Adam is a manager in a multinational corporation. His exact role is not important to this story. For 20 years, he has come into the office at 8.00 a.m. on the dot, sent his manager a note on the tasks he is going to accomplish during the day, then called his team into a meeting each morning for a quick update. In the years he has been doing this, the people working with him have changed, but his process hasn’t. For years, he was constantly appreciated for this system.
In the last two years, however, he has been getting pulled up by his manager due to complains from his peers, reportees and partners. These complaints ranged from Adam’s speed of working, productivity, response times, etc. They perplexed Adam because nothing had changed in the way he was working. The team’s performance was also at an all-time high.
In observing the way that the people around him worked, Adam realized that it starkly differed from his own working style. After months of trying to mimic their style of working, Adam’s productivity and engagement levels started to drop. He couldn’t keep up. In less than a year, he had taken the difficult decision to quit his job at an organization that he had committed to for two decades.
This is, unfortunately, a common scenario in the workplace today. Some of the most experienced and talented employees leave the organization because they don’t feel connected to it anymore. While Adam’s situation is unfortunate, employees also choose to leave the organization even if their performance and productivity levels are high. A crucial factor in this decision is “fitment”.
For many organizations, a crucial factor in placing a candidate is “fitment” – will the individual work well with the team? Do the individual’s values, beliefs and goals align with that of the organization? In other words, will the individual feel a sense of belonging and ownership within the organization?
A well-functioning organization, like any tight-knit group, is one where employees share core elements such as values, beliefs, and goals, even if the way they manifest these attributes is different. As a result, many organizations let go of prime candidates despite them having the capabilities the organization seeks.
But what do you do about those employees who are already employed with the organization, and no longer feel that they fit within the organization?
Cultural fitment is a core evaluation criterion within organizations because culture is difficult to change. It is embedded in one’s DNA. The downside of it is when an organization’s culture needs a shift, there end up being many casualties – highly experienced and talented people leaving the organization because they do not relate to or are unable to adapt to the changing culture.
Therefore, while organizations continue to focus on “young blood” to take the organization into the future, they are losing those with experience to guide these youngsters.
This is the impasse that organizations are at today, in the Digital Age. Many senior executives are finding themselves becoming obsolete because they are unable to adapt to the new culture of the organization, stemming from the disruptions of digital. In short, organizations are undergoing digital transformation, and a shift in culture to “digital culture” is key to the success of the organization’s digital transformation.
As a result, organizations and leaders are increasingly asking what digital culture is and why there is so much hype around it. This blog attempts to demystify the concept and construct of digital culture and explain why it should matter to everyone.
Digital culture and why it should matter to you
Part – 1: Defining Digital Culture
For generations, our understanding of the term ‘culture’ has been ‘the synergy of underlying beliefs, assumptions, values, norms, habits, symbols and language which defines and characterizes a group’. This definition has shifted significantly because of the advent of digital. Digital, in the simplest words, is the marriage of people and technology. Digital technology is changing the environment around us, and we further use technology to accommodate the demands of this changing environment.
In other words, disruption from the immersion of digital technologies is accelerating our pace of life and work. To adapt, we need to innovate and evolve. This means, changing what, why and how we think, act and feel. In short, to keep up with the speed and pace of digital disruption, organizations need to focus on evolving culture as needed.
Digital culture may mean many things to many people. However, it eventually boils down to how people interact with technology in their work and lives.
The need for organizational culture to evolve to a digital culture is because there is a shift from ‘what to do’ to ‘how to do it’. In a large sense, the world has reached a plateau in terms of new inventions. In its place, we are faced with unbounded innovation and relentless iteration, two core tenets of the Digital Age (Read more: Digital BLUR framework). The agenda here is to improve on existing models, processes, structures and systems. This clearly needs a mindset shift.
Digital Culture vs. Digital Mindset
It is often misconstrued that digital culture and digital mindset are the same thing. While the two concepts share many characteristics, the fundamental difference is the scope and scale of each one. Where mindset is a construct at an individual level (Read more: What is digital mindset and why is it important?), digital culture is a construct of the collective.
For an organization to thrive, it is important that at least most of the workforce shares the same or a similar mindset. Collectively, a predominantly digital-first mindset amongst the workforce is instrumental in forming the organization’s digital culture.
However, digital culture is so much more than just a digital-first mindset. While digital mindset refers to how one thinks and processes information obtained from digital technologies, digital culture also incorporates how the collective workforce responds to this information, behaves and influences one another.
The crucial elements of a strong digital culture include:
- Risk management
- Strong customer focus
These are tenets of digital culture, rather than a digital mindset because they manifest in outlook as well as behavior.
In the past, risk aversion, a lack of customer focus and silos have harrowed organizations. These are cultural challenges and solving them is pertinent to successful digital transformation.
Part – 2: Uncovering the Importance of Digital Culture
“We can have all the bold ambitions. We can have all the bold goals. We can aspire to our new mission. But it’s only going to happen if we live our culture, if we teach our culture” – Satya Nadella, CEO – Microsoft.
