Experience has often exposed us to a scenario where two companies with the same access to capital and talent have had extremely opposite results in their attempts to generate value from new technologies. While one is successful and disruptive, the other capsizes and misses the boat on innovation. But, how are these two companies different? The obvious answer is that the first company was able to develop what is known as a digital mindset.
The digital mindset is not related to a technological approach or the implementation of a tool in particular. Instead, it is a way of imagining the organization as a whole, and it involves everyone from top management to workers in all areas. A broadly used definition states that the change of mindset comes about when all the members of an organization –including investors– come to view technology as a fundamental force that drives the success of the company’s mission and vision.
Companies with a digital mindset built into their DNA seek to understand the future of their business by relying on data. The first pillar that identifies companies with a digital mindset is the capacity to view future developments as a business model. They do not ask themselves how to implement automation, artificial intelligence, or the internet of things. Instead, they analyze how to deliver products and services more efficiently and friction-freely. After drawing the corresponding conclusions, they further explore how technology can support the whole process.
The human variable
The same thing happens with human talent. The leading companies in the digital universe concentrate on high added-value activities: tasks oriented to enhance customer experience, improve business processes, or optimize all aspects of the organization. Companies that lag, in turn, still include many repetitive support tasks that do not add any value, such as balancing the accounts or controlling receipts to manage expenditures.
A leader who translates the digital mindset to the whole team is essential. What skills must each collaborator have to bolster this objective?: resilience, intellectual curiosity, continuous learning, lack of fear of making mistakes (something impossible if the company itself has not understood that failure is an opportunity to learn), and the capacity to achieve personal purposes, all of them aligned with the company’s goals.
Cultivating the digital mindset
Is it possible to cultivate the digital mindset? There is no magic recipe or silver bullet. However, some cultural elements and behaviors indeed help. The company’s top management must be the voice that leads the cultural change. Then, as was mentioned before, the company must generate a “failure-friendly” environment. If people are judged or punished when they make a mistake, they will be afraid to experiment or innovate. A word that stands out whenever things are being tried that never before is “courage”.
Creating a Center of Excellence (CoE) can play a crucial role in attracting and measuring digital initiatives and identifying and surpassing cultural obstacles. Very often, resistance results from misinformation: no understanding of the impact of digital initiatives and confusion about the direction in which the company is headed, combined with a feeling that the risks and threats for certain employees are tangible and immediate. The CoE can facilitate communication by clarifying the objectives of digital transformation related to the organization and its impact on all the interested parties.
Another key point to identify whether a company has a proper digital mindset is if it is, well, a digital organization. Analogical processes and archaic ways of doing things will be forever banished. Finding the way to “squeeze” new technologies into the old status quo leads to spending money, frustration –which prevents progress into other digital initiatives– and losing ground against the competition.