwieldy, adapted poorly to individual users needs, difficult to use, and an impediment towards value creation, especially at the edges of our organization, where key business activities such as sales, marketing, service delivery, and customer care take place.

Today’s Successful Enterprise Systems Engage Effectively

In recent years, new highly personal forms of digital engagement have demonstrated a new path to us through the large scale global success of social media, use-anywhere smart mobile devices, and consumer apps that are essentially effortless to acquire and use.

When I look at most enterprise IT today however, it’s clear that the buyer is not the end-user but IT departments and other stakeholders who won’t have to use the systems themselves. The traditional ERP system, which runs much of the mission critical infrastructure, is possibly the worst offender and most in need of remediation in today’s era of highly consumable personal IT, which runs rings around most enterprise technology when it comes to usability, personalization, fitness to purpose, and responsive design.

The Contemporary Enterprise: Systems of Records and Systems of Engagement

Certainly, enterprise systems often have a very different set of goals than consumer IT, including much higher levels of security, more rigor in data structure and quality, complex operating requirements, and other factors that consumer IT simply doesn’t have to contend with. I’d argue these are, however, just not valid excuses for meeting the standards of modern IT systems when it comes to improving productivity, usefulness, and effective results in our organization. As I’ve long argued, we need to unclog the arteries of enterprise IT for competitive reasons as well as basic employee retention, given trends I’m seeing in end-user expectations of how IT systems should work.

At this point in IT industry evolution, I’d argue that the nature of the enterprise procurement process, along the roles of those typically charged with IT acquisition each conspire against the kinds of systems that users — and the business itself — would find more useful and productive in getting their work done. Plenty of evidence now shows that usability and accessibility have large benefits when it comes to getting results from enterprise IT.

An actual data point from the respected Nielsen Norman Group serves to make the point here: Allocating a mere 10% of the budget of your IT system to usability will approximately double the quality metrics for the system. Yet few projects allocate anything like this amount, especially to off-the-shelf systems.

Modernizing the ERP for Engagement by Augmenting It

So how can we overhaul the poor effectiveness of today’s ERP systems and bring the latest advances in today’s systems of engagement to bear to increase the poor usability of ERP systems that Jon Innes famously lamented back in 2010.

Given the slow rate of change in the usability and reach of ERP systems over the years, I’d now argue that we’re not going to see a major improvement in the design of ERP systems themselves. Instead, I now see that enterprises, which have invested enormous amounts in their existing enterprise systems, have little choice from most of the leading vendors. Instead, the typical ERP system should instead be augmented with the capabilities that will provide the full measure of value creation that was originally hoped for.

To this end, I’ve authored a new white paper that lays out my analysis that we’re about to enter a new era of enterprise IT. One that is not just more consumerized and highly usable, but focused on both the needs of the business and end-user both. By augmented ERP with effective systems of record, most organization can now take the power of today’s sophisticated ERP systems and extend them to wherever they are needed in a far more personalized, dynamic, and focused way.

As a new generation of IT thinking emerges, I now see that this will be the pattern of ERP and most enterprise IT systems, in that they will become a fusion of capable foundational systems of record and systems of engagement. The latter will either be purpose-built or developed by a new generation of enterprise IT companies that understand the new generation of IT, consumerization, design thinking, and usability on top of traditional IT requirements.

How ERP Will Become the New Systems of Engagement White Paper by Dion Hinchcliffe

Credit: I’d like to thank Capriza for making my time available for the research and analysis that went into this white paper, which is freely available for download.

Using Online Community for Digital Transformation

Driving successful change in a large organization has always been one of the most difficult activities in business. But for those who are principally tasked with carrying their organizations forward into the digital future, they are currently facing perhaps the single most challenging large-scale enterprise activity of our time. One has only to look at the short-list of needed technology adaptations to recognize the true extent of the challenge.

Part of this is because digital itself is so intangible. It’s hard to understand all the moving parts of the vast technology stacks, ecosystems, and platforms that now surround us because it’s hard to discern them. It’s often even harder to understand the diverse needs, perspectives, and skill gaps of the people that have to change along with the technology.

