Four Principles of Successful Digital Transformation

Four Principles of Successful Digital Transformation

GUEST POST from Greg Satell

When Steve Jobs and Apple launched the Macintosh with great fanfare in 1984, it was to be only one step in a long journey that began with Douglas Engelbart’s Mother of All Demos and the development of the Alto at Xerox PARC more than a decade before. The Macintosh was, in many ways, the culmination of everything that came before.

Yet it was far from the end of the road. In fact, it wouldn’t be until the late 90s, after the rise of the Internet, that computers began to have a measurable effect on economic productivity. Until then, personal computers were mainly an expensive device to automate secretarial work and for kids to play video games.

The truth is that innovation is never a single event, but a process of discovery, engineering and transformation. Yet what few realize is that it is the last part, transformation, that is often the hardest and the longest. In fact, it usually takes about 30 years to go from an initial discovery to a major impact on the world. Here’s what you can do to move things along.

1. Identify A Keystone Change

About a decade before the Macintosh, Xerox invented the Alto, which had many of the features that the Macintosh later became famous for, such as a graphical user interface, a mouse and a bitmapped screen. Yet while the Macintosh became legendary, the Alto never really got off the ground and is now remembered, if at all, as little more than a footnote.

The difference in outcomes had much less to do with technology than it had to do with vision. While Xerox had grand plans to create the “office of the future,” Steve Jobs and Apple merely wanted to create a cool gadget for middle class kids and enthusiasts. Sure, they were only using it to write term papers and play video games, but they were still buying.

In my book, Cascades, I call this a “keystone change,” based on something my friend Talia Milgrom-Elcott told me about ecosystems. Apparently, every ecosystem has one or two keystone species that it needs to thrive. Innovation works the same way, you first need to identify a keystone change before a transformation can begin.

One common mistake is to immediately seek out the largest addressable market for a new product or service. That’s a good idea for an established technology or product category, but when you have something that’s truly new and different, it’s much better to find a hair on fire use case, a problem that’s someone needs solved so badly that they are willing to put up with early glitches and other shortcomings.

2. Indoctrinate Values, Beliefs And Skills

A technology is more than just a collection of transistors and code or even a set of procedures, but needs specific values and skills to make it successful. For example, to shift your business to the cloud, you need to give up control of your infrastructure, which requires a completely new mindset. That’s why so many digital transformations fail. You can’t create a technology shift without a mind shift as well.

For example, when the Institute for Healthcare Improvement began its quest to save 100,000 lives through evidence-based quality practices, it spent significant time preparing the ground beforehand, so that people understood the ethos of the movement. It also created “change kits” and made sure the new procedures were easy to implement to maximize adoption.

In a similar vein, Facebook requires that all new engineers, regardless of experience or expertise, go through its engineering bootcamp. “Beyond the typical training program, at our Bootcamp new engineers see first-hand, and are able to infer, our unique system of values,” Eddie Ruvinsky, an Engineering Director at the company, told me.

“We don’t do this so much through training manuals and PowerPoint decks,” he continued,”but through allowing them to solve real problems working with real people who are going to be their colleagues. We’re not trying to shovel our existing culture at them, but preparing them to shape our culture for the future.”

Before you can change actions, you must first transform values, beliefs and skills.

3. Break Through Higher Thresholds Of Resistance

Growing up in Iowa in the 1930s, Everett Rogers, noticed something strange in his father’s behavior. Although his father loved electrical gadgets, he was hesitant to adopt hybrid seed corn, even though it had higher yields. In fact, his father only made the switch after he saw his neighbor’s hybrid seen crop thrive during a drought in 1936.

This became the basis for Rogers’ now-familiar diffusion of innovations theory, in which an idea first gets popular with a group of early adopters and then only later spreads to other people. Later, Geoffrey Moore explained that most innovations fail because they never cross the chasm from the early adopters to the mainstream.

Both theories have become popular, but are often misunderstood. Early adopters are not a specific personality type, but people with a low threshold of resistance to a particular idea or technology. Remember that Rogers’s father was an early adopter of electrical gadgets, but was more reticent with seed corn.

As network theory pioneer Duncan Watts explained to me, an idea propagates through “easily influenced people influencing other easily influenced people.” So it’s important to start a transformation with people who are already enthusiastic, work out the inevitable kinks and then move on to people slightly more reticent, once you’ve proved success in that earlier group.

4. Focus On The Network, Not The Nodes

Perhaps the biggest mistake that organizations commit when trying to implement a new technology is to try to push everything from above, either through carrots, like financial incentives, or sticks, like disciplinary action for noncompliance. That may give senior management the satisfaction of “taking action,” but can often backfire.

People are much more willing to adopt something new if they feel like its their idea. The Institute for Healthcare Improvement, for example, designated selected institutions to act as “nodes” to help spread its movement. These weren’t watchdogs, but peers that were early adopters who could help their colleagues adopt the new procedures effectively.

In a similar vein, IBM has already taken significant steps to drive adoption of Quantum computing, a technology that won’t be commercially available for years. First it created the Q Experience, an early version of its technology available through the cloud for anyone to use. It has also set up its Q Network of early adopter companies who are working with IBM to develop practical applications for quantum computing.

To date, tens of thousands have already run hundreds of thousands of experiments on Q Experience and about a dozen companies have joined the Q Network. So while there is still significant discovery and engineering to be done, the transformation is already well underway. It always pays to start early.

The truth is that transformation is always about the network, not the nodes. That’s why you need to identify a keystone change, indoctrinate the values and skills that will help you break through higher thresholds of resistance and continuously connect with a diverse set of stakeholders to drive change forward.

— Article courtesy of the Digital Tonto blog and previously appeared on
— Image credits: Unsplash

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