Tuesday, October 20, 2020

Business Longevity Achievement via thresholding Critical Things Right

With high velocity and information overloading, today’s digital business environment is dynamic, complex, and uncertain. Organizations become much more nonlinear, hyperconnected and interdependent than ever. Great opportunities, dangers, and disruptions are around every corner. Statistically, compared to decades ago, businesses have a shorter life cycle. Therefore, they have to keep rejuvenating themselves by breaking down the traditional silo mentality, management practices, and culture inertia. There are always better ways to do things and it’s imperative to achieve business longevity via uncovering hidden patterns and thresholding all critical things right.

Identify key leverage point: Digital organizations are not isolated mechanical entities, but organic business systems which keep evolving. There are many factors that influence and have an impact on digital maturity such as organizational structure, process, people, culture, information technology, competition, market segmentation, rules, responsibility, performance measurement, etc, and these elements are interrelated competency identification. Businesses have many variables. To unlock performance and accelerate business speed, it’s critical to identify key leverage points. If you pick the right one to change and discover the untapped leverage, perhaps you could make a significant impact on accelerating business performance disproportionately.

Digital transformation represents a break from the past, with a high level of impact and complexity. There are always different complexities at a different time or dimension and there are multilateral integration to achieve business coherence. Sometimes, you need to leverage all tradeoffs, other times, you should retreat a few steps back or bend over in order to stretch up or make a leap. For instance, talented people are the important leverage point for maximizing business potential. In reality, top business risks always include talent-related risks. It’s important to identify critical skill gaps, define the technical/professional competencies required to achieve business goals or solve right problems.

Strike the delicate balance: Organizations are the mix of old and new, static and fluid. Business leaders today need to ask themselves what their strategies are and which practices they need to take to change with the “tide,” and how to strike the right balance between stability and growth, standardization and innovation, centralization and decentralization. The organizational hierarchy must balance the freedoms, welfare, and responsibilities of the business systems, encourage horizontal linkage and enforce vertical accountability. There must be enough central control to achieve coordination toward the strategic goals, and enough autonomy to keep all subsystems flourishing and functioning for achieving high-performance.

In business, every day is a risk, as long as risks have been identified and agreed with stakeholders as per business needs, you can find regularity in chaos, capture trends and opportunities from uncertainty, take risk models that effectively predict, optimize, and consider a continual and sustainable approach with multi-faceted perspectives. The overly rigid hierarchy or imbalance of management approach creates bottlenecks that prevent information flow and slows down business speed. The high mature digital organizations are flexible and resilient, they can strike the delicate balance between solid and flow, with the attributes such as “open communication,” “integration,” “ownership,” “innovativeness,” “intelligence,” “self-adaptation,” and "self-renewal."

 Hypothesize intervention or constructive disruption: The hyperconnectivity nature of digital breaks down the functional, geographical, or even organizational border, businesses cross the vertical sectors are stepping into the uncharted water and blurred territories. The organization has become "unconscious" if it is no longer responding to the external environment or “keep the lights on” only without going anywhere. With high velocity and unprecedented uncertainty, disrupting, or being disrupted? Forward thinking companies make constructive disruptions themselves or take hypothetical intervention, figure out the best scenario to change and sharpen their unique set of competencies.

To make creative disruptions, organizations depend more heavily on their technological knowledge, high talent, and market capabilities to experiment, learn and innovate. In the face of vast areas of unknowns, effective business leaders understand that a system is a necessary precondition for an effective intervention, and leverage a scientific management framework to threshold all critical factors to get digital ready. In reality, how successfully the organization can handle digital disruptions depends on how fast and capable they can leverage the right information to make effective decisions, how skillful they can put the right talent in the right position, as well as how resilient they can bounce back or fail forward, for adapting to the “VUCA” digital new normal timely.

Knit all the important business elements together: As the pervasiveness of an organization's digitization journey increases, change management becomes a more complex problem because multiple business lines are impacted. As most companies across industries are being forced to become the information management business. It’s important to knit all critical business elements into business capabilities. It's also important to deploy organizational assets in combination and disentangle dynamic capabilities in clusters of processes and managerial orchestration. It requires engaging all the people involved working together as a team to excel in crafting the organizational competency for building the business advantage.

To run a company as a holistic whole, you have to consolidate, integrate and optimize. By doing so, you are creating a case where you force an organizational alignment to the integration. You also create a more ponderous entity which has a difficult time adjusting to change. To knit business components into dynamic business capability, the loose coupling makes it possible to change the components without affecting the system, as long as the interface is kept stable. The capability-based strategy can be implemented smoothly to reach high performance results such as revenue growth, margin improvement or customer satisfaction, etc.

Orchestrate a holistic ecosystem: Digitalization implies the “always on and hyper-connected” business connected to the dynamic ecosystem which keeps expanding. They explicitly seek to create a flexible environment in which people can grow, treat customers, channel partners, or suppliers as ecosystem participants to co-solve tough problems. For many, the ecosystems have evolved without much attention or planning. But for top performance businesses, they can awaken the ecosystem consciousness, start thinking about ways to influence their ecosystems and create new revenue streams while becoming more responsive and innovative. They are like the self-adaptive system which is able to re-configure its own structure and change its own behavior pattern during strategy execution by adapting to the environment promptly.

To effectively respond to the new dynamic, the organization needs to awaken the ecosystem consciousness, start thinking about ways for adapting to their ecosystems and create new revenue streams while becoming highly responsive and innovative. Digital leaders today have to keep evolving and gaining fresh views, understand the dynamic competitive landscape, proactively look for ecosystem partners that can help the business succeed, build strategic partnership, orchestrate a broader ecosystem beyond functional, business or even industrial borders, and demonstrate the benefits to the ecosystem in ways that might have happened in the past but at a much faster rate with much broader impact in the digital era.

To run a high performance business and achieve longevity, companies must learn how to make proactive preparation for dealing with continuous digital disruptions and adapting to the digital new normal. Business management needs to understand why and how confounding problems persist in complex business systems and what can be done to effectively alleviate them, or proactively solve them, and this is accomplished by thresholding critical things right, taking logical and iterative steps for reaching the next stage of business maturity.


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