In today’s era of ‘permanent upheaval,’ shaping your organisation’s future, as well as your own, will involve four tech-related areas.

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February 26, 2024 – Coming away from the 54th World Economic Forum (WEF) Annual Meeting in Davos last month, where we celebrated the achievements of the newest members of the Global Lighthouse Network, I was struck by several topics relevant for leaders and decision-makers today, including a few technology-focused elements that will interest those looking to shape their organisation’s future (and their own).

On the Move

Technology—not CEOs, not investors, not regulators or governments—is the prime pace setter. We have entered an era of what we might call ‘permanent upheaval’ where businesses cannot afford to dwell on issues or weigh decisions for too long. This sometimes confusing state of hyperreadiness is driven by rapidly evolving tech capabilities, but it is experienced across all functions and disciplines—from being able to analyze and act upon data to increase sales, to less obvious issues like dealing with “quiet quitting” and creating attractive employment propositions for a very different workforce now entering the employment market.

Thriving in this environment of fluidity of opportunity—and of risk—means that intuition, dynamism, and flexibility will be needed, and sometimes needed over and above traditional management and leadership elements that valued structure and process. Indeed, those are things that many organisations need to break out of to achieve their goals and reach their full potential.

A McKinsey survey of 2,500 business leaders in countries across Asia, Europe, and North America found that two-thirds believe their organisations are overly complex and inefficient, while only about half say they are well prepared for the upcoming changes needed. It seems that structures that were the very fiber of businesses in the past are today often standing in the way.

Speed of decision-making, experimentation, discarding what hasn’t worked, and moving on with learnings to the next iteration at pace—all of this is non-negotiable for leaders today. In numbers, it looks like this: our research shows that, compared with peers in slow-moving companies, leaders in fast-moving organisations report 2.1 times higher operational resilience, 2.5 times higher financial performance, 3.0 times higher growth, and 4.8 times higher levels of innovation.

Solutions for picking up the pace and keeping transformations moving will come in all shapes and sizes—from versions of Jeff Bezos’s two-pizza rule for meetings, to reward programs that recognize silo breaking, to talent acquisition strategies that bring Gen Z talent in significant numbers into the business, workers who have the intention of staying there and building careers.

A lot of the proactive change necessary won’t feel comfortable, and some of it will certainly be unpopular with people at all levels. Many of those charged with breaking down walls will have had a hand in building them. Continuous self-reflection and an indefatigable focus on communication will be essential activities for leaders seeking to boost organisational speed.

Opening Organisational Borders

A further consequence of technology’s reshaping of business is that squirreling away ideas and building moats can be bettered by opening up, teaming up, collaborating, and making it to market (or even making markets) quickly. In a world where we don’t need to look far to find examples of heightened competition and conflict, finding opportunities to scale and prosper through collaboration are ever more valuable.

By several measures, levels of global collaboration in innovation and technology have stabilized since 2020, with cross-border patent applications and international student flows, for example, starting to decline. At a company level, there is a need to know how and where boundaries can be flexed to enable seamless teaming, and to easily create virtual workspaces for projects that may involve distributed employees, contractors, suppliers, partners, and other stakeholders. To do this safely and securely means knowing in advance what data and information can be shared, with whom, and under what terms.

Again, speed is key here. The impulse and opportunity to co-create and collaborate will rarely abide six months of compliance signoff. Rather, collaborative capabilities need to become a feature of each organisation’s infrastructure.

AI Readiness

Amid the excitement about generative AI and how it can be applied to enhance and transform businesses, there are also questions about how and where leaders might consider making a start. Operations functions often have well-established measurement and reporting processes in terms of time or resources saved, which makes it easier to see the impact of generative-AI-infused experiments and projects.

Businesses experimenting in generative AI in operations, for example, can analyze the results then carefully apply what they have learned to more complex scenarios. These sometimes-ignored parts of the business may be the best test beds for AI trials and for nurturing a culture of AI readiness, so that the business can move quickly when the moment comes for more rapid and universal adoption.

Transformation Rigor and Reinforcement

Of the many aspects of successful transformation, I want to touch on rigor. Our latest research in this area finds that successful execution of transformation involves two irreducible actions: moving quickly and embedding reinforcement. Survey respondents who reported meaningful improvements quickly are more likely to report sustained organisational performance improvements. There is also clear evidence that reinforcement through a range of formal mechanisms results in organisations outperforming their peers.

Companies can start by aligning incentives with transformation objectives and behaviors—introducing them in performance reviews and holding leaders accountable when their teams are not working toward transformation goals. Tying financial incentives as closely as possible to transformation goals is hardly new thinking, but it will get results.

Concrete Examples of Progress and Success

For real examples of organisations consciously changing to meet the change challenges of today, a great place to start is the WEF Global Lighthouse Network, a community of manufacturers built over five years of research and selection. Each member organisation has shown leadership in using Fourth Industrial Revolution technologies to transform factories, value chains, and business models for compelling financial and operational returns.

To date, 153 Lighthouses have been identified across different industry sectors. So if you’re looking for inspiration, persuasive examples, and great stories to help you on your transformation journey, you’ll certainly find them here.

The article was first published here.

Photo by Donald Giannatti on Unsplash.