The inefficacy of a digital strategy can be assessed using a number of indicators, including no foreseeable increase in growth, gaps between experience and delivery, and increased expenditure on technology. A powerful and transformational digital impact strategy is one that changes the game in 6 key dimensions. (Adapted from the seven principles of leapfrog impact).
People Matters in collaboration with XED Learning Solution hosted a webinar on understanding – ‘How to leverage your organization’s digital transformation?’ Porus Munshi, visiting Professor at XED delivered an insightful session on the methods to undertake proactive digital transformation journey, suggested ways to craft digital impact strategy, and highlighted paradoxes of ‘Leapfrog performance’, along with the seven principles of ‘Leapfrog impact’.
So, what does it take to actually create digital impact? Going digital does make your organization faster, better and stronger. But what really enables them to shift is to move as a completely different catalyst. This catalyst can be seven principles of leapfrog impact. These principles serve both as a trigger and a guide in any organization’s digital journey. Porus Munshi explains this with help of a bank nationalization example. He shares that although banks were computerized in 90’s, their real digital transformation came with the arrival of ATMs. The real shift happened then- when the mental model changed, business model changed, and performance model changed. It changed from incremental impact to leapfrog impact. He further stresses that those organizations which are digital natives such as Uber, Airbnb, Facebook, Salesforce.com, Amazon, and Google do not follow the usual performance model; they follow a completely different model that boosts their performance.
Seven paradoxes of leapfrog Performance
Professor Porus Munshi explained seven paradoxes of leapfrog performance. He carefully highlights changes or shifts which organizations need to undertake in order to grow multi-fold.
Paradox 1: Don’t set goals: Most goal setting is incremental and only serves to keep us in a limiting paradigm. It is based on past performance, industry growth rate, competition growth rates. None of which is an indicator of true potential. Digital native doesn't set goals, they create leapfrog challenges.
Paradox 2: Don’t work hard: Hard work is not a differentiator. Some of the hard working individuals are amongst mediocre performers. Digital natives don’t work hard on repetitive tasks or incremental tasks instead they give repetitive or incremental tasks to machines and they themselves work on leapfrog challenges.
Paradox 3: Don’t seek resources: Resources can become a trap. They trap us into an existing paradigm model. Instead of crash resources; constraints set us free. Digital natives don’t have their own resources rather they have access to all resources. They use resources available in the ecosystem.
Paradox 4: Talent is a limiter: Talent masks inefficiencies. Instead, process beats talent. Digital natives create processes, algorithms, and steps for learning that completely change the need for talent.
Paradox 5: Don’t solve large problems: Problem-solving keeps us trapped in linearity. Many problems are large by one scale of the challenge and when you transform the scale of the challenge, the problems become irrelevant.
Paradox 6: Don’t face ‘reality’: This isn’t a singular reality, there are many realities. We often tend to look at limiting reality. Digital natives look at it reality as ‘more’ rather than ‘less’. So, we need to adopt a pragmatic approach.
Paradox 7: Don’t compromise. Don’t make trade –offs : Trade-offs cause dilution. It is best to always go for theoretical best. Leapfrogs are about the ‘AND’ not ‘either-or’.
Seven Principles of Leapfrog Impact
From these seven paradoxes emerge seven principles of leapfrog Impact .They serve as both a spotlight and a reference point. When they serve as spotlight, they focus on specific areas in the quest to create transformation — digitally or otherwise. When they serve as a reference point, they do not look at incremental goals but leapfrog challenges.
Principle 1: Move from linearity to Leapfrog
Principle 2: Crash resources – work less hard, use far fewer resources because resources can become trap
Principle 3: No trade-offs; no compromises. Its ‘AND’ not ‘either or’
Principle 4: Process beats talent
Principle 5: Choose an enabling reality
Principle 6: Don’t solve problems, make them irrelevant
Principle 7: Create self – imposed constraints that are greater than environment constraints.
After the application of these principles, an organization should be able to achieve its digital transformation by growing 70X-100X in 10 years, X/2 investments, 70 X with existing manpower, customize an offering for individual customers, make existing problems irrelevant, Break free of trade-offs and compromises.
Some examples of leapfrog impact using the seven principles include a global software major, which created a $1Billion business, a major Petroleum company grew its LPG business from $226 Million to $1.2 Billion (5X in 2.5 years); a global chemical company, set up and commissioned from scratch a large chemical plant in 6 months compared to the industry average of 24 months saving several millions in infrastructure and opportunity costs; also helped to transform a city through a citizen’s cleanliness movement. In addition, a global organization sale grew by 70% within one year using the principle of ‘Process Beats Talent’.
How leapfrog challenges and digital work together to create transformational impact
Porus Munshi explained with the example of Titan Jewelry- how leapfrog principles and digital transformation helped in company’s growth. They successfully transformed productivity, quality and crashed manpower, and created a $1 Billion opportunity for machine export. Titan Jewelry automated jewelry inspection, with Soliton, a Bangalore based company that specializes in software and vision cameras. Transforming themselves digitally, they replicated human work by building an algorithm that transfers human aesthetic intelligence to a computer.
Why are high-quality analytics key to digital transformation?
• It is often the first step in the transition from legacy to digital
• It also helps shift organizations from being reactive to proactive, when it comes to business decisions or customer engagement. It gives customer feedback real time.
• It facilitates a shift from a myopic view of the business and its ecosystem to a panoramic view of the whole ecosystem
• It helps in the transition from tacit knowledge locked away in people, to easily available and leveraged knowledge for the entire system.
Insights change the game: Insights create predictability for organizations. They enable the organization to perform in a superior way, more reliably and consistently than others.
Leveraging the platform ecosystem: Porus Munshi explained about three revolutionary platforms. First being ‘Innocentive’ and ‘Quirky’, which provide a paradigm shift to your ideas. If you have an idea they will work on it. Third is –‘Kaggle’, which is a data analytics platform.
So, in order to dole out digital transformation, an organization requires a CEO who can plan strategic shifts. In addition, mental model shifts with leapfrog as a mental model is necessary. An organization requires to do direction setting, to create purpose and leapfrog challenges for the organization. Also, it needs to bring in digital natives as champions. Operationally, organizations need to break free of existing IT challenges and focus on data gathering and analytics for insight.