Get Digital Transformation Right the First Time: It’s Not About Your Tech, It’s About Your People

Transcript

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Good morning, everyone, and welcome to Daggerwing Group’s presentation on getting digital transformation right the first time. Our POV is that it’s not about your tech, it’s about your people. I am Cheryl Ferguson and I am the president and co-founder of Daggerwing.

Hi, I’m Ning Wong, I’m the head of APAC for Daggerwing, based in Singapore.

So, we are really grateful for the time you’re going to spend with us this morning. Here’s our promise to you of what’s going to happen in the next 20 minutes.

Number one: you are going to learn all about the greatest failure factors for digital transformation from a people perspective.

Number two is: you’re going to learn how to read the minds of your people. What are they really thinking, and how you can use that knowledge to influence what people think, feel and do when it comes to digital transformation?

And last: you’re going to learn how to get your people leaders to embrace, drive and accelerate the digital transformation that you’re probably on the hook for.

So, why does that matter? Right now, the stakes in digital transformation have never been higher and the risks of failure have never been greater.

In fact, this year, Harvard Business Review published an article, and they said digital transformation today is less about technology and more about people. And that’s where we come in. Daggerwing Group is a global change consultancy that’s really focused on the people side of change.

We’re rated in the top ten in change consulting for the impact that we have on clients. And we do all kinds of business transformation and changes. So, mergers, acquisitions, big org structure changes, culture changes. But about a third of what we do is in the area of digital marketing and CX transformation.

And we are extremely proud of our roster of clients and the leaders that we get to work with and how we have helped them to do change right the first time by focusing on the people side of change.

So, that actually brings us to a story I like to convey about a client we worked with a few years ago. A great big global giant that was working on a digital transformation, making massive investments – in data, in digital, in tools – to really change the entire way that marketing and sales was going to engage with their customers. And after all the money was spent several months later, there was tremendous frustration by the leaders because there was no business impact. They weren’t seeing a return on all the time and effort in getting those digital tools and technologies in place. So, that’s where we were brought in.

And what we really saw was that it was definitely a people-centered problem.

So, on one side was the leaders. The leaders – they did not – they didn’t explain well enough what was changing and why. They didn’t create any kind of sense of urgency. They didn’t address the concerns of their own people. Aside from sort of one-off training, they didn’t really help people build the skills they needed. And they didn’t necessarily think through all the ways that structure and process needs to change to enable using these digital tools and technologies.

So, on the flip side, what did employees do? Well, they did not see any reason to change. They didn’t really understand what was expected of them. They certainly didn’t feel that they could do anything that might be seen as risky and be publicly taking a risk in front of their colleagues or bosses.

They didn’t feel that managers were listening to them and they didn’t really even know even if they were ready to take it on: “If I come to work tomorrow. What am I supposed to do differently?” They didn’t know.

These are exactly the kind of trends that we see over and over again when we get brought into digital transformation. So, Ning.

Thanks, Cheryl.

So, throughout all these years, Daggerwing keeps coming across eight key human factors that influence the success of organizational transformation. Including digital, of course. So, if you’re the one leading the change and you’re handling every aspect of the organization against a tight timeline, chances are you haven’t had the chance to think about all these different human factors.

Such as: have you articulated a compelling and meaningful vision for your people? Have common biases being surfaced to be addressed meaningfully? Have you unveiled how people actually feel about having to build new skills?

So, what we realized is that the starting point for most change drivers is these assumptions about how the people would respond to a big digital drive and announcement. You’d think they’d be excited because they’re going great. “I can’t wait to get started. It means learning new skills. New things, count me in.” Or “this is good for our people, our business and our customers. I get it. I’m part of the journey.” Well, the truth is that you might see people smiling and nodding and going along with the change, but they’re likely thinking these thoughts really:

“Do they care more about tech than about me now?” “Things keep changing. What if I can’t keep up?” “Everything’s working great now. Why should we change?” “I stand to lose more than I will gain by adopting these new digital tools, right?” “I know every company is accelerating digital and we need to take it seriously. But why?”

So, for today, we’d like to focus on two key human factors that relate to both your people and your leaders. Assuming you already have a clear communicated vision, let’s talk about how you can start to tackle four, which is about understanding how your people actually see, think and feel to respond to changes.

