Wednesday, September 5, 2018

Digital Effectiveness as an Important Characteristic of Digital Quality

Many organizations are on the journey of digital transformation which represents the next stage of business maturity.

Generally speaking, effectiveness is about doing the right things. Effectiveness is one of the critical characteristics of the overall organizational quality. Digital leaders need to focus on effectiveness, to ensure business having the vision, keeping in the right direction, and having well-defined goals to reach it.

Take an oversight of the business effectiveness: Effectiveness is about doing the right things and qualifying the business result. Thus, senior leadership teams should always scrutinize the effectiveness of the business. They play an important role in setting digital principles to ensure the right things are easy to do and encompass the business in the right direction. One of the pitfalls for achieving high business effectiveness is sometimes getting the “right answer” to the “wrong question.” Therefore, the top digital leaders should know how to frame the right questions and be open to the variety of point of views. The digital era upon us is full of uncertainty, velocity, complexity, and ambiguity, business leaders including boards should focus on effectiveness - the “why” part of business oversight, to ensure the organization having the vision and well-defined goals to reach it before jumping into “how.” Make sure that the good things are easy to do, and the bad things are hard to do. Make sure that the business is doing the right things first - pursuing effectiveness, and then, doing them in the right way - to achieve efficiency.

Quality (Effectiveness +nEfficiency= Q) is doing the right thing right, the first time: One of the pitfalls either for business improvement or innovation is sometimes getting the 'right answer' to the 'wrong question." Efficiency is doing things right with minimum inputs and resources (do it right the first time) and effectiveness is doing the right thing by following the principles and leading in the right directions. Generally speaking, you have to have effectiveness first, and then make the effect more efficient. Leaders focus on effectiveness, to ensure that the business is in the right direction while managers focus on efficiency, which is the relationship between how much time (or labor) you expected or planned to spend, versus what the actual was. Efficiency is to do what is effective, achieve high customer satisfaction with less operating cost, and achieve productivity and satisfaction for employees ling good teamwork. The optimal internal structure, autocratic or democratic of the enterprise is the one which provides the greatest effectiveness and efficiency, and depends, in large measure, on the nature and purpose of the enterprise. Efficiency means a way to measure how well you are in what you are doing in terms of available resources and talent. At some point in the enterprise evolution, business effectiveness and efficiency are also correlated specifically when the organization reaches its capacity.

The organizational management short-sightedness and running the business in a transactional mode cause digital ineffectiveness for the long run: Silo thinking cloudy the digital vision and decrease digital effectiveness. Doing the wrong things well won’t improve business effectiveness. Digital transformation is a long-term journey, to move up the organizational maturity level, businesses need to shift from transactional mode to transformational mode, ensure doing the right things to improve digital effectiveness before doing things right to achieve efficiency. The industrial organization with silo functional setting is to achieve the certain level of functional efficiency but often decrease business effectiveness. From an organizational structure perspective, often the middle management is the bottleneck of the business effectiveness and the very reason of change inertia. Thus, to improve business effectiveness, it’s important to think long-term and leverage a holistic lens for improving digital flow, enabling effective decision-making, and taking a systematic management approach to ensure that the business as a whole is superior to the parts.

Many organizations are on the journey of digital transformation which represents the next stage of business maturity. Setting the right policies, identifying the right people and doing the right things in the right way at the right time are all important management disciplines to improve the overall business effectiveness, efficiency, operational excellence, agility, innovation, intelligence, resilience, and people-centricity.


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