digital success factors

Surviving in a fast-changing world. Women to the rescue?

Discussions around digital transformation are intense. For some too intense. But fact is that the world has changed. Are women better equipped to succeed?

Tired of buzzwords

“If businesses don’t prepare for digital transformation, there is little hope left for them.” This digitization message is continuously being streamed today. There is hardly a way for any of us to escape it. It reaches us with a range of buzzwords and “facts” intended to create nervousness.

One of these facts I recently came across refers to Fortune 500 companies. It was said that 46 % of companies have dropped out of this ranking in the past 16 years due to the fast-changing world. But a quick fact check shows that even more companies dropped from the ranking in the previous 16 years – a total of 67 %. Dropping off this list does not necessarily imply a negative development for a business either: the numbers also include company mergers and name changes, for example.

I think the sheer amount of buzzwords and pseudo-messages that we are exposed to has resulted in many of us “switching off”. Quite a few have become reluctant to listen any further. But on the other hand, I also think we are all quite aware of the fact that the world is changing. And in everyday business, we indeed experience more volatility, uncertainty, complexity, and ambiguity (BTW, the buzzword abbreviation for this is VUCA ;-). Why exactly is that?

What really has changed

Connectivity

The ever-growing internet paired with evermore powerful computers bring the world closer together. More and more people, organizations, machines, and “things” across the globe get connected at an exponential rate and information is exchanged much faster than ever before. This connectivity results in almost immediate reactions to any market activity. Success of a new consumer product can no longer only be determined once the sales figures are available several months after the launch like in the past. Instead, you get immediate feedback from the community through social media and enterprise IT systems.

Globalization

But there is more to it than just information reaching us faster and in a better way. Globalization is a key factor, too. Businesses are facing a tremendous market growth – both on the supply and the demand side. Generally a good thing, of course. But with greater supply chain networks, the number and diversity of events with impacts on business have also increased. This includes incidents within a company’s own supply chain but also external developments such as competitor updates or financial difficulties of suppliers.

As a result, it seems more things are happening at a faster pace. Needless to say that this is not really the case. This illusion is fed by getting information sooner, in greater volumes, and with potential relevance on a global scale. Any news that may impact a business – even remotely – also creates echoes and a chain of reactions that may last for a while and may alter the need for actions. With this, facts – or pseudo-facts – have become more transient and less reliable to plan upon.

Actually, I really like the VUCA expression for now. It is a good reminder that we need to become more agile and adapt our plans more frequently ;-).

The ones who make it

What marks a successful business today? Instead of struggling with the continuous changes in their environment, successful companies have learned how to live with them. They even manage them to their advantage. Progressive companies launch products or services before they are “final”. Even before they fulfill all the requirements that their providers think they should fulfill. And then these companies continuously and effectively enhance their offering based on direct feedback from their target group. This strategy ensures that current market demand is met, prevents product development in the wrong direction, and secures investments.

  • Tesla is a good example for this, even though it’s debatable whether they might have been slightly too fast the last time. My colleague Markus has explained more about Tesla’s beta versions in his post “Autonomous cars – saving me or saving you?
  • Inditex is fully on the pulse of the market, too. They recently became the world’s largest manufacturer of clothing. For their fashion brand Zara, the company successfully manages a short time-to-market. Together with sophisticated market intelligence, this enables them to ride the wave of consumer wishes and re-launch products over and over in line with actual demand. You can read more about how they scare their competition on Business Insider.

These examples refer to consumer business, of course. But ultimately, dynamism in consumer markets has an upstream impact on supply chains and consequently affects B2B, too.

What needs to be done

The mission now is to be in a position to keep up with the flow of information. And to act as dynamically as the outside world does. Not easy? Yes, that’s right, it’s not a simple task. And, as so often, it’s rather an individual journey for every business, too.

What I really like about this mission is the following: in essence, it brings together a long-standing effort that any company invests and the new possibilities that new technologies and tools present. Customer centricity in particular can be lifted to new levels by involving the customers with their ideas and needs through entirely new means of communication. It also allows to address the customers’ demands through entirely new business models like Airbnb does it, for example.

To understand and react to market feedback and to create products or services based on it, requires flexibility and new organizational setups. Competencies and responsibilities need to be bundled in teams across departments and business divisions. An inflexible, top-down organization that is planning product developments in long cycles is simply not suitable anymore.

You can read more about this in “Becoming a Digital Organization – a Three-Phase Journey” by the Denovati Group. Especially the third section – “Digital Transformation” – is very informative.

As part of this, IT skills are becoming increasingly important competencies in all such teams. For data handling, for new products and services, and so on. My colleague Daniel recently wrote about this, too, in his post “Geek versus nerd? Never mind. Logistics teams need either one.

Women to the rescue?

Ah yes, let’s come to the headline. I came across an interesting thesis the other day. It’s based on stereotypes, and as such, it must be taken with a pinch of salt, of course.

In this overall context, Professor Christiane Funken from Technische Universität Berlin (Technical University of Berlin) also sees the need for a more network-like, integrated, and communication-intensive organizational structure of companies today. And in such an environment, Professor Funken says, women will tend to have an advantage over men.

Aha! Why? Because such environments require empathy, the ability to communicate, flexibility, and creativity. And (stereo-)typically, these are competencies we generally associate more with women than with men. An interesting thesis. And it will be interesting to see whether it will materialize. 

Conclusion for today

Today’s market dynamism is either a threat or an opportunity. Internalizing and living the connectivity and volatility of the outside world today (and in the future) is the key to success. The same applies to intensive and agile collaboration within an organization.

The future is even less predictable today than it was at any point in the past. The complexity and amount of influencing factors are just too great. The only trend that seems to emerge is that companies that manage to adapt to the market in a flexible manner will be the ones with the greatest chances to succeed.

At AEB, we have embarked on this journey to adapt our organization, too. We will share updates on this another time – I am running out of space ;). How do you address these challenges in your company and how do you manage the required culture change? I am very interested in your views  on LinkedIn.