Why employees are the key to your digital transformation

Take as much holiday as you want

Richard Branson recently announced that Virgin will allow staff to take as much holiday as they like; no checking with managers, no tracking days off. The rationale is simple. Since the boundary between work and play has blurred we can, and do, work anywhere. So it’s no longer possible to reasonably meter when we’re at work, thus, it’s no longer reasonable to meter when we’re not. The most striking thing about this is the inherent recognition that Industrial Age working practices, tracking annual leave for example, are no longer relevant; that employees today need different working practices to be effective (see below).

This isn’t new, companies like Netflix have had a “Freedom & Responsibility” policy since 2010, which includes unmetered vacation; and the gaming company, Valve, has had a collaborative and adaptive structure, with no bosses, since 1996. Start-ups are also highly familiar with this approach having applied them for over a decade (see Mick Liubinskas and Phil Morle’s excellent book, ’Start-Up Focus’ for more).

However, although these ways of working are proven there’s still a challenge. More than half of companies cite changes in culture and working practices as the main barrier to a successful digital transformation. Much of this is a result of companies, to their detriment, struggling to let go of Industrial Age practices.

Going beyond the lab.

Many large corporates are applying Digital Age practices, but for the most part they’re limited to innovation labs, spin-off ventures, or digital departments. These aren’t without value, though they generally struggle as they’re effectively “another” silo that’s applying Digital Age approaches within an organisation that’s still using Industrial Age ones. Under these conditions they struggle to make a material impact in the company and tend to, over time, erode and eventually fail.

So how can companies adopt Digital Age working practices and maintain a path to ‘Digirati’?;

1. BE HOLISTIC

Stand alone investments (innovation labs, agile/digital teams etc.) make a statement to the market and broader business but they’re not a long term solution and are likely to fail if stand-alone. An holistic approach that considers how these investments will connect and extend across the company is essential. For example, Nike created Nike Digital Sport, and although this was a distinct division, it focused on leading customer-facing digital projects across the company.

2. LEARN (IN REVERSE)

For the first time in history the young know more than the old. The average age of Board members is over 60, with multiple surveys agreeing that they need more technology knowledge. This knowledge already exists in new recruits, and reverse mentoring programs, like the ones at L’Oreal and GE, can bring this critical learning to the Board.

3. LET GO

We’re in a time where the demands of customers are changing continuously. Employees need autonomy and space for self-leadership so they can respond quickly and effectively. Letting go means trusting employees to manage their time, as Richard Branson has, and, in tandem, relinquishing the tight control that comes with Industrial Age working practices.

4. BREAK EVERY SILO

Digital isn’t just about connecting with customers, it’s also about opening flows of information and softening line management structures to broaden networks and break silos. Connect with start-ups, other companies, and open employee connections (e.g. enterprise social). Even connect more strongly with customers, like giffgaff, for example, who regularly collaborates directly with customers on new product ideas.

Fighting on two fronts

Granted, it’s not straight forward to do this in an organisation that’s been around for 100 or even just 20 years. Digital Age working practices challenge the core of Industrial Age ways of operating, requiring the leadership and management to relinquish control and this is hard.

But there’s a widening gap that needs to be addressed; in a recent MIT study, all levels of staff agreed that digital transformation was critical. However, whilst the C-level are generally comfortable with how quickly the business is responding, everyone else is crying out that the pace is far too slow. This creates challenges with staff morale and attrition, with many moving to the leading companies, the ‘Digirati’, (which exist in every industry), strengthening their position even further.

Adopting Digital Age working practices might be hard, but not doing it may leave CxOs in the unenviable position of fighting the digital battle on two fronts; with their customers AND their employees.

ABOUT THE AUTHOR

Ben Gilchriest

Ben is focused on helping companies understand and achieve their digital future. He has led consulting practices in both Australia and the UK for 14 years, including the design, setup, and leadership of the Digital Transformation practice for Capgemini ANZ. He has defined and led a wide range of major digital transformation and strategy projects, all with a focus on the customer, to deliver step changes in operational performance. He is part of several global forums on digital transformation and developed and delivered methodologies across a range of domains including social media, Enterprise 2.0, and digital commerce. Most recently he setup the Digital Transformation Lab Australia, a joint venture with the University of Sydney Business School, that is setting new standards for Australian businesses across a wide range of digital domains.

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