We have to evolve it, as we go. With anything that is evolving in front of our eyes, we will need to recognize some of the decisions we will make will turn out to be wrong but made as a good judgment at the time, on ’emerging’ evidence, not proven. Achieving a digital transformation is becoming really essential for innovation, helping to enable your ability to deliver sustained growth through making all the ‘connections’ come together in different ways than ever before; in evaluations, analysis, in collaborations and in the process from discovery to eventual commercialization.

Digital transformation executed well is a really big undertaking. It goes way beyond making a series of incremental improvements to become cloud-ready as are supposed to build in and reflect social, mobile and digital technologies in the solution set. We need to fundamentally transform our processes by opening up and engaging with customers in dramatically different ways, in real-time, in constant exchanges and connected ways. Everything needs to be tracked and traced.

Customers will want to participate, influence and aid your design and final product. On top, we have to deal with a broad range of communities, across platforms and in different ecosystems at speed, scale, and scope to master different levels of complexity and draw in the expertise we lack within our organization. However, we must do all this in this world of the uncertainty of if it does all connect and work, to reposition all our businesses towards the digital world.

Digital transformation is, without doubt, an event of historic impact, challenging what we know

Technology is becoming an integral part of our lives, for us personally, as consumers or employees, but equally for businesses, the government and our educational institutions. It is pervading everything.

Look at digital transformation as an investment, our future ability to function, compete and communicate will depend on it. Investments always take time to show results, and digital will demand a lot. It is shaping the ways we will work in the future, on how we are going to connect, communicate, and learn. Often, we have been caught up in a specific device we use. This time, it is different though. It is how that set of devices allows us to become connected, how they interact and form a system to tackle a need or task. We are all struggling to re-equip ourselves, in skills, in simply managing, in managing the digital world and its demands. This is another work-in-progress

Digital transformation will keep pushing us to become more efficient and effective yet also to become more adroit and innovative. It erodes and eats into our time that in the past was taken up by so many other things. We will need a new reset in our values and beliefs, we will have to carve out a different set of routines and habits, otherwise digital will simply take over our lives to the detriment of everything else.

The good thing is that Business entities are being forced to open up

Digital transformation happens on a scale and scope that makes many reluctant to take it on; it seems overwhelming in its complexity and risk. The business returns seem hard to quantify in traditional metrics yet the need for transformation compels us to ignore the known metrics and believe in all the unknowns that we are told are achievable.

Often it is hard to convince deciders to support this need for such a significant transformation, whether they are just skeptical or lacking technology adroitness. They want to slowly attack it, sometimes in the hope, it might “sort of” go away. Yet for others, who recognize the future lies in technology and the power of networks and community engagement, it is the opportunity to radically alter their way of doing business; the opportunity to forge new competitive positions that have an engagement at their heart.

We don’t know what the “end game” will look like

We don’t know how the digital transformation will turn out in the end and we have to accept that. Much will come towards us as we adapt, learn and experiment, with many emerging technologies, all in different stages of their evolution.

You sometimes get a sense of crisis pervading the boardrooms, a sense of growing concern, when they recognize the threats and the magnitude of change this transformation will demand of them. They are often the least equipped to understand it. They have to become highly reliant on others to teach them, inform them and encourage them to keep ‘at it’

They will be required to find multiple resources for this journey, and be it just to stay competitive in this new digital world where the demarcation is blurring and industries are agonizing in continuous disruption. It is the blending of all the different experiences, understanding, and comprehension that is rapidly flattening the hierarchy to accommodate all these different voices contributing to building a new digital business landscape.The “survival of the fittest” will be determined by how successfully and how fast deciders

The “survival of the fittest” will be determined by how successfully and how fast deciders maneuver through this shift. Transforming established businesses has become an imperative today.

We are told there are three strategic goals to justify the transformational journey:

1. Providing a better, systematic customer experience, leading to greater loyalty and fostering a community of advocates
2. Internally, digital transformation can improve the operational efficiency
3. New business models, which were not feasible before the time of the connected world, offer new markets and growth opportunities

The worry becomes with customer engagement there is this risk that senior executives will let transformation fail

Of those strategic goals, achieving customer engagement, in the sense of a sustainable partnership, is the most valuable one. Digital transformation enables you to engage your customers along their journey across various products, services and communication channels. Digital has become truly pervasive in people’s lives now and this forces businesses to think about how they can become a consumer technology company, irrespective of what they offer.

The challenges are massive. Companies are struggling to see clear business benefits in traditional ways of managing return on investment. Senior executives have been trained in a curriculum that didn’t prepare them for this world of digital technology and a collaborative world where they have to listen, learn and accept others are often more often right.

The senior executive lacks the understanding of new tools of engagement, which are table stakes already in the world beyond their own corporate offices, in startups, social media companies etc. They consider technology as something for others to worry over. Increasingly, they also lack the relevant exposure and experience to handle the new game successfully.

Driving an effective digital transformation through technologies, which are constantly adapting and evolving, is not the prediction-model based experience they are used to and that got them to the top. A new mindset is required, with solid risk judgment based as much on experience as in listening to others, replacing hard facts often with soft instincts, and incomplete data that is in a constant validation of structured experimentation.

