This is the second article in our special series on the Digital Journey.
Digitisation has become synonymous with computing technology and data. Smart lifestyle devices such as phones, fitness trackers, refrigerators and cars are packed with unprecedented computing power. They also have incredible bandwidth for gathering reams of data. It’s not only “big” data, but “fast” data. In the 1990s, capturing data on consumer or employee behaviour meant conducting surveys, interviews, focus groups and data aggregation. Human beings plugged data into machines that spat out charts and tables for them to analyse.
Now that we have a wealth of real-time, and highly granular, information from the many digital products in our lives, the key is extracting meaning from all of these data. This means some new roles, and some added complications for old ones.
Executives and managers at the forefront of digitisation who we recently interviewed stressed that the focus today is less on “data” and “storage” than on “analysis” and “ideas”. But as these managers explained, this has multiple implications for the way data are mined, the skills and roles organisations need and who takes the lead.
Our findings in these areas form the second article of a six-part series spanning our 10-point framework for the digital journey (figure below). In the first part of this series, we covered the mindset element: Organisations need to think of digitisation less as a transformation and more as a journey. We now move on to the people and skills – the foundations for digital work – that organisations will need on this journey.
Starting at the top of the organisation, the Chief Digital Officer (CDO) has emerged as the most visible addition to the organisational hierarchy. While easily confused with Chief Technology Officers (CTOs), CDOs connect technology to the core business model while simultaneously aligning it with the marketplace and culture. The ideal candidate, in other words, has a good awareness of technological possibilities but must be able to make the connection to business opportunities.
One CDO we interviewed saw himself bringing “a little bit of the technology knowhow on the one hand and on the other side, the business development knowhow.” Being able to understand both sides and “speak their language” was crucial, he believed.
Another respondent with deep industry expertise and technical experience cautioned, however, that “there’s no one individual who understands enough of the whole business to be able to make the right decision.” The CDO’s role is therefore largely one of facilitation and orchestration, and particularly the integration of three specific skillsets.
Quants, digital natives and suits
Our interviewees expressed demand for three different types of people: “quants”, “digital natives” and “suits”. The quants are those with math, deep programming and analytical skills. One advertising manager described this as a shift from “Mad Men” to “Math Men”. In many ways, this is the cornerstone of the digital skillsets that companies need. People with programming and deep analytical skills will be in high demand for the foreseeable future.
Digital natives are those well versed with our digital world and digital lifestyles. While digital natives are typically young, they can be found across age groups. They are people passionate to learn how things digital are increasingly becoming integrated with all facets of life. They are active users of many platforms from messaging to video streaming, and preferably know a thing or two about coding.
One respondent told us that “you need to have so-called digital natives who have grown up with this and who also constantly follow it and have the open mindset to hopefully anticipate and foresee changes in the future.”
Finally, organisations on the digital journey still need “the suits”, people who understand business plans, marketing, financial structures and operational processes. Suits can monetise opportunities by connecting technological value to customer needs.
But when quants, digital natives and suits work together, things can often get lost in translation. One banking manager told us of his experience working with quants: “They were explaining to me and showing me what the technology could do but they were not understanding what the “use” of it was. It was like I was speaking Spanish and they were speaking Arabic.” In other words, the gulf between the “coolness” of the technology and the value to consumers can be dramatic.
This places a burden on digital leaders to integrate these diverse but crucial skillsets. One way is to seek “unicorns”, high-potential mid-career types who have become acquainted with the methods of the quants, digital natives and suits. But they are a rare breed. Companies unable to deploy armies of unicorns must develop a collaboration strategy instead. One manager reported that “we have company summits to help them [engineers] understand: ‘This is that thing you’re working on and that thing the person next to you is working on, you start putting those blocks together and this is what it does for our customers.’” Unfortunately, many companies have no systematic plan for collaboration.
Because unicorns are hard to find, CDOs must either take responsibility for integrating digital and business efforts, or create “enablers” to do so. Two key functions of these digital leaders emerged from our research: brokerage and storytelling. Brokers connect people and ideas throughout the company, providing a master repository of the work at hand, essentially mapping activities to bridge collaboration. This requires people who are actively plugged into various company networks, and who stay on top of the movement of those networks, bridging people in the process. Storytelling entails the provision of an ongoing narrative of digitisation work to explain where things are and how they fit together. The CDO could be the broker and storyteller or others could be nominated to fill these responsibilities. In some ways, this is classic general management work, as one manager told us: “I think it’s more important…to have specialised teams and a general manager involved…who can actively manage all the different types of specialists.”
In other words, the management processes companies need on their digital journeys are not so much “digital” but “social” and highly collaborative. The human and social systems for crunching through data with speed and accuracy will be essential. Facilitating collaboration and matching the skills of the technology specialists with those of traditional business executives will be crucial for capitalising on data. As our next article will show, how companies design their processes will also mean the difference between success and failure in tracking external change and adapting to it.
Charles Galunic is a Professor of Organisational Behaviour and the Aviva Chaired Professor of Leadership and Responsibility at INSEAD.
About the series
First, the article in my mind is a very sensible framework of roles and behaviour needed to succeed in digital transformation.
In your estimate, what percentage of S&P500 companies actually are aware of the need for such a framework, and how many have been able to implement it effectively?
Finally, how have the successful organizations been able to get the balance in between quants, digital natives and suits right? Is this “cross the river by feeling the stones” type organizational journey, or could you bring up any best practice examples that could help us learn faster?
Thank you and best regards,
This framework is a broad collection of things digitizing firms need to consider, but how far along, say, the S&P500 firms may be is very hard to tell. One place where you can look, however, is at the McKinsey Global institute survey of digitizing penetration by industry. They look at such things as assets, labour (skills), and usage to create an index of digitization progress. https://www.mckinsey.com/mgi/overview
Getting the mix “right” is a firm-level question and will vary. But in my experience the common issue is how to coordinate and collaborate across these different roles and skillsets.
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24/05/2020, 12.57 am
thanks for an insightful article. A lot of literature is focusing a lot on the role of CEO's, CDO's and other collaboration partners. Have you considered the role of middle managers in the implementation of digital transformation?