The brutal truth on how thinking ‘tools’ is for fools
A few weeks ago I came across this Management Team article (in Dutch) that states that digitisation brought us mostly useless junk; despite its potential of making us more productive and efficient, digital technology has yet to deliver on that promise. The main reason for that, according to internet pioneer Gerry McGovern, resonates with me: going for quick ‘wins’ rather than doing things right.
What we see at our clients, and in fact at our own consultancy firm as well, is that it is not a question of whether to embrace digital innovation or not, the question is how to do it in the right way. Where we see digitalisation go wrong, is when it is treated as a technology project. Not because of the technology itself; the issue is in operationalising it, i.e. getting the implementation right, which requires your people to adopt new ways of working in your process. Not getting this right may happen when you do not have a clear view of your actual (informal) processes or the true root causes of the issues you experience on a daily basis. In the end, treating it as a technology project may in fact cost you more rather than deliver the benefits promised in the brochure, as you add complexity and confusion to an already broken process.
The brutal truth is this: there is no ‘silver bullet’ or shortcut to automation, no hardware or software solution will solve your leadership issues – technology alone can and will not fix your culture. Research1 shows that 70% of (digital) transformations fail and it is much for the same reason why most (sound) strategies fail. Paraphrasing Peter Drucker: culture eats digitalisation for breakfast.
Not about smart factory, but smart people
Strategies require flawless execution as much as (digital) tools require proper implementation – as a business leader, it’s important to realise this upfront, before kicking off a digital transformation, as there are two routes you can take to realising business value: either you focus on the technology, emphasizing the ‘digital’ part, or you focus on business impact, emphasizing the ‘transformation’ part. At R&G we encourage you to do the latter and call this the Data-Driven Leadership (DDL) approach. DDL is not a tech project – you don’t face a system problem, the issue you have is one of application. DDL is all about connecting your people to your data, your process and your operating system, creating transparency about performance and issues and increasing accountability. It is not about smart factory, but about smart people. Use what you have and focus on what you need to make business impact. Investments remain to be a constant debate (and rightfully so), just be aware not to act penny-wise, pound-foolish here. Apart from investing in the right hardware and software, invest in getting the execution of your process done right prior to switching over to it.
As McGovern points out in the MT article: you can’t transform digitally if you can’t transform at the organisational level first. This is what Data-Driven Leadership is about – building not just tooling but the right mindset and necessary capabilities in your organisation – and how we see digitalisation gets done right: delivering on the promise of making us more productive and efficient.
Ad de Grauw is a Senior Consultant at R&G Global Consultants, based in the Netherlands.
If you’re eager to learn more about Data-Driven Leadership or other (digital) capabilities, including Process Mining, please contact Ad directly via email@example.com or visit our website: www.rnggc.com
1 The ‘how’ of transformation, McKinsey, 2016