What’s the goal to keep in mind? Looking at the needs of return

• Simply put, you need a picture of how you will (eventually) make money when you start your journey of digital transformation. Create a clearly outlined set of value propositions, and define how you will engage and interact with your customers, partners, and suppliers in products, services, and business models.
• Your business will revolve around what customers really want, a seamless experience where speed, time, performance and response become dominating values – far beyond a specific job-to-be-done. The return in innovation, in new products and services that will rise in ongoing customer satisfaction, becomes as relevant as pricing a product. The customer is willing to pay for a product he or she believes good value, great service and solves their needs
• The toughest part of any transformation is actually recognizing you have to challenge your own past assumptions and be prepared to strip them down and rebuild them on a constant always experimenting basis, adapting to what you ‘hear’ and can ‘see’ in breaking opportunity from all the increased data coming into you to analysis.
• In general, business is moving towards a culture of experience. Whether in communications, development, or delivery, with the customer, in the product itself:
• Everyone’s time within the organization is pivoted towards the outside world, learning to collaborate, exchange and forge different alliances.
• There is a great advantage in seeking increasing speed and scale. It delivers ‘time to impact’ to as wide an audience as you can achieve. Having a global ambition or partnerships that can enable speed to market makes increasing sense but there is a higher likelihood you will have to narrow your offering focus to reduce internal complexity but still deliver within a network of providers, products, and services that deliver to customer needs.
• And the most important change in perspective is about being different, about carving out our own uniqueness but recognizing this is forming more around platforms and ecosystems where all participants look to collaborate and build a more superior offering than one they could achieve on their own

So the actual starting point will be to come up with a detailed plan of coordinated actions that challenge the way you have been running today’s business and totally rethinking it from top to bottom to make any transformation, digitally dependent.

Innovation is becoming highly dependent on digital technology, it feeds understanding, validates it and delivers much of the final value proposition. Undertaking a digital transformation becomes essential to the health of innovation, let alone the company for the future.

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The post Moving to a Digital World totally across your Business is highly challenging first appeared on Building Your Innovation & Ecosystem Intelligence.

We continually learn nthat intuition and ‘gut feel’ on research set up and gathered weeks or more often months ago, has a hidden cost as it rapidly goes out of date. This ‘knowledge’ is becoming out of date before we can gain from it and sometimes highly dangerous to follow, or believe in in the more volitile market conditions of today’s, those that are rapidly changing. We need to get closer to ‘real-time.’

This reliance on rapidly out-of-date understanding cannot be the basis for any justifications for high-stake bets when it comes to innovation. We need to change our thinking and design in the digital insight part more specifically within and along the innovation process. Technology in all its forms is altering the innovation game but are we adapting to this radical change potential? We need to embrace it.

We have, in the past, partly because of levels of uncertainty. We have been overly reliant on ‘poor’ limited data and tended to take a safer route to market from this limited comprehension of the dynamics within the market. We are trying to achieve well-defined problems based on limited validation and simply place “solutions” into the pipeline for innovation. We attempt to work methodically along the timelines irrespective of changes constantly occuring, often impervious to the market conditions change, often going on before our eyes, with the end result, a disappointment and a lot of wasted energy and resource.

We continue to couch our bets and gravitate to solutions that are as close to what we currently offer, and that just keeps reinforcing the incremental route regretfully.

Today we can radically alter this innovation discovery by getting as close to ‘real-time’ if we care to invest in it. We need to invest in the enablers of technology to deliver constantly updated data, to allow greater analysis of choices and potential, closer to ‘go/no-go’ decision points.

Digital threatens (thankfully) this entire incremental pathway.

Markets continue to have even greater uncertainty and we need to respond in very different, faster, well-informed ways. Competition is changing, markets are blurring and customers are becoming far more vocal. To respond we need to reconceive innovation into a constant and rapid learning approach, listening and observing from these sources.

The need is to become far more iterative in feeding back what we hear; full of experimentation, testing, and adjusting, we must lend ourselves to adopting a far more minimal viable product approach, where we continually test assumptions, checking what is valued about the concept, gained constantly from the customer or market feedback.

Digital is also pushing us to shake off complacency since customers are increasingly further connected and interacting in new ways, making the constant choice, adapting to best experiences, imaginative offers and certainly not being as brand loyal for most of our products as previously. We need to find different and adaptive paths to ‘plug into’ and join the conversation, to help shape that conversation and through these exchanges, recognize how the brand and reputations become increasingly important in all things innovating.

Digital tools are changing how customers discover, evaluate, explore, make their purchases and use products and then how they react, share, interact and make their connections to our brands. The whole process is highly dynamic and reliant on the ‘network and social media effect’, and the job of the innovator is to translate this and respond in fast, nimble, agile ways, to fulfill the needs and capitalize in responsive ways. This demands a radical redesign of the innovation process and the whole customer engagement process. Most of our organizations today, really lag on this engagement, let alone on building a more adaptive and agile innovation process being ‘fed’ by the technology solutions we have available to us today.

The need is to “test to learn” and then adjust and adapt, some thoughts include:

