This article is part of our XPRT Magazine #13. Read the full magazine here.
Nowadays, every business is a technology business, no matter what product or service it provides. In the current day and age, no company can make, deliver, or market its product efficiently without technology. Whether it is banks, insurance companies, logistics companies, or retailers, technology is critical to their success. Many companies embrace this fact. They understand when they adopt new technology and implement it successfully, they gain a stronger foothold on the market and stay relevant. Companies that wait for a second or third wave stay at the back of the pack and will have a very hard time becoming a leader in their market or even staying afloat in markets with strong competition.
To be a technology company, you need to act and behave like a technology company. At Xpirit, we look at your business as a collection of capabilities that are required to allow you to run, create and deliver your products and services. We distinguish digital capabilities and leadership capabilities, which are both required to succeed digitally as a business. A digital capability we regard as a combination of people, processes, and technology to deliver value to internal and external customers. The leadership capability is about merging the skills and perspectives of your business and IT leaders with the goal of helping them drive change together. For that, they need to have a digital vision, engage the organization at scale and govern the change.
We call this combined set of capabilities and behaviors a company should have an Engineering Culture. Everything we do as Xpirit adds to this vision. This Engineering Culture can be seen from many different perspectives that we categorize into a number of distinct pillars that together will help you become successful and can be used to drive change.
One of the pillars of this Engineering Culture is Moving the business needle. For us, moving the business needle is all about achieving greater success for your company by helping you get the most value out of technology. Our way of working should have enough of an effect so that people notice a change that adds value to the business. Making a noticeable impact. Moving your business needle to become a truly digital enterprise.
Start with why?’ (And for whom?)
A company can only exist by the grace of its relevance. To stay relevant, you will need to keep reinventing yourself. This applies to people as well as companies. We probably all know stories of companies that have been felled, and the stories of those that have proven able to reinvent themselves. It’s clear that, without relevance, it takes only time to become obsolete and for companies to eventually go out of business.
To be able to stay relevant, you must start by asking yourself the question: what is our why? Why are we in business? And, more important, for whom? Who are our customers? You’ll need to find out who and what decides whether you’re still relevant. Because let’s face it, it’s not you who has the say in that. You’ll find out that your customers aren’t part of a single group. In fact, your customers will be both internal parts of your organization, customers you directly serve and customers you indirectly serve, in the form of your customers’ customers. You’re not in business for a single of those groups and have the others merely follow. To be perceived as relevant, it is all about delivering continuous value to those that you serve, let’s call them stakeholders. And to impact them, things don’t stop at the gates of departments or even your company. You’ll need to think in delivering value end-to-end to truly impact your customers.
Organize around value streams continuously delivering value
That is where value streams come into play. A value stream is focused on how value is delivered to stakeholders and is not about business processes or how things are done. Value streams use an outside-in view, from the perspective of the customer rather than an internal value chain or process perspective. Using this outside-in view, you’re challenged to think as the stakeholder affected. A value stream can be cross-mapped to enable business capabilities that describe what an organization must do to deliver value to that stakeholder.
Within a value stream, multiple disciplines work together, creating a continuous flow of value. Instead of working in silos, value streams contain cross-functional teams that can work autonomously. They have adopted the ‘You build it, you run it’ approach, taking responsibility and control over development and operations. This shortens the feedback loop, eliminates barriers, and lessens delays, ultimately allowing faster learning, higher quality, increased productivity, and shorter time-to-market.
Know where you differentiate, versus what is (or should be) a commodity
After knowing your why and for whom you are in business, it is also important to understand where you differentiate. Because to bring the most value, you need to know where to focus your efforts. Things where you don’t or simply could not differentiate should be commoditized, meaning you adhere to industry standards in processes and technologies. You must make choices and focus your precious efforts and resources, as it’s not worth – nor feasible – spending those towards things that deliver a relatively low value. Having this focus is crucial for success, especially in times like these where talent is scarce, technologies change with the speed of light, and you are in a constant race with your competition, be it known or unknown.
Don’t make the mistake of thinking your organization is (too) special, be honest with yourself here. Sure, you will have processes that are in some shape or form unique to your business. But, is that because they are truly differentiating you, or are they because they’ve grown that way historically, and you are holding on to them believing they differentiate you? Remember, most in fact, are – or should be – commodity. Don’t try and reinvent what everybody else is doing, but instead adopt standards, whether it be processes, technologies, or software. This leaves a way to focus your precious money, energy, and time on what really differentiates you and can therefore deliver the highest value and make the biggest impact.
