April 25, 2017
Setting a Digital Transformation Journey Leveraging the Hedgehog Concept
I talk at length these days about Digital Transformation (DT) with our clients. It seems to be on everyone’s mind. When discussed, it’s usually framed in the context of a NEW investment within their respective organizations – the characteristics of which usually involve elements of cloud, big data, and/or mobile technologies. In some instances, DT is used to describe efforts to replace an aging business systems or advance reporting and insights. In other cases, it’s used to describe the modernization of an application or moving computing workloads to the cloud.
These efforts are certainly “transformative” and involve “digital” technologies, and by this reasoning companies have been “digitally transforming” since the dawn of computing. In this regard, DT is not a new concept at all, but rather quite the norm for our clients who are committed to using technology to establish competitive advantage. So then why is DT such a hot-concept in recent conversations?
Many client conversations initially tend to focus on the “what” they are doing, but often the “why” is absent in understanding how it fits into a much larger organizational goal. The pace at which technology is changing can cause an organization to become reactionary and lose sight of business goals. To truly realize a successful DT, an organization must be transformative, involve digital technologies, but also maintain focus on achieving their unique offering and strategic purpose. Worldwide author and leadership coach, Jim Collins, discusses stimulating transformation by introducing us to the concept of the Big, Hairy, Audacious Goals (BHAG). “A BHAG engages people – it reaches out and grabs them in the gut. It is tangible, energizing, highly focused. People “get it” right away.”[i]
To discover a BHAG for an organization, Collins introduces the Hedgehog Concept that aims to center an organization’s purpose into a single concept or basic principal[ii]. Based on an ancient Greek parable featuring a fox and hedgehog, the hedgehog is often overlooked because of their quiet demeanor, but “unlike the fox, they are able to simplify the world and focus on one overarching vision[iii]. It’s this principle that guides everything they do, and helps them succeed against all odds.”
Collins identifies the Hedgehog Concept as being the intersection of passion, skill, and economic engine.
It’s from these basics that any good DT strategy takes root. For our clients that have long-established businesses, the predominant challenge is the hyper-pace of technology change and the internal pressures it’s causing operations, business-to-business integrations, and customer connections. From meeting with our clients, it is clear that every industry is experiencing some level of disruption, along with the constant looming threat of new competitors with less barrier to entry in this born-in-the-cloud era. I heard of one business express fear of “getting Uber’d” (used as a verb) to describe the impact Uber has had on Taxi and car services for their industry. While many of our clients have active projects to respond to industry disruption, the more progressive ones are looking to create it. A well-constructed DT strategy not only looks to optimize the existing business but rethinks the very way business is performed today. Some of our progressive clients have even established Innovation Centers specifically designed to reinvent themselves for the new digital era.
So, what are the elements to starting your DT journey?
- Define a clear purpose and align to the organization’s Hedgehog center
- Identify and map your DT project charters to organizational BHAG’s with direct C-level sponsorship and board backing
- Ensure BHAGs are front-of-mind and guiding each technical decision among project team members
In client conversations, I’ve learned that it is important to take a step back from the reactionary ideas and identify the Hedgehog Concept which will lead to the BHAGs that are exciting, new, and achieve maximum impact.
Connect with us now to learn more about identifying your Hedgehog Center and tackling those BHAGs!
[ii] Collins, Jim. Good to Great. New York: HarperCollins Publishers Inc. 2001.