The Human Side of Your Digital Transformation

Welcome to the age of digital disruption. The Gartner 2019 CEO and Senior Business Executive Survey, qualified and surveyed 473 business leaders of companies with $50 million or more in annual revenue. 60% of these 473 business leaders were at companies with $1 billion or more in annual revenue. According to this survey, 82% of respondents agreed that they had a management initiative or transformation program underway to make their companies more digital – up from 62% percent in 2018¹. At the same time, this survey showed that CEOs are concerned that some of the executive roles do not possess strong or even sufficient digital skills to face the future. On average, CEOs think that sales, risk, supply chain and HR officers are most in need of more digital savvy. When ask which organizational competencies their company needs to develop the most, talent management topped the list, closely followers by technology enablement and digitalization and data centricity or data management.

Digital technology can significantly improve the performance of businesses and even give birth to entirely new operating models that shake up sectors (the newspaper and recording industries are cases in point). Yet, only a paltry 14 percent of 1,733 business executives polled by McKinsey in September 2018 said that their digital transformation efforts have sustained performance improvements, with only 3 percent reporting complete success at sustaining change. To address this, McKinsey lays out a roadmap for a digital transformation that involves 10 steps.

Secure senior management commitment
Set clear, ambitions targets
Secure investment
Start with lighthouse projects
Appoint a high-caliber launch team
Organize to promote new, agile ways of working
Nurture a digital culture
Sequence initiatvies for quick returns
Build capabilities
Adopt a new operating model

But, appointing a high-caliber launch team, organizing to promote new, agile ways of working, and nurturing a digital culture is about more than acquiring technical skills (“digital savvy”) and coming up with new operating models.

First, it’s about fit. Matching people’s basic natural self with the roles they will play in that launch team or in the organization’s new operating models and ways of working. Then, second, it’s about diversity. Diversity of basic natural behaviors and work-styles coupled with mutual understanding and appreciation for each other’s similarities and differences and how these basic natural behaviors and work-styles work best together. Then, finally, it’s about the mindful habituation of this mutual understanding and appreciation and new ways of working together. All three are required in order to successfully transition to and sustain that change that, in essence, represents a new state of being for an organization.

The Basic Natural Self
Everyone has a basic natural self. The basic natural self is the way one behaves without any outside pressure for adjustment. And, the basic natural self seldom changes once a person reaches adulthood. This is because, by the time one reaches adulthood, they’ve practiced being a particular basic natural self for a long time. And, the longer we’ve practiced being a particular basic natural self, the harder it can be to change it.

Matching Basic Natural Selves with New Roles
The fact that the basic natural self seldom changes is the reason it’s extremely important to match people with roles and ways of working that are a good fit with their basic natural self. Think about hiring a battle field sergeant for your army. To be effective, they need to be swift decisions makers, take charge, tell people what to do, and not care too much about being liked. Now, take that same set of basic natural behaviors and work styles and ask that person to sit by the bedside in a hospital and patiently, supportively, and empathetically council people all day. What do you think will be going through their mind 30 seconds into their first counseling session? What do you think they’ll do?

The same is true with your new roles and ways of working. For example, take the machine operator who has been manually operating that expensive piece of equipment running on your shop floor for years. He or she is flexible and adjustable and that makes them great at optimizing overall equipment effectiveness as the ways in which that machine is utilized constantly change. But, now your new digital manufacturing solution is doing that by constantly analyzing inputs from a variety of sensors and using data, algorithms, statistics, and machine learning to optimize overall equipment effectiveness. This presents a new way of working for the machine operator. Now, your machine operator is overseeing a new, connected digital system that requires a structured, consistent way of interacting with it… the exact opposite of the basic natural behaviors and work styles that were required before.

Diversity
Building a great team, whether it’s your launch team or a new operating team, is like building a life raft. In order to survive, you not only need a diverse set of skills and abilities, you also need a diverse set of natural behaviors and work styles. And, just having this diversity is far from enough. It takes mutual understanding of and appreciation for the similarities and differences each team member brings to the life raft (i.e. to your launch or new operating team) AND how this unique combination of natural behaviors and work styles performs best together in order to thrive.

Consider the case of launching and instantiating an advanced analytics capability. The goal is to harness data and analytic models to optimize business outcomes. This is done by sourcing data creatively, identifying analytics models that allow managers to predict and optimize outcomes, and transforming a company’s culture to exploit analytics successfully. What’s it mean to transform a company’s culture to exploit analytics successfully? It means lots of new ways of working such as:

Being specific about the business problems and opportunities the organization needs to address and getting creative about the potential of external and new sources of data.
Encouraging the development of models that are the least complex to improve performance.
Working with senior executives and their managers to build understanding of and trust in analytic models and data.
Working with frontline managers to ensure analytics and tools complement existing decision processes and encouraging the development and execution of new decision processes that take advantage of analytic models.
Identifying and implementing training, role modeling by leaders, and incentives and metrics to reinforce behaviors that utilize data and analytic models that allow managers to predict and optimize outcomes.

