Welcome to our blog, the digital brainyard to fine tune "Digital Master," innovate leadership, and reimagine the future of IT.

The magic “I” of CIO sparks many imaginations: Chief information officer, chief infrastructure officer , Chief Integration Officer, chief International officer, Chief Inspiration Officer, Chief Innovation Officer, Chief Influence Office etc. The future of CIO is entrepreneur driven, situation oriented, value-added,she or he will take many paradoxical roles: both as business strategist and technology visionary,talent master and effective communicator,savvy business enabler and relentless cost cutter, and transform the business into "Digital Master"!

The future of CIO is digital strategist, global thought leader, and talent master: leading IT to enlighten the customers; enable business success via influence.

Wednesday, March 22, 2017

A Philosophical Digital Board

The shift to digital cuts across sectors, geographies and leadership roles. The digital transformation is now spreading rapidly to enable organizations of all shapes and sizes to reinvent themselves. In fact, Digital Era opens the new chapter of human progress; and philosophy is the compass of human civilization. Digital philosophy is simply in pursuit of a holistic understanding of the hyperconnected digital business world and discovering the better way to do things. Corporate boards as the top leadership team and governance body, how to apply philosophical digital principles to steer the business direction and drive business transformation seamlessly?

BoDs with philosophical mind are in high demand to provide abstract thinking and leverage multi-dimensional lenses to navigate through business uncertainty: Philosophy is a Greek portmanteau of the love of wisdom. Business management is both art and science. Science always needs philosophy, if there were no critical philosophy to add to the brainstorming, science will in the end loose ground. Philosophy is the foundation upon which science has been built and continues to put forth the questions which help move science onward and upward. BoDs with philosophical mind are inquisitive to gain the multidisciplinary knowledge and insight about digital transformation.
Philosophy is the history of ideas and an ongoing inquiry into the nature of things based on abstract reasoning rather than empirical methods. Because philosophy is always important to “better understand evolution and harness its power to serve human purposes.” Compared to other science discipline, philosophy is abstract. There is no need for BoDs to become philosopher, but BoDs with philosophical mind can practice abstract thinking and communication to reach a point of agreement for setting up the right digital principles and navigate digital transformation effortlessly.   

The philosophic mind is not only to solve the problems, but to dissolve them: The BoDs with philosophical mind can set guideline to solve the problems more radically. You have to define a problem, and then, try to solve it. Philosophy can ask question that other sciences cannot even think about. Philosophy can talk about the nature of being human. The philosophical thinking encourages you to ask big WHY question, and it helps you see reasoning in action. And then, when you have seen reasoning in action, you've got an example of what's philosophy: a problem, and a logical argumentation. The philosophical mind can abstract the quintessential from complexity, discover the root cause of problems. Philosophy can not only allow you to reason the visible, but also perceive the invisible elements of the business. Philosophy takes on problems of knowing and knowledge, but perhaps its greatest strength is in its ability to "solve" problems elsewhere. It contributes to solve problems via interdisciplinary understanding. So, BoDs with philosophic mind can advise business management wisely and monitor business performance via multi-faceted angles.

Interdisciplinary holism as digital philosophy: The digital BoD with philosophical intelligence can understand digital transformation in a holistic way. A philosophic mind is abstract to converge the divergent information and bridge the gap with commonality; and a philosophic mind can also perceive the circular vision to see things holistically. They are able to see the big pictures, and make unbiased decision, they have the ability to see the whole picture and relate it to stated vision and goals. They may evoke what we call the paradoxical thinking process, which is defined as a statement that seems contradictory, unbelievable, or absurd but that may actually be true in fact. To put in more logical way, today’s leaders always have to see the both sides of coin at multi-dimensional angle before making any strategic decisions.

Philosophy can talk about the status of other sciences. Philosophy can allow us to see the cause and effect thoroughly. Hence, digital BoDs with philosophical mindset are able to think holistically,  are willingness to ask the difficult questions about strategy, leadership and outcomes, guide senior management team through effective questioning, coaching, advising, make an assessment of the business strategy and organization's execution objectively, so they can lead digital transformation in a balanced way.

IT Digital Transformation: Three Practices from Here to There

Organizations are moving from here (doing digital via using some digital technologies) to (Going digital via expanding to all dimensions for a holistic digital transformation). Digital becomes the very fabric of high performing business, organizations have to create synergy via building a positive culture, achieve operational excellence, become customer-centric, and do more with innovation. To stay competitive, companies must go beyond experimenting with digital and commit to transforming themselves into a fully digital business powerhouse. But how to develop the best/next practices moving you from here to there?

