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The key to a successful business transformation is good leadership

10 November 2017 by Hege Skryseth
Four elements are essential if you want your business to succeed with a digital transformation.

This article originally appeared in Norwegian as part of the "Lederblikk" series by Oslo Business Forum. You can read the Norwegian version here

We all know that digital technology and innovation are key drivers for fast transformation in all industries. And we want to ensure that our own organization achieves the greatest benefits of digitalizing and avoids the pitfalls. It is easy to forget – or underestimate – just how crucial leadership is in this context.

My time in the Kongsberg Group and Kongsberg Digital has taught me that four elements are essential for an organization to make it unscathed through the current disruptive age.

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1. Vision and strategy

The board, the CEO, and the management team must lead. They must possess digital competence or at the very least understand digitalization. The company's vision and mission must be aligned with a clear ambition to use digitalization as a means for business transformation. 

One of the key advantages of new technology is the transition from reactive to proactive analytical decisions. This means that a key component in the vision should focus on utilizing technology and internal business expertise to enable data-driven decisions.

This can help transfer the goal to the mission. Here, the strategy could reflect a roadmap that will enable the company to identify the areas with the greatest potential for improvement.

The organization can then focus on a digital roadmap and combine it with industry knowledge to achieve the benefits it wants.

2. Culture and people

Digital transformation contributes to increased security, higher turnover, and better results. A flat structure where everyone can contribute with their good ideas and a culture for testing new concepts in a design phase can increase the digital interest and insight into your organization.

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It is imperative that the leaders focus on adapting the vision and mission to give the organization a digital mindset. They must also consider whether their employees have the key competencies that will enable the organization to deliver on the changes.

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Key areas of expertise are a combination of digital technology, solid business expertise, application and domain knowledge and an ability to change. An external review and skills assessment might highlight a need to strengthen these areas in a traditional industrial setting.

It is crucial to be curious about how both your own and other industries are driving transformation. It is especially important to understand the possibilities technology provides.

3. Innovation

In a digital transformation, you need to establish an innovation culture where good ideas are tested through quick "proof of concepts" – limited to a couple of weeks. Ideas of value can be tested in targeted pilots.

Established companies focus on operations and the opportunities offered by digital transformation. But it is also important to focus on the customers' experience of what the company delivers and especially on new business models. Many industries that have experienced major changes due to digital transformation have seen challengers taking positions precisely because they have this focus.

In the innovation phase, a common error is devoting too few resources to a commercialization strategy. In the phase of technology enthusiasm, technological development often plays a key role. Little attention is paid to the discussion about how the company will succeed in taking a significant market position, and the resources it will need for this.

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4. Tools and technology

Traditionally, IT departments have been in charge of acquiring tools and technology. Nowadays, fully integrated IT departments are working side by side with the management to acquire, develop, and purchase the best solutions supporting the pipeline process.

The development within key areas such as artificial intelligence, machine learning, autonomy, cognitive computing, cyber security, and the Internet of things has been incredibly rapid. As a business manager, you depend completely on having a solid technology partner with proven experience and competencies in these areas. This will provide you with the widest possible perspective on the possibilities that are open to your organization.

It will be an advantage for your organization to set up meetings with potential partners to collaborate on key business challenges. Among other things, this will allow you to find out how you can take advantage of open digital ecosystems or technologies.

Finally, I will urge you to look for partners who are cloud-ready when choosing tools. This will help you avoid underestimating the costs of internal development.

Are your organization in control of these four elements? In that case, you are well equipped to make it through the industrial revolution.

 

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About the writer
Hege Skryseth
Hege Skryseth has worked for KONGSBERG since August 2013 holding various management positions within the Group’s corporate team. She has been the President of Kongsberg Digital, and Chief Digital Officer of KONGSBERG since March 2016. Skryseth also holds broad experience from several leading international technology companies and has been a board member for various organizations including her most current participation with eSmart Systems.