Digital transformation: What CIOs have learned about culture in the last 9 months
Blog: The Enterprise Project - Digital Transformation
Throughout this year, the MIT Sloan CIO Digital Learning Series has been providing a window into how leading digital companies are handling the pandemic. The recent final pair of panel discussions in the series was nominally about digital transformation, but it was really about the changes that CIOs have been making over the last nine months or so.
So this is a technology story, right? Indeed, there’s been technology involved. A common theme throughout this series has been how quickly things changed. Stephen Franchetti, vice president, IT & business technology, Slack, described rolling out his company’s chat product to 100,000 users at a grocery chain over a weekend. Cynthia Stoddard, senior vice president & chief information officer, Adobe, says her company “clicked over 24,000 people without a blink.” All that takes technology.
But there’s been another theme that was even more front and center at this event: the importance of people and culture.
[ Get answers to key digital transformation questions and lessons from top CIOs: Download our digital transformation cheat sheet. ]
Companies with digital maturity put people first
Dr. George Westerman, senior lecturer, MIT Sloan School of Management, has previously written about their research into how “the best companies — those we call Digirati — combine digital activity with strong leadership to turn technology into transformation. This is what we call digital maturity. Companies vary in their digital maturity, and those that are more mature outperform those that are not.”
As a panel moderator at this event, Westerman added, “The first law of digital innovation: Technology changes quickly. Organizations change much more slowly. Unfortunately, organizational cultures change even more slowly.”
[ Want more advice from George Westerman? Read also: Digital transformation: 3 steps to build a digital-ready culture. ]
And a company’s leadership has a great deal to do with establishing that culture. Westerman argues: ”If you think about digital transformation as two words, we pay too much attention to the digital and not enough to transformation. It’s not a technology challenge, it’s a leadership one.”
Shamim Mohammad, senior vice president, chief information and technology officer, Carmax, went so far as to call culture “the operating system that runs the company.”
The technology leaders were unanimous that everything starts with people, a view shared by panelists at the past MIT Sloan events, such as Aarti Shah, senior vice president, chief information & digital officer, Eli Lilly and Company. For example, Stoddard talked about how people need breaks. At Adobe, she explained, they “try to be very respectful of the weekends. [We] have also started having a global day off every third Friday.” And based on their network traffic, “people are taking advantage of it.”
Zeeshan Tariq, senior vice president and CIO, Zimmer Biomet, talked about how making sure employees were both physically and financially safe was a key step when the pandemic first hit. Zachary Smith, managing director, Packet, an Equinix Company, described how one of the things that most helped them was focusing on their workforce. “I’m safe, I belong, and I matter. I’m safe working in the datacenter.”
[ Read more about how Zeeshan Tariq built trust during the pandemic. See his article: How building trust and empathy can increase speed in IT. ]
Post-pandemic world: Goodbye, old office norms
Participants also had a lot to say about what a post-pandemic world might look like from the perspective of how businesses operate. They were unanimous about this, too: Things will be different.
As Mike Grandinetti, mentor, instructor, and program development Fellow, University of CA at Berkeley Sutardja Center of Technology and Entrepreneurship, summed it up: “When VCs are willing to give out money based on a Zoom call, you know the world has changed.”
One area of change is the office. Franchetti predicts, “The office is going to be reinvented.” Tariq asks, “Do we need all our facilities? Do we need them in their current capacity?” The consensus: Most companies won’t see a return to business as usual, but they won’t go 100 percent remote either. Tariq added that he doesn’t anticipate travel to disappear but does expect it to shrink considerably.
As many office-centric companies have found, these IT leaders are also seeing that remote work can work well and can even be better in some ways than before. For example, Stoddard remarked, “People are very creative. They want the organization to succeed. Everyone is equal in a way. We have had remote workers before. But with people in a physical conference room, people remote could feel a bit left out.” She also observed, “Many people who never spoke up before [in physical meetings] are now speaking up.”
Tariq shared that his organization is very high-touch, with company reps often in operating rooms to provide medical device assistance, pre-COVID. But with hospital systems locked down, the company was able to make subject matter experts available virtually to the people present in the facility. They also piloted augmented reality (AR)/mixed reality quickly.
Agility is the new scale
One lesson that has emerged throughout the pandemic: Organizations with the right culture and technology have been able to quickly adapt when they’ve had to. The speed has even been a bit surprising to some of the best-prepared participants. And it’s leading some to ask: If they can do things this quickly in a crisis, why does it take so much longer in normal times?
For example, Stoddard observed that “things which would have taken six to nine months have taken weeks.” While “there needs to be a certain process and checkpoints that let you go faster and still have quality,” she and others also wondered if “maybe we don’t need to go through all of the long cycles.” Tariq discussed how, before the crisis, they tracked sales on a monthly basis. But for supply chain and other reasons, they quickly needed to pivot to tracking on a daily basis. “Don’t expect us to ever go back,” he added.
Digital transformation team success secret: Trust
It’s easy to listen to panelists like these and conclude that their lessons may apply to digital leaders who have already done a lot of the heavy lifting to react to and survive the current environment. Indeed, Carmax’s Mohammad credits their success with the fact that “over the past few years, we have been going through a lot of transformation to make it a digital company and innovate faster. Customers were changing rapidly. We wanted to meet customers where they wanted to meet.” Tariq noted that “luck favors the prepared” in that “when the COVID crisis started in late 2019, we did a tabletop exercise to see what would happen if it became a pandemic.”
But we’ve seen adaptability across many businesses. To Smith, it’s been “pretty incredible that even small and regional healthcare providers were able to scale,” with one customer having a 500 percent increase in home interconnectivity within about a week, along with additional networking demands due to telemedicine.
Preparedness is one lesson here, yes, including with respect to technology platforms and cools. But the broader lesson comes from Stoddard: “Build trust with the team and let them innovate.”
[ Culture change is the hardest part of digital transformation. Get the digital transformation eBook: Teaching an elephant to dance. ]