Break down silos from both mentality level and organizational structure perspective: Silo mentality is a common challenge for lots of organizations. It is also the root cause of IT-business gap. Because digital means hyperconnectivity, fast-paced change, and always-on businesses, silo drag down the business speed and stifle digital flow. Though functional silos in traditional organizations at the industrial age intend to achieve the certain level of business efficiency. There are negative conflicts when the organization has little clarified communication and collaborative competency; and when they integrate, there is more potential to innovate and create value, more so when the collaborative competency of the organization is strong. From mentality level, a lot of organization’s reaction to the silo mentality goes back to leadership and trust.Often lack of strategic and team objectives and rewards that drive this mentality.  It is not structured, but the behaviors and attitudes of the leadership teams, having leaders of respective functions to interact in a structured setting on a consist basis goes a long way towards eliminating the silo mentality. When organizational leaders place an emphasis on building a culture of cross-functional communication and collaboration, the opportunity for silos to work against the alignment of all departments towards the strategic goals and objectives of the organization is diminished.

IT cost optimization is a continuous journey: Thoughtful cost optimization and wise investment with an eye towards the future is the signal of a well-run company. This is particular critical for IT because of frequent technology update and costly IT investment. A CIO must be able to develop and optimize the IT operational function within itself, as well as help optimize business at the company scope. All of IT spending must be looked at through an investment lens, provide a framework for thoughtful and informed decision-making, etc. Though IT is complex, Keep it Simple” should always be one of the guiding principles and management culture for running IT to achieve operational excellence. Also, it is so critical to have the IT resource aligned with the business strategies/ objectives. When a CIO is able to position and maintain the IT organization to ensure it addresses both "IT effectiveness" and "IT efficiency," strive to achieve IT agility and maturity, they have earned their stripes.

Doing more with innovation and manage a healthy innovation management portfolio: The spectrum of digital innovation is broad. There are different flavors of innovations: Disruptive innovation, evolutionary innovation and incremental innovation. There are “hard” innovations such as product/service/business model innovations as well as “soft” innovations such as management or culture/communication innovations. More and more firms are learning and implementing best practices of innovation for improving the success rate of innovation. The paradox is that, innovation is about figuring out the new way to do things, it is not supposed to be the industrial best practices. Every organization needs to develop the set of customized practice for the specific situation and challenges that are faced and that actually requires different priorities as compared to others. So any best practice is not a “one size fits all” formula, these practices might be different across organizations, across departments, and affiliates within an organization and can change over time. It requires an organization and culture that nurtures new ideas and is able to profitably execute on those ideas. Every organization needs to develop the tailored innovation practices via leveraging effective tools or methodologies and use them wisely with the expertise to really add value or drive innovation

From here - doing digital to there- being digital is the journey with the multidimensional digital effects. But it provides impressive advantages in term of the speed of delivery, the quality of information for decision making, and the wisdom of digital workforce. It is important to develop the best/next practices, and it takes the team effort and coordination for building a consistently innovate and high mature digital organization.

Tuesday, March 21, 2017

The Gains and Pains in Change Management

Change is never for its sake, it is about tolerating growth pains, removing unnecessary pains, and solving problems for the long term gains.

Change is inevitable, and the speed of change is increasing. For individuals or organizations at the lower level of change maturity, change is a reactive action and a reluctant activity. They get stuck in the “comfort zone” for so long, dislike changes. But change is the only way to move forward. In fact, there are both gains and pains in Change Management, so how to identify, understand, and manage changes smoothly?

Understand the big WHY about change to clarify growth pains which are perhaps necessary, but also avoid unnecessary pains: Many organizations focus so heavily on the "doing" (the "how"), they lose the sight of the "purpose," the "WHY" part of changes. It is the key to present the WHY first. Primarily, it provides a way to inject enthusiasm, which is infectious and spurs the concept forward. Clarify the big WHY about change is to convey the vision about the change, highlight the potential gains via changes, and emphasize on the cause-effect - What could be happening (more pains) without changes. Because change cannot be completely manipulated from top-down, many static mindsets scattered at all level of the organization perhaps consciously or subconsciously set roadblocks for changes. Hence, it is important to start changes from the mindset level in order to gain in-depth understanding about the big WHY, bridge any cognitive gaps, further drive change attitude and sustain change behaviors. "Why" should be reaffirmed at each step in the "How." Once people agree with the “WHY” part of the reasoning, they can develop their own level or means of participating, embed creativity in the change scenario, maybe even offer what you didn't think to ask for, expanding the full meaning of the CHANGE concept itself, thereby re-injecting further excitement in their being part of it. People only like the comfort zone if they have been given no reason to consider going someplace better or don't even know there is a "new and improved" zone they could go to. Hence, the big WHY change conversation can clarify the gains and pains accordingly.