Each of these new ways of working will invariably bring together a corresponding diversity of basic natural behaviors and work styles. For example, an organization’s high-energy, assertive, creative, and intuitive sales manager will now be working with a “digital worker” in the form of an analytical model that produces predictions and prescriptions that may run counter to their intuition from time-to-time. This sales manager in turn may be supported by a data scientist with lower energy who is supportive and systematic and fact based in their decision making. In this new relationship, the sales manager can help the data scientist be more creative about external and new sources of data and produce quicker decisions based on simpler models and the data scientist can help the sales manager make better, more fact-based decisions that result in better business outcomes. But, mutual understanding and appreciation of each other’s similarities and differences and how they work best together will be required to get the most out of their relationship. For example, the sales manager will need to appreciate and understand the value of giving the data scientist time and the opportunity to process their requests for change rather than demanding immediate responses and the data scientist will need to learn to discuss how changes will be handled and establish in advance that changes are to be agreed upon together before implementing.

Habituating new ways of working
Have you ever noticed that people read all kinds of self-help books but rarely change? This is because philosophical knowledge is a pre-cursor to bringing about and sustaining a new state of being but, philosophical knowledge by itself will not bring about that new state of being. The same is true of an organization’s digital transformation because, in essence, it’s a transformation to a new state of being. Most people effectively go unconscious shortly after waking up each day; quickly slipping back into the unconscious emotions, habits, and/or hardwired attitudes of the past. These form the basic natural self that we described earlier and create a predictable future in the image of the past. The challenge is to properly fire and wire new thoughts and emotions (of one’s future) into one’s brain and heart every day. In order to do this, it takes imagination and practice. Imagination because one must have a clear, firm image of their desired new state of being and practice because practice is what’s required to supplant old habits with new ones.

In business cases for Robotic Process Automations, the assertion is often made that current workers will be freed up to work on higher value activities that only a human can perform. But, take the case of an auditor in a risk department, who’s basic natural self is to be cautious and require proof and work deliberately with accuracy and follow-through. This makes them highly effective at working through mountains of data to spot errors and ensure compliance. Now that a company’s new “digital worker” or “bot” (short for “robot”) is going to perform this function, does the work that auditor is now freed up to do require the same basic natural behaviors and work styles? If not, the auditor and their company are faced with two choices. Either that auditor must create a new image of themselves and practice being that new person until they have wired and are firing new thoughts and emotions consistent with who that new person is every day or their company needs to move them into a role that still requires someone who is cautious and requires proof and works deliberately with accuracy and follow-through. This is because, until that person creates these new habits, no matter how much education and positive and constructive feedback they are given, the way they work (their basic natural behaviors and work styles) won’t change. They’ll experience constant pressure for adjustment (known as stress) and the company will experience sub-optimal performance.

Digital technology can significantly improve the performance of businesses and even give birth to entirely new operating models that shake up sectors. But, appointing a high-caliber launch team, organizing to promote new, agile ways of working, and nurturing a digital culture is about more than acquiring technical skills (“digital savvy”) and coming up with new operating models. It requires matching people’s basic natural self with their new roles and ways of working together, developing mutual understanding and appreciation for each other’s similarities and differences and how these basic natural behaviors and work-styles work best together along with habituating new ways of working in order to enter into and sustain the new state of being that an organization’s digital transformation represents.

About iHs Retained Search
There are many who can do the job but, few who will manifest excellence in it. Poor fit is costly but, it’s also 100% preventable. iHs Retained Search combines expertise from the successful completion of hundreds of searches and leadership advisory engagements for digital technologists and leaders in areas such as Advanced Analytics, Block Chain, Digital Manufacturing / Industry 4.0, Intelligent Automation, and Security with engagement leadership by Partners with first-hand, peer level experience in the engagements they lead, rigorous process, state-of-the art research technologies, competency model development and behavioral assessment tools to help their clients discover, acquire, and develop digital technologists and leaders that fit. iHs’ clients evaluate three candidates on average before making an offer and iHs has a better than 98% offer acceptance rate over the past 10 years. Consider the following quotes from iHs clients:

“This was enlightening. Now I understand why no matter how much clear direction and positive and constructive feedback I was giving several of my leaders they never consistently did what was I hoping and their customers were expecting.”
– Global VP of IT at a Fortune 500 company

“Wow, after 90 days on the job, I barely feel as if I need to manage the person you helped us place in this new role. They just naturally do what I hope that they will be doing every day with very little input from me. Their customers are delighted!”
– Senior Manager at a Fortune 1000 company

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