Creating new value - or simply keeping up?

Photo by Fancycrave on Unsplash

Demand for digital transformation is at an all time high - according to a survey of 600 leading execs for a DXC report: 2019: The year of digital decisions. It provides timely evidence that supports my mapping of the situation facing industry right now - referred to in detail here.

Referencing that article (The Job Of Digital Strategy Consulting): Companies are testing the water, feeling their way with agile here, lean there, new-tools-but-same-ways -of-working almost everywhere... There is no certain way of doing or being digital yet. Not by some distance. But we must expect that there will be movement in that direction.

What the increased demand/desire tells us is that digital transformation is headed toward ubiquity and with it standarisation and the need for interoperability. There's an increasing realisation that companies must build themselves a new future and this is at such scale that trying to do this with hand wrought nuts and bolts is too bespoke - too slow and too expensive.

What this also reminds us is that digital transformation is not the end product. It is a process of creating the nuts and bolts on which higher-order complexity - the novel stuff that creates greatest value - gets built.

When you have all the nuts and bolts, and power supplies and gears and pulleys and all those things you need to make stuff, it doesn't magically self-assemble. into things of value.

How you are able to use what you have brought together - the pile of 'what's' your grand 'why' of digital transformation may have provided you - that is where the magic happens.

The insight, the imagination, the ideation, the design, the rapid iteration, the testing and scaling - without these your digital investments are simply 'efficiency' spends. They won't even reduce your IT budgett. When we make stuff more efficiently we tend to use more of it (as Simon Wardley points out. Think how many more nuts and bolts got used as a result of standardising them.

What is needed is a way in which you can standardise and make repeatable the insight, the imagination, the ideation, the design, the rapid iteration, the testing and scaling. What is needed is a new way of working.

This is the 'How' of digital transformation and it is where the fight for market mastery gets won and lost.

In 2019 this is the most pressing challenge for creating new value vs simply keeping up.

How to make the extraordinary, normal

Digital strategy consulting has a simple task to carry out.  A little situational analysis reveals that the job of digital strategy consulting is to turn the extraordinary into the everyday.

When we fail to do this we force customers into a chasm of uncertainty which they resort to filling with often inappropriate products. They look for magic.

A look at this Wardley map of evolution, (below) applicable to most products or services, gives us a way of exploring the digital strategy landscape.

Digital is maturing from novel toward common along the Ubiquity axis.  We will return to how far it has actually moved along that axis to help explain the tensions we may otherwise miss. But what we can be certain of is that demand is increasing and that means the movement is toward Common.

On the Certainty axis it is harder to see movement away from the Genesis zone. Companies are testing the water, feeling their way with agile here, lean there, new tools but same ways of working almost everywhere... There is no certain way of doing or being digital yet. Not by some distance.

Strategy is on the whole built from experiment. And while productisation is a mantra within most consulting houses, the reality is customisation built upon rapid-iteration experiments. Making those rapid iteration cycles more effective is state of the art in digital strategy right now. And that's because certainty remains low.

To summarise to this point: There is a greater demand for ubiquity than there is market capability to productise its response. Referring to the map below, it feels to me like we are high enough up the Ubiquity axes for products to be the norm, but on the Certainty axis, we have hardly got out of Genesis.

From Simon Wardley: via https://blog.gardeviance.org

Understanding this situation helps us better plan our response. My (badly drawn) map below illustrates both where it feels to me we are (X), and offers a response to what the evolutionary drivers suggest is the direction our customers will want us to take. Note, the product and custom boxes have contorted offering a much larger overlap than ordinarily expected (compared to the original, above). This is my take on responding to the distortion of current high demand vs current low supply.

X marks where we are now - market trend indicates the direction of evolution we must respond to 

It suggests that we have to respond with products which help take our customers further along the Certainty axis. 
To do this we should offer and embrace

• A clear role for digital consulting - Responding to the need of moving the customer to greater certainty, enabling them to take advantage of genuine productisation as it emerges (essential to the value-building activities of creating higher-order outputs - just as custom nuts and bolts enabled the building of higher order products customers could actually use and value).
• Hybrids of custom build and productisation (applicable to each nut and bolt - eg managed innovation, human insight-centred design, customer experience design, product lifecycle, eco-system build etc)
• Greatest customisation where the customer has least certainty.
• Active strategy teams combining diverse cultures; disruptive creatives (Wardley's Pioneers who will create the new) alongside those who will grow the market (Wardley's Settlers). 

That's just a start list. But it is at least one against which we can start a sensible discussion about what we supply versus what the customer needs, and, as always, I welcome your builds.

For more on Warldey Mapping start here: https://en.wikipedia.org/wiki/Wardley_map