Understand the psychology behind the change to manage emotion life cycle and discourage negative vibes which perhaps cause unnecessary pains: What is more interesting about change psychology is what drives people's perspective. Those lack of vision are either incentivized to focus only on the short-term gain; limited by their narrow lens and dimmed outlook, inexperienced outside of the small domain in which they operate; too focused on their own comfort zone for self-preservation; or have no energy or desire left to think longer term. Even worst, when the negative vibes surrounding in your organizations, talented employees become the victims of suffering those unnecessary pains, the business reputation gets damaged via lower morale, low employee satisfaction, and mediocre performance. When people experience a state of anxiety or uncertainty, they tend to drift back to the comfort zone with “small thinking” filled with negative emotions. When that anxiety is removed and they experience more certainty, they have the courage to think more expansively. There is a distinct relationship between a person's emotional state and small or expansive thinking:  If change is going to make them feel more comfortable, they accept it. If not, they resist. The bottom line, people love comfort zone and dislike anything that will take them away from that zone. Hence, recognize your change champions and empower your change agents, in order to build the culture of CHANGE- the fundamental step for making advancement and accelerating innovation.

The good change leaders focus on solutions to the painful problems, not on blame or finger-pointing: What is (and has been) missing from the organizations is perhaps a palpable sense of long-term vision, problem-solving culture, and people-centricity. Change is never for its sake, it is about tolerating grow pains, removing unnecessary pains, and solving problems for the long term gains. So as far as who is to blame, per se, anyone who contributes to the decline of an organization can own some fault it in its demise. But to keep the positive tone and get change going smoothly, change leaders should focus on solving problems, not for finger pointing, and reduce unnecessary pains. Build a culture of accountability which is the key to building strong teams. When the leader isn't holding others accountable, the team can become fragmented, unappreciated and quickly dysfunctional. Further, put the emphasis on learning instead of retribution. Enhance opportunities for self-expression and personal autonomy, encourage the culture of authenticity, and build the trust-based and professional work environments for catalyzing changes and improving business maturity.

"Change management" is the overarching umbrella, that encompasses planning, communications, discovery of concerns / objections / potential points of failure, addressing fears and resistance, developing a shared vision, communicating valid and compelling reasons for cooperation, recognizing sacrifice and incremental success, measuring outcomes in a shared and mutually understood and agreed upon fashion. Change is also a journey full of uncertainty. So manage the gain and pain effectively, and build change as an ongoing capability.

Leaping Digital Transformation at the Inflection Point

A strategic inflection point is a time in the life cycle of a business when its fundamentals (people, process, technologies, cultures) are about to change. 

All forward-looking organizations are on the journey of digital transformaiton. Digitalization implies the full-scale changes in the way the business is conducted and expand business transformation to the multiple directions, so that simply adopting a new digital technology is not insufficient. Such change can mean an opportunity to rise to new heights, or a risk to hit the uncertainty. Hence, a solid roadmap with well setting goals is important for making a smooth digitalization journey. The leading organizations today are also reaching the inflection point for digital transformation. A strategic inflection point is a time in the life cycle of a business when its fundamentals (people, process, technologies, cultures) are about to change. You have to transform the company's underlying functions and organization as a whole with adjusted digital speed. Here are three focal points for making a seamless digital shift.

Gap-minding: Digital means hyperconnectivity and interdependence. Digital era is volatile, complex, uncertain and ambiguous, to run a high performance and high mature digital organization, it is important to bridge the multitude gaps for speeding up changes. However, many organizations today are still running in the silo, with rigid processes and bureaucratic management styles. There are leadership gaps, functional gaps and communications gaps existing to drag down business effectiveness and decrease organizational agility (the ability to adapt to changes). For example, miscommunication is caused by perception gaps because people have the different knowledge base and cognitive understanding to articulate things. Communication effectiveness can be improved when the hard barriers (processes) are breakdown and soft obstacles (collective mindsets) are overcome, the heterogeneous team embraces the multiple viewpoints, learn and share via common business language without “ lost in the translation," and facilitate smooth digital dialogues to ensure all parties are on the same page. To speed up digital innovation and transformation, it is also important to bridge resource gaps for harnessing innovation and maintain the digital balance and flow. Try to digitally connect key resources/assets in their vicinity/context to the resource-rich innovation hubs/clusters across the business ecosystem. It is also important to bridge the collaboration gap to harmonize business partnerships and improve the collective business capabilities for problem-solving with speed.

Scalability: Due to the increasing pace of changes and continuous digital disruptions, change management is no longer just a one-time initiative, but an ongoing business capability which also needs to scale up across the organizational scope via building the common set of principles and developing the best and next business practices. The reason why some or many transformations fail - some soft factors and the challenge of complexity come into play. One thing is to implement and scale certain best practices, keep adding the right ingredients for a transformation. Digital organizations arise when the scale of the interrelations, interactions, or interrelational interactions amplifies the collective capability to achieve more values for the organization. When reaching the inflection point of changes, Digital Masters can stretch out in every business dimension for driving the full-fledged digital transformation with all essential dimensions (people, culture, organizational structure, process) to adapt to the new world of the business. Faster, always “on,” high connected and super competitive. Digital business is a system that is not scalable so easily, but it’s the worthy effort to amplify business capabilities and accelerate and sustain changes and digital transformation.

