Challenging Legacy Mindset & Encouraging Cultural Transformation

Executives can more easily prepare their organizations for the cultural transformation that they wish to institute.

Covid-19 has stalled the plans and expectations of business the world over – when it comes to digital and cultural transformation this is doubly true. Following the outbreak, businesses realized that the technologies that they had penned for delivery over the next demi-decade were essential to the success of a workforce employed remotely and, therefore, had to be realized immediately.

Early estimates from Gallup, for example, suggest that 62% of the American workforce were pushed towards remote work during April and for an executive actively pursuing a new innovation strategy, this eventuality is far from ideal. Without effective communications tools, nor the necessary lead time with which to prepare, executives have had to employ a number of quick fixes to prepare their infrastructure, network and employees for the current climate – but more significant action is required.

To this end, few in business feel that they are even well equipped to fight back against the virus. Although most executives see innovation within their organization as critical, it is getting and harder to see the forest for the trees and increasingly, many are realizing that their organizations aren’t ready for change.

Encouraging Cultural Transformation

Instituting cultural transformation across any organization cannot nor should not be solved overnight. Workers – whether they be employee or stakeholder – are often resistant to change; a resistance made even more reasonable based on 2020 in general. However, enterprise leaders shouldn’t be afraid of a cultural sea change, it’s an opportunity to fix well-known organizational issues and encourage technological growth.

Any organization planning to institute transformative digital innovation initiatives must first make sure then, that their culture is aligned for and welcomes such change. An effective digital culture will encapsulate each of the five following tenets:

  • Extroversion over Introversion – An effective digital culture will see employees engaging with individuals outside of the immediate business to pursue solutions and innovation.
  • Renounces Control and opts for Delegation – Employee and executive relations must be slackened, with workers given greater freedom in their tasks as opposed to explicit instruction.
  • Open to Risk – A well-implemented digital culture will take risks, fail fast and learn quickly.
  • Emphasize Action Over Planning – supports the need for speed and promotes continuous iteration rather than perfecting a product or idea before launching it.
  • Values Collaboration – Collective work and information sharing across divisions, units and functions are essential to effective change, these cultures prioritize transparency & interaction.

By taking each of these values into account, executives can more easily prepare their organizations for the cultural transformation that they wish to institute. Research from the International Data Corporation suggests that by 2022 organizations will be spending nearly $2 trillion on digital transformation. However, without first aligning the investment with the behaviors and values of employee’s executives are essentially burning their money.

On the subject of cultural transformation, Carey Owen, a partner with Deloitte Risk and Financial Advisory states, ‘When organizations undertake digital transformation & focus only on technology at the expense of culture, that can hinder progress in many areas, technology is definitely a part of digital transformation, but unless leaders can ‘win hearts and minds’ throughout the process, efforts can stall or be less successful than they could be.” Innovation is as much about the technologies which take you over the line as the employees that integrate them, executives must realize this as they pursue change.

The case for culture change speaks for itself. BCG assessed 40 companies undergoing digital transformation and discovered that the proportion of companies reporting breakthrough or strong financial performance were five times greater (90%) among those that focused on culture than it was among those that neglected it (17%). This finding is even more impressive when we consider that nearly 80% of the companies that focused on culture sustained strong or breakthrough performance.

To learn more, download the full report here or continue the debate at the Digital Innovation Insight Summit NA, a GDS Summit, where we bring together senior Digital executives who are actively seeking to share, learn, engage, and find the best technology solutions.

GDS Group hosts experts to help experts. We strive to provide an atmosphere for our attendees that enables them to confidently lead their companies through major transformation projects. For information on upcoming events, view our Digital Summits. To remain current on our activities, visit GDS Group on LinkedIn | Facebook | Twitter.