Thus the popular topic of digital transformation has come full circle back to the change process itself, largely because we’ve found our existing toolkit to be entirely unsatisfactory. For example, we already know that the vast majority of strategic change initiatives employing traditional methods don’t succeed. We also have an increasingly good sense of why this is, and a big part of the reason is that centralized processes break in exponential times (see Martec’s Law.) They quickly become overwhelmed by the scale and dynamics of the necessary change processes, which have to keep adapting and updating themselves in near real-time to stay relevant, often in windows that are hardly more than weeks today.

Enabling Digital Transformation at Scale with Online Community

Consequently, we’ve seen steadily emerging models for change that go well beyond the strategic initiative, the center of excellence, or incubator to push out change into a much broader set of minds and hands, far beyond what we’ve normally employed to drive change previously. I now believe that unless organizations greatly expand the notion of who is involved in change, who can drive it, and how they are enabled, empowered, and supported, they will largely underperform with digital transformation.

To determine how scalable digital change can best be realized and figure out what kind of forward-thinking constructs will be required, I’ve been experimenting for the last several years with employing the very same models that we use to engage in the digital world, to cultivate and foster more dynamic change processes. The ideas of social business and online community, which show how the most scalable, cost-effective, and rich model for working is to enable the network to do the work. I’ve now come to understand that in digital transformation, we have to let the network do the work. Put simply, there is no practical way to achieve the pace and breadth of transformation required in exponential times without using exponential tools.

In the last few years, I’ve been using online community as the platform for change, instead of creating traditional centrally-staffed change programs, and found it far more effective in general. I am not the only one that believes this is a key path forward towards new types of highly potent change models. This is an industry-wide discovery and conversation we are beginning to see emerge in general. We have moved beyond the center of excellence model, which we’ve learned soon bogs down and largely fails to address the scope of enterprise-wide change activities, to a new model I’ve called the network of excellence, for lack of a better term.

Realizing that we need to scale change on a platform

I’m not alone in thinking along these lines. For example, well-known management thinker Gary Hamel has been promulgating this very same idea, entirely independently. My industry colleague John Hagel has also been writing about many related concepts, most recently about how we can scale learning in an exponential world. The highly regarded CIO of the Federal Communications Commission, David Bray, spends a tremendous amount of his energy using social media and other channels to talk about how to broadly enable digital change agents and “intrapreneurs.” There are still others exploring this topic as well.

The subject of learning in particular is a vital one to this conversation. That’s because unless we’re prepared to radically restaff our organizations, mass education for the digital era is required to help our organizations as a whole shift our thinking, behavior, and culture. Great communication is essential also, as we’re learning it is the leading success factor in driving effective change. Both of these activities are best realized using today’s modern digital communications and collaboration tools designed for very high scale, leverage, and asynchronicity: Online communities and enterprise social networks.

While I’ve been “experimenting” with new open methods with real transformation efforts in enterprises to the extent I can the last few years, an emerging model for how to structure and wield online communities to drive these kinds of change has begun to present itself. Far from being a proprietary new way of driving large scale change, I now see that this model, and similar ones like it, are the inevitable direction that change will take.

In the very same way that open source software communities eventually transformed how most software was developed and social media revolutionized how most media content was created, and we see the same advances in crowdfunding and other crowdsourcing methods, the very same shift is now happening to our organizations’ change processes. They are becoming more decentralized, more empowering, diverse, and resource rich by using digital connections to enable wide-scale learning, alignment, communications, and execution around a change process. They are even allowing local actors — and often now even external agents (see open APIs, developer networks, hackathons, startup partnerships, etc.) — to pick up the tools, processes, and lessons learned to change their part of the organization.

