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The Technology Fallacy: Lessons on Successful Digital Transformations

Students graduating this semester are entering an age of digital disruption and must get used to it. In order to successfully adapt, The Technology Fallacy: How People Are the Real Key to Digital Transformation declares that it is ultimately leadership’s responsibility to establish an organizational mindset that drives employees to work together and successfully respond to change. 

Far from a technical manuscript on the nuances of blockchain or the path to artificial superintelligence,  The Technology Fallacy relies on copious research over a four-year period and partnership between MIT Sloan Management Review and Deloitte in order to reveal the key characteristics of digital leadership as well as the digital talent mindset. Surprising, their research concludes that organizational challenges of digital disruption are largely industry agnostic.

Today, the discussions around digital disruption focus on the implications of digital maturity on organizational leadership, talent and the future of work. Speaking with co-author Garth R.  Andrus, Principal at Deloitte Consulting, he explained to me that in his practice, “CEOs no longer need to be convinced. The need to change is now obvious and companies are increasingly focused on the ‘how’ rather than the ‘why.’”

“Staggering rates of change are causing businesses to get further and further behind technology advancement.”
Photo credit: The Technology Fallacy

Digital maturity measures an organization’s qualities and capabilities. It is a moving target and often unevenly distributed. The Technology Fallacy provides both a specific top-down and bottom-up approach for organizations to identify with, guiding them to address key areas of improvement. Leaders can use the framework to gauge the digital maturity of their organizations.

The Technology Fallacy identifies 23 traits making up an organization’s digital DNA. Much like an individual’s DNA, these traits are unique to each organization. While certain traits may have served as strengths in the past, however, leaders must recognize that they can become weaknesses if organizations don’t evolve on pace with the changing times. Despite each organization’s unique DNA, certain ubiquitous traits were found among digitally mature organizations. During our discussion, co-author Anh Nguyen Phillips reiterated a core theme throughout the novel, that “a clear and coherent digital strategy is the single most important determinant of a company’s digital maturity. A key challenge for organizational leaders then, is forming and communicating a coherent and directed digital strategy.” 

Companies must further learn to leverage technologies in unique ways (“there is no ‘right’ way”). One poignant example of a rapidly evolving, versatile technology is Twitter, an all-purpose tool or  “the equivalent of digital duct tape,” according to The Technology Fallacy. However, technology literacy, understanding the capabilities of technology, is just a part of maintaining digital maturity. By articulating a digital strategy and cultivating an aligned organizational growth mindset, organizations can empower employees at all levels to harness digital disruption in order to create value.

Andrus added that he sees digital transformation happening in different ways: “Companies can either focus internally on being more effective and efficient, [or externally, by] using technology to be more customer centric, [or] do both. Eventually, all companies need to do both.” 

Unsurprisingly, there is a strong emphasis on leadership to drive organizational change. “It is more important to focus on the leader who will be most successful rather than the business area that will be most successful,” Andrus said. “Digital transformation can start in any area: finance, a business unit, marketing… through incremental changes, over time, it starts to grow naturally.”

The Technology Fallacy rigorously compares digital maturity across organizations based on interviews with senior thought leaders at digitally mature companies as well as survey results from over 16,000 employees at all levels. Vividly, the authors underscore blind spots among laggards and virtuous qualities embraced by digitally maturing organizations. Their research shows that compared to lower level employees, higher level leaders are generally much more optimistic about how their organization is adapting to disruption, suggesting a critical disconnect on digital growth within an organization.

Additionally, while technological advances are widely seen as an opportunity, most organizations underestimate the risks to their own status quo. This humbling insight should serve as a starting point for conducting critical internal assessments of an organization’s digital position and strategy. The Technology Fallacy expounds that this is a recursive process that includes proactively identifying the strategic moves unique to each organization.

Talent issues are a significant risk in digital disruption. The vast majority of employees say that they want to work for digitally mature companies. Phillips explained that “digitally mature companies attract the best talent and make room for autonomy, pushing decision-making down into the organization.” These companies are aware of this desire, engaging in passive recruiting by seeking employees with desired skill sets through platforms like LinkedIn. “Candidates increasingly need a digital presence to advocate what they are learning and developing,” Phillips said. 

Companies behind the curve can decrease the outflow of talent by creating opportunities for employees to develop digital skills. The Technology Fallacy reveals that employees were 15 times less likely to want to leave their organization when they had the opportunity to continue developing their skillsets. For both employees and employers, it’s evident that digital maturity must be pursued throughout all parts of a company.

In a exclusive insight for students as future leaders, Phillips emphasized the importance of continuous learning. “It is increasingly important to remain flexible and adaptable,” Phillips said. “Previous generations thought of life in a different way, with phases for learning, working and leisure. Today, learning needs to permeate [throughout] all of life’s phases.”

A page-turning compilation of research, practical examples and actionable takeaways, The Technology Fallacy provides an essential handbook for organizational leadership in today’s rapidly changing business environment.

Garth R. Andrus is a Principal at Deloitte Consulting LLP. Anh Nguyen Phillips is a Digital Transformation Research Lead at Deloitte’s Center for Integrated Research. Two co-authors not interviewed are Gerald C. Kane, Professor of Information Systems at Boston College, and Jonathan R. Copulsky, a retired Principal of Deloitte Consulting LLP who teaches marketing, branding and marketing technology at Northwestern University.

Photo credit: MIT Press

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