Gary OBrien - Digital Transformation Game Plan

by Xiao Guo , Gary OBrien , and Mike Mason

Copyright 2020 Xiao Guo, Gary OBrien, and Michael Mason. All rights reserved.

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[LSI]

Change, change, change. For as many years as Ive been working in the industry (which is sliding past 50 now), pundits have talked about change and the need to respond appropriately. Is the next decade different or more of the same? My vote is for different. Klaus Schwab, author of The Fourth Industrial Revolution, seems to agree:

The speed of current breakthroughs has no historical precedent. When compared with previous industrial revolutions, the Fourth is evolving at an exponential rather than a linear pace. Moreover, it is disrupting almost every industry in every country. And the breadth and depth of these changes herald the transformation of entire systems of production, management, and governance.

According to Schwab, there have been four stages so far in this industrial revolution:

• The age of mechanical production

• The age of science and mass production

• The digital revolution

• The age of technology transformation

Each of these ages caused major disruptions to businesses, government, and other institutions. What can we learn from these disruptions? First, big changes are inevitable, and they usually happen fast. Many institutions dont survive the change. Surviving and thriving requires the ability to adapt, and often a bit of luck. As the authors of this book point out, around half of the current S&P 500 members will be replaced over the next 10 years. So lets make a broad-brush assumption that 50% of todays organizations dont thrive (and might not survive) in the next decade. How will you manage to put your enterprise into the 50% category that succeeds?

Leaders need to truly think through the extent of changes facing their enterprise in the next 5 to 10 years and think about their response. In this period of disruptive change, success wont come from small adaptations here and there. Success will come from massive adaptations in every aspect of corporate and organizational life. Gary OBrien, Xiao Guo, and Mike Mason have thought about this, and they have given us the benefit of their thoughts and experiences in The Digital Transformation Game Plan.

The authors point to three areas that enterprises need to embrace in this new world and provide you with strategies and tools to do so. First, you need to move rapidly to the position of being driven by customer value. Second, you need to create Agile, responsive organizations that can deliver that customer value. Third, you need to integrate technology into a core competency of everyone in your enterprise.

Businesses today usually drive to increase shareholder value at the expense of customer value. One company that bucked this trend is Amazon. Jeff Bezos has been unconventional from day one: dont worry about competitors, the short term, or Wall Street. Focus on customer service and the long term. Even though customer focus has been a business mantra for some time, traditional financial measures such as ROI and shareholder value have dominated management attention; using customer value, and determining how to calculate it, has often been left to the marketing department. Business processes, practices, structures, financial matters, and much more have developed over decades to support internal functionality versus an external customer view of the world. Creating a responsive, Agile organization that can deliver customer value sustainably over time requires that you examine your traditional functional and hierarchical organization and align your business to the flow of customer value. The complexity and interconnected nature of todays economic system means that you must simplify business models and streamline your organization. The authors of The Digital Transformation Game Plan provide principles, guidelines, and actions about how to accomplish these things, but they wisely refrain from advocating specific organizational structures. As they say, every industry and enterprise is different, and therefore the extent of fluency in various responsive building blocks will be unique to your organization. To find that uniqueness, they propose a thin-slice approach to learning and adapting to your specific needs. Dont try to clone anyone elses approacheven Amazons. It doesnt work. They advise creating your own unique approach to digital transformation using fundamental building blocks.

The third component of your digital transformation is technology, which is both the source of disruption and also what provides your enterprise with the capability to adapt to that disruption. For many years, technology was primarily used to support business functions, from manufacturing to finance. Today, technology, particularly software, is core to your product. As such, everyone in your organization, not just technologists, need to integrate technology knowledge into their core capability. This book provides practical strategies on how to accomplish this monumental undertakingagain, in thin slicesproviding a foundation for sustainable, continuous growth and change.

We are living at an inflection point in economic history, from the predigital to the digital age. How will you respondwith bandages here and there or with a sustained revamping of your organizations measures of success, organizational structure, and approach to technology? Will you respond to change and create change for your competition? If you need a good road map to the future, look to The Digital Transformation Game Plan by Gary OBrien, Xiao Guo, and Mike Mason as a great place to start your journey.

Jim Highsmith