Embrace a culture of change… or brace for impact!
Understand that the heart of becoming a digital enterprise is not just technology, but human capacity. And with becoming a digital enterprise, therefore, comes cultural change. Instead of going about change in a project-by-project manner, create a culture of change. Continuous investments toward creating a culture of change will allow your organization to embrace it, make change happen, and sustain change.
When changing, it will be natural for there to be criticism and resistance. Communication is key here, communicate clearly, early, and often. Share your vision and the reasons for change. Listen to feedback and create a feedback loop. Bring people on board and develop a team mindset with people representing the whole value chain. This will form a powerful coalition and be the guiding team. These aspects serve as strong governance when embracing a culture of change.
Develop a vision and a plan, but mind the concrete
At this point, you will have realized that becoming a successful digital enterprise does not begin with technology, nor that it stops at technology; rather, it’s all about having the right strategy and mindset. Yes, technology is an essential tool in achieving your desired goals, but it’s only a tool.
Where do you ultimately want to be, what’s the dot on your horizon? The answer to that question is your definition of success. And remember, success is relative. To achieve success, set realistic goals on the journey toward that definition that fit your organization’s capabilities. Nothing is more demotivating than working endlessly towards unrealistic goals. That doesn’t mean you should neglect the bigger picture and your ultimate goal. Or, as we like to call it, your BHAG: Big Hairy Audacious Goal. But define steps feasible steps toward that goal. Writing down how you plan to move the business needle helps with focus and commitment. It becomes your roadmap, and you will be able to tangibly measure your progress. And don’t set your goal concrete, this allows you to sharpen your goal along the way.
Collectively look at the same gauges and needles
To make a big impact on your goals, you need to have everyone involved in the organization collectively look at the same gauges and move the same needles. This is something you will only achieve based on a mutual understanding of what is important (your gauges) and how it is measured (your needles). Having your gauges and needles in place allows you to measure the impact of changes and track the results over time. It enables you to employ statistical techniques to discover what aspect of your efforts is having the greatest impact. With this, you can take learnings and steer your plan to focus efforts on what delivers the most value. It creates a feedback loop that allows continuous improvement and increases effectiveness.
Start small, but be strategic and intentional
You might have heard the phrase, “It’s not about the destination, but the journey.” When you embark on becoming a digital enterprise, you’ll for sure not know the exact end goal and how to get there, be it simply because you can’t predict everything. If you think you do, look at some recent disruptive events, like Covid, and think again. Hell, it might even be all journey, and there might not be a ‘final’ destination, and that’s fine. So, whenever you start the journey, not knowing when or how you’ll reach your destination, make the journey itself worthwhile. Start small, and work in steps towards overseeable goals. Create quick wins, and be sure to celebrate and share achievements. Experiment and allow yourself failures, or as we like to call them: opportunities to learn.
Leadership: Put your money where your mouth is
As a leader, show your commitment to achieving results, by being part of it, being seen, and getting your hands dirty. Don’t just talk the talk, walk the walk. Put trust in the people around you and give them the power and mandate to make choices they think are best in line with their shared goals and ambition. Empower people to take ownership and reward those who go above and beyond. Nurture a culture that allows people to fail often and fail fast, without shame or punishment, in order to learn and improve.
Share a clear vision and communicate early, clearly, and often. Be an approachable leader for your team and always keep your eyes and ears open, absorbing feedback from the organization and eliminating barriers that impede transformation. Address concerns and show that you are there to make difficult choices in the process when plans require adjustment. Don’t stick to plans blindly, and don’t fall for the sunk cost fallacy, a human tendency to follow through on an endeavor just because of your investment in time, effort, and/or money into it, whether or not it will outweigh the future benefits.
Build on the change and make it stick
Making all that change stick is not something that happens overnight, it takes thoughtful planning and a true shift in mentality. To make change stick is to create a culture of change instead of handling change in a project-to-project manner. Only a culture of change will allow your organization to make change happen and truly sustain it. If you mind the beforementioned organizational and leadership behaviors, you are sure to be in the right direction.
When you have the right foundation set, and you are progressing well in your journey of transformation, moving the needle in a business environment can be infectious, in a positive way. As a team and in numbers, working towards a common realistic goal, greater and larger accomplishments are possible, and skills like leadership and priority management are subconsciously born. Make that mindset a part of company culture, and growth and success are likely to become commonplace.
Would you like to learn more about building an Engineering Culture and Moving the Business Needle? We’re happy to have a pressure-free chat and see how we can help you.