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Welcome to the Decade of Digital Difference

The controversial philosopher Jacques Derrida coined a new term, différance, to refer to the meaning of things being defined by their difference from other things. Derrida saw meaning as an endlessly deferred web of differences. This rather exotic concept helps us understand the approach we need to take to succeed in the digital world.

Welcome to the Decade of Digital Difference

Where Enterprise IT tends to be ‘inside-out’, the digital world requires us to be more ‘outside-in’.

Having been exposed to some cutting-edge user interface (Virtual Reality, Augmented Reality, etc.), collaboration, machine intelligence, and other technologies and trends by my brilliant colleagues at LEF in my first month, I feel 90 percent excitement at the possibilities of the coming digital decade, but 10 percent concern that companies, governments and nations will evolve incrementally and inside-out, perform an undifferentiated digital ‘race to the bottom’, and miss the great opportunities this era represents. The way to avoid this ignominious outcome is to focus on digital difference.

Firstly, difference from our current selves. As my colleagues here at LEF have noted previously, where Enterprise IT tends to be ‘inside-out’, the digital world requires us to be more ‘outside-in’. We need to be looking at services and innovations in the outside world, including the consumer world; sharing and co-creating communities, and learning to engage with and exploit them, rather than simply improving what we have inside. We must actively aim for difference in ourselves, rather than incremental improvement. We must willingly and enthusiastically cannibalize our previous assumptions, business models, operating models and IT architectures.

Then there is difference from others. More subtly, but even more importantly, we must note that though the notion of ‘best practice’ has some relevance in the world of Enterprise IT, it is much less valuable in a digital world. Best practice implies a level of ‘sameness’. Saying “We want to have best-in-class ERP processes and systems, best-in-class HR, best-in-class payroll, etc.” is all well and good for processes that are ultimately commodities, and for the IT that enables those processes. But in the digital world, information and technology are everywhere – in products, processes, communities, experiences, and the lives of customers and citizens.

We should be looking not at industry best practice, but at differentiated next practice.

This changes the game and differentiates our offerings, as well as optimizing the existing game. It means we should be looking not at industry best practice, but at differentiated next practice. We need to develop a distinct identity in a digital world – a distinct digital difference, that excites customers and consumers, and inspires current and potential employees and partners. We need to explicitly aim for difference from others. This approach rests more on comparative advantage than competitive advantage, and represents a win-win-win for customers, company and society, avoiding an undifferentiated, competitive ‘race to the bottom’.

Just as important is a differentiated approach to digital opportunities and threats. The fact that there is also way too much digital innovation to pursue it all (think machine intelligence, internet of things, virtual reality, 3D printing, the various tiers of cloud, etc., etc.) is a further reason that we need digital difference, digital identity and digital focus. Focusing on every digital innovation may be even more dangerous than focusing on none. We need differentiated attitudes to each digital opportunity and threat.

Has your business got a powerful identity and strategy, that is clearly different from the herd, that will help you say yes to some innovations, but (equally important) say no to others? Will this identity and strategy make more (not less) sense, and be more (not less) exciting and inspiring, as the digital world evolves? 

Making Your Digital Difference Real

The follow-on question is whether you have the right stuff to make your digitally differentiated identity and strategy a reality. Do you have the right approach to maintaining situational awareness, experimenting, learning, and sensing external change, threat and opportunity? The right double-deep (business- and technology-savvy) talent, and the ability to attract and recruit, retain and motivate that talent? The right partnerships and ecosystems? The right structures and disciplines to unleash that talent? Sufficient agility in all aspects of your business model, operating model, financial model, infrastructure and architecture to evolve? The right ways of measuring and monitoring value and risk?

Digital success is only as good as your weakest link.

If you don’t have the talent; if you don’t have the courage to state a clear digital strategy and identity; if you can’t make value-based decisions in dynamic and uncertain contexts – then your digital plans will be found wanting.

Loving the Change

It has been well documented that neither humans nor organizations are predisposed to enjoy change, and certainly not change that we didn’t choose ourselves. If, when you read about Chief Digital Officers or Chief Data Officers and radically new organization structures, business models and work practices, your inward narrative is “OMG – why do they have to change things?”, you may need to (as the urban vernacular goes) “Check yourself before you wreck yourself.” 

We need to accept that there will be a lot of change. The way we structure our companies, the way we segment our industries, the way we manage and nurture our talent – all these things have been standard and static for far too long, and need more change rather than less, and more difference rather than more standardization. For the next decade at least, we need to go with the flow, evolve and adapt – we need to be Digital Daoists!

For the next decade at least, we need to go with the flow, evolve and adapt – we need to be Digital Daoists!

Having joined Leading Edge Forum a few weeks ago, taking over the research leadership reins from my thoughtful and insightful colleague David Moschella, I am excited to work with a great team and great set of clients. I look forward to us all embracing our digital differences. 

Game on.

COMMENTS

Conor whelan 16.33PM 10 May 2016

Dave, welcome on board, an interesting into from yourself on the "Digital" agenda. Fortunes four the brave i suspect. My question is one of pace and focus? Do you expect a wholesale structural change within the organisation or a separate parallel capability to mature before you collapse in the existing heritage people and processes? Regards Conor

dave aron 06.47AM 11 May 2016

Conor - nice points. I agree that fortune is likely to favour the brave. But of course this implies the possibility of failure. That is why the disciplines of experimentation, agile development and lean are critical. I have seen this done within the business, and as a separate parallel capability. I know it is a fence-sitting answer, but I do think it depends. Calcification of the existing culture/ systems/ people/ processes would push towards a 'spin-off', whereas the potential gains and synergies from applying digital innovation to existing brand, products, customer relationships etc. would push the other way. It is for each of us to weigh the one against the other, and introduce some innovations in the 'mothership', and others as separate entities.

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