CFOs: Have you ever wondered if being digital is enough to create successful business transformation?
If you do, you are on the right track, according to Paul Leinwand and Mahadeva Matt Mani, the authors of Beyond Digital published by Harvard Business Review Press.
Digital transformation has been the big buzz in recent years, but only being digital is not enough to create successful business transformation, the authors said.
In addition, while digitization as a business strategy has become a road to equivalency, digital initiatives alone are not enough to win in the marketplace, the authors added.
Companies need to reimagine the compelling value they will offer and how they will create it in a differentiating way, the authors advised.
In the book, the authors explain that the future will belong to companies that successfully answer two fundamental questions: “What unique value do we contribute in today’s world?” and “What capabilities allow us to create that value better than anyone else?”
The book’s findings are based on three years of research with 12 companies that have executed business-wide transformation strategies: Adobe, Citigroup, Cleveland Clinic, Eli Lilly, Hitachi, Honeywell, Inditex, Komatsu, Microsoft, Philips, STC Pay and Titan, according to the authors.
Through interviews with the leaders who led these transformations, the authors have identified seven leadership imperatives that are essential for companies to transform their organisations and shape the future:
- Reimagine your company’s place in the world
- Embrace and create value via ecosystems
- Build a system of privileged insights with your customers
- Make your organisation outcome-oriented
- Invert the focus of your leadership team
- Reinvent the social contract with your people
- Disrupt your own leadership approach
“There is a revolution in how competitive advantage is achieved — both in what consumers expect and the ways companies deliver on those expectations, said Paul Leinwand with Strategy&, PwC’s strategy consulting business.
“It is more important than ever for leaders to guide their companies to define their place in the world in terms of the unique value they create for customers and for society,” he noted. “Then they need to define the system of distinct capabilities that allows them to create that value in ways that others cannot.”
The book emphasises that lasting business success requires building a capabilities-based organisation, with outcome-oriented teams that are totally focused on delivering differentiating value.
Leaders need to be brutally honest about gaps their companies have in the seven imperatives and there needs to be a commitment to executing all of the imperatives, the authors pointed out, adding that an incremental approach focusing on only one or two is likely to fall short.
“One of the things that stood out in our research is how many leaders emphasised that they themselves had to transform at least as much as their companies did, said Mahadeva Matt Mani with Strategy&.
“Today’s business leaders need to be both strategists and executors; tech-savvy and deeply human; good at forming coalitions and making compromises, all while being guided by their integrity,” he noted.