Culture and Humility as Competitive Advantages
In 2019, I interviewed over one hundred business leaders. In the course of these interviews and follow up discussions I learned a great deal – some of which I want to share here. I have seen workforces that are united with their leaders in a desire to change and improve. I have seen organizations that bring in all new leadership eager for change, but watched them fail because of institutional resistance. I have seen leaders and workforces passionate about winning, but without the humility to learn from their customers. I have witnessed how difficult it is to change.
I have learned the human-work of solving problems, facing challenges and overcoming obstacles tends to share a common purpose: creating stable, secure and predictable environments. The tendency for most humans is that once we solve a challenge, we want to be done with it. That propensity, however, does not fit with today’s reality of perpetual change.
In today’s business world, organizations have no choice but to operate in an unclear, uncertain and continuously shifting environment that requires a new mindset and approach to formulating business strategies. Digital winners recognize that change is part of the game, and that they need to develop ways to exploit continuous ambiguity. In fact, in our surveys of high-tech professionals, when we asked how long they thought digital transformation initiatives would last, about one-third of the surveyed technology professionals answered “forever” – and as we all know, forever is a long, long time.
Today change is not something to be solved; instead, change is the energy that propels organizations to be in perpetual motion – creating new innovations, designing new business models, identifying new threats and opportunities. Business leaders must continuously recognize new trends, competitive forces and markets, and then retool, reprioritize, re-educate, culturally align and retrain employees to capture new opportunities profitably. They must constantly fight “normalcy bias,” which is the desire to keep things the same. They must foster an environment that embraces change and recognizes competitive opportunities reside in every instance of change.
Three Cultures that Block Change
My discussions with business leaders over the years have revealed the extent to which company cultures can block or restrict change efforts. One healthcare executive identified his organization’s culture as its biggest challenge – ahead of resistance to process change and outdated technologies. In another survey I worked on 20% of technology professionals identified cultural issues as their biggest challenge.
I have found at least three critical cultural areas that impact an organization’s ability to successfully make changes:
Leaders must embrace a culture of change. One that understands how digital technologies help them compete. They must define their business doctrines and strategies and communicate them to their teams daily. If business leaders don’t convey a full understanding of how digital technologies are impacting their industries, markets and customers, and then acting upon it, they are a detriment to their organization’s future. I have learned the following:
- Leaders struggle with accepting change – adjusting their mindset, and appreciating the true significance of digital transformation on their business and future.
- Leaders often require a major failure event to wake them up to the need for decisive action and digital transformation.
- Leaders must realize that different segments within their workforce view digital technologies in different ways, and they must be managed, educated and trained differently as a result.
An organization may have insightful leaders, but if the organization does not follow, even the best leadership efforts will be ineffectual. Here is what I have learned:
- Digital transformation and organizational change means it’s not just the IT infrastructure that must change, but all areas of the business.
- Digital transformation and organizational agility must be embedded deep in the culture of an organization.
- Without continuous education and engagement the workforce will resist change.
Businesses must understand the culture, practices and fast changing behaviors of their customers and align with them quickly enough to matter. I have found that the majority of companies I speak with are motivated to change because their customers demand it. Customers’ are adopting digital technologies and changing their online behaviors faster than many companies can recognize it. Here are additional things I have learned:
- Customer demands and changing habits are interrupting organizational priorities, budgets, strategies, investments and plans. Many businesses are irritated if customers are not aligning with their plans – a silly notion.
- Digital transformation is unevenly distributed and some customer and industry segments are far ahead of others, which creates opportunities and competitive advantages for fast movers.
I have come to understand we need to purposefully monitor and develop new mindsets. Accept that our world is in permanent flux – not temporary. Understand emerging technologies and their capabilities, and rethink every aspect of our business with a new mindset. Recognize we don’t control our digital customers and we cannot dictate their behaviors. Our role is to observe, support and align with them faster than our competition.
Our organization’s culture plays a big role in our ability to compete today. Our leadership’s, our organization’s and our customer’s cultures all have an impact on us. It’s important to purposely develop a culture built to support the continuous and rapid changes that comes with the Fourth Industrial Revolution.