Digital Versus The Weight Of The Past

Why reimagining the future of business requires some important decisions about what we keep from our past

This is the second blog as part of a six-part series.

Most of us are employed by companies that preceded digital business. Accordingly, these companies typically have both a heritage to cherish and a legacy to manage. This has become one of the most pressing issues of the digital age, as managing what we have inherited from the past is inextricably linked to how we reimagine and re-engineer our business for the future.

One of the definitions of heritage is the status acquired by birth, and this makes perfect sense in this context. A new Rolex product, born of the Rolex brand, has perceived value before its features and functions are even known; this is a good example of the positive side of the balance sheet of company history.

Many established companies would also consider their culture to be a vital part of their heritage. And while we have known for many years that culture is fundamental in determining or constraining strategy, what has become apparent recently is that culture is an essential ingredient in fostering digital transformation. It’s something that needs to be nurtured through what is likely to be a protracted period of intense change at work.

On the other side of the balance sheet of company history, we come to the many tangible items that established companies have and are bound up with our current definition of work. Businesses that were not born digital will have more buildings, plant, assets and materials than their digital equivalents. Each of these represent cost, in the form of ownership or hire, and complexity in the form of associated contracts, applicable regulations and so on. Of course we, as employees, are also tangible. Our pensions, healthcare and all the other elements of our employment contribute significantly to both the cost and complexity of the business that has to be managed.

However, in most companies, there is tremendous value to be taken forward. This can come from customer experience, core competencies, a history of innovations or company culture, and in many companies these will be embedded in the brand. Taking these forward into the future provides a competitive advantage over a startup with no heritage. Digital transformation initiatives should pay diligent attention to how the asset value of the past can make a positive transition to the future.

To carry employees through a period of intense disruption requires leadership to build a confident narrative, and one that is inclusive of the achievements of the past is likely to be stronger than one that attempts a hard restart on a given date. GE, a 124-year-old industrial company that is rigorously reinventing itself in digital form, describes its heritage as one of process mastery; it is upon this process excellence that GE’s digital future is being built, providing both the brand and the workplace a continuity that is incredibly valuable.

With both our workplace and our work becoming increasingly digital, it is easy to see this shift as the rise of the machines. While it is true that in the near future the workplace will increasingly be shared with automation and supported by humans with augmented capabilities, the digital platform is often based on mature technology – mostly middleware and integration. The new element here is actually new business thinking. So makes more sense to contemplate the shift to digital business as different thinking supported by technology and guided by change management.

Driving and sustaining change in a large organization is extremely challenging, but this is an area in which each of us can play a part. We can adopt the tools of the digital workplace, embrace new working practices built on data and testing, and even shift our behavior and values to those that support a new approach to business.

If we do this while our leaders ensure the vision for the future is built on a careful scrutiny of value delivered over time, our future digital workplace becomes a less fearful and far more attractive proposition.

Want to learn more about the road to digital transformation? Download Digital Transformation: The Move to Digital.