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Digital Era Success: Five Building Blocks
Posted on February 3rd 2014
Summary: The main building blocks for Digital Era success are leadership, governance, digital competencies, education and training, and change management. Each requires a unique set of considerations that differ from traditional success factors, and in some cases are unprecedented. Many Industrial Era mental models, processes and cultural values are not transferable to or effective in the Digital Era. The digital transformation of both individuals and organizations requires fundamental changes and long-term commitment.
Many people are trying to wrap their brains around the applications and implications of social and digital technologies, particularly from professional and organizational perspectives. In addition to questions about the barriers to digital engagement and transformation (see my thoughts here), I’m also often asked what I think are the primary building blocks for Digital Era success. I’ve boiled it down to five interrelated factors. Here’s my first cut at articulating them.
This is first and foremost, and a factor I’ve spent an incredible amount of energy on (and experienced no small amount of frustration with) since 2009. We all know that leaders determine strategic direction and allocate financial and human capital resources to the initiatives that are deemed to have the greatest strategic value. Digital Era success requires leaders who recognize that digital engagement and transformation are worthwhile long-term investments and not just short-term tactical initiatives. Digital transformation is neither easy nor cheap, but it can absolutely pay dividends in terms of outcomes like increased revenues, decreased expenses, more innovation, better client service, less inefficiency, etc.Smart leadership is key to reaping those rewards.
In addition to determining and facilitating the pursuit of strategic priorities, leading for success in the Digital Era requires developing sophisticated, informed, and forward-thinking answers to questions like the following:
- What kinds of fiduciary and governance responsibilities do Boards of Directors have with respect to addressing Digital Era opportunities and challenges?
- What are new and evolving legal and regulatory requirements specifically related to digital technology that could impact the organization?
- What are the primary Digital Era risks, and how should they be managed?
- How must human capital management practices change to adapt to Digital Era realities?
- Should CEOs and other leaders be directly engaged in external applications of social media? What about internal initiatives?
- What traits and behaviors must leaders have and demonstrate to be effective and successful in their roles as the Digital Era evolves?
I think of governance in terms of things like roles and responsibilities, rules and guidelines, policies and procedures. One of the paradoxes of digital transformation – particularly the use of social technologies – is that opening up channels of communication and using more sophisticated technology to facilitate communication and collaboration create the need for more, rather than less, control. Unlike Industrial Era approaches to control, however, the purpose here is not to restrict behavior in a way that promotes standardization and conformity, but to do so in a way that liberates people to interact with each other using social and digital technology more efficiently and effectively. Furthermore, the approach should reflect a shift from managerial direction and power to worker empowerment and engagement.
Good governance does not involve unnecessary bureaucracy or excessive rigidity, and it should not be based on an arbitrary set of standards. Rather, following models created by Frederick Winslow Taylor in the early days of the Industrial Era and and W. Edwards Deming after WWII, it should maximize the efficient and effective achievement of organizational goals and be driven by rational, scientific approaches, including a strong reliance on (big) data and analytics.
Although there’s much to be learned from Taylor and Deming, the lessons to be derived from their work have more to do with how we approach the development of good governance models rather than what the models themselves should look like. It bears emphasizing that the kinds of models we need today are generally without precedent. The role of strong governance models in determining Digital Era success is unquestionably important, but what those models should be requires fresh thinking and approaches.
Who will be the Digital Era’s Taylor or Deming?
