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3 steps for a corporation to survive in an age of disruption

27 June 2017 by Matt Duke
How does a large corporation best address the challenge of being disrupted? Do they even need to? Find out as VP Digital Platform Matt Duke looks into these questions.

To me, there is no doubt: The fourth industrial revolution is here, and all corporations, no matter their line of business, need to address the disruption that follows in its wake. Within KONGSBERG, we have chosen to disrupt ourselves by creating the start-up Kongsberg Digital and evolving an open, digital ecosystem. Every business is different, but the need to embrace innovation and remain competitive is common for most of us. In order to tune your organisation to grow in an age of rapid digital disruption, I have developed what I like to call the “Three steps to surviving in an age of disruption”. In this blog post, I will share these steps with you.

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Step 1: Make innovation a core business vision

If your business goals for safety, bottom-line costs, and top-line growth rely on data-driven decision support, this will lead your organisation to consider how you can capture data, clean it, and decide which you should use to meet your goals. Data-driven decisions will make it easier for you to see what you can do better in areas such as chartering, voyage optimization, and fuel efficiency. Focusing on areas of high value, in turn makes it much easier for your organisation to set critical priorities. At the same time, you will create a digital roadmap and develop business solutions with many value-based imperatives.

This is why I believe a business vision should include utilising innovations and moving towards data-driven decisions. The vision can be shared across the organisation to make sure everyone understands it. It will help you set critical priorities and a mission based on sound business goals.

Read also: What is a digital platform?

Step 2: Pay attention to cross-industry trends and form strategic partnerships

It is vital to keep an eye on the road ahead, not just in your industry, but across industries. To illustrate this point, let me expose a bit of my past to you: 21 years ago, I spent some of my working hours in a global data centre, replacing hard disks when indicators based on vibration, heat, and power usage said that they were likely to go wrong. In other words, I did predictive maintenance based on server condition monitoring. Back then, we did not have such programs for rotating machinery on board vessels. We do now. The concepts aren’t new, but often they come from different industries, and it is only now with connected assets and vessels that we can harness sensor information and deliver true value from it.

If you don’t have anyone with the skills to review possible digital trends within your organisation, you can get an external view or a sanity check by chatting with someone outside your organisation, perhaps a partner or trusted advisor who has the skill set you need. Get some input, and look outwards, across industries.

You should also look outwards to find your optimal partner because the right partner will make your organisation stronger. When you consider any existing or potential partners, I strongly recommend that you consider how they treat your raw data and other information. Will they make it as easy as possible for you to gather value from your data, or will they make it hard for you to get access to the information? To make sure you get easy access to your data, look for open digital ecosystems, without exception.

Read also: How to combat security risks emerging with the new industrial revolution

Step 3: Make digital disruption and the need for continuous change part of the company DNA

How do you make digital disruption and the need for continuous change part of the company DNA? It is a question of culture, and people are critical. Your organisation won’t succeed without the right people, and they need to be serviced with world-class leadership, who will work to support and build the culture and make themes like digital easy to understand and relate too.

Among senior managers, I have observed a tendency to believe that the solution is as simple as having a so-called digital native on the team and giving the “digital responsibility” to someone who’s main qualification is that they have been familiar with computers since childhood. By giving this complicated task to the young person on the team, they believe their business transformation will go smoothly, almost by itself. Let me be blunt: If that is what you think, you are wrong. Yes, having a digital native on board can be an advantage, but what you need more than anything is for all your people to be part of and understand the digital transformation. Conversations around time charter earnings, reducing Opex and testing new business models are more likely to be relevant to the team than buzzwords like big data or A.I. It takes great leadership, empathy, and understanding of the underlying business processes to succeed.

Read also: Digitalisation and the future role of the seafarer

Being curious – and encouraging the team to be so – will also mean things go wrong occasionally. Allow a degree of failure with non-critical systems, and set a clear line between the areas that are open for exploring innovation, and the core safety areas that are off limits.

Start thinking cross-functional teams rather than top-down command and control. Your people need to have a new concept and way of looking at business under their skin to spark innovation thoughts across your entire business. You need to leverage their knowledge and thoughts. Their ideas might be entirely different to the way businesses have been doing things for the last twenty years, but that is the whole point. You need to get the best out of the people you have and getting the best ideas you can. That doesn’t happen in isolated silos.

How to make it all real: Innovation through smart business processes

To make any of this happen, you must first focus on your board of directors and executive leadership team. Make sure your board invests in digital understanding and that your executives invite in the right people that will help them gain insight into the current development in industrial digitalization and the megatrends in transformation.

Fuel economy and voyage routeing is a classic example of the value of better decision support. I would advise you to use this or other examples to enable your leadership to understand, drive, and own the value of better decision support. In the same way, they should empower your middle management to use tangible examples of success, and make it a priority for their teams and colleagues. Remember, your people have to lead and steer the organisation.

Large, complicated businesses also require quality and process control. Embracing change does not mean you need to drop everything and adopt a start-up culture. The trick is to encourage change and exploration, and simultaneously run ideas through a robust project portfolio process. Many ideas will come from within, and a cross-functional project scoring model with a focus on how each initiative can benefit the business in top line, bottom line, or growth, will give a fair and transparent priority list for your CEO and management team. You can adjust existing company risk heat maps to reflect how running the highest-scoring projects will impact risk.Lowering company risk is an often-overlooked benefit in itself and encourages your teams to focus on the right areas of concern for your company. After all, ideas that don’t contribute directly to your company mission are less likely to be supported.

The result should be that your organisation moves from being a business that changes when it has to, to one that rewards curiosity and where every single person listens to and considers what potential innovations could be relevant to your business. Such an organisation will allow you to embrace controlled, continual change, with a thorough understanding of the value of data-driven decisions. This change is a combination of process, technology, and culture. The leadership required to achieve these improvements is challenging but incredibly rewarding for the business and the people who are empowered to see the benefits that change can bring.


Do you agree with my thoughts on this? Or is anything holding your organisation back from embracing the culture and agility to change all the time? Let me know in the comments below.

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About the writer
Matt Duke
Duke has been with KONGSBERG since January 2017 and holds the position of Vice President for the digital platform economy focusing on the maritime sector. He has been in digital technology for 20 years and has worked in the shipping industry for the last 15 leading global digital and IT organizations within Odfjell. Because of Duke’s proven experience leading organizational change and moving Odfjell to a truly data-driven business, Kongsberg Digital brought him on to combine the customer perspective from shipping and elements of leadership and change management required to secure successful digital transformation.