And five, supporting your people, leaders themselves and embracing and driving change. And we’d like to share with you today on what you can do and what they need to hear in order to make sure change is successful.

So, starting with common biases not being surfaced or addressed.

What this really means is about diving deep to understand and address how people are really feeling so we can address their real needs and their biases.

So, did you know that we receive 11 million bits of information every moment? And yet we’re only processing 40 bits of such information at a time.

What this really means is 99.99999% of the information that you’re taking in right now is unconsciously biased. What this means is we’re resulting – this results in the decision responses being driven by how we perceive reality as opposed to what reality is in reality.

So, let’s start with the very first one, which is the most common for us, and we’ll experience it all in our lives at some point. This is a status quo bias. It’s that everything’s working great now. Why should we need to change? So, we all know the meaning of staying in your comfort zone versus stepping out of your comfort zone – and this is exactly what it is. It’s natural for us to stick to what we know, even when we’re presented with something that could be better on the other side.

But how do you start to drive this mindset shift from “why should we change?” To “yes, you’re right. Things could be better, especially if it makes life easier for us all.” So, here are a few tips that we’d like to share with you on what you can do.

Make your company’s vision tangible, meaningful and inclusive. What we mean by that is rather than saying this is good for our bottom line, this is good for our customers, this is good for business growth. Let’s talk about you. This is good for you. This is good for you to focus on your priorities, this is great for you to focus on what truly matters – such as your family, for example.

So, next point then would be emphasizing pain points in the current systems and showing people how they can be eased if you step outside of the comfort zone and start to explore the new things. And in order to make that step easy, we need to start thinking about what’s intuitive to your people when you’re taking that first step as well. And of course, when they’ve taken that first step and you need to start moving them down the program, you need to state a clear deadline for when the visible impact could be expected.

So, what they will need to hear from you is: in how many months you’ll see the digital helping us spot problems faster. Let me show you how these new tools can save you time and effort so that you can focus on what matters: your customers, your personal priorities, even your family. And once you try it, I guarantee you won’t look back.

So, let’s move on to the next one. The loss aversion bias, which is exactly what it is, it’s a fear of losing what you already have, even though the future may be brighter and better for you.

So, it’s the tendency to prefer avoiding things. It’s like having something in your hand and not knowing what’s out there. It’s allowing people to come to terms with what they may be losing isn’t that substantial.

So, imagine if you can change that mindset to shift it once again from losing more than I will gain to “hey, you’re right, I’m not actually losing anything substantial, and the end results seem great.”

So, once again, a few tips on what you can do. By making the gain clear and compelling to clarify what’s in it for your people, it will allow them to hold onto something tangible in the future where the grass is greener on the other side. By clarifying with your people what they see as being a loss, you’re also helping them to come to terms that it may not be that substantial. Also, the idea of getting them together with other people to promote sharing of ideas and opinions that get them thinking forward rather than having them stuck in the present is also a good way to go.

So, what they’ll hear from you is, “if you feel the current ways of working might be compromised, let me know how and why exactly. And let’s put a team together to make sure we address those gaps for you and your colleagues as well.”

Now, let’s move on to our last bias for today, which is the availability bias. Some people would call it the “fear of missing out bias.” Also commonly known in Singapore as “Kiasu.” It’s the idea where you see someone lining up for something and it’s a long queue, and you can’t help but get in line because you know that something’s great at the end of it – you’re not so sure what it could be – but if everyone’s in that line, you have a fear of missing out.

So, you get into that line, and the next question is, “why are you getting in that line for yourself?” It’s the same thing for digital transformation. “We know that companies are accelerating digital. We need to take it seriously. But why?” So, how do you shift it over to: “You’re right. We need to get on board because this digital change makes complete sense given where we want to go.”

So, what that means for you is if you can make your company’s vision tangible, meaning meaningful and visible for people so they know why digital change needs to happen, then it will make sure that it’s specific in terms of your people’s goals, the benefits for them, etc.

So, it helps to clarify how your goals are, what your goals are, and how it achieves it. And it emphasizes how it benefits your people and the key stakeholders in your group.