• Without a doubt, it is finding and using more techniques and tools that help you make far greater rapid prototyping, testing, piloting and learning from these understandings and how they can be quickly translated back into the innovation process to improve on what you have known, into one of what you have become aware of. “Testing to learn” will become the new innovation mantra and the accepted innovation process; a dynamic, fluid and rapid experimenting that makes it a constant learning one.
• We are today, partly down this route of early learning, with the help of software that can capture ideas, offering a sound vehicle for communicating these and a place to gather and define solutions that can be taken forward. Yet we have to push the path of constant evolution and that will continue to come at increasing speed from technology to keep providing new knowledge so as you can constantly improve on your eventual value proposition but that is going to require an ever-increasing agile organization and adaptive system.
• We will need to find different ways to redesign the manufacturing process (more outsourcing) to have more adaptive points where we can intervene and change product design further upstream. We will need to find different ways to ramp up or dampen down finished goods and that is going to push ‘agile’ even further. The ability to balance “scale, speed, and scope” will become paramount in this.
• We will need to learn to focus on the seizing of emerging opportunities in quicker ways but also take a much tougher approach to divestment, so as to release resources from declining positions of advantage. The whole life-cycle thinking needs challenging and thinking through.
• We will need to push for “agile systems” where we can design new applications, find better communication and collaborative social technologies to reduce delays in getting the right information to the right people to advance the process and reduce the duplication of work or the search for the information needed to complete the job. We need to focus much more on reducing innovation process cycle time for faster deployment.We must be constantly adaptive not blindly following an outdated innovation process, that is full of rigidity.
• We will also need to invest in more data-driven front ends to build a more sophisticated process of discovery. The whole concept of divergent experiments and convergent testing leading to validations will become the way to think of the innovation process as a re-looping process. This will require a critical mindset change from a linear one on how you set it, in the design of the process and the use and application of the digital tools you deploy to move this through this constant, ongoing iterative process. Nothing can remain ‘static,’ we need to make it ‘highly’ dynamic, iterative and fluid, a constant learn and adapt.

Rapid innovation matters and it will become even more central in 2017 as digital takes hold.

Rapid-iteration needs to replace the fixed product release date mentality we see in much of our innovative software. We are in a world, driven by digital that requires us to constantly adapt to new learning that is coming from real-time market feedback. The way we learn from this and our rapid innovation application process will be all about this continually testing new assumptions to improve our (final) product and service propositions. This is where the cloud provides the ability to constantly update and release, so we the innovators benefit.

This, I believe, requires a rethinking of the innovation process, as we will need to transform the existing methods and make them increasingly digital and social, in real time, feeding (as close to) real-time data and insights. We need to focus on the rates of innovation output from our learning and improvement in the eventual offering, not on the ‘classic’ input and output metrics from the past, as our constant bearing. It is outcome learning as the driver for metrics It is how we design this in a more comprehensive manner will be a real challenge in 2017.

Are we in a pivotal year of the rapid innovation application process? Will we finally move towards a greater fluid and looping innovation process? One that is fully designed and adopt as our new innovation discovery to the execution process based on the transformational effect of technology. One that is a constant path of innovation understanding and evolution that fits far more with these digital transformational times we are going through. They certainly do need to form a closer partnership for us to gain the transforming value.

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**adapted and revised from an original post supporting a digital transformational study exploring leading practices completed for Hype. Register and then download, it is complimentary

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The post Digital technology is changing the innovation game first appeared on Building Your Innovation & Ecosystem Intelligence.

The customer has become absolutely central to this transformation and the push towards the 4th Industrial revolution is driving this transformation wholesale, across all industries and services engaged in business.

Let me outline some of the challenges in my opinion that might help us all form a clear view of the digital transformation journey, recently researched.

Firstly I’m sure we can all agree transformation is very hard at the best of times

Digital transformation is doubly difficult, it forces us to work with mostly emerging, constantly evolving technologies, and then apply these in an integrated way into an existing business. This stretches our abilities significantly.

Beyond making a series of incremental improvements to become cloud-ready, we are supposed to reflect social, mobile and digital technologies. We need to fundamentally transform our processes by opening up and engaging with customers. On top, we have to deal with a broad range of communities, across platforms and in different ecosystems at speed, scale, and scope. However, we must do all this to reposition all our businesses towards the digital world.

I provided a recent digital transformation report that might help you in planning this digital journey.

I wrote a meta report on the recent developments in the digital transformation in late 2016 that was published by Hype. The report offered a selection of key visuals and overviews from 14 reports, which in turn were shortlisted from an original data set of 140 reports on the topic, ones published over the course of the last few years, that from my research, I found the most valuable. To obtain a copy, it’s free, click this link to register and download.

The intention of this report was to provide data for orientation for people dealing with this difficult topic, it was an attempted to extract a selection of the best emerging practices or thinking of the what, how and why digital transformation needs to be top of every business person’s mind. The report was designed to help you to trigger your thinking, and make you aware of multiple challenges and opportunities you may encounter on this journey.

I provided an opening backdrop to the report here as triggering points to reflect upon and recognize.

Business entities are being forced to open up

Digital transformation is happening at a scale and scope that makes many reluctant to take it on; it seems overwhelming in its complexity and risk. The business returns seem hard to quantify in traditional metrics. Thus it is hard to convince those undecided to support this, whether they are just skeptical or lacking technology adroitness. Yet for others, who recognize the future lies in technology and the power of networks and community engagement, it is the opportunity to radically alter their way of doing business; the opportunity to forge new competitive positions that have the collaborative engagement at its heart.

We have to embrace new technology – or leave the stage

The buy-in to this means undertaking a disruption to the existing organization, to the way you go about business. When considering this, you begin to understand the magnitude of the speed of change demanded. It implies a competitive need for opening up, for responding to and connecting with all external parties who are ready to collaborate.

We all need to think mobile, digital, cloud, and social far more than we did to date. We need to become comfortable in the analytics of big data. If we are not willing to accept that, we should step aside and allow those willing and digital savvy to take the reins and set the pace for the transformation journey.

At present individuals are far ahead of businesses in embracing the digital world

Transformation is coming at us in rapid waves. Its scale and complexity is either seen as amazing or simply accepted, with a shrug of the shoulders. Many are expecting it to be a seamless experience, powerful and adaptable, allowing the individual to make it highly personal.