Early lessons in using online community for digital change

While the methods and approach we are using to connect together change agents in a community to organize around and realize strategic change are very much still emerging, I can say from experience now that the following is generally required:

  • A community platform. This is a digital forum within which digital change agents will collaborate on and effect change, formulating plans, making joint decisions, and carrying out their efforts, often in very self-organized ways.
  • Facilitation. This is by applying what industry colleagues like Rich Millington refer to as strategic community management, actively facilitating the change process, ensuring those who get stuck get the help they need, and empowering, educating, and orchestrating many points of top-down and bottom-up change across the community, and therefore across the organization.
  • Learning. The community as a whole becomes a massive learning repository, a sort of self-documenting and emergent MOOC for digital transformation adapted to the organization, with lessons learned and best practices culled by facilitators and spread to change agents.
  • Empowerment. A community of transformation spreads knowledge, resources, know-how, and collective energy, enabled by sponsorship, capabilities, staff, and a mandate from the highest levels of the organization.
  • Communications. With rapid change comes an absolute requirement for transparency and clear, open communication. These traits are the natural attributes of an online community, as everyone can see what’s happening and why. As I cited above, this is the top factor for successful transformation.
  • Co-creation. The strongest, swiftest change happens is when there is alignment locally and globally on what needs to be done. Then everyone comes together to put together their ideas and resources to drive digital change.

I invite you to collaborate with me as the digital transformation world begins to adopt the same digital forces of open participation that have remade many industries now, and apply them deeply to our practices and frameworks. For just as the old, plodding, limited, and bandwidth-starved methods of central production are no match whatsoever for today’s methods of digital peer production, failure to adapt has very significant competitive and existential consequences. In short, online community is one of the most powerful methods for achieving almost any large-scale human endeavor, and so I’m pleased to see it arrive to help with digital change.

Can most organizations achieve this? Well, we do know that organizations can’t change unless their leaders change with them, so I do hope so.

Postscript: I’d be remiss in not citing Don Tapscott’s excellent work in identifying and promulgating Global Solution Networks as perhaps the most strategic form of using community to drive large scale learning and change at an intra-institutional, consortia, industry, government, and NGO level.

Additional Reading

A change platform is a priority of the CIO in 2016

Going Beyond ‘Bolt-On’ Digital Transformation

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

In Digital Transformation, Culture Change Goes Hand in Hand with Tech Change

I’ve spent a lot of time in the last few years identifying the best approaches for that urgent enterprise topic of our time, digital transformation. When I first started, I often looked to top examples of organizations that have started the transition and made good progress (see sample case studies below.) More recently I’ve derived insights from my work directly with a number of organizations on their individual transformation journeys.

Ultimately, however, I have determined that the short answer is one that you might expect: There is no single blueprint for transformation that works well for everyone.

Instead, the right steps very much depend on the organization itself. We also know now that there are indeed common success factors we can apply, if we can adapt them to our organizations. Generally, I’ve found that the best method is to employ heuristics on an established framework that takes an organization’s industry traits, cultural inclinations, organizational strengths/weaknesses and uses a generative process to create a starting point for change.

The resulting adapted framework is informed by best practices and industry lessons learned so far. A good place to start for these is Perry Hewitt’s 10 best practices for digital transformation, which she developed when she was Chief Digital Officer at Harvard.

The framework is balanced so it does not focus too much on technology or change management. In fact, the starting point must be one that steadily shifts both the technology foundation and the people of the organization in unison towards both planned goals and emergent opportunities. This starting point then continues to evolve as the organization learns from early experience. The overall process usually works best when realized on a supporting platform that enables open communication, enterprise-wide learning, digital channel leadership, stakeholder empowerment, and enablement of a network of change agents across the organization. This is the change platform I’ve been discussing in the industry lately, and is typically an online and offline community of practice.

The Stages of Culture Change for Digital Transformation

Rapid, Sustainable Digital Change Requires a Platform

Having an effective change platform is critical, as it’s the people side of digital transformation that is the hardest part by far, which we can clearly see from a great set of recent data by Jane McConnell. Far and away the most significant challenge is getting the organization to collaborate across functions and silos, given disparate priorities, timelines, and lack of mutual familiarity. Without this, fragmented results and disjointed digital experiences are too often the outcome. It’s only by having a common and participatory venue to discuss, plan, and execute that effective transformation can take place. Thus, as Ron Miller has noted: Digital transformation takes true organization-wide commitment.

I typically employ a cultural change map — generically presented above, but adapted to the specific organization — to communicate some of the key aspects of mindset that has to shift to support digital transformation efforts.

