Does Any CEO Have the Luxury to Ignore Digital Transformation and Innovation?
Gregg Fraley and Karen Kirby, copyright 2017
Innovation + Business + Technology = Digital Leadership
Turnover of CEOs is already high, about 14.9 % a year as of 2016*. The demands of digital leadership and the enterprises of the future could dramatically accelerate that rate in the next few years. The conversation CEOs need to be having, to remain in the shrinking 85.1%, is about how to integrate digital technology and seize new pathways to industry leadership.
In HBO’s Game of Thrones there has been that recurring foreboding phrase, “winter is coming.” For years, the phrase has been whispered in the ears of CEOs “digital is coming”. They are both here. But, unlike the darkness of that mythical winter, digital tech is a blizzard of fresh, new capabilities, and new combinations of capabilities, that impact and augment every single aspect of a business, the entire value chain — products, services, distribution, sales, manufacturing, business models – everything. And, introduces disruptive approaches to customer value.
There is amazing opportunity for digital innovation and organizations that adapt have the potential for huge growth and success. Those that don’t adapt will lose more than their CEO. Sadly, we have already seen the headlines of respected organizations closing doors and stores that have not embraced digital or created seamless omnichannel customer experiences. Once-household names like Radio Shack and Blockbuster will continue to exist in the pages of Wikipedia. Digital leaders like GE are already transforming industries.
Even those organizations with existing continuous improvement and innovation programs need to amplify and expand their efforts. The innovation effort alone is complex. Digital technology is vast and can be simultaneously intriguing and overwhelming, The time is now to align Innovation + Business + Technology – in order to achieve Digital Leadership.
A meaningful digital conversation would span a wide range of topics and technologies. Mobile devices, apps, commerce, and location have already changed our daily lives. We constantly witness the global reach and influence of social media. Cloud infrastructure creates the backbone to connect the digital dots. Internet of Things (IoT) devices, sensors, and wearables introduce game-changing opportunities. Analytics contribute to a spectrum of sophistication with advanced analytics, data visualization, machine learning, cognitive computing, artificial intelligence, etc. Data tools and platforms wrangle the explosive data pipeline of big data, data lakes, and business applications. Blockchain and Bitcoin provide access to secure digital ledgers and currency.
In order to steer their companies into a successful digital era, CEOs must address some fundamental questions. Where do they need to expand their leadership teams? How do they shift the culture of an established company to become intrapreneurial and nimble? What will they do to forge alignment between historically-siloed parts of the organization to tighten the business+technology+innovation=digital leadership connection? Are they leading or lagging behind their peers and competitors? Harvard Business Review press points out that digital leadership is no longer optional.
So, the time for a conversation between CEOs and their teams about their digital future is now. The time for action immediately follows, and, as HBR indicates, it has to be done differently in this new environment. Things are moving too fast for 24-month stage-gate innovation project cycles. Even the magic of Design Thinking is not enough to inform you as to what projects to do and ensure success. Understanding your consumer is only a start when creating with a new palette of possibility.
A big part of the conversation is going to be about How. Our answer is that a new innovation methodology is emerging that blends current best practices with more rapid innovation project cycles, market knowledge, new ideation techniques, and analysis of where digital technology is best applied to reinvent or disrupt the organization’s value chain. For some, it may appear daunting. But a blended methodology will deliver results.
It starts with a conversation. CEOs, have it now. Game on.
* PwC 2016 CEO Success Study