So, what they need to hear from you is: “this transformation plan was specially developed for us, our people, our processes, and our priorities now and into the future. It’s one of our pillars of growth that will take us to number one. It will make us faster. And this is how.”

So then, over to Cheryl to continue as to why leaders do not drive the change, then?

Exactly. So, that example that I gave at the beginning where there’s a failure and a lot of that failure was a failure of leadership. So, what everyone wants to do is to ensure that leaders are the reason you succeed, not something putting you at risk for failing.

So, the thing about digital transformation is ultimately you may want hundreds or even thousands of employees to do things differently: use new tools, use data in new ways, new ways of working, new standardization. And of course, you think that it’s your people leaders that they are going to actually be that front line driving force for change. Right?

In fact, leaders may not be as prepared as they think. So, there was a study that came out this year from MIT Sloan on – they interviewed more than 4000 leaders in 120 countries about a leadership playbook for the digital age. And some of the findings that were presented here are a little bit shocking in terms of readiness. So, just 12% of the people that were spoken to feel that the leaders in their companies have the right mindset. Only 40% felt that there was like a pipeline of future leaders coming along, and less than 10% felt that leaders had the right skills to thrive. So, a bit worrisome. Let’s look at what the individual leaders thought.

So, a little bit more promising, seven out of ten leaders agreed that they do feel prepared to lead in the digital economy. But leading a business in a digital economy is not the same as leading a digital transformation that gets you there. So, in fact, less than 60% of leaders believe they had the skills to command respect among the people that report to them in their peers. Less than 60% are confident in their own ability to be role models in using these new tools and technologies, and less than 60% are ready to advocate for the kind of changes that have to happen across other functions.

So, those are those are really essential to digital transformation. It really boils down to: everything Ning talked about earlier about your people, people leaders are people too. They also have fears and biases.

Think about it. A lot of people got ahead because they sort of graduated in a safe passage way through a series of conventional rules. And risk of failure really wasn’t a part of how they got ahead. And all of a sudden, here comes digital transformation.

All these new skills – things they don’t know – can be exceptionally frightening, and they are going to be so preoccupied with what it means for them and their own fears of failure that they’re not going to be on your side leading that change.

So, we need to get people from “a very worried, in their own head” state as leaders to a “very confident – can’t wait to lead my people” state. So, at the beginning, people might be thinking: “they’re asking me questions, I don’t know what to do.” And they’re really feeling at this point, it’s very natural for your people leaders to say “it’s all about me” and they really are not seeing the business benefit or the or what they have to do as leaders. You need to get them to: “I can’t wait to share this with my people. I can’t wait for everyone to go on a journey. I’m going to be the leader.”

So, how does that happen? Here’s a few tips. So, first of all, it’s really helpful to engage your people leaders and let them come up with their own personal motivation, their own “why?” Why is this good for them and their career? They need a personal motivation as well, of course, being motivated by what’s good for your customers in your business.

Second, don’t wait until you’re about to launch digital transformation before bringing these people leaders in. Bring them in now. Give them a chance to get more familiar with the terms and the technology and everything happening, as well as really start to accept what you are – what your expectations are for them.

And third, of course, fear of failure is going to be paramount, almost paralyzing. So, you need to give them a sense that it’s okay to try and test, and that doesn’t mean that you’re failing and let them work amongst themselves as peers and support each other.

So, what they need to hear is they need to hear, where do they fit into the big picture, right?

So, “our digital transformation plan was developed for us. It’s our priorities, our processes and our people, and that includes you. We want to make sure you have what you need to lead your people on an exciting journey. Let’s start by understanding what this journey means for you and how we can support you.”

So, it really is – the more you get them to the point where, “Aha, I get what this means for me.” Then they can turn into the leaders that you need them to be.

Because really, doing digital transformation right the first time really does involve migrating people. As you’ve been listening to us, you’ve heard that people are going to be angry and confused and frustrated, and you need to shift them from these red and yellow zones over to green so that they’re they’re accepting. They’re proud. They’re excited. That’s exactly the kind of mindset that’s going to fuel your successful digital transformation the first time.