The digital transformation effort then uses strategic education, mentoring, and specific activities (these might be hackathons, MOOCs, certification efforts, reverse mentoring, and #changeagents outreach) to proactively shift mindset across the organization and build the requisite digital skills and ideas. These include counter-intuitive notions that can be hard to otherwise learn: Designing advantageously for loss of control and using the intrinsic strengths of digital technology to change more rapidly and scale out faster.

As the organization comes together and engages together on the change platform, it then generates the framework to identify their starting point and guide the ongoing process using rigorous measurement and action-taking, which are two other key success factors, though proactive communication remains the most important action to take (again, why the change platform is so critical).

An Adaptable Framework for Digital Transformation

Communication isn’t sufficient by itself however. Effective action is required. The digital transformation framework above is therefore also very focused on day-to-day operations supported by an ongoing redesign of core business processes that is adjusted continously through early data from careful measurement of early prototypes and pilots. Of course, there are more details involved, but this is the high-level process that I’ve both used and seen work at large organizations to close the execution gap and create sustained and successful transformation.

Leading digital transformation case studies

Burberry’s All Encompassing Approach to Digital Transformation

Travelex and Their Digital Transformation: Communicate, communicate, communicate

How Nordstrom executed cross-silo digital transformation for the long haul

How Tesco used a diverse “community of colleagues” to drive digital transformation

Additional Reading

The Building Blocks of Digital Transformation

What Organizations Should Do in the First 100 Days of Digital Transformation

New Methods Leaders Can Use to Drive Digital Transformation

Vital Trends in Digital Experience and Transformation in 2016

This year I was invited again to come to Dreamforce in San Francisco and present on the latest developments in digital experience and digital transformation for the conference’s Emerging Tech Trends track. Surprisingly well-attended given the satellite location of the track at the Hilton Union Square, having to prepare this session is always a good opportunity for me to go over my research in the last year and map out what’s likely going to happen next.

For myself at least, it’s clear that human change has become closely linked to and as important as digital change, so I have divided up the trends list in the last two years into a tech dimension and a human dimension.

The bottom line: How we think, work, and react as people has tremendous impact on the usefulness and effectiveness of emerging technology. It’s what separates the digital native from those who are just beginning the journey. For example, those not inclined to share information won’t get much use from the technologies and techniques of social business, nor will those who are uncomfortable and unused to spending time in virtual worlds be able to take advantage of the rich opportunities of virtual reality. And if we’re not changing our leadership skills to be more network-centric as opposed to hierarchy-centric, then much of the business value of digital experience and engagement is wasted on us. The list goes on.

What’s more, not only are we co-evolving with our tech, but we need to understand how we need to change just as much as the technology is changing. This is required in order to a) understand the art of the possible and b) to be able to access technology’s unique and historic new value propositions.

What's Next in Digital and Social Experience and Digital Transformation in 2016

Another point I make early in the presentation is the technology is changing exponentially right now and has climbed into a rather steep part of the curve, yet our organizations just don’t change on the same curve. Instead, we change far more linearly, at best logarithmically (see slide 8.) That’s not to say that that enterprises can’t organize themselves to change much faster, but in order to do so we must employ fundamentally new ways to transform organizations. Certainly, some organizations are adapting faster and digital transforming more sustainably (see data on slide 4.)

Sidebar: I’ve recently been exploring what these new models for sustainable yet highly scalable models for digital transformation, even proving them out on client projects I’ve been working on over the last few years. The key seems to be a more network-based, decentralized, and emergent approach I’ve called a Network of Excellence.

Emergent Tech Trends Inputs

For this year’s round-up of emerging tech trends, in addition to original research, I used as inputs several items:

Major new additions to the list include digital assistants/bots/chatbots, blockchain, omnichannel, workplace app integration, and collaborative EMRs, along with significant tweaks in a variety of the existing trends.

You can see the whole deck with an overview of each trend on Slideshare. I’ll post any video that is produced as well.

Also, in other Dreamforce news, you can review my live blog of the main Dreamforce keynote as well as my current assessment this week of the Salesforce platform and ecosystem.

Additional Reading

Digital priorities for the CIO in 2016 | ZDNet

The Building Blocks of Digital Transformation: Community, Tech, Business Models, and a Change Platform