Digital native organizations increasingly dominate our attention and choices as consumers in many markets such as media, entertainment and retail. As growth leaders and the darlings of investors, it is unsurprising that all five of the world’s highest-valued companies are now digital natives, in contrast to just one in 2006. Long-established and traditionally-organized companies look enviously at their valuations and business models and wonder: do we need to be more like that?
In response to the challenges of the digital age, organizations are making choices around the design of their organizations. Organization design choices are one way to embed strategy into the organizational model and start to drive longer-term cultural and behavioral change. Choices drawn from parallels with digital natives are therefore made in the expectation that they will drive both operational improvements and the disruptive innovation that the digital natives are known for.
When it comes to their organization design, digital natives have had an advantage in the digital age: they have not needed to transition at scale from legacy systems and ways of working. The structures, roles, capabilities and resources needed to continuously experiment, learn and adapt have been embedded in their organizational DNA. They have built a continuous cycle of digital innovation into their business models, enabling them consistently to out-grow their competitors, capture existing markets and create new ones, and continue to attract talent and investment – even while not making a profit. This gives them organizational advantages that competitors can observe and can try to replicate.
In contrast, non-digitally native organizations have turned to ‘digital transformation’ programs and projects. Due to their size and complexity, many established companies have taken an incremental approach to transforming the organization. However, by ‘doing’ digital rather than ‘being’ digital, the full benefits of digital transformation have often not been realized, or not at the expected pace.
- Structure: How are they organized?
- Roles: Who is accountable for what?
- Capabilities: What skills do they have and develop?
- Resources: Where and how do they invest in their workforces?
Mindset over skillset. Digital natives recruit people for their mindset rather than their skillset. This enables them to build a workforce with the flexible capabilities needed to respond to evolving priorities and shifts in customer or market demand.
The obligation to innovate. Rapid innovation is what often makes digital natives stand out; it is key to their ability to disrupt. Responsibility for innovation doesn’t rest with any single person or department – everyone is empowered and expected to innovate. This creates an environment where the focus is on teaming for the best ideas and outcomes.
Everyone is in customer service. Consistently delighting customers enables digital natives to keep ahead of their peers. Responsibility for the customer flows down from the c-suite and underpins many core capabilities across the organization (e.g. product management, data analytics, behavioral insights etc.).
Feedback and learning. The digital native approach to risk is very different to traditional organizations. It isn’t expected that every idea or investment will work: digital natives are comfortable failing and failing fast. Employees are empowered through the design of their roles to take risks and this creates a culture of continual growth and learning.
Connected team and workplace design. Digital natives make conscious decisions about how they align and connect team design with expected ways of working and the physical environment they work in. Collaboration, innovation and productivity are driven through aligned team design and workspace set-up. This joined-up employee experience in turn drives employee value proposition and impacts positively on talent attraction and retention, ultimately driving up employee engagement and productivity.
5 effective ways an organization can accomplish that.
1) Embrace Transparency
Embedding a digital culture means that everyone in the company regardless of their role is aware of the impact digital can have on revenue, sales and productivity.
Technology is no longer limited to professionals. we are personally embedded in the digital world. The upside is that as technology has been around for a while, most businesses are already digitalized to some degree. The key with digital transformation is to fine-tune that digitalization.
2) Offer Digital Training (at all levels)
The most effective way to ensure that employees have a knowledge of digital and its impact on the business is to offer a learning and development program that caters to all levels of knowledge.
The fact is that not all employees need to know the ins and outs of digital from the intricacies how to strategize a digital campaign, many just need a fundamental understanding for their roles. Therefore a suite of digital training programs from ‘digital awareness’ to ‘specialist’ would be ideal for a workforce in order to educate them in the areas of digital that they need to know and that will add value to their roles, rather than a one-size fits all approach that may take up valuable time and can disempower rather than empower an employee.
In addition, programs that are flexible can be very valuable to a busy workforce. Programs those are available online through a Learning Management System (internal or external) means that staff can tap into knowledge as and when they have time and feel the need to upskill.
3) Encourage Collaboration
When employees enjoy spending time and working together, the workflow improves considerably. Ideas fly around the room at high speeds, and the progress is measured in real time. On the flip side, when people have a hard time working with each other, they will avoid interacting with their co-workers equaling low productivity.
It’s no longer possible for teams to work in silos. Sharing learnings and insights between departments is paramount to a productive and effective digital culture. For example, marketing and sales teams should work closely to ensure the messaging for prospects and customers is consistent. While customer service teams should work with IT to feedback on systems and how improvements could be made.
4) Be Comfortable with Risk
Risk doesn’t have to be a scary concept. The beauty of digital is that it lends itself to experimentation and the wins can be built on to bring great rewards to a business.
Due to the fast moving pace of digital, agility is key in a workforce and risk feeds into that as leaders in organizations should cultivate a workplace where employees are comfortable trying new things. However, this approach only works if employees have the skills and mindset to take advantage of the data and insights on offer. Outside talent from start-ups or digital natives can help inject disruptive thinking while empowering frontline workers such as customer service team with purchase history or detailed account profiles can help to solve customer issues on the spot.
Using digital technologies and insights with a digital mindset can greatly enhance the knowledge of a workforce and help them to optimize daily tasks effectively and efficiently. The key to this tactic of risk is to ensure there is trust between employee and employer and an open culture that embraces innovation.
5) Aspire to Inspire
Digital offers a world of opportunities, but not enough companies are capitalizing on them. Innovation in a digital world requires big thinking, aspirational even.
Take the New York Times as an example. Setting itself the task of doubling digital revenue in 5 years, it set its staff a huge goal but also one that inspired. As a result of this aspirational thinking, its digital subscription revenue is growing at a strong pace to 1.5 million digital-only subscriptions up from zero just 6 years ago. And it’s this type of thinking that will continue to help them thrive and grow.
The fact is that digital disruption is not going away. There will continue to be new entries onto the market that will challenge how things are currently done. By setting a mission with big ideas and digital at the heart, an organization can encourage its workforce and inspire them to not only take calculated risks but also see things in new ways.