However, business is lagging in exploiting the opportunity, whereas we as individuals seem to have embraced the social digital world already. Companies want technology to transform their business, but they struggle to find ways towards opportunities that offer true growth.

We don’t know what the “end game” will look like

We don’t know how the digital transformation will turn out in the end and we have to accept that. Much will come towards us as we adapt, learn and experiment, with many emerging technologies, all in different stages of their evolution.

You get a sense of survival pervading the boardrooms, a sense of growing concern when they recognize the threats and the magnitude of change this transformation will demand of them. They will be required to find resources for this journey, and be it just to stay competitive in this new digital world where the demarcation is blurring and industries are agonizing in continuous disruption.

The “survival of the fittest” will be determined by how successfully and how fast deciders maneuver through this shift. Transforming established businesses has become an imperative today.

However, there are three strategic goals to justify the transformational journey:

1. Providing a better, systematic customer experience, leading to greater loyalty and fostering a community of advocates
2. Internally, digital transformation can improve the operational efficiency
3. New business models, which were not feasible before the time of the connected world, offer new markets and growth opportunities

Customer engagement becomes the primary focal point of justification to transform

Of those strategic goals, achieving customer engagement, in the sense of a sustainable partnership, is the most valuable one. Digital transformation enables you to engage your customers along their journey across various products, services and communication channels. Digital has become truly pervasive in people’s lives now and this simply forces businesses to think about how they can become a consumer technology company, irrespective of what they offer.

The challenges are massive. Companies are struggling to see clear business benefits in traditional ways of managing return on investment. They need to experiment and be ready to be agile and adapt as they go, as their customers will radically alter their perceptions and past positions. The journey will often be uncomfortable but necessary.

Senior executives have been trained in a curriculum that didn’t prepare them for this world of digital technology.

They lack the new tools of engagement, which are table stakes already in the world beyond their own corporate offices. They consider technology as something for others to worry over. Increasingly, they also lack the relevant exposure and experience to handle the new game successfully. Driving an effective digital transformation through technologies, which are constantly adapting and evolving, is not the prediction model based experience they are used to and that got them to the top. A new mindset is required, with solid risk judgment, replacing hard facts with soft instincts, and incomplete data with structured experimentation.

We must overcome the barriers for digital transformation

As outlined above, we face plenty of barriers for digital transformation: a lack of vision, not understanding the urgency, holding on to traditional measures for growth, and a host of organizational constraints that restrict decisions.

How do we best start off?

The toughest part of any transformation is actually recognizing you have to challenge your own past assumptions and be prepared to strip them down and rebuild them. Once you have accepted that, the answer to the questions is as simple to say as it is difficult to carry out. You have to understand and potentially fix your customer relationship, adjust internal operations and create a data collection workflow for business insights you can base your decisions on. And you have to do all this in a concerted way, as much as possible. So the actual starting point will be to come up with a detailed plan of coordinated actions and this is where this report might have great value.

What’s the goal to keep in mind?

Simply put, you need a picture of how you will (eventually) make money when you start your journey of digital transformation. Create a clearly outlined set of value propositions, and define how you will engage and interact with your customers, partners, and suppliers.

Your business will revolve around what customers really want, a seamless experience where speed, time, performance and response become dominating values – far beyond a specific job-to-be-done.

In general, business is moving towards a culture of experience. Whether in communications, development, or delivery: everyone’s time within the organization is pivoted towards the outside world. And the most important change in perspective is about being different, about carving out our own uniqueness.

A digital transformation is an event of historic impact, challenging what we believe to know

Technology is becoming an integral part of our lives, for us personally, as consumers or employees, but equally for businesses, the government and our educational institutions. It is pervading everything.

Look at digital transformation as an investment. Investments always take a time to show results, and digital will demand a lot. It is shaping the ways we will work in the future, on how we are going to connect, communicate, and learn. Often, we have been caught up in a specific device we use. This time, it is different though. It is how that set of devices allows us to become connected, how they interact and form a system to tackle a need or task and we need to learn how to respond to what they are telling us, and listening to others has never been the corporate’s best attribute.

In Summary

Digital transformation will keep pushing us to become more efficient and effective but also to become more adroit and innovative. We will need to take a ‘dual’ mindset to constantly balance these often conflicting tensions so as to harness all the different power sources of digital and structure the business and organization accordingly.

Digital is presently determined to be all-dominant, it simply erodes much of what we know and eats into our time that in the past was taken up by so many other things. We will need a new reset in our values and beliefs, a new re-equipping, to deal with everything digital.

Welcome to the digital era where we all are learning to transform ourselves! You might find the visuals shown in the report as very valuable, so as to piece together your understanding of the needs of any digital transformational journey. I enjoyed researching and extracting the best leading practices and frames to help.

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The post The backdrop of digital transformation and its consequences first appeared on Building Your Innovation & Ecosystem Intelligence.

The lack of having a well mapped out customer journey means missing out on opportunities caused by not knowing this complete set of connections being made into you. By not knowing all these connecting points and drawing them together in a cohesive plan, there is a significant chance you are simply restricting the developing of innovation solutions that map back to all the decision-making that is going on in the customers’ minds.

This failure to optimize and seize upon all the possible options to connect with your customers is restricting your ability to broaden out your innovation solutions, making the journey more value creating, it certainly can be really holding your business back.

As you explore the digital transformation path this can become your best opportunity to connect along the total customer experience and see a greater return on this understanding and investment.

With the increasing need to adapt to a digital world, the essential need for understanding customer behaviors of those wanting to engage with your business or brand becomes even more of a challenge if you have not mapped this out. Also, how comfortable are you as new customers start connecting – can you have any certainty of the reasons why they did, what decided this and what might hold them for the future of a repeating business?

