Digital Transformation brings back the notion that processes cannot and should not be entirely stripped of the person or role executing them. For years we have looked at a process as an idealization of how things happen, and stripped out the messy detail of who makes things happen. This is where knowledge expertise and experience improves or accelerates the process. Without it, we are simply looking at a system that ignores such accelerators just so we can have a lowest common denominator of predictable activity.
At the annual gathering of experts at Enterprise 2.0 Summit last week in Paris, Björn Negelmann, our maître des cérémonies, described how the term enterprise 2.0 is now in the trough of disillusionment (per the Gartner hype cycle definition). But as the many case studies by medium and large businesses alike at the event, the idea is still very active and productive. We heard great Europe-centered case studies from SIKA, BNP Paribas Cardif, Continental AG, BASF, Bayer MaterialScience, Sanofi, Bosch and others. Real ideas rarely die entirely; they morph into new forms. Enterprise 2.0 and Social Business therefore has a new label: Digital Transformation.
What is it exactly remains a debate because of the different starting points that lead us down this road. Some see it as transformations in marketing, others under HR, and still others under Information Technology. What is common is the recognition that (a) technology has reached a point where it is (b) fundamentally changing long-understood, documented, taught-in-schools approach to how we structure and operate our businesses. There are many technologies involved, but I’m more interested in the transformation itself.
Seeing the Big Picture of Transformation
To better understand transformation, lets look a case study shared at the Enterprise 2.0 Summit. Multinational chemical company SIKA AG has a challenge in working as a global organization, according to Charlotte Aguillar and Christian Frey. The producer of concrete mixtures, sealants, adhesives, grouting, waterproofing, and structural strengthening systems began over 100 years ago. But since 1971 it has grown into a multinational of 17,000 employees spread across 4 regions (89 countries) and 7 target markets. In 2013 alone, they acquired four other companies Everbuild (UK), S.A. de C.V. of Mexico and Texsa India Ltd, with regional expansion in 2014 to Sri Lanka, Ivory Coast, Albania, Nigeria and more. They have regional supply chains, and cross sell products to support airports, rail systems, hotels, manufacturing facilities, waste water treatment plants, stadiums and more. They also emphasize greater transparency, becoming one of the first Swiss-based companies to report their business activities and supply chain following the Global Reporting Initiative’s latest standard.
Their challenge? While employees are located in offices and know people well within their regions, they didn’t know too many horizontally across sites. More so, the regional offices have stronger decision-making power than corporate as a whole.
To help bring more people together and work as a unified organization, they started an enterprise social network project in 2012 they labeled GECO (Global Employee Collaboration platform) based on the IBM Connections product. They also emphasized their common global organizational values of empowerment and respect. However, they realized that they needed to change their communications strategy.
Emphasizing unified values had less of an impact than they realized because I would say the organization itself still sees itself as a collection of independents. They agreed the GECO platform would in the long run be the way how they bring people together. But they needed to first encourage participation in the platform, with the view that being in the shared environment would eventually help connect more people.
To move the needle, they decided instead to move one thing at a time: transition their mode of work but stay with the current mindset. In other words, move off of phone and email into more work in GECO, but keep the individual mindset and show ‘what’s in it for me’.
CEMEX—one of the world’s leading producers of concrete, aggregates, and mixtures—has been through a similar transition, but are further along. According to Gilberto Garcia, their Head of Innovation, they started their digital transformation about 5 years ago with two directives: on employee services & communications, and on innovation & collaboration. They emphasize global teams and social or peer-to-peer learning. One of their hallmark ideas is ‘anyone can contact anyone’.
Using their enterprise social network, labeled CEMEX Shift, they have a number of identifiable successes. For example, innovations in how they package goods originated in their logistics group in Mexico leading to 20% reduction in damaged goods (broken sacks of product), which is now spreading across their company. They also have an online community for over 650 members who have developed three new global brands, after members shared over 3000 recipes for ready mix concrete products. These are but two of the wins for the organization, but the greater theme is that employees have moved beyond individual benefit and instinctively start thinking and working around shared goals and purpose.
Shared Purpose as a Digital Transformation Directive
SIKA is a case study of a large organization in the midst of their digital transformation, while CEMEX is starting to capitalize on theirs. It has been two years since SIKA started with an ESN, but you can see IT is only a part of the issue. Their greater challenges are in the unification aspects in HR, and in Operations. Both organizations have looked into the first stage of transformation: getting beyond what the software can do and seeking processes they can change.
CEMEX is entering a second stage where employees via openness and transparency see value in working with each other. Anyone can contact anyone in CEMEX, across their global system. SIKA on the other hand would like to see more people connect globally and get to that state. Their transformation challenge ahead is in that developing that shared purpose and identity.
Figure 2: The Digital Transformation journey in stages
In my closing keynote at Enterprise 2.0 Summit, I outlined some of these state transitions along the transformation journey (see Figure 2) as an example to describe the art of what is possible and what lies ahead. In the first transition, what many thought leaders and companies present at the event agree upon is we need to move beyond thinking of the software and enterprise social networking platform capabilities and into what processes and operations in an organization they may affect.
Judith Will of BNP Paribas Cardif (their insurance unit) said, “Perhaps what you need is not a community?”—a proposition I have been stating for some years now, and the reason why I wrote my last book. This sounds controversial at first when so many keep asking to start a community for their team, customer(s), or business units. But the point is that many vaguely identify with the term, and associate it with the software, but what they really want is the feeling of community and participation. Unfortunately, software vendors often muddle the meaning toward a focus on tools by labeling their components as ‘communities’. As has been said thousands of times before, it’s not about the software, it is about building relationships and commonality, and the shared understanding.
When people work in business operations or processes together, they have a starting basis of commonality. There may be variations based on locations; there may be local skills, viewpoints, and approaches; but there is a seed idea. A group of people can use this seed and grow new ideas from it. This is why the first transition is in thinking of existing processes. It gives a strong basis for comparison, and measurability to seek that ROI. Technology is the lever to change how to do the processes.
Yet, to go beyond just thinking about how to do things, organizations like CEMEX, SAP, Buurtzorg, FAVI, and others (see my full talk at E2.0 Summit) have shifted to think about who makes them happen. This focus on who becomes their accelerant. If you want to get more out of the system, more ROI, think beyond the base level in operating processes, even social ones.
When we start looking closer at people, we begin to look at leadership and culture as the primary lever. The transition here is to look spreading decision-making across inside the whole organization, and as they develop more trust across all the people that make up the ‘who’, they can look to the next transition of really involving decision making by people outside the organization (partners, suppliers, customers).
The lever then is no longer the internal but global leadership, and a multi-stakeholder cooperatively created view of culture. These are not vision statements that some leader gets to make and disperse. These become collective network driven decisions. To understand all these transitions, we need to consider new views and measurement mechanisms that spotlight the evolution of culture at these various stages.
Rawn Shah is Director and social business architect at Rising Edge. He is speaking at a number of events on work culture and transformation, with the next one at HRTech Europe in March. He can be reached on LinkedIn or Twitter.
This article was written by Rawn Shah from Forbes and was legally licensed through the NewsCred publisher network.