Prioritization: There are so many things organizations need to spin well simultaneously these days. “Run, Grow, and Transformation,” is all about setting the priority right and laser focus on the most important things. It is also about striking the right balance of keeping the bottom line organizational efficiency and the top line business growth. Regardless how many distractions in the business ecosystem, Digital Masters concentrate on the strategic goals and objectives of their organizations and make sure that the roles and functions are stated perfectly, and the digital management styles are updated to enforce interrelational management process being developed to help reduce the tensions, frictions, and conflicts that arise; the business/IT investments are evaluated comprehensively to achieve high business return; the leaders and managers master the holistic digital management discipline to encourage autonomy and avoid micro-management pitfalls; and the talented employees have superior time management skills for putting more time and effort on the things matter to their organization most such as innovation, also keep sharpening their skills for adapting to changes.

Going Digital is no brainer. However, it is the thorny journey with many curves and bumps, roadblocks and pitfalls on the way. Organizations have to build the well-rounded capabilities, run up all important stages. Make a leap at the inflection point, minding gaps, scaling up and prioritizing right, for reaching the high level of digital maturity.

Monday, March 20, 2017

The Monthly CIO Debates Collection: March, 2017

Debating is not for stimulating conflicts, but for brainstorming better ways to do things.

Modern CIOs face many challenges, it is not sufficient to only keep the lights on. Regardless of which industry or the nature of organization you are in, being a digital leader will need to master the art of creating unique, differentiating value from piles of commoditized technologies and take advantage of the emergent digital trends as well. Digital CIOs need to have multiple personas, “Chief Innovation Officer,” “Chief Insight Officer,” “Chief Improvement Officer,” “Chief Information Officer,” and here, we discuss CIOs as “Chief Inquisitive Officer,” with a set of Q&As to lead the digital transformation.

  • Make a Leap of IT Digital Transformation via Healthy Debating? Due to the exponential growth of information and disruptive nature of digital technologies, IT is at the crossroad: Should IT continue to be run as an “isolated function,” just keep the lights on, and gradually become irrelevant? Or should IT reinvent itself to become the change agent of the business? It is the time to reimagine IT via inspiring critical and creative thinking and spurring healthy debating. Because debating is a type of critical thinking activity. Critical thinking is a basic form of organized thought specifically used to frame the right questions, identify the real problems, and discover better ways to do things.

  • Are you Running IT Organization as a “Magic” or a Trendsetter? IT plays a critical role in modern businesses today, however, most business leaders and professionals lack the in-depth understanding of IT organizations, often time, the “magic” thinking of IT is one of the root causes to divide business and IT and create gaps for the digital transformation. In practice, digital IT organization needs to become an integral part of the high mature digital company, to gain competitive advantage or differentiated capability for the business’s growth. To improve IT maturity, CIOs should ask themselves: Are you running IT organization as a “Magic,” or a “trendsetter”?

  • How to Set Right Priorities for IT Digital transformation Digital disruption is frequent and unstructured, businesses just have to get used to the new normal and learn how to deal with them proactively. Obviously, there is no one size fits all solution, and "boil the ocean" approaches seldom deliver expected results. So how to take a structural approach in dealing with digital disruptions, and what’s the logical scenario to manage digital transformation seamlessly?  

  • Is your Organization in the Progress, Plateau or Stagnation of Digital Transformation? Digital makes a significant impact on every aspect of the business from people, process to technology both horizontally and vertically. However, businesses evolve changes at a different speed because they are at the different stage of the business lifecycle, as well as they are in the different level of business maturity. Hence, in order to lead change effectively, business leaders should do the check-up continuously: Is your organization in the progress, plateau or stagnation of digital transformation? And how to create the momentum and lead change more effortlessly?

  • As CIOs: Which IT Management Dilemmas Do you Encounter? Technology is pervasive, business initiatives, changes, and transformation today nearly always involve some form of technology implementation or information analysis; IT touches both hard business processes and soft human behaviors. However, managing a highly effective IT is not an easy job, IT leaders have to overcome many change management roadblocks and deal with quite a few of IT management dilemmas in transforming from a cost center to value creator, from a support function to a strategic business partner; from a back office to an innovation front yard.

The “Future of CIO” Blog has reached 1.8 million page views with 3600+ blog posting in 59+ different categories of leadership, management, strategy, digitalization, change/talent, etc. blog posting. The content richness is not for its own sake, but to convey the vision and share the wisdom. Blogging is not about writing, but about thinking and innovating the new ideas; it’s not just about WHAT to say, but about WHY to say, and HOW to say it. It reflects the color and shade of your thought patterns, and it indicates the peaks and curves of your thinking waves. Unlike pure entertainment, quality and professional content takes time for digesting, contemplation and engaging, and therefore, it takes the time to attract the "hungry minds" and the "deep souls." It’s the journey to amplify diverse voices and deepen digital footprints, and it's the way to harness your innovative spirit.