The vital map of the customer journey

A recent Altimeter report “the 2016 State of Digital Transformation” discusses these problems, along with many others. The mapping of the customer experience (CX) has become a top driver of digital transformation, yet only half of the companies studied have mapped or are mapping their customer’s journey. So that you are aware, the data and insights in this report are based on the input of more than 500 digital transformation strategists and executives who are leading change within their organizations.

In a good visual, they illustrate the severity of the digital transformation challenges: finding that 71% struggle to understand behaviours or impact of a new customer; 69% cited the lack of data or ROI to justify the value of data transformations; and 67% on the risk management, compliance and /or legal implications. Lacking the essential insights many companies are failing to grasp the potential, with many (alternative) innovation opportunities wasted and perhaps suffering a growing customers churn rate. Knowing the why of your customers is something that keeps many marketing and C-level executives up at night.

The good news is that although half of those surveyed are now mapping the customer experience journey most of these are only just doing this. Back in 2014 at the time of the last survey by Altimeter, only 25% of companies undergoing some form of digital transformation had mapped the customer journey, as now 88% cited CX as the driver of change and why technology was the necessary solution. There is some real catching up taking place to justify any transformation.

I still sense that it still seems IT & Marketing are not working on this together, there are separate initiatives and operating in their own silo’s, often in pursuit of different investment decisions that might be better served by combining forces.

As each organization changes in its modernization with new systems, models, processes and architectures it is this lack of customer-centricity that is a growing problem. The lack of a vital set of insights means the continued investment taking place in front-and-back-office solutions has this lack of the customers’ expectations, preferences and values clearly understood.

There is even more of a warning within the report

Traditional touchpoints, such as websites, contact centers, representatives, affiliates, etc., seem to not meet heightened expectations. In fact, they deter from what’s becoming an on-demand customer experience. Equally Mobile has given way to what Google refers to as “micro-moments,” and they are completely upending traditional customer journeys.

These mobile-first moments play out in common scenarios when someone is intent to do, buy, or learn something. As consumers increasingly use their phones to complete everyday activities, they’re fracturing the consumer journey into hundreds of new “micro” touchpoints where they seek real-time, mobile-optimized content, reviews, shared experiences, and direction online.

Despite all of this, just 20% of digital transformation leaders are studying the mobile customer journey and/or designing for real-time micro-moments in addition to customer journey work. There is a need to understand these ‘micro-moments’ as they increasingly impact on the customer decision-making, behaviors, and values.

The report warns even further: Mobile is just the beginning of disruption in the customer journey. With the runway for disruptive technologies still ahead (e.g., wearables, Internet of Things (IoT), artificial intelligence, virtual and augmented reality), companies will need a resilient infrastructure that adapts to not only mobile’s “micro-moments,” but also the impact of all these trends and new devices over time.

There is also a change taking place on the primary catalyst

While CX was initially the primary catalyst for digital transformation, innovation, agility, and the pursuit of digital relevance are the new factors driving companies along the maturity model. For executives and senior leadership, the need to accelerate innovation (81%) was at the top of the digital transformation agenda.

Right behind this was the need to modernize the IT infrastructure with increased agility, flexibility, management, and security (80%), and the third priority for enterprise transformation is improving operational agility to more rapidly adapt to change (79%).

Altimeter argues it is through these priorities, businesses are developing a roadmap that helps them compete for the present while building a next-generation business model to compete for the future.

For this report, Altimeter, a Prophet Company worked with Phronesis Partners to conduct a survey of 528 qualified digital transformation strategists and executives leading change within their companies. Respondents were from companies in varied industries, with more than 250 employees, in the United States, Canada, United Kingdom, France, and Germany.

In summary

As Altimeter state in their opener in this report and I repeat here in my closing:

“Digital Darwinism continues to impact businesses as technology and societies evolve. As a result, organizations are moving away from “business as usual” as they pursue digital transformation to compete”

We are all aware (or should be) that customers are increasingly choosing products and services based increasingly on the quality of the experiences they have with them. The pressing need is to address a competitive risk if you are not mapping and understanding the channels, touchpoints and shifts taking place in technology solutions that capture, evaluate and determine customer experience.

Are you meeting your customer needs, do you fully understand their motivations, associated behaviors to design a better range of innovation solutions?

Link to the Altimeter Report “The 2016 State of Digital Transformation”

Publishing note:  This blog post was originally written on behalf of Hype and with their agreement, I have added this to my own site.

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The post Mapping the customer journey is the top driver for digital transformation first appeared on Building Your Innovation & Ecosystem Intelligence.

At the top of our organizations they ‘require’ innovation but will often not want the potential disruption this might entail.

Yet the organization today is being challenged like never before, it has gone from managing the predictable business to responding to the unpredictable, more opportunistic and alert to change, a place innovation can fit within the need to respond to this different environment.

This is the final post in the series that has focused on the innovation work mat components

Within this final post, I look at why innovation needs to align into the organization. Innovation seems to be in conflict and tension within so much within our organizations. Innovation is challenging the established order; today’s world is also demanding a new organizational design.

The Executive Innovation Work Mat offers a framework to gain a higher level of strategic focus around innovation. Innovation requires engagement throughout the organization to deliver in today’s tougher, more challenging world.

In this series of articles I have looked at the seven components to raise questions, to probe and prompt the necessary thinking that needs to be made in organizations around building innovation that sustains and delivers to the strategic need.

