Monday, December 28, 2015

Digital Master Tuning #120: How to Overcome Three Digital Inertia

Change is the new normal, but it also becomes fundamentally difficult in most organizations due to the digital inertia.

We have moved into the deep, deep digital age when information is abundant and where creativity becomes a baseline competence. The race of information against the machine is ongoing, and the knowledge life cycle is significantly shortened. Many organizations are also at a crossroad facing unprecedented change and uncertainty, the significant business transformations are needed to digitalization, globalization, and radical innovation management. However, statistically, more than two-thirds of Change Management effort fail to achieve the expected result, so what are the digital inertia you need to deal with, in order to manage a successful digital transformation journey frictionlessly and ultimately build a Digital Master?

Change Inertia: Change is the new normal, but it also becomes fundamentally difficult in most organizations due to the change inertia or culture inertia, because it is treated as something distinct from running the business, evolving performance and increasing results over time. People often resist changing because they don't understand how it is relevant to them. The golden key is to acknowledge resistance and deal with it properly. There is nothing wrong with resistance. On the contrary, it is a good sign! By saying, "it is ok to feel resistance," the resistance will go down significantly because people feel that they are being heard/seen. Addressing the concerns doesn't necessarily mean altering, postponing or canceling the change, it often means explaining the rationale and may mean difficult decisions. Look at resistance as a source of energy and where there is energy there is still passion and potential. Much more dangerous is the disengaged workforce to continue doing things in the old way even the circumstances have changed significantly.

Innovation Inertia: The more dramatic and powerful the change is, the greater the risk would be. People tend to be "risk averse." Fear is one of the causes of innovation inertia. Creativity is inherently risky because it is new and different. Anyone or any company that fervently wants to be creative must be willing to face risks, and overcome the fear and inertia associated with such risks. With every "change," the risk is involved. If an individual is also plagued by self-doubt, then he or she would be even less likely to assert a creative idea public. In addition, it’s easier to think and act creatively in an environment that encourages risk and nurtures creativity. Therefore, from the innovation management perspective, you must allow room for failure, for tangents, for "being different." With creativity, "change" is made."

Strategy Execution Inertia: The top management in many companies spends the significant time in strategy making, however, the failure rate of strategy execution is still very high. One of the factors for strategies to fail at the implementation phase is its complexity. There’s ambiguity in such strategy. The expectation is not communicated clearly to all and is neither well understood by all stakeholders. Strategies should be simple that are understood by all. Digital ecosystem is volatile and uncertain, It becomes complex if things do interact - in particular in the case of "nonlinear" interaction and hyperconnectivity of digital ecosystem, you can't separate things properly or you cannot predict the actual effect of interaction straightforwardly. There are unknown interactions and very high inner dynamics in complexity. The complexity can be good or bad for businesses depending on your strategy and capability. Complexity Management is the methodology to minimize value-destroying complexity and efficiently control value-adding complexity in a cross-functional approach. And organizations must learn to navigate uncertainty and complexity via complexity mindset, innovate and adapt to increasingly changing digital realities. Strategy execution inertia can be overcome via clear communication, cross-functional collaboration, and the strong set of digital capabilities.

Organizations large or small are being experienced the dynamics of the most significant business transformation since the industrial revolution, and they are also at the different stage of such paradigm shift. One the biggest challenges is to overcome the digital inertia discussed above, cultivate a proactive attitude, build the full set of business capabilities to take the business from where you are to the next level of digital maturity.


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