Can the Data-Driven Enterprise Raise GDP?

Transformation begins when leaders enroll everyone in a mission to overcome needless delay. These three patterns can inspire leaders to build a better, next normal.

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Inspiring a sense of mission while reminding people why their work matters is one way some of history’s greatest leaders helped people through challenging times, according to Harvard Business School’s Nancy Koehn.

We’re in the worst downturn since the Great Depression. The IMF expects growth to fall 4.9 percent this year, while the total loss to global GDP from the pandemic could be $12 trillion by 2021.

On the one hand, we all hope beating COVID-19 will make it possible to return to “business as usual” soon. But, on the other, I think this crisis has shown that the constraints of “business as usual” were impeding progress in ways we should no longer accept.

Pre-coronavirus, most companies aspired to become digitally transformed, data-driven enterprises. Analyses pointed to upside in the trillions of dollars from increased application of AI and analytics across industry and government.

There were plenty of reasons to be inspired by this. For example, 30 percent of construction spend is waste. Likewise, about one third of all food produced never makes it to human consumption. When Microsoft Japan adopted a four-day workweek, productivity rose 40 percent.

But, nonetheless, we now have strong signals that we were tolerating needless delay applying technology to drive efficiency or growth. Microsoft CEO Satya Nadella’s statement on April 30 cut to the chase: “We’ve seen two years’ worth of digital transformation in two months.”

We ought to enroll everyone in a mission to overcome everything holding back progress in the status quo ante. We should be inspired by the opportunity to define new practices in our organizations that drive a faster, bigger bounceback.

For me, the past few months have shone a light on three patterns for successful transformation that I’ve observed over the last decade. The first and foremost is: build conviction, not consensus.

One CIO we interviewed told us why he was able to make the kind of progress Nadella was describing as a result of this crisis: “Historically, when we've tried to make digital transformation steps, there have been curmudgeons that have said, ‘You can't do that. Here are all the problems. It'll never work, yada, yada, yada.’ And that obstructionism is really easy to do.”

Building consensus takes time and effort. Reducing its cost is a mug’s game. That’s because increasing the correctness of beliefs by doing wins over trying to do it by debating.

Most decisions—the kind that Amazon CEO Jeff Bezos describes as “two way doors”—can be reversed.

In his words, “To invent you have to experiment, and if you know in advance that it's going to work, it's not an experiment.”

The only thing everyone needs to agree on is that it’s everyone’s obligation to relentlessly create conditions for “fast failure and learning”—and leadership’s job is to celebrate it when it occurs.

In my next post, I’ll dig into the other top two patterns for success I’ve observed: embrace urgency and aim high.

In my next post, I’ll dig into the other top two patterns for success I’ve observed: embrace urgency and aim high.

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