Five Themes in Amplifying Collective Human Capability

Though there are both hard and soft business elements in building organizational capabilities. Still, people are the capability masters

Digital is the age of people, building a people-centric organization is the strategic imperative for any forward-thinking business today. These talent-magnet organizations are good at building the culture of authenticity, inspiring autonomy, and putting the right people with the right capability in the right position to solve the right problems. To unleash the full digital potential of the organization, do not just think people as cost or resource only, but as assets and capital to invest in to build the collective digital capability. Digital workforce planning and management have to become more analytic and systematic, strategic and innovative. Here are five business management themes in amplifying the collective human capabilities.
Communication: Either as the digital leader or professional today, we can achieve effective communication when we make sure our desired thought is interpreted between multiple entities and acted on in the desired way. Effective communication is so important, since different perspectives, and talent, lead to well-rounded ideas and solutions. It is more a thing of personality match and expertise in the goal of the company. It is about the skill and ability to work together and amplify the collective capability for problem-solving. Try horizontal and vertical open communication to reach out to your audience. As a leader, you must follow-up to get feedback which can also be a way to confirm your team's understanding of your communication and to catch errors and correct them on time, with the goal to create a high-effective, high-capable, and high-performance team.
Innovation: Innovation is always the tough journey, not a flat road. Due to the complexity of modern businesses, innovation nowadays is often the teamwork, the collective innovation capability can only be crafted in the working environment with open and risk-tolerance culture. Failure is part of innovation; it is very much an intrinsic part of innovating, but fail forward and learn some lessons from it. Innovation is the teamwork, and Innovation Management System includes policies, structure, and program that innovation managers can use to drive innovation. Remove any of the three, you're liable to fail.  Like many other things in businesses, innovation management takes a balancing act to have enough failure and an environment that encourages learning from failure quickly and cheaply, without having failures that are too frequent or too expensive. So, the differentiation between a good innovation and bad innovation is the innovation leaders’ attitude toward risks. The positive attitude to be cautiously optimistic, take calculated risks and be alert about obstacles or pitfalls, can inspire a good innovation initiative, and manage innovation as the differentiated business capability.
Motivation: Motivation is all about to cultivate the culture of learning with the growth mindset. Self-motivation is to get yourself doing things with discipline, practice and achieve the ultimate goals. A self-motivated person is more driven and adapts to changes, a motivated leader with the right approach can drive the team to become self-disciplined and achieve better business results via the collective human capability. A successful high-performance team is good for the business and an important factor in employee retention as well. And motivational leaders are both self-motivated and can motivate people moving more into the area of coaching or mentoring because you are motivating people by allowing them to learn and by giving them the time and the confidence to work out for themselves what needs to be done in certain situations.

Empowerment: Overall speaking, the employee satisfaction is still low in the majority of organizations today. To achieve high performance and unleash talent potential, it is critical to empowering talented employees to learn, grow, discover “who they are,” and become “who they want to be.”  The latest enterprise social platforms and collaboration tools make it practical to break down functional silos and improve cross-functional communication and collaboration. From an organizational structure perspective, delayering becomes a lens through which it is possible to examine and then fix many other issues for optimizing business processes which underpin business capabilities. In other words, an organization can approach the flow zone when the positions in its hierarchy have clear, accountable tasks. The empowered digital workforce today is hyper-connected and divergent in many ways, share a natural affinity for new perspectives, innovations, and collective capability.
Collaboration: Nowadays, digital hyper-connectivity blurs functional, business and industrial territories, cross-silo or cross-divisional collaborations are crucial to building dynamic digital capabilities. It is imperative that we are willing to seek out help, break down silos, and harness cross-functional collaboration as we work to generate new ideas or co-solve problems, and amplify collective capabilities. Digital leaders and professionals today need to master both asking insightful questions and facilitate answers via multiple perspectives and figure out the alternative ways to do things because digital is the age of choices. Being inquisitive is not the sign of a weakness, but rather an open door to illustrate the value of developing the answer with a colleague or sharing the power of diverse perspectives to shape a new idea or solution. That is the art of digital collaboration, the science of digital business discipline, and the beauty of digital convenience. Being high-collaborative and connecting-wise means to discern the trend from fads, seek business values before taking business initiatives, and to build a high-innovative digital powerhouse.
Though there are both hard and soft business elements in building organizational capabilities. Still, people are the capability masters. Digital businesses today must inspire and empower their people. Highly mature digital organizations have the high-level digital capability not only to build a digital business with people-centricity, but also to catalyzing enterprise-wide transformation via self-aware leadership, self-adaptive systems, and self-disciplined and self-motivated people. They have to stretch out in every business dimension for amplifying collective human capabilities and driving the full-fledged digital transformation.

