Becoming a Digital Organization

If your company is like most today, your employees are probably decked out with all the latest technology – carrying their laptops around the office connected to high speed wi-fi. When they aren’t on their laptops, they are sending text messages, emails and making calls on their smart phones. By these standards, it’s safe to say your company is at the leading edge of the digital revolution.

Or is it? What does it mean to be a truly digital company? It’s an interesting question posed by Charles-Edouard Bouée in the September edition of the Harvard Business Review. “Digitization”, he argues, is “more than just a change of tools.” Rather, it is a change in mindset brought about by these tools where companies are flatter and less hierarchical and networks within the company better fuel innovation.

Few can argue with the results of this change in mindset - companies benefit in both increased revenues and employee happiness. Bouée’s research with French companies at Roland Berger indicate “digitally mature companies grew revenue at six times the rate of their less mature counterparts.” Further, employees at these companies “reported a 50% higher index of well-being at work.”

What “Digitally Mature” Means

Bouée argues that “digitization should not be seen merely in terms of machines replacing humans.” Rather digitization is a process where daily routines, management, information sharing, customer service are transformed for the benefit of all.

Truly digital organizations, according to Bouée, enjoy a more flexible and less hierarchical structure where employees have autonomy and are more free to be creative. This radical departure from a strictly top-down style of management to one that coherently supports both top-down and bottom-up styles unlocks a vast amount of value, as indicated by the research cited above.

Making the Leap to Maturity

To bring about this change in mindset, it is important to remember it’s not just the technical devices, it’s how these technical devices are used by employees. In this new world, the employees are sometimes more technically savvy than their employers. For example, Bouée discovered in his research while nearly 60% of French people shopped online in 2013, only 10% of French companies sold online in that year.

This disconnect represents significant untapped potential. To bring about their full value, managers should put in tools for staff to suggest and experiment with new ideas.

Bouée also encourages the development of communication networks between teams and ridding organizations of the silos that shut groups off from one another. Everyone gains with the creation of cross-functional teams, like when the HR department regularly communicates with the finance staff.

Tools that foster open and transparent collaboration can create tremendous value. As he writes, “Recognize these teams formally and empower them with digital tools, so that they can reach a higher degree of autonomy. While these teams will not replace the traditional organization, they will work from within to reform it.”

It is easy to confuse having the latest gadgets with digital age success. But it is less the technology and more the “dexterity and adaptability of the people who wield it.” Technology is only as valuable as its users, empower them to make positive change in your company.