Now that we have broken down what digital culture is, let’s get into why it should matter to every organization and leader. We explore five core reasons why Digital Culture should be a key concern for your organization:
1. No digital transformation is complete without cultivating a thriving digital culture
Research conducted by Couchbase indicated that over 90% of digital transformation initiatives fail. Why? It’s because many organizations believe that investing in digital technologies is enough to propel them into the digital age.
The reality, however, is that successful digital transformation is a result of three elements: digital technologies, digital leadership, and most importantly, digital culture. Two of these elements are people-centric. Where organizations fail is in realizing that unless their people transform, business won’t either.
A key theme in the analysis of digital transformation failure is the inability of leadership to foster a unilateral culture that supports the organization’s digital strategy. Building and sustaining culture is continuous work. It takes time to break down an existing value system in favor of a new or improved one, especially when you intend to do this with an existing and long-serving workforce.
Factor in attrition and new hires, and the need for constantly reinforcing the tenets of culture is high. Most importantly, when an organization’s culture evolves, it must be recognized and managed appropriately – a multigenerational, heterogenous workforce means a diverse set of values and behaviors characterizing how things get done.
2. Shortcomings in organizational culture are one for success in the Digital Age
Within a single organization exists a disparate level of comfort with technology – digital rookies working alongside digital masters and natives. As a result, how employees interact with technology and the value they derive from it is disproportionate.
So long as this disparity exists, organizations will continue to fail in cultivating and sustaining a digital culture. But the challenges of a disparate mindset among the workforce goes beyond just a unified culture – Agility within the organization cannot be achieved.
Imagine half of your company leveraging technology to produce results in a fraction of the time the other half does, simply because they aren’t as comfortable with even the basic nuances of technology. What happens?
The collective speed at which the organization delivers output, and more importantly, value significantly decreases, leaving the organization at a competitive DISadvantage.
In a time where the business landscape is rapidly changing, and customers seek immediate results, a gap such as this will almost definitely result in the organization’s demise.
3. A strong digital culture is an organization’s competitive edge
If digital disruption has taught us anything, it is that the future belongs to the fast. But technology alone cannot propel an organization into the future. By placing people at the foreground, focusing on their performance and ensuring that their purpose aligns with the organization’s vision, an organization can almost certainly propel itself into the future.
Why digital culture plays a significant role here is because of the very tenets of digital culture revolve around people, performance and purpose. In cultivating a strong digital culture, organizations can successfully nurture an environment where people and technology are able to coexist and thrive together.
In doing so, organizations open up opportunities for harmonious collaboration between various points of view and approaches to doing things. This is the basis of a highly innovative organization, one that can:
- Unlock unforeseen value
- Deliver to customers things beyond their expectations
- Pave the way for future innovations
4. A strong Digital Culture is key to business longevity
Many organizations are at a stand-still today, either because they aren’t able to make sense of the disruptions around them and how it relates to them, or because they don’t know how to leverage the full potential of digital technology and the impact it can create for the organization.
In his book, ‘Building Digital Culture’, author Daniel Rowles, CEO of Target Internet warns organizations about treating digital disruptions like anything they have responded to in the past. Technology is evolving faster than predicted and it is not happening in a linear manner. Therefore, organizations have no option but to take a risk and experiment with.
Supporting Rowles argument is the evolution of disruptive businesses such as Amazon, Uber, Airbnb, etc., who have reinvented business models and show no signs of slowing down. They’ve been able to do so because they not just admire innovation; rather, they have created the hotbed for it.
Being able to do this requires a culture that leverages technology, propounds taking risks and is focused on delivering value to the customer. In other words, it requires a strong digital culture.
5. Embracing Digital Culture can improve employee engagement
A study by Microsoft EMEA found that organizations with a strong digital culture have:
- 5x more employees who feel empowered
- 4x more employees who feel engaged
- 3x more employees who feel innovative
- 2x more employees who feel productive
How is this possible?
Here are some facts about the modern workplace employees:
- They want to feel a sense of ownership and responsibility over what they do
- They are most motivated when they see a sense of purpose, value and meaning in what they do
- They seek openness, equality and a sense of community
- They expect open and honest feedback
We know that an organization’s biggest asset is their workforce. By meeting the expectations of their employees, organizations are able to generate 26% higher profits. This is because highly engaged employees:
- take fewer sick leaves,
- stay with the organization longer,
- find ways to reduce costs while maximizing value,
- are ardent promoters of the organization,
- are able to constantly surprise and delight the customer, and
- retain the loyalty of their customers irrevocably
Watch this video on how does an organization build a digital-first culture.
The benefits of investing in cultivating a digital culture are amply evident. The question remains – how far is your organization in its journey? To truly be able to boast about a successful digital transformation, cultivating a digital culture is non-negotiable. The effort put into the transformation process can only be fruitful if organizations start with transforming their people’s mindsets and the organization’s culture to digital-first.
In subsequent parts of this series, we will also address ‘the characteristics of digital culture’, ‘helping your aging workforce to embrace digital transformation’ and ‘how to cultivate a thriving digital culture’.
Good luck on your journey, and we hope to see you on the other side!