Some people like to refer to this as digital literacy, but I think competencies is stronger and more action focused. Years ago, after doing extensive benchmarking and creating a social media and online communities curriculum for Northeastern University, I began developing a model that includes the following competency areas:
- Concepts: Ideas unique to the Digital Era, or that take on new meaning in the Digital Era
- Tools and Platforms: Specific enabling technologies or applications of technology, and the digital environments in which multiple social technologies are leveraged for specific purposes
- Skills: Capabilities unique to the Digital Era, or that take on new meaning in the Digital Era
- Tactics: Specific means of leveraging social and digital technologies to achieve goals and objectives
- Management: Issues and challenges related to the development and implementation of social/digital engagement strategies and plans (including governance, risk, and human capital considerations), as well as the use of these technologies by individual employees
The Digital Competencies Model is actually several models. These five elements comprise the core, but the details of what each involves will depend on factors like an individual’s leadership status, functional area, roles and responsibilities, etc. As with governance models, we’re dealing with a set of realities and requirements we’ve never had to deal with before in any substantive way. Traditionally, professionals and other workers have had to develop a knowledge base, skills and expertise that were directly related to their professions and/or organizational responsibilities (e.g., accounting, manufacturing, medicine, law). Now, however, they also need to add a digital dimension to their knowledge base, skill set and expertise to do their jobs. This digital dimension may relate to the unique tools and requirements of their jobs (e.g., 3D printing, digital radiography), but it’s also strongly connected to their interactions with others. The communication and collaboration platforms and tools available today are far more sophisticated and require more advanced capabilities than traditional tools like pens and pencils, phones, and even early digital tools like email.
Though they’re loathe to admit it, most workers today have low levels of digital literacy (and many are virtually illiterate). To achieve Digital Era success, organizational leaders must recognize the importance of digital literacy and digital competencies – and act on that recognition to ensure they have a high-functioning, efficient and effective workforce.
Education and Training
For too long we’ve been operating with what I call a LIY (learn it yourself) approach to social and digital technologies. This approach has generally been ineffective (e.g., most people still don’t know how to use traditional tools like Microsoft Office products, email or the internet itself at more than a basic level), and it’s even less ideal when it comes to the more sophisticated and powerful tools now available to us. Our collective suboptimization is going from bad to worse.
Ironically (or perhaps paradoxically), the LIY approach is accompanied by a tendency to “blame” the tools for having too many bells and whistles and being overly complex (which is a fair complaint, but maybe not a good excuse), along with a corresponding expectation that it’s the responsibility of the software developers and designers to make digital tools easier to use. As important as good user design and user experience are, it’s unrealistic to expect that the standards of simplicity and intuitiveness we apply to consumer-oriented technologies can be completely extended to the tools we use for work. At some point we have to recognize that even the best designed software tools require knowledgeable and skilled users. Training is necessary to create strong users, and the required training should not just focus on the literal aspects of how to use specific tools and platforms. Rather, there needs to be an emphasis on understanding the underlying logic behind new technologies (e.g., what is a discussion thread, what do hyperlink codes tell us) and developing transferable skills that can be used across a wide range of platforms (e.g., html basics).
In addition to training focused on knowledge and skills related to digital tools and technologies, training related to tactics and governance, as well as education regarding key concepts and managerial issues, are also critical to Digital Era success. Much of the necessary training can be offered by organizations for their employees or can take place via digital learning platforms like Udemy or Alison. But there’s also an important role for academic institutions from elementary schools through higher education to help workers at all levels and all career stages develop the necessary competencies for Digital Era success. They need to know not just their ABCs and 123s, but also their 0101s.
This may seem like a no-duh factor, but like education and training the change management aspects of digital transformation are too often underemphasized and undervalued. As noted above, laying a roadmap for Digital Era success is going to require some very powerful shifts in cultures and mental models and processes, the likes of which we haven’t really dealt with before. These changes will be profound and dramatic, but they will not – and should not – happen overnight. Digital transformation is a long-term commitment, and it is best approached as an evolutionary process that requires balancing the past, present, and future, respects the rights and needs of both individuals and the organization, is flexible but inevitable, involves both carrots and sticks – and above all is clear and transparent.
For more on this idea, see Social Software Implementations: A Judokan Approach to Change.
These ideas still seem a bit rough, and I have much more to say about all of them, but hopefully this general sketch makes sense and resonates with folks.
What other building blocks do you think are required for Digital Era success? What additional ideas and suggestions would you offer? What questions and concerns do you have? As always, your comments and questions are welcome.