I had the pleasure of doing a video interview with Kevin Benedict today, where we discussed a number of topics, including the recent book Machine, Platform, Crowd: Harnessing Our Digital Future. Kevin is from the The Center of Digital Intelligence. Our wide ranging discussion can be viewed here.
Andrew McAfee and Erik Brynjolfsson – Authors of The Second Machine Age – wrote a new book which they launched in the middle of this year. Machine, Platform, Crowd: Harnessing Our Digital Future builds upon their first book, exploring three big trends that are reshaping the business world:
- The rapidly increasing and expanding capabilities of machines
- The large and influential young companies (Platforms) that bear little resemblance to the established incumbents in their industries, yet are deeply disrupting them
- The emergence of the crowd: the large amount of human knowledge, expertise, and enthusiasm distributed all over the world and now available
Digital transformation means different things to different people. As I strive to change mindsets, I am sensitive to these distinct perspectives and the individual filters applied to terms like digital and transformation. In my view, Digital has been more narrow than holistic, while in some organizations ERP implementations are considered transformation. So, does digital transformation represent the narrow use of digital technology to improve some aspect of our organization? Or, is it the wholesale change of a set of structures, institutions and paradigms built for a different era? Although I have mostly abandoned the phrase, when I do use it, I mean the latter.
Let’s call it what it is, starting with the term transformation. To truly transform means to change from one nature, substance, form, or condition into another. I’d maintain that the pace of change has made the archaic nature of our industrial era structures, institutions, and management paradigms very apparent. Therefore, to transform in this sense means to change from the nature, form and substance of our industrial past, to a state that is viable for our digital future. Digital is foundational: the building block for which this future state is built upon. Therefore, for clarity sake, a better way to describe digital transformation is:
TRANSFORMATION FOR THE DIGITAL AGE: a change in the nature, substance, and form of our industrial past, to a future state that allows us to thrive in our emerging digital future.
I joined another episode of Coffee Break with Game Changers on Wednesday of this week. A very good discussion on privacy and data. Here is a brief abstract.
The buzz: “You already have zero privacy – get over it” (Scott McNealy). We as individuals have welcomed Internet-connected, mobile devices to help us make daily decisions. But when we share data with companies, and they share it with their business partners, are their built-in and bolted-on data security capabilities enough to protect our personal information?
“Digitization has barely started, and so has the accompanying upheaval”
– Jacques Bughin, Mckinsey
That’s a scary thought – but accurate. That thought comes from a recent Mckinsey Insights post titled: Think digital is a big deal? You ain’t seen nothing yet. Thanks to Heidi Schwende for sharing this article.
Their research finds that digital technologies and processes have penetrated only about 35% of an average industry, which says that a third of the products and operations that could be digitized have been. Yet this is more than thinking about digitizing the other 65% – it’s a moving target. The phrase “You ain’t seen nothing yet” captures that well. As the innovation accelerators that I describe in my Anchor Visual accelerate, digital is merely the foundation. A reimagined world is built on that foundation – and without it, organizations cannot participate in Reimagination. Here are other key insights from the Mckinsey post:
In my last post, I described a Sense and Respond model that sits at the heart of several activities, including scenario, opportunity, and risk analysis. As complexity and pace continue to intensify, uncertainty increases. To survive in this Emerging Future, we must embrace a framework for future thinking, and an organization that can adapt as it shifts. In essence, we must see the future, rehearse it, continuously monitor for shifts, and adapt as the shifts occur. A sense and respond model sits at the core of the framework – but represents the biggest cultural challenge.
“The rhythm of technology is changing the rhythm of business, and we’re all going to need to adapt” – Jeff Gothelf and Josh Seiden, Authors of Sense and Respond
Back in 2013, in a post on sense and respond systems, I talked about the drivers that would push organizations towards a sense and respond paradigm. There are no bigger drivers than volatility and uncertainty, and nearly four years since that post, that fact is becoming clearer. In a recent book by Jeff Gothelf and Josh Seiden, they elevate sense and respond to a position that is core to achieving an adaptive enterprise. They see feedback loops and a movement away from command and control as the enabling mechanisms that allow us to thrive in the digital age.
Management expert Gary Hamel summarizes the challenges we face as the structures of the industrial age collide with the digital age:
“Modern management is one of humanity’s most important inventions. But it was developed more than a century ago to maximize standardization, specialization, hierarchy, control, and shareholder interests. While that model delivered an immense contribution to global prosperity, the values driving our most powerful institutions are fundamentally at odds with those of this age – zero-sum thinking, profit-obsession, power, conformance, control, hierarchy, and obedience don’t stand a chance against community, interdependence, freedom, flexibility, transparency, meritocracy, and self-determination. It’s time to radically rethink how we mobilize people and organize resources to productive ends”.