Adjusting our innovation systems to the changes happening all around us

I certainly believe there is an awful amount of change occurring around innovation.

Organizations are attempting to integrate innovation far more into their existing practices.

I think many of these attempts will fail. Existing practices often are not innovation-friendly!

The old organization model built on efficiency and effectiveness, operating in predictable conditions is being destroyed, we are in the world of the disruptor. Innovation needs to be more central to organization design to counter this challenge. Innovation thrives well in networks, it gains from ‘being connected’

Innovation is at the core of a new battle for securing an organizations future, in its relevancy and importance, yet our organizations continue to struggle with where to box this.

If innovation stays a side-show the organization faces a slow demise, as it hangs on grimly, determined to continue to work in ways it has become comfortable with.

Those ‘old’ ways that values controlling in prescribed hierarchies and through rigid plans are simply struggling in today’s more connected world.

We are in uncomfortable times where past systems and structures are not fit for purpose. What is valued more today is “guiding coalitions” where iterations and co-creating thrive.

Strategy and execution are highly interrelated and it is the power of a connected network, working on common cause within innovation that can generate powerful results. ‘Connected’ and ‘collected’ intelligence gives us fresh capacity and far more promising futures.

Innovation is operating in this growing organization world of the designers’ dilemma.
The middle of our organizations continues to focus upon constantly looking to achieve efficiencies and effectiveness to deliver that more predictable result that the top really prefers.

Much of middle management is working with yesterday’s tools and techniques. Innovation is caught up in this middle kingdom and continues to be in conflict. This needs changing.

The innovator themselves, those beginning to roam around the organization, are seeking to disrupt, to challenge, to alter the established pattern as their remit is to bring new innovations into the world. They often face considerable resistance from so many antibodies to this new way of managing.

Organizations have to face this constant ‘tension’ around innovation and where it fits in design, function and structure. Innovation is today not the most comfortable space to work within in our organizations. It often seems to ‘rub’ up against much that seems immovable, innovation generates often unwanted heat and conflict.

Yet innovation is essential, it ‘must’ reside, so we need to manage this ‘creative’ tension to achieve real value out of innovation, results that have lasting impact.

Moving through this disruptive and tense world calls for a more radical response.
Organizations want to see well-defined processes and coordination happening across the functions undertaking the activities of innovation.

It wants innovation to fit within existing organizational design.

This struggle that innovation has with this ‘need to fit’ is a tough challenge. The resolution requires senior management attention to work this thoughtfully through.

It is through this designing of all the essential parts that make up innovation, that will give it the functioning fit for ‘innovation purpose’ but this takes time, engagement and dedicated energy. It needs integrating and coordinate throughout the whole organization.

Innovation is certainly no different from other functions specializing, it does need to be well-designed into the organization but it needs carefully managing, piloting through the organization and that attention to its needs has to come from the top, as it can challenge many established practices that need resolution.

Innovation requires a well-designed system, this is where risk can be managed and defined. This requires having in place a well-designed innovation framework that accounts for and builds around all that good innovation needs.

Designing an integrated innovation system that can ‘pilot’ the activities safely is critical. Organizations will not permit undue risk unless they are in desperate situations where radical actions need to come into play, regretfully these are often too little too late.

How do we design innovation into our organizations systems?

Innovation over time will become more of the core of an organization.

To do this it needs to be well-defined, fully resourced and valued.

It constantly needs to demonstrate value creation.

Organizations need to set about building distinct set of capabilities that deliver on the essentials to provide the future health of the organization.

Innovation offers ‘much needed’ fresh oxygen that allows an organization to thrive and grow. If it starves the organization of this oxygen not only innovation dies but over time so does the organization and it will die.

Innovation must fit somehow into an organizations thinking, find a way to be worked into the routines and practices to do its job of creating the growth, the advancement in new products, services and business models to compete effectively with others to attract the customer to buy.

It needs to balance risk and opportunity; to deliver both efficient and effective results, be highly visible, organized and able to deliver on its future promise.

The design of the organization’s innovation engine room is the place for managing future growth. It needs examining and managing carefully.

As the current organisational tensions are being navigated through with new organisational designs emerge, Innovation has the potential within its possible design and management that could significantly contribute to this new emerging organization order.

Every organization has some clarity in their design, function and their innovation process yet it is constantly constrained by these tensions within organizations. Today there is a need for a new architecture of design for our business as outlined here, a post relating to designing new business models.

The call is for a well-designed innovation framework.

Within this series around the Executive Innovation Work Mat, we covered the different components that make up this work mat. The overarching aim of the work mat is to address one of the missing links we face in innovation today.

We need to achieve a clear alignment and engagement on innovation with the top through to the bottom of our organizations, where a strategic innovation document or framework lays out the integrated thinking for innovation and its contribution to the strategic needs of the organization. This can provide a clarity and purpose to unite behind.

This intent is determined by aligning innovation with the strategic needs and business outlook from the Chief Executive downwards.

In conclusion to the innovation work mat series.

In my view organization engagement comes from adopting a framework that prompts identification.

By working with an integrative innovation work mat it outlines innovations critical aspects to be worked through across the organization, to gain this greater alignment to the strategic intent of the business.

Any design and engagement needs to be highly dynamic, where the learning taking place will flow throughout the organization, top-down, and bottom-up, to make innovation alive and all connected.

This endeavour starts creating a thriving innovation ecosystem. One that is fuelled by energy and organisational commitment as all can see the connected parts and their contribution to this.

Can the Executive Innovation Work Mat be the catalyst needed? I think so.

