Digital transformation and change? It’s all about clarity, stability and company culture

Source: Data News (03/02/2017); Author: Els Bellens

Innovation and disruption have become fashionable words, but despite how often we use them, not all companies are ready to innovate. Far from it. We sat in on a lesson in Digital Leadership, a course at Vlerick Business School, where managers undergo a week-long immersion in digital transformation. An extremely important aspect of this is the approach to your company culture.

What is striking about the course is that hardly any of the participants are in IT. We find a grand total of one CIO in attendance, but the rest are marketing professionals, HR professionals and others. This hopefully makes it clear that digital transformation is no longer something that is left to the IT department to sort out. It is a sweeping change across the whole business. This means that the challenge lies in making the innovation comprehensible to the entire company.

Everything the way it used to be

Professor Peter De Prins explains that people have a natural aversion to change. If we are not given clear tasks, it is our initial reflex just to leave everything the way it used to be, he says: “People who don’t know where they are supposed to be going stay where they are.” To make change palatable, the main need is for clarity. “Create clarity,” says De Prins. And by that he does not just mean that you need to communicate more. “Communication is not the same as clarity.”

Incidentally, this aversion to change also has an adverse effect on organisations. “Many companies have been doing well for a long time. But then something changes: the housing market collapses, or maybe digitisation threatens profitability. And all of a sudden, businesses need to change their approach.” The problem, De Prins says, is that companies often fail to react appropriately to this changing world. “Doing new things is scary, because you don’t really know what you’re doing. People prefer being competent at something they have been doing for a long time to being incompetent at new things. Even if those new things might get the business back on track. That applies to both people and businesses,” De Prins explains. “They prefer just to wait and see.”

Managing stability

If the company does ultimately make the right decisions, things will go well again for a while. “That cycle used to last thirty to fifty years, from disruption to change to good times. Now disruptive technology appears on the scene every two to seven years,” De Prins claims. And that takes its toll. “A company is like a house. In the old days, you had time to repair all the cracks before the next storm. But that is no longer possible. And then the actual change is often not the problem. A much tougher challenge is that you cannot create enough stability to face the next change. This makes stability management more important than change management.”

How do you go about it, then? By getting the foundations right. “Change management is usually good at coming up with plans. Directors often have an overarching plan for several years, but people want to see results in the short term. This makes context important. The working environment, the processes that keep people working.”

Clarity

So how do you make digital transformation palatable? Through clarity, stability and understanding the company culture. “Not understanding your company culture is one of the main reasons why change fails,” says De Prins. “Clear communication has little to do with giving new information. You need to understand what people have seen and heard, what they remember.” As a manager, you especially need to understand the context in which employees operate. “There are 101 ways of measuring corporate culture,” says De Prins. “And the results you obtain from measuring culture are worth their weight in gold.” For De Prins, the art of change management is also a question of being clear and stable. He lets us in on an important trick: “Change weighs much less heavily if people see all the things that have stayed the same. Because usually quite a lot of things do.”

Related news

  1. New

    Artificial intelligence: the new arms race?

    Date: 21/03/2017
    Category: Opinions
    Will robots soon be doing our grocery shopping? Will they buy clothes you are guaranteed to like, that fit perfectly and get you ‘likes’ from your followers? Will they make medical diagnoses and decide on the treatment? Artificial intelligence – is it science fiction or reality?
  2. FinTech Futures - Open Banking

    Date: 22/02/2017
    Category: Opinions
    During the latest edition of the FinTech Futures experts discussed the less sexy side of payment innovation, being infrastructure change and payment policy. The Payment Service Directive 2 (PSD2) is the legal framework for innovative payment services. You could hardly call it a buzzword, nevertheless it is everybody’s cup of tea in anticipation of 13 January 2018. That day, the revised payment directive becomes applicable. It’s the European Commission’s main effort to strike a fair balance between supporting innovation, ensuring fair competition, enhancing security of payments and increasing consumer protection.
All articles