The Ecosystem View of Business Capability Building and Digital Transformation

Everything is interconnected and the business ecosystem becomes more interdependent and dynamic than ever.

Digital transformation is the paradigm shift. Adopting a different paradigm is like changing the glasses and new possibilities continue to emerge. Those who look through the lens of the previous industrial era see their own reality very differently from those who leverage the lens that the new era has crafted. Due to the hyperconnected digital reality, you have to gain the interdisciplinary understanding via the multitude of dimensions (socio-cultural, socio-technical, socio-economic, organizational, scientific, philosophical, the psychological, the artistic, etc), and to catalyze changes and accelerate digitalization, you have to embrace the holistic ecosystem view of capability building and digital transformation.

Changeability: Digital paradigm means hyper-connectivity, interdependence, and integration. By this new digital age thinking, the business ecosystem is integrated and hyper-connected, just like the whole nature ecosystem is an integrated identity.  Management systems and processes are gradually moving away from a static, unidirectional, and time-bound avatar to a more dynamic, continuous, and interactive state, such dynamic digital ecosystem explicitly seeks to create a creative working environment where people can grow, and business focuses on dynamic resources, long-term perspectives, scalable performance and harmonized relationship. There are two significant factors behind successful organizational changes and business transformation. The first is organizational change capability. The second is around the appropriate bounding of roles and responsibilities of those working in the organizational change space. The solutions will most probably cover standard aspects such as culture/behavior change, support resources for the design/build/implementation of the change (what mix of internal/external resources /capabilities), planning and control etc. but also very specific technical/functional aspects. The reality is that there are many contributing factors to change failure, and it is often a combination of these causes which has such a devastating impact on a change initiative or the business transformation effort. So do not limit the success factor for a change or transformation to any particular aspect, nor accept the pure success or pure failure assumption. To start and to expand the collaborative change process, it will be effective to the surface, examine, challenge and perhaps, even shift the underlying paradigms and tune the dynamic digital ecosystem in a structural way.

Building a digital capability portfolio and manage capability lifecycle effectively: After gaining the full digital awareness, top leadership/ management in an organization defines a business strategy, in order to reach the business vision, a set of core capabilities is needed to meet and implement the strategy.  The organization needs to ask whether they need the capability at the base level to keep the light on, or at the competitive level to stay competitive in the business and at a differentiating level to be the key differentiator for its business. So the core capabilities could be those that are identified as delivering the competitive products, services, and customer experiences than competitors.Enterprise capability management, in essence, consists of a portfolio or matrix of capabilities that are used in various combinations to achieve outcomes. Within that portfolio, a capability will be transient unless managed and maintained over time. Therefore, a typical capability lifecycle spans need, requirements, acquisition, in-service, obsolescence, and disposal. There may be many elements of digital capabilities that are foundational to almost any foreseeable digital strategy so implementing them could be viewed as a valid preparatory first step in readiness for a strategic opportunity when it is recognized. The most important thing when it comes to implementing strategy is to gain the buy-in or understanding of those who will be affected by it, and understand the interconnected digital business ecosystem as well.

Crafting the modular capabilities to create the integral business solutions: Internal capabilities and processes are broken into modular service components that have standard open interfaces. Loose coupling makes it possible to change the components without affecting the system, as long as the interface is kept stable. The dynamic digital organizations need to get away from letting things fall through and start creating “integrated wholes” by utilizing the correct processes to solve these complexities, ultimately bridging the chasm between strategy and execution. Organizations need to close both capability gap which is the lack of certain capabilities, as well as the capacity gap which is a lack of 'the resources' needed by the processes which operationalize a capability to do a given amount of work. Align the different parts of the ecosystem to adopt more points of integration and incorporate the use of "stacks"— modular, layered and loosely coupled modular capabilities to build integral business solutions with:
-Ability to collaborate with their business counterparts.        
-Understanding of end customer expectations and experience.   
-Optimizing organizational structure (hierarchy, existing roles and skill sets)     
-Building technical abilities.
-Improving agility to move quickly, adapt and change course

Therefore, in order to succeed in today’s fast-changing digital business dynamic, harnessing the power of ecosystems is critical. Everything is interconnected and the business ecosystem becomes more interdependent and dynamic than ever, the all-permeating information has made every object of the digital system and nature responsive, communicative, and innovative. Organizations just have to keep evolving, ride above the learning curve and upcoming waves, and get digital ready with the steadfast speed.

Sunday, March 19, 2017

Understanding Business Capabilities from Multiple Perspectives

Gaining an in-depth understanding of business capabilities helps today’s business leaders to craft good strategy and implement it effectively.

The capability is the ability to achieve the desired effect under specified performance, standards, and conditions through combinations of ways and means (activities and resources) to perform a set of activities. The capability necessities enable the business to operate smoothly on the daily basis, and the capability differentiator leaps the business to win over the competition and building the long-term competency. Statistically, the capability-based strategy has much high success rate to achieve the well-defined business result. Therefore, it is critical to gain an in-depth understanding of business capabilities from multiple perspectives and build a solid foundation for implementing the capability-based strategy and running a high-performance digital business.