So, today we only covered two key human factors: common biases and helping people lead. But there are six other human key fact- key human factors of digital transformation on which we would love to share learnings with you. My other two favorites, for example, would be around encouraging and enabling people to develop new skills and behaviors and organizational systems and other initiatives having to be aligned with change. But we’ll leave that for another day.

Meanwhile, to learn more about human factors and other types of transformation work that Daggerwing does do reach out to me any time. Thank you for your time today and we look forward to answering any questions you might have in our Q&A session.

From Daggerwing Group and sharing some – a quick overview on the people part of transformation. Great insights from Daggerwing. As mentioned at the start of the presentation, we have had Daggerwing join us both our UK/European event and our North American event where we’ve went – we’ve heard kind of similar sentiments. So, it’s great to be touching on the people – the crucial people part of digital transformation and gaining more understanding within that. I think Cheryl and Ning are with us now for the Q&A session. Cheryl and Ning, if you just want to come on with your mic and camera, the controls are at the top right, not top left. So, if you can get yourselves, switched on and then we can start the Q&A session. Just quickly while we wait for that to happen while we wait for Cheryl and Ning to come through, if you do have any questions, I’ve seen a few coming through on the – on the chat function in our conference page on Beyond Business buzzwords, if you do have any questions, do pop them in there, we’ve got questions for them. Now I can see Ning’s joined us. Good morning, Ning. Welcome. How are you?

I’m fine, thanks. Morning.

Thank you for your presentation and for sharing those insights. It was great to have you with us, and I think – I’m not sure if you managed to watch any of this morning’s early morning presentations, but they kind of touched upon the people side of transformation alongside it and saying it’s probably the biggest challenge that their organizations face – that shift, that culture transformation shift. So, it’s really interesting to kind of hear yourselves – that kind of expert opinion. And that’s why you’re working with that kind of day in, day out.

Yep, absolutely. I saw a message from Marilyn about how do we actually help leaders manage remotely, especially in the times of pandemic, and we’re helping our clients do that at this very moment. I think there’s a whole lot of – I think there’s a whole – there’s a big shift that we’re helping the leaders, that we’re working with, the C-suite level figure out how they could start injecting trust and autonomy and accountability into the way people are working today. We find that a lot of leaders are feeling very fatigued from having to be available 24/7 for their people, so they’re also wearing themselves thin.

So we do – we have been helping our leadership teams set in certain management structures that promote both synchronous and asynchronous management styles. And what we mean by that is in terms of synchronous is the idea of having structured cadences, of working with people, checking in with people, taking care of people. And rather, it’s rather than just it’s me to you, me telling you what to do. A lot of it is centered around conversations. Always starting off with, “hey, how’s it going? How are you doing? What’s top of mind for you today? Let’s kind of get all these out of the way before we start tackling what is the order of the day?” And then, if there are certain things that have being revealed in the synchronous structured meeting forum, you would take it offline and we say, “hey, if you’ve got time for a cup of coffee over Zoom, maybe we could catch up later for half an hour. Grab your morning coffee, I’ll grab my morning coffee and let’s have a conversation about how things are going.”

We’re also getting leaders to adopt more democratized platforms, such as getting them to leverage Teams, for example, where they’re always able to check with other people how they’re going, getting them to shift away from meeting rooms, to go into more of live chats and just “hello just to see how you are.” Rather than set up a half an hour meeting, we also say, “let’s just talk for five minutes. Let’s just check for five minutes to see how things are” in the sense of more casual, so it’s a bit more personal. And we’re also encouraging leaders to delegate their own responsibilities to other people so that they don’t feel like they have to be on 24/7. I’m sure a lot of us here have heard of this idea of dual leadership where you actually have people in similar roles just kind of taking care of the night and day approach so someone gets to recharge while the other one’s taking care of some other aspect, but they’re all within the same role. So, there are many things that we can do that help leaders deal with remote management and this constant 24/7 demand in this time of pandemic, really.

Nice. That’s a really good answer, thank you Ning and welcome, Cheryl. I can see you’re with us now. How are you? How are you this morning?

Really great.

