On September 1st 2017 an article worth reading was published: "Why companies don’t need consultants"
The author correctly points out that true digitization must be integrated with a holistic approach: "Only because the board of directors and its representative have written on paper how digitization should work in the company, things will not change. For that it needs the whole team." This elementary dependency between successful digitization projects and cultural change in companies places new demands on successful consulting and we believe it is worth taking a closer look at it.
According to our observations, the relevance of digitization projects in companies has developed over several stages. In the beginning, the necessity of digitization was often denied. Due to the undeniable success of new digital competitors, this negative attitude has become a thing of the past and various forms of digitization projects are being launched in companies. The scope of the projects varies greatly - from the pure digitization of products to the digitization of processes, to the supreme discipline of establishing new digital business models.
We are currently at a new level: progressive companies recognize that digitization is only one side of the “digital transformation”. The digitization of products, processes and business models can only be successful in the long term if the second side of the coin is also taken into account: the agilisation of the company. As the author Rainer Petek has quite rightly stated, the digitization is like an expedition into the unknown - no one can seriously draw up a fixed catalogue of measures including a roadmap, which has to be done exactly at a certain point in time in order to successfully master the digital transformation. Targeted testing and quick learning therefore becomes a critical success factor. The complexity of interpersonal interactions, the ever faster pace of technological progress and the possibilities of new digital attackers require new ways of thinking and working. The quick adaptability of each individual employee becomes a key competence. This requires internal structures that enable the necessary agility.
Successful organizational models and processes reach their limits. Fortunately, there are a number of tools and techniques available to successfully manage the transition to a more agile organization together with employees. When employees know how to quickly and cheaply test ideas against potential customers, products and services quickly become more customer-centric, solution-oriented and competitive. This, in turn, can only be achieved with an existing error culture (better: learning culture), made possible by a new management culture and a cross-functional cooperation at eye level.
Agilisation is not an end in itself and the ideal agile target image varies from company to company. It is not enough to have agile islands (e. g. in software development) nor is it enough for the Executive Board alone to understand the challenges that digitization poses for the organization. The decisive factor for the concrete design of the agile structures within the company is the precise alignment with the corporate strategy and the degree of complexity in the company’s environment. Since this type of analytical work is not usually part of the core competence of many organizations, it can be useful to draw on external expertise in order to create the ideally aligned target image with suitable tools. However, without consistent involvement of employees in the development of the target image, the knowledge and creativity potential available in the organization cannot be fully exploited.
Rainer Petek is absolutely right that even a perfect target image, which only exists on paper, does not lead to the desired effect (even if it has been developed together with the employees). After the development of the digital target image, therefore, the corresponding prerequisites must be created within the company in order to implement this target image and bring it to life. Consulting that wants to help the company achieve sustainable success, must therefore not end at this point.
After the joint development of the target image, good consulting must help to ensure that all people in the organization have the necessary understanding of the target image and the significance of their own actions. In addition, it must be ensured that the participants have the necessary skills and experience to carry out meaningful experiments for the realization of the target image. The organizational model, management culture and decision-making processes must support the implementation of the target image in the best possible way. Every individual in the company must know the target image and should want to, be allowed to and be able to implement it.
External consultants can create significant added value in this respect: on the one hand, they have to put their fingers in the wound if necessary in order to draw attention to grievances. The impartiality of an external consultancy enables an objective assessment of the company’s internal agile maturity. Particularly in companies that have been very successful for many years, there is often a lack of willingness to carry out experiments, which by their very nature often fail. The existing “0-error culture” sees failure as problematic and prevents learning effects as well as the validation of hypotheses and data-supported decisions. However, the effects of failure can be significantly reduced by appropriate methods.
The task of the consultancy is to impart the necessary methodological competence. In addition, consultants must support the company as long-term companions and provide help for self-help. The ultimate goal of the companion should be the sustainable empowerment of the people in the company. Suitable workshop formats can be, for example, design thinking or innovation workshops. Employees and executives up to and including the Executive Board must be involved in this process. Required methodological knowledge is imparted by practical testing on concrete questions. By trying it out, it can be experienced which elements of the agile toolbox are best suited for which situation and question. This actively encourages the transition to working at eye level and in cross-functional teams, to targeted experimentation and favorable failure. Kanban can also be a suitable means of gradually but lastingly addressing change without any initial changes, simply by creating transparency and a common commitment to continuous improvement.
As a result, the employees can embark on the transformation step by step with increasing independence. If more and more people in the company are enabled to actively participate in shaping change, they can jointly develop and live an organizational model that is oriented towards the strategy and the target image, without change being perceived as something threatening from the outside.
This approach however, requires a new type of consulting: consulting that does not see digital strategy development and sustainable cultural change as two separate silos. A consultancy that has knowledge of strategy and digitization and also devotes a great deal of attention to implementation and acts as a long-term companion, which ideally makes itself superfluous over time.