Eight Steps to Digital Transformation

MIT Sloan Management Review

Big Idea: Digital Transformation Blog          

August 02, 2013  

Michael Fitzgerald

A panel of executives and thought leaders offer insights into how digital technologies are transforming businesses.

If companies are going to get real transformation from technology, it takes both management skills and technology chops. Who better to talk about this than a CEO and a CIO?

MIT Sloan Management Review brought together Kim Stevenson, Intel’s chief information officer, and Mark Norman, the president of Zipcar, now part of Avis, along with Andy McAfee of MIT’s Center for Digital Business and Didier Bonnet, who runs Capgemini Consulting’s digital transformation practice. In a wide-ranging discussion, they made the following points:

See beyond the hype. The hype might make it feel like mobile, social media, analytics and embedded sensors and cloud computing are now well established. In fact, “We’re only at the very, very beginning of this next generation of computing, and I think that every industry leader will be the ones that transform first,” said Kim Stevenson of Intel.

Technologies don’t change companies, companies change companies. Technologies don’t change anything. “What’s really transformative is the way that you actually put it all together,” said Capgemini’s Didier Bonnet.

Find well-spoken technologists. Companies need tech-savvy people at a high level, and other leaders need to take them seriously. “A critical skill at the top of a company is to have someone who can keep scanning the technology landscape and explain it to the rest of the management team, so inertia and the complacency can’t take hold,” said Zipcar’s Mark Norman.

Don’t throw up your hands. All these new technologies create an overwhelming amount of choices for business leaders. “There’s this dizzying array of stuff we could possibly do with technology,” said Andy McAfee. Choose wisely.

Experiment. To reduce the risk of massive failure, avoid moonshot bets on new technologies. McAfee notes that it’s cheap to run small experiments with most new technologies. “Experiment. Run a pilot, run a test, get feedback. Keep iterating that way,” he says.

Swarm. Intel is working to restructure its teams so that it sends a ‘swarm’ of people to work on different functions, similar to how Hollywood movies get made. “If you’re making a movie,” said Kim Stevenson, “all these people that effectively are independent contractors come together. When the movie is finished, they disband and they go work on another project. That is the work style of the future. The way work gets assigned, it becomes much more about the project and the work, not the department’s mission.”

Be open. Zipcar has almost all its leadership out in the open. Intel, already famous for having a CEO in a cubicle, will soon see an IT department that doesn’t have assigned desks, but rather will go to a ‘neighborhood.’ It’s also lowered those cubicle walls. Such structures force people to collaborate more.

Transformation never stops. “The vexing thing about innovation and disruption is they don’t stop once you do it,” said Andy McAfee. Transformation is a continuous process. Business leaders should understand that they need to keep looking for new ways technology can transform their business.