The post Organizations are in a constant dilemma of the innovation fit. first appeared on Building Your Innovation & Ecosystem Intelligence.

When you look at all the (broken) parts within innovation it takes some time to figure out how you can piece it all together to make it a better whole  improving on what you had

Innovation and its management is just this place this needs to be pieced together. It often cries out for it.

Most people that work in our business organizations are spending their increasing time in piecing their part of the innovation equation together to make innovation work and trying to improve on the existing conditions to deliver new products and services.

People are spending a greater part of their time have to work on fixing the system and its many faulty parts, let alone finding time to work on any new concept or learn differently. Is it not about time we stepped back and really thought through the design of innovation and its managing? Why is this so hard to do?

The negative cost of rework.

When you don’t understand the parts that make up the complete system, you end up with an awful lot of rework that really should not have been necessary. This rework is different from experimenting and learning, where you gain positive insight that improves the innovation activity you are working on. No, this is the negative stuff, the attempts to ‘keep the show on the road’, to keep the momentum and commitment focused and so often this requires a lot of messy, fiddling and fudging of the parts to keep it functioning.

Why is it we often forget not just the innovation project we are working on, needs goals and a clear picture of where we are going although this is heavily influences by what we are learning and absorbing on the way, yet the innovation system never gets this constant, focused attention?

Have you ever completed a 2,500 piece puzzle?

Try completing a 2,500 piece puzzle without knowing the finished picture (or objective). In the jigsaw puzzle we always have the corners and as we spend time looking at each of the pieces we see the unique way they fit together. It is by this dedicated focus we can piece together the final puzzle. The point is, if we have a clear picture to help up, we can piece it together a whole lot quicker. Innovation management needs that final picture, the one where we can constantly refer too, to put together all the pieces and complete the puzzle. Its strategic and it needs to be provided by the leadership of the organization for each of us to work within.

The problem we often face is deciding on the type of innovation puzzle itself.

Innovation and its management does need to always figure out is what it is trying to achieve early on. If you don’t have this clear strategic picture how can you set about delivery of innovation that fits in? If we don’t have clear alignment of innovation to strategic objectives and goals, we end up with thousands of pieces of innovation effort all designed to fit but not pieced together to make the complete design as they lack this overarching picture.

I was checking out on Wikepedia on the puzzle and you can apply some of the attraction that innovators have with solving their puzzles. The entry within Wikipedia suggests you should treat puzzles a little more seriously. “Solutions to puzzles may require recognizing patterns and creating a particular order. People with a high inductive reasoning aptitude may be better at solving these puzzles than others. Puzzles based on the process of inquiry and discovery to complete may be solved faster by those with good deduction skills.”

Can you see managing innovation in this puzzle analogy?

We need to design innovation and its management in purposeful, well designed ways. Often we never seem to know what types of innovation are really needed, we lack alignment to the strategic goals, so we settle on less risk and more incremental solutions, smaller puzzles we can quickly resolve and get a ‘notional’ pat on the back for but fail to really move the innovation needle for real growth.

The other thought is how we love to treat innovation as a mystery.

 Tim Kastelle wrote a great article on both the puzzle and the mystery called are you solving a puzzle or a mystery. He rightly suggests that the problems that lead to disruptive innovations are often mysteries. This means that we need a different toolkit to solve these problems than we use when we solve puzzles.

Tim’s article is based on reviewing the book by Jeanne Liedtka and Tim Ogilvie pick up on this distinction in their outstanding book Designing for Growth: A Design Thinking Toolkit for Managers.

He provided this “designing for growth” visual, which I think is great, it is not an aside, it can help in this ‘puzzle’ thinking.

Tim goes onto argue in his article: “We are strongly drawn to puzzles because of how clear-cut they are. Unfortunately, many of the big problems that we face are not puzzles, but rather mysteries. Mysteries are messy, and the methods that solve puzzles don’t work for mysteries, and they might actually make them worse”. This is a great insight that I am sure is built on Tim’s own personal experiences constantly tackling both mystery and puzzles on many occasions.

We are messy in mysteries and equally in solving puzzles

How do we set about designing innovation management systems? Tim provides a great starting point “when the parameters are basically known”. We just need to find the right information to develop the innovation parameters that will guide and frame the problem.

So what makes up the parameters within innovation system design?

The sad fact is that most organizations never bother to fully understand the multiple levels that make up the parameters needed in designing an innovation management system. They just seem to just love the rework, all that negative stuff!  Surprising when there is so much talk on the emphasis on driving out inefficiencies. Perhaps innovation falls outside the mainstream comfort zone for applying efficient design?

I just think we can design the innovation system, structures, process and their governance so much better to allow those working with their innovation puzzle a better chance to piece it together as they can understand the end goal, of fitting their innovation into the bigger frame of the organization’s strategic growth goals.

For each of us to achieve that, it needs both the puzzle and mystery to be taken out of the innovation system and this is where leadership plays its part. It is by designing and communicating this in an innovative strategic way, may I suggest through the Executive Innovation Work Mat.

The work mat offers the framework for the design by providing its distinct edges for the pieces to be put together and offering a completed picture to work within, it starts to set the parameters needed.

The post Piecing innovation together first appeared on Building Your Innovation & Ecosystem Intelligence.

We often talk about simply incremental and radical, yet we do have other choices such as a more ‘distinctive’ design or one that sets out to be ‘disruptive’.

Let me offer this for thinking through on your fits on the innovation path you want to take and ‘flag’ some areas you need to consider. Each degree of innovation (or type) has considerable organization design issues to think through.

