by Oliver Marks

Digital Buzzwords are Obscuring Real Business Strategies and Value Creation

Feb 24, 20155 mins
Enterprise ApplicationsIT Strategy

Finding a successful path to valuable business strategy via digital technologies is both common sense and a balancing act between old and new thinking, but marketing hype is confusing the basics.

digital enterprise
Credit: Thinkstock

The hardest place to be right now in the Information Technology world is at the intersection of Future and Main Streets. We all know there is massive societal change enabled by digital tech use patterns and also that digital evolution is accelerating faster and faster.

wardle grimshaw flinders street station competition 1 John Wardle Architects + Grimshaw

Flinders Street Station Design Melbourne Australia

That’s Future Street… but Main Street is where we live today. Unless we are working with a shiny new business startup, or the opportunity to redesign like the Australian Flinder Street Station architectural design above that consciously aims to combine the best of old and new, we have to juggle past, present and future with all the attendant legacy technologies and integration hairballs.

There is compelling commercial evidence that transitioning to digital business models is one of the most important competitive differentiators for decades, but the sheer volume of noise, buzzwords and possible vendor red herrings make it increasingly hard to sort out the real from the hype. Overworked cliches around transformation and ‘the future of work’ can be very distracting and dangerously out of context to specific business problems.

Board level and C-suite directives are often informed from rarified high level discussion of ambitious digital business transformations which don’t translate well to realities on the ground. Those given the task of translating fresh business goals into workable strategies that deliver results have to speak past, present and future fluently, and be able to parse the details to create the required value. 

This video of Gary Hamel speaking at the 6th Global Peter Drucker Forum in Vienna, Austria last November has his usual power and conviction, and you can’t help but admire his ambitious logic I quote below in essentially defining why the business practices of the last 100 years are now increasingly obsolete in the face of massive societal change:

“…why do we revert back to that hierarchical, rule driven organization? The answer is that as managers we have a lot of vestigial, residual beliefs that were handed down to us by long dead ceo’s, by ego polishing consultants, by backward looking scholars – we have to challenge those toxic mindsets that people are instruments, that efficiency matters most, that emotions are suspect, that change has to be managed.” 

This is the type of language that impresses the upper echelons of the enterprise but all to often fails to get through to their colleagues who are working long hours to fix past and present problems. The Main Street where you live today is likely to be a complicatedly plumbed environment geared up for the hierarchical past and with huge challenges for any sort of retrofitting and integrations to enable a new era. 

Meanwhile the individual and the customer clearly now has colossal and rapidly growing computing power, connectivity and a vast human network instantly accessible from their pocket, and the ‘enterprise’ vs. ‘the networked economy’ is the latest conundrum to be solved – merging the old with the new.

As Peter Drucker said “It’s easier for companies to come up with new ideas than let go of old ones,” and this is doubly hard when we then try to blend the old into the new. Most mature companies have multiple layers of legacy technology strata, plenty of delicate integration points and a brittleness that makes extending functionality very challenging.

New layers of digital technologies typically tend to be silos because it is so hard to integrate them. Over the last few years, username & password protected digital silos have popped up like mushrooms all over the modern enterprise funded by departmental budgets, creating a new generation of rivalries and knowledge hoards. There is no question that greater agility is possible across modern digital tech, the greater challenge is in finding ways to pull all the elements together into a streamlined and simplified, cohesive digital enterprise without breaking the bank and/or becoming trapped on a tech vendor platform.

Identifying medium and long-term boundaries to new digital retrofitting work and next generation platforms isn’t as important as having a clear idea of precisely what business value they will deliver when fully functional and how that value will evolve. With a billion and half mobile devices and rising on the planet, and with heavily populated areas of the planet such as Asia Pacific ahead of the Western world in integrated digital and growing rapidly the pace is accelerating fast. Drucker again: 

“We are becoming aware that the major questions regarding technology are not technical but human questions”  (from an essay Technology and Society in the Twentieth Century, 1967)

The alignment of key business goals and kpi’s– informed by an awareness of emerging digital realities — with IT budgets, boundaries and problems is the road to an efficient digital enterprise, and getting that objective strategic thinking right is critical before embarking on subsequent execution tactics for the long march down Future Street. This should be obvious, but it is surprising how often ‘ready, fire, aim’ takes place today around fragmented digital initiatives.