Digitize Your Strategy
What does it mean to ‘digitize’ and what are the benefits? “Digitization is the process of converting information into a digital (i.e. computer-readable) format, in which the information is organized into bits”. Entire industries, let alone companies and processes, have been digitized, solving global problems, reducing cost and democratizing otherwise inaccessible services.
The music industry is particularly interesting to me (picture above). Firstly buying cassette tapes and ‘taping’ music from the radio station. Moving to a better quality medium on CD, then a brief dance into mini-disk, before the digital step to iTunes, MP3, then leap into the iPhone, where an entire portfolio of music can be saved in the palm of my hand. Now I listen to continuous mixes, automatically selected, and synced, suddenly connecting and bursting out whenever I get close to an output device. A number of innovations, all using technology to provide unlimited accessibility, reduce resistance (and cost) and improve the user experience to my chosen service. I’ve clearly left off a number of steps in that map, and considered only me, the customer. The world of production, service providers, musicians, DJ’s has also been transformed in this digitization process.
Similar industry change can be seen for photography, literature, media, taxi, travel accommodation… you know this picture. On a parallel note, processes have also followed this digitization thread. Take communication as the obvious example, from letter writing to fax, to email, now the communication process has multiple digital channels to one or millions of people in real time for free.
This digitization process is not roses for everyone, people lose their jobs when processes, industries and companies are affected. Humans have to adapt to the new world, and those adaptations come at a financial price added to social norms, as we substitute human touch with digital devices. However digitization is happening whether we like it or not, and those thriving in the digital world are reaping the benefits, excited by the opportunity. Better still, those who are using technology to pave the way to the new world are letting the machines do the work, while spending more time thinking and creating new reward structures.
Words like exponential being used to describe this opportunity, simply by the reach and capability provided by digital means. Every individual with a smartphone can consume the entire contents of a shopping mall, if they have a fast enough finger speed, or message the entire world, if they have the right reach, illustrating how quickly a digital strategy can be effective.
Moving onto strategy “a plan of action designed to achieve a long-term or overall aim” and, like communication, the process of strategy has evolved. Military strategy as an example, evolved from leaders planning, then meeting in a safe house, lengthy discussions around purpose, scanning 1:100,000 maps, perhaps years old, then sending those objectives to the teams on the front line via the many different channels. During and post mission, the feedback following the many different lines of communication back to base, who can try gauge success of the mission and plan the next move. This process taking weeks if not months. Compare this to a modern day reconnaissance mission where multiple command centers and front line teams plan with live site data, communicate, perform and report, often directly to unmanned machines, in real time (via encrypted channels) with full factual data. Delivering a purpose and objective to responsible teams with immediate feedback loops. Of course success can still only be measured against a purpose, which in some military cases is not always that clear.
For those involved in organizational strategy like me, used to seeing the CEO once a quarter, post annual offsite deliver the strategy with well thought out objectives and chosen responsible owners, then deliver chosen updates with some high level performance indicators to back up the success. I evolved to participate, providing quarterly updates in the flavored format of the many initiatives. I further evolved to somehow design and coordinate all this planning and feedback into the quarterly update for our leadership team to analyze and action.
When I had overview of the process, the biggest challenge came in trying to link the deciding factors to the performance indicators, the path from cost to revenue, or initiatives to purpose. A complex web of budgets, programs and tasks, often very well organized independently, tightly governed by clever people, paid to control the process. Leaders and managers better informed, offered more data, to make decisions. However the divide remained between the vision, thinking, purpose and the ever increasing rate of execution. The subjective interpretation and calibration of initiative performance vs strategic objectives still being the main role of corporate leadership. And as most leaders know, just doing the same things better doesn’t equate to company success.
Using the analogy of photography, being the best at what you do, like making cameras and producing prints wasn’t enough. The photography industry disrupted by mobile phones and (free) photo sharing apps, needed more than better execution of the age old objective. The process of strategy being so rigid, implementing such strong corporate governance often associated with rigid strategy cycles, barricading the space to question purpose and company objectives, protected to the point of failure.
So we’ve ascertained one of the main issues with corporate strategy is the divide between purpose and execution. Better task management doesn’t equate to company success. Successful leaders are those who constantly challenge processes, the rise of Apple, Google, Amazon all on the back of innovation, design and a constant challenge to how things are done to achieve a very ambitious purpose.
Matrix thinking came across my desk a few years ago, closing the gap between purpose and execution. Based on a simple designers grid, used by architects and artists for decades, to structure thinking into a consistent format around purpose. Starting with an illustratration of the objectives required to achieve a purpose, you can easily see if the right objectives are in place to achieve the purpose. If we achieve those objectives will we achieve our purpose, a quick and honest highlight of any gaps. Then delivery plans from each team mapped to the objectives.
The first grid can be set-up at organizational level, which can be used to show the purpose and organizational objectives. Each intersect in the grid provides space for further teams to map their own plans into the organizational plan. So there is a level 1 grid and level 2 and so on, as each plan links to the overall plan through a series of organized levels, now creating a matrix, hence the term matrix thinking. Giving each leader, manager and team the ability to link their plans to the purpose in a consistent and transparent way.
Finally, as you can imagine, a hard copy format of this structure will be as difficult to maintain as the maps detailing the battle plans for the military in 1940. In digital form this is not only possible, it creates an opportunity to illustrate, order, and connect all stakeholders emotionally to the ‘why’. Measure these connections, and provide real insight from the behaviours.
Our organizations all have objectives with responsible owners and teams. Mapping those to the company purpose and long term sustainability is often the job of a select few. With a digital platform the formulation and link of strategy throughout the organization becomes possible and like parallel industries and process, has the potential to unlock an exponential capability by letting the machine do the administration and you do the thinking, digitizing strategy