Let me explain these a little more

Degree is the scale to increase the intensity of innovation- incrementally, distinctively, radically or disruptively. Each of these ‘degrees’ have implications and aspects for the organization to consider.

Type provides the environment you are operating within. Incremental innovation is fairly predictable, it is the ‘easier’ option, and it tends to be a fairly static place to be, everything is fairly predictable; you keep refining the practice of innovation.

For distinctive you are extending your innovation into good practice, you are looking to push design, to offer something beyond the existing extension. I feel design innovation fits really well within this type.

Radical is more about learning, being alert, agile and experimental, preparing to take some risks but pushing beyond the existing boundaries, into emergent practice.

Lastly disruptive, a high-risk approach where it is very much leading-edge, self-generated, self-inflicted but offers a potentially high reward that changes existing dynamics and is often novel and experimental in how you handle this in practices.

Approach is the way you set about innovation. Incremental for the vast majority is often through a very ad hoc innovation process and not systematic in their approach in linking strategy with their innovations.

Although you could argue and argue well, that the vast majority of consumer goods companies have a very highly systematic process to churn out incremental products constantly but I don’t think this type of incremental innovation gives ‘huge’ additional growth value, it tends to maintain the ‘steady’ state.

I think the more it is systematic the more the innovation moves from a ‘incremental’ to ‘distinctive’ as it is the richness of combinations that separate the product or service.

For instance you redesign the container, you add different ingredients that are healthier, you reposition your product in brand message, you offer a more emotive attachment- this becomes more distinctive, more enduring than incremental.

Radical or disruptive is far more fluid, adaptive and constantly searching out, less reliant on a given process, more on the nature of the proposition to drive it through to translation, not on a given process or accepted methodology.

Fit deals with the space you chose to operate within. The more you chase up the degree of innovation the more you need to challenge your organization’s structure, response mechanism and adaptation.

Without going into the Cynefin framework explained here http://youtu.be/N7oz366X0-8 it has considerable value as it offers a ‘sense-making model to think through’ for you to reflect on the type of innovation and its difficulties.

Innovation is certainly complex and the Cynefin framework offers an excellent complexity model for being made more aware. It helps you to think differently and apply the necessary changed mindsets needed for these four innovation types.

Conditions are more to do with how you work. These are to a large degree the ability within the organization to adapt and how you learn. If you don’t communicate well, you don’t seek to learn from mistakes or each other the learning loops never actually happen. You need to find ways to question and re-question if you want to push the boundaries.

Where do you see your organization?

So these are my dominant design structures for firms when it comes to innovation. Can they operate across all four simultaneously – highly doubtful -especially if you have a culture, industry and leadership that stays within the incremental space or a given comfort zone.

It is really hard to unlearn this repeating pattern of innovation and attempt to move into the different degrees of radical or disruptive particularly, yet I hear so many talking about this, as a need to do but can they?

The implications of degree of innovation do have significant implications and organisational design challenges, so be warned.

The post Your dominating innovation design is? first appeared on Building Your Innovation & Ecosystem Intelligence.

It is about the power of design and interaction to make something new happen fast.

Tackling messy problems

“A pressing question for more established economies… is how to foster more entrepreneurship and innovation despite greater stability and predictability.

One method that companies and individuals are adopting is design thinking—the approach of scaling or “group-sizing” the way that solo designers have always worked to enable to cross-functional teams tackle messy problems that don’t fit neatly into any one person’s job description or academic discipline.

Design thinking is one way to simulate some of the extremely dynamic conditions of an emerging economy and foster entrepreneurship in the US.

Forcing direct contact with users

The idea is to put teams in situations where they are forced to synthesize meaningful opportunities out of a lot of highly subjective data about the world and the needs of end users.

At the Stanford d.school, for example, classes are all project-based, and require students to have direct contact with users to gain empathy and test ideas, including the use of ethnographic research to quickly gain insight into unfamiliar environments, communities, and systems.

Imposed constrained timelines

The projects also force students to operate under highly constrained timelines. This can effectively replicate the whirlwind conditions that entrepreneurs in emerging markets experience – consumer needs and the whole ecosystem are changing so rapidly that they have to adopt an iterative approach to nearly everything.

Cultivating skills in quickly assessing complex situations with fresh eyes – and swiftly getting prototypes out into the world to test ideas concretely are what allow design thinkers to conquer uncertainty and create concrete opportunities from open-ended project mandates.

A wonderful example of  taking a ‘raw’ idea into a fast prototype

Two graduate students taking a d.school course this past spring used design thinking to go from idea to revenue-generating product in just 6 weeks. That product is Pulse, which quickly shot up the iPad app charts to become the number one selling app. Pulse is a newsreader that allows users to rapidly toggle between multiple sources and articles.

Once they had the original seed of the idea from conducting user research, the Pulse founders sat in a café and tested a low-resolution version of their product with potential users. They quickly iterated in response to feedback, coding new aspects of the software in the time it took to drink a latte.

Unconcerned with whether the next version was 100% ready or “right,” their bias was to learn from low-res prototypes as quickly as they could.
By using design thinking to collaborate and innovate, these two students were able to upend what seemed like an established market for digital newsreaders and compete with major incumbent players like the New York Times.

Skills in design thinking are a foundation for finding hidden patterns and making something real and actionable emerge from an uncertain environment.”

My comment: this is such a great illustration of the power of design interacting with potential users, so as to discover if the idea firstly ‘gels, meets a need and can be worked on really fast in prototypes to deliver on that.

The post Placing Design into the Innovation Equation first appeared on Building Your Innovation & Ecosystem Intelligence.