Investment Perspective: All business investments and meaningful business activities should strive to build tangible business capabilities to achieve ultimate business goals. There are both opportunities and risks for every investment. The business executives have to apply systems thinking to make an objective assessment of their investment portfolio for getting high ROIs; continually evaluating individuals and aggregate investments in terms of value, risk, and reward, for building a cohesive business capability portfolio. Visibility into each investment is established to provide ongoing investment health information as well as enable understanding the overall portfolio health: Are they diversified?What is the relative health (risk, value, strategic importance) of each of the portfolios? What investments, or even portfolios, should be shut down? What investments, or even portfolios, should you direct more assets to? What, and where, are there talent gaps to build the set of differentiated business capabilities?

Process Perspective: Business processes underpin organizational capabilities. Hence, process improvement, time, and period reduced for the business by IT directly impact the maturity level of business capability. The processes and capabilities are the opposite sides of the same coin, processes are the actions that provide desired capabilities as outcomes. Start with a mapping of processes to capabilities, do the process assessments, and infer from that with the resulting capability perspective. There are different conditions to evaluate a capability, such as - is this capability valuable? Is this capability rare?  Is this capability costly to imitate? Is this capability non-substitutable? Any capability which fulfills all these conditions would lie pretty close to the core competency of that enterprise and thus is valuable.

Talent Perspective: Even process, resource, information, etc., are all important elements of business capabilities. People are still the most critical business element for either crafting organizational capability or building business competency. The collective human capability is the ability to transform which existing to which is new, it is the driving force of creativity, and investing human capital will directly impact on how to maximize the full digital potential of the business. Today’s digital professionals are innovative workers, hard workers, knowledge workers and intelligent workers, who are exploring, innovating and evolving bringing new digital paradigms.

Information Technology Perspective: IT is the threshold for building the digital capability of the business. Digital IT is the integrator and superglue to recombinant dynamic business capabilities, without them, strategy execution can not be sustained. Thus, IT first needs to dig through the underneath functions and processes of the business, and understand the business’s operation models, explore the way to define value to the organization, and to do that, it needs to properly understand all elements of business capabilities that can help create business competency to the organization, and how all the pieces and parts of the organization’s capabilities can be recombined into the new dynamic business capabilities to respond to the ever fast-changing business dynamic for either improving operational excellence or delighting customers.

Governance Perspective: Corporate governance is most often viewed as both the structure and the relationships for enabling business capability building. It also determines corporate direction and performance. Governance can begin with frameworks and policies to be put in place, depending on the nature, scale, and complexity of the organization, understanding one's risks and conducting. From a business capability perspective, governance is not about maximization but about optimization. Governance is a neutral term which is useful in having the ability to discuss bad governance with terms such as waste, corruption, inefficiency etc. It is the structure and processes of authority, responsibility and accountability in a business or organization with three things in concert: Oversight of assessment - gauging conditions and choices, oversight of appropriation - matching priorities and resources, and oversight of accountability - scoring activity and net results.

Gaining an in-depth understanding of business capabilities helps today’s business leaders to craft good strategy and implement it effectively; it also enables the digital workforce to map their daily tasks with the professional capabilities they need to craft, as well as mapping professional capabilities with specific business functional/operational or change/innovation capabilities, for adapting to the new business dynamic, with the ultimate goal to run, grow and transform the business and maximize its full digital potential.

How to Set Right Priorities for IT Digital transformation

By setting the right priority and focusing resources and budget on the most critical areas, IT has the opportunity to not only be responsive but ultimately be the strategic business partner.

With increasing speed of changes and overwhelming growth of information, IT can no longer keep static to run as a support function only. Today's IT plays a more crucial role in discovering a path to strategy building, implementation, and innovation. Business/IT leaders should also realize the breakthrough success in digital businesses requires not only forward-thinking strategies but also having a step-wise approach. But more specifically, how to set the right priorities for making a digital transformation of the company?

Innovation Management: The digital mantra of IT is to “Do More with Innovation.” Besides transactional business activities, IT has to spend more time and resource on spotting the opportunities to increase revenues. Looking for solutions which will directly benefit the external end customer will improve the competitive advantage and in-turn bring in increased revenue. Digital IT needs to spend a significant amount of time on strategy management and innovation. IT is no longer just the tangible hardware boxes which are heading into the commodity, The pervasive digitization requires both business and technology professionals to rethink how things are done in organizations. The “reach and range” flexibility that now exists removes barriers that have existed in the past. After researching what happens when business managers use lateral thinking, the requirement that creativity CIOs need to become the real business leaders to work within IT and across the business scope and seek ways to grow revenues, improve profitability and spur innovation. IT also needs to build up the new set of core digital capabilities in transforming itself and business as a whole; as IT is an innovation solution provider to help organizations deliver the best-tailored products or solutions to its end customers.