Thanks for joining us. And I was saying to Ning before, thanks for the presentation. It was a really nice kind of oversight into into your world. And I was also mentioning that we’ve had Daggerwing involved in our UK event and our North American event. It’s been great to have you involved and to kind of understand your perspectives on probably what is the most crucial part of any kind of digital or straight up kind of business transformation. So, it’s beenreally nice to hear from you.

Ning, on that point as well, and this is for both of you. I mean, your jobs must be ten fold harder at the moment with the huge shift to kind of the remote work place. We’re seeing a rapid rise of digital tools and technologies in the workplace. Even before the pandemic, adoption was a huge amount. How difficult is it going to be kind of moving forward and navigating 2021 when we’re hearing a lot about kind of hybrid patterns of work and everything like this? How much is the ecosystem and landscape going to change as we move forward?

If you’re talking about the hybrid approach where we’re looking at flexible working. When we mean hybrid, we’re talking about people who may opt to go back into the office and then also work from home. Then, there are a lot of – there’s definitely a lot of emphasis that we’re putting in terms of culture, values and behaviors that we are looking at getting our leaders to adopt and promote within the organizations. So, when you think about the hybrid model, a lot of it is if we keep going the way of Team A and Team B, for example, right now, even at this point, there are half of the workforce who aren’t feeling they’re connecting with the other half of the workforce because you’re always switching into this kind of rotation. And even now we’re saying still leverage this idea of virtual, asynchronous and synchronous kind of collaboration to make sure that people who aren’t seeing each other every other day are still syncing up. Always allow for time that’s in a way of online with people who are not with you in the office to be able to make sure that that kind of camaraderie is still promoted.

In terms of this idea of hybrid. Next year, let’s just say that the vaccine kicks in, and we’re still opting for the work life balance, I suppose, then this gives us an opportunity to once again promote that sense of trust and accountability for leaders and managers. We realize a lot of managers want their people to be back in the office after some of them are still waiting for this moment to be over so that they can go back to this 100% normalcy. I think this will be another six months when people are still coming to terms about that this is the next normal, right? We keep talking about that and it’s about putting in the right work and protocols – would love to talk more about that but we don’t really have too much time for that today, but we definitely have a lot of views on that. But Cheryl would you like to add to that?

I think the one thing that that if there’s a, you know, any kind of positive coming out of what we went through this year is we’re seeing a lot of companies that are saying we’re way more adaptable than than we thought we were.

We thought we would never change. We thought we were a monolith and it was, it was like turning the Titanic. We just couldn’t change. And now they’re realizing that they are – that necessity has made them so much more adaptable.

And so, it’s taking companies that are very conservative and hesitant about change to say, let’s go for it. So, I think we’re really optimistic next year that this whole idea about adaptability being how we are and it’s okay to live with this uncertainty. We’re going to get through it – there’s more optimism. I think we’re looking forward to leaders in 2021 really harnessing that digital transformation and pretty much every kind of business transformation.

Sure nice answers. And then with going back to your presentation where you were talking about kind of the leadership needed to be in place. Why are leaders so reluctant and resistant to kind of change in large parts of business? And how difficult can it be to kind of reconfigure them and change their mindset?

Ning, go ahead.

Yeah, sure. I think that’s exactly one of the key points we covered earlier on. It’s that leaders do not drive change. And we recognize that most of the time a lot of them are under pressure to always come across as we know everything.

But, if you think about it, given that they’re at the very front of this journey of ambiguity, who’s actually there to help them navigate through it? So, I think a lot of the reasons why people are afraid to kind of to take the next step is are leaders themselves permitted to fail?

Are they permitted to fail and learn? We keep talking about learning culture and fail and learn. But are we actually allowing the people who are meant to be promoting these values doing it themselves? So, I think a lot of it comes with, for example, recently we just did this whole leadership team building session, one of our clients here in Singapore, and they’re actually the aerospace industry. And we had a very frank conversation with all the leaders about the vulnerability they’re feeling. And we were talking about – as a Cheryl was saying – adaptability, authenticity, resilience and a lot of them felt that they’ve been going through this journey on their own, where they come together to try and solve problems, but they don’t come together to give each other peer support. What comes to vulnerability. So, it’s going and tackling these biases that we’re feeling ourselves and recognizing that leaders are people, too. Which is