Monday, December 17, 2018

Running Digital Organizations with Differentiated Business Competency

Digital management is fundamentally an iterative cycle to design, build, scale and optimize business competency and achieve the desired effect under specified performance standards and conditions. 

The characteristics of digital business are dynamic, volatile, uncertain, and hypercompetitive. Digitalization implies the full-scale changes in the way business is conducted so that simply adopting a new digital technology isn’t insufficient. You have to continuously scale up and dig underneath, optimize organizational processes and develop business capabilities, transform the underlying organizational structures and functions to ensure the business as a whole presenting the differentiated business competency and running with digital speed. Here is a set of differentiated business competencies.

Communication competency: We still live in the age of information-rich, but insight poor. Many gaps and problems at either business or society level are caused by miscommunication and misunderstanding. Communication gaps are caused by cognitive difference, ambiguous process or management bottleneck. Communication gaps decrease productivity, further cause mistrust and decelerate business speed. There are both hard communication barriers such as outdated processes, procedures, practices or soft obstacles such as culture, politics or leadership style, etc. The upside is that, nowadays, organizations move from using technology as a vehicle to maximize efficiency and minimize costs to leveraging technology as an enabler and catalyzer of developing totally new business models. Methodologically, companies are applying the latest digital technologies to open up the digital way to think and do things, leverage the multitude of communication channels to fit the situation and audience, and enforce collective creativity and collaboration. To build communication competency, pay more attention to communication content -what's your message; communication context (what will indicate to a different audience), communication style (one to all, one to one., etc, direct vs. indirect., etc),, and communication channel (face to face or leverage technology-based digital conversation, etc,) and enforce cross-functional communication and collaboration.

Problem-solving competency: Behind every problem is a relationship dynamic out of alignment. Fundamentally, running a business is an iterative business problem-solving continuum. Problem-solving is a multi-stepped process that includes both problem resolution and solution implementation. The traditional problem-solving approach is usually analytical, break down the bigger problems to the smaller pieces in order to be understood, and solve them step by step. However, many of today’s problems are over-complex and interdependent, sometimes, you try to fix one piece of the problems, but cause more issues later on. Thus, all stages must be handled with attention and proficiency to ensure success. Knowledge by itself is nothing if you do not understand how to apply it and make it useful for problem-solving. In practice, the comprehensive solution to a business problem requires both cross-domain knowledge and breakdown of the silo mentality. That means, besides breaking down, you need to combine or integrate different pieces of answers to ensure a cohesive solution to larger problems with less side effect. It's critical to refine information and knowledge to invaluable insight, and leverage insight for identifying the root cause of a problem and core issues of a situation that leads to understanding the resolution. It is also critical to apply System Thinking to gain an in-depth knowledge of the interdependence of the problems, and follow systems principles for solving them in a structural way under volatile, uncertain and ambiguous circumstances. With lightweight digital technologies, abundant information, and well-educated digital workforce can organizations today move from problem-solving conundrum to a solution-driven digital continuum.

Change and innovation competency: Change is the new normal with increasing pace. Often, the severe problem facing business is its inability to perceive a change in the environment and adapt timely when conditions require it. Thus, change competency directly impact the business’s survival and thriving today. Pre-contemplation, contemplation, envisioning, decision, preparation, action, adjustment, and maintenance are all the logical steps in managing change scenario and building change competency. Innovation is the most wanted changes, innovation competency is the key differentiator between the leader and the follower. In essence, innovation management is about how to manage people, assets, time, resources, and risks to achieve high-performance business goals and unleash organizational potential. A leading digital organization with innovation competency can handle innovation streams for different goals and different time frames and manage a balanced portfolio including both radical innovation and incremental innovation, hard innovation, and soft innovation. It’s also important to manage innovation systematically via a good alignment of great innovators, reliable information, disruptive technologies, and rigorous but not overly rigid processes. When innovating to create new value, position a brand, align people inside an organization or differentiate and position products or services in diverse markets, organizations are on the right track of developing innovation as the management process and the business-wide unique competency.

Digital management is fundamentally an iterative cycle to design, build, scale and optimize business competency and achieve the desired effect under specified performance standards and conditions. The organization's long-term success is based on a set of differentiated capabilities and its core competency. Digital competency can be built through the combination of talent, resources, processes, and technologies to perform a set of activities and achieve the high-performance business result.


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