Schlagwort-Archive: Cooperation

The dimensions of the digital transformation

The search for digital transformation affects many areas of the business. In the context of  the delivery of goods and services as well as in the generation of  revenue and income, traditional notions of the business world dissolve – the size no longer determines the range; Knowledge is not only available to the financially strong ones; Collaboration does not  need the common roof of a company. The society and the politics no longer provide the sense of belonging and social security to citizens – opinions are controlled with new resources, the new normal is the loud otherness; ethical principles are reinforced by the own filter bubble. A look at the dimensions of digital transformation shows that we are already in the middle of change.

The following dimensions require rethinking in business as well as in politics – now. Digital transformation will be possible, as soon as obsolete conditions are abandoned – e.g. Preference of long-term frame contracts, high entry barriers for small businesses by purchasing departments, lack of access to financial means and bureaucratic overload through institutional requirements.

  • Scaling for all
    The use of economies of scale was previously reserved for large companies. In order to keep the price for the means of production low, large quantities had to be accepted. Digital components cost almost nothing. This will make even small businesses competitive. Now these new entrepreneurs still have to be freed from the bureaucratic burden of the old economy. Purchasing departments and HR departments need new terms and conditions for these micro-business partners.
  • Limitless cooperation
    The services are complex today, since they are composed of many building blocks. The differences in local or national circumstances that have to be taken into account are made possible by modules and interfaces that fit together because they are standardized. The mandatory cooperation and the distribution of income need new business models.
  • Increasing acceleration
    The virtual proximity of all those involved, who are only one click away, leads to a staggering speed. Established approaches and formal decision-making can no longer compete. This gives unbureaucratic, agile companies a head start. It can only be achieved, if the legal and internal framework conditions are correspondingly debureaucratized.
  • „Soft“ capital
    Since physical assets no longer count in digital markets, „soft“ capital comes to the fore – data, knowledge, software, relationships. The critical key players are the computers, networks and above all the employees, who can be located anywhere in the world. This requires the replacement of a rigid corporate concept with networks that are able to quickly come together and to dissolve again.
  • Homeless values
    The values of a company are situated in the cyber-wonderland. There are no national boundaries or affiliations. Since national laws and regulations lose their effectiveness, we need in the medium term supranational legislatures and tax authorities to take over these tasks. In the meantime, the values are moving back and forth in the twilight zone. Assets are no longer determined by an objective financial value, but by the ability to create something new.
  • Network for everyone
    The minimal effort that is needed to set up a network enables everyone to open their own bubble of information. Over time, there will be powerful creative clouds due to the participants and their networking. This wisdom of the crowd, which is available for free, means the end of many, expensive research sites.
  • Multi-sided business models
    Due to the diverse market, it is increasingly difficult to find the right partner. For this reason, business models will evolve that specialize in the mediation between producers, their suppliers and customers. Proven, close cooperation’s will dissolve in favor of spontaneous, time-limited projects that are needs-oriented. The mediator role can be exercised by all those, who can bring together the relevant partners and will be able to earn a living from it.
  • Site loss
    The classic location and headquarters will disappear. The company headquarters will be located where the founder is currently living without being officially registered, because the business takes place in cyberspace (see above). Accordingly, there will no longer be the workforce with their representatives and regulated employment relationships. Legislation, state power and jurisdiction need to be adapted to international challenges in order to prevent location nomads, who are constantly on the run from responsibility and other duties.

The point in time, when the digital transformation is over, depends on how quickly and skillfully large companies can respond to these new developments. At the same time, government agencies are challenged to create the appropriate framework conditions to support these new developments. It is not the question whether, but when the parties act. In the meantime, the pioneers of these developments will find their way in the Internet and implement their business models.

Bottom line: The digital transformation is happening for years. Like the frog in the Boiling Frog Syndrome, the world is heating up due to increasing digitalization and networking. The dimensions are the scaling for all, the limitless collaboration, the increasing acceleration, the „soft“ capital, the homeless values, the network for everyone, the multi-sided business models and the loss of the site. For the sectors of the economy and the society this requires an immediate rethinking, in order to get the control over the used free space, so far unregulated by enterprises. This applies to tax havens as well as to the providers of illegal businesses in the Darknet. The dimensions of digital transformation are the basis.

(More here: OECD Digital Economy Outlook 2017)

The conductor does not only set the beat

The Berlin Philharmonics consist of more than one hundred twenty musicians, who are led by Sir Simon Rattle. This is an enormous manager-to-staff span compared to business managers. Even if you divide the symphony orchestra in 16 instrument groups with the respective concertmasters, still the conductor has to lead each and every musician directly within the rehearsals and concerts. At the latest, when we think about Igor Stravinsky, we will recognize that the conductor makes more, than setting the beat.

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Executives should also not only be limited to the beat. The following aspects have an important role in leadership, independently of the leadership style that one exerts.

  • Self management
    The largest task before you lead others is to steer yourself. A natural bias makes the neutral look at the own mental states and actions difficult. Only considering the own roles and the associated aspects, like convictions, abilities and actions, enable you to demand and promote the employees.
  • Conception
    The idea that leadership is a task independent of contents does not fit any longer into current times. The leader has to take care of the development of new approaches. The efficacy of the employees is determined by the basic conditions, like consistent goals and the clear description of the tasks. For this purpose it is critical that the executives have a content-related mental map of their field.
  • Coordination
    Leadership that reduces itself to practicing a given power does not fit any longer into today’s business reality. The actual control of organizations takes place through a positive harmonization of the interests of the involved people. Besides the applied mechanisms (e.g. agreements, result orientation, Linking pin) a structured change management and a lean control system (Governance) determine success or failure of the initiatives. Coordination works best at eye level.
  • Communication
    The dissemination and the mutual exchange of information within the nervous system of the organization are the basis for a viable and flexible business. This is where you can experience the real communication culture – the speed and preciseness of the information flow. Knowledge that is power, does not exist any more in an open information society, since the employees can get more information, than bosses could ever stockpile for their personal advantage.
  • Cooperation
    The biggest effect leaders achieve with the design of the internal and cross-functional cooperation. It becomes especially crucial, when the dedication of many people is needed, in order to achieve a joint target. Workshops are the framework for developing integrated strategies and business models as well as improving the culture of the enterprise. Without an appropriate infrastructure (e.g. meeting corners, beamers, whiteboards, on-line forums, video conferences) the breeding area for the work is missing.

The additional aspects of leadership, like the performance review, the employee interview, and the job description also have to be fulfilled. The classical HR instruments set the beat. However, effective leadership needs more (see above).

Bottom line: The current dynamics and the fast pace require more than the application of the classical controls. The appropriate self-awareness, paired with a level of conceptual imagination, the employment of the right coordination mechanisms and a reasonable openness in communications create the perfect place for business. It is crucial that the conductor does not only set the beat.