Cost optimization: Traditional IT organizations are often overloaded and understaffed. Too many requirements, too many conflicting priorities of organizations do not create an environment for clarity and optimization. IT management often spreads limited resources or budget on too many things, lack of focus, or set the wrong priority. In fact, many organizations have little insight into their cost structures and who is consuming the assets. They have no idea where they are spending their money on and often assume it is mainly being spent on items which are actually much lower on the list. Hence, to digitize IT and improve IT efficiency and agility, all IT spending must be rationalized against the business benefits. Assume you're going to allocate the cost of IT investment across several revenue generating groups, whatever the cost is estimated to be, they will then need to determine the net increase in revenue at current margins needed to offset the cost of the the business and the management can get a better clearer picture of IT solution from a cost, transparency and complexity level. In addition, avoiding waste is better than eliminating waste. Eliminating waste is about eliminating something which is not used and saving effort on maintaining it. Avoiding waste is more about not building non-value adding features. The goal of optimization is to eliminate unnecessary complication, but also encourage desired complexity such as design, or overall business capability management, to better compete in a global marketplace with optimized cost management. The business leadership team needs IT to be the business cost optimization expert for the company, to find creative sources of competitive advantage.

Projects delivered on value, on time and budget in this order: Due to the fast pace of changes and shortened business cycle, IT has to be run in a continuous delivery mode. There are fewer multi-year projects, more customer-centric solutions with faster delivery. Also, the project development and management cycle is shortened based on Agile philosophy and methodology. Statistically, there is a very high percentage of projects fail to meet customers’ expectation. It is essential for a company to have an up to date understanding of their own IT, sadly many do not and forge head forwards into projects which fail because of that lack of understanding brings. The organizations who are successful in delivering its IT projects is to ensure that there is readiness among other important aspects of schedule, scope, and cost.
That is not to say that these projects didn't have problems because like most projects they did, but the whole team, including sponsors, worked together to resolve them. When to look at those really successful organizations that seem to always be able to execute projects and programs well, they mostly have clear, precise and inspiring leadership; engaged and driven employees and technical expertise. The most successful projects are those in which the business and technical (IT) personnel worked in harmony and the leadership fully empowered and supported the IT leadership and management.

Customer satisfaction (both internal and end customers): Digital is the age of customers. Building a customer-centric IT is the goal to improve IT maturity. IT has two sets of customers, internal business users as well as end business customers. IT should empower internal customers via providing them efficient tools to improve employee engagement and productivity; IT also needs to spend more time on digitizing the touch point of end customers’ experience and improve customer satisfaction. Customer experience is the key differentiator and an important strategy for the business’s long-term profitability. The next practice is to live as "customers," point out that customer inquiries are not just support related, but can foster new and better ways the application can perform and optimize every touch point of customer experience. Customer experience isn't about improving things for the customer at any cost. It's about having the real insight to make confident business decisions that result in unambiguous ROI. As always, take a step-wise approach: First, define "customer experience" for your organization. And then a valid strategic objective and the strategy mapping allow you to first understand your customers and what they value, and then identifies how to best characterize that value, define key indicators, and then set those measures appropriate to best assess the performance of these indicators because they show you how well they satisfy or delight customers.

Digital IT Workforce management: IT skill gap is the reality. IT needs both specialized generalists who have both strong business acumen and in-depth IT understanding to frame and solve the right business problems; as well as dedicated IT specialists who can take care of the daily IT operation issues. Therefore, it is important to put the right talent in the right position with the right capabilities to solve the right problems. Otherwise, it can enlarge the IT-business gaps because many IT specialists do not have enough knowledge and understanding about their businesses or customers, very few know their business’s strategy, and can’t map their daily tasks to the business’s strategic goal. Thus, it is no surprise that sometimes, instead of solving problems, they probably add more unnecessary complexity to the already tangled processes or products, to create the new problems. To digitize IT, the IT workplace needs to be designed to build a culture of innovation, and help employees at all levels within an organization (from leaders to front-line) understand and develop their creative capacity to solve problems and exploit opportunities in new and innovative ways. IT professionals today must demonstrate learning agility to keep update knowledge. Although the responsibility to maintain and grow one’s expertise (technical and management/ leadership/ industry) has always largely fallen on the individual employee; albeit it is great when the organization provides support and empower their staff to achieve more, align their career goal with the business goals and build the culture of risk-tolerance & experimentation, to inspire creativity and catalyze innovation.

There is no one size fits all formula to run a high effective IT. Because different IT organizations and the enterprise as a whole are at the different stage of reaching business maturity. By setting the right priority and focusing resources and budget on the most critical areas, IT has the opportunity to not only be responsive but ultimately be strategic leaders capable of helping lines of business thrive by proactively driving digital transformation.

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