Digitize the Solution is a must for the survival and growth of any Company.
Digitization definition: “The investment in and development of new technologies, mindsets and business operational models to, improve work and competitiveness and deliver new and relevant value for customers and employees, in an ever-evolving digital economy.”
Technological disruption is now an inescapable reality, and the factors that define successful strategies have completely changed. Technology companies are not the problem, they are a symptom. And what businesses in every sector need to understand is that managing as they have done for the last 20 years, despite the changes in the context of their industries, is a losing game.
WHY DIGITIZE, IS ANSWERED POSITIVELY ALREADY.
HOW TO DIGITIZE IS EXAMINED IN THIS ARTICLE.
Digital disruption will reshape business in one fashion or another and we must find a way to embrace these changes. Going digital is not like installing new machinery or introducing a new product. Going Digital requires being open to reexamining your entire way of doing business and Understanding where the new profit centers lie.
THE DIGITIZATION EFFORT IS ABSOLUTELY A TOP DOWN PROCESS.
Understanding emerging growth sectors and/or fading products or processes requires a commitment to recognizing the implications of developments in the business environment that digitization presents and evaluating opportunities or threats.
This is primarily the responsibility of the C suite.
Digitizing the solution and not the problem will relieve many Companies from the frustrations of the transition to the new digital era.
To digitize the solution and not the problem Companies must accept that:
THEY MUST DEVELOP A NEW COMMON LANGUAGE WITH IT.
If the size of the Company allows it, there is a need for a CDO, (Chief Digital Officer). This can be their present IT Manager if he/she has the Strategic Understanding necessary, further to the Technical one.
Companies should accept that:
- They have a unique opportunity to really reshape processes and procedures.
- They must understand that the learning curve laws apply also to digitization.
- The Customer is not a guinea pig for the testing of the digitization process.
The Way To Do It
When our Clients ask us: “How much it will cost us to digitize the Company,” we always answer: “This is the wrong question. The right question is how long it will take to adequately digitize”.
The present digital ability status of the Company is what will define the time and cost of digitization.
It is not easy. My fights with my IT people were legendary. Bugs, late delivery, under-performing applications etc. were all their fault.
Until I realized that I and my team were as much part of the problem as the IT.
I understood that we had a dialogue of deaf.
And then I understood that what they were teaching us in University about Computers and data is also valid for IT, AI and all digital applications and processes. GIGO (“Garbage In, Garbage Out.”)
A process is the accumulated experience of the Company. It is designed by humans for humans. One cannot just digitize the process, one must reshape the process so that it is suitable for digitization, because, like so many other new technologies, AI has generated lots of unrealistic expectations.
In an extremely illuminating article titled: “Algorithms Need Managers Too”, published in HBR January – February 2016 issue, I found the answer:
ALGORITHMS ARE NOT HUMAN BUT WE TREAT THEM LIKE IF THEY WERE.
ALGORITHMS ARE EXTREMELY LITERAL.
If you have, for example, an AI application that validates the client’s signature on a check, as everyone’s signature varies slightly from document to document, the application will reject the majority of signatures, because that is what it understands it has been instructed to do, unless you have exactly defined variation margins in each signature. That means that you need a higher order algorithm with some graphological capability.
Of course, the same can happen if you have a human who is a responsibility-phobic idiot checking signatures.
The difference is that the idiot you can replace, the algorithm you must rewrite.
If you put a very human-like voice in an algorithm based phone answering service, humans will treat it as a human, expecting it to understand questions even if they are not precisely phrased. The arrogance of managers and IT specialists is that they expect the customers to train for it, where in fact the service is deficient because it provides less help than a human.
That means that in the altar of efficiency, a company sacrifices the only asset that can keep it alive in this and the next decade which is Customer Service.
There is worse. While some markets, sectors and individual businesses are more advanced than others, AI is still at a very early stage of development overall. Decisions taken for digitization and AI introduction in the organization come from the top management. It is subsequently a collective decision of many departments and a conspiracy of silence prevails. Nobody can challenge the great digitization effort by saying that it was premature, the culture of the organization was not adequately prepared for it, or that now Customer service is worse than before.
Facts are hidden until they surface ugly.
Digitizing does not mean adopting immediately AI. There are many steps, aspects and many applications for the digitization transformation.
The solution, as always, is the same.
Assess the present digital status of the Company.
Meager digital literacy within businesses is restraining the scope and extent of innovation to respond to consumers’ new expectations.
Prepare diligently for the transition, then apply it as a pilot project. That will allow you to grade both the organization’s capability to absorb and use successfully the technology as well as grade the suitability of the provider of the technology for your organization.
Digitization cannot be successfully introduced to a Company if its employees are not trained to it, prior to its introduction.
The whole Company must fully understand the new method of work in a digitized environment. A digital culture must be introduced in the Company, prior to its use for current business. This digital culture must be adopted starting from the Top.
A CDO (Chief Digital Officer) must be given the same status as a CFO (Chief Financial Officer) or a CMO (Chief Marketing Officer) the company’s responsibility to understand how steep is the learning curve that is required and what is needed before the new technology introduction, to obtain a successful result.
The end result must always be the improvement of Customer understanding and therefore Customer service.
To successfully digitize the Company, the level of understanding and competence of a digital environment by its top executives, must be assessed first.
Following this some digital training of the C suite may be necessary, not to specialize, but just to understand profoundly the subject as it will be essential to the survival and growth of the Company from now on.
In a brilliant article titled: Are You Accurately Measuring Your Company’s Digital Strength? By Jeff Maling, Rod Fertig, Arun Muthupalaniappan, three main parameters, according to the authors, define success:
Digital magnitude. Simply put, this is the aggregate of all digital measures (visits, page views, social media views, social media visitors, etc.). Understanding your company’s magnitude versus those of competitors is a key indicator.
Digital share. Your company’s digital share is its magnitude divided by the sum of the magnitude of its competitive set. You should compare this number to your company’s actual market share. If your digital share is larger than your market share, you are in a strong position to increase your market share.
Digital momentum. A simple way for a company to calculate its momentum is for it to take monthly snapshots of all metrics and track which are increasing or decreasing. If a firm isn’t gaining digital share, it is jeopardizing its future market share — yet few companies look at their digital growth. In fact, many companies see digital as a destination and believe that “once we build that website or improve social, we can scale back.” The reality is that winning in digital requires a sustained program of continuous improvement and investment.
As the director of Stanford’s AI Lab and now as a chief scientist of Google Cloud, Fei-Fei Li is helping to spur the AI revolution. But it’s a revolution that needs to include more people.
She emphasized this need by observing that:
“Vision is a cornerstone of intelligence, and language understanding is a cornerstone of intelligence. What makes humans unique is that evolution gave us the most incredible and sophisticated vision system, motor system, and language system, and they all work together”.
This, uniquely human ability, we must enmesh with the capabilities of the present and future digital revolution.
The successful and smooth combination of human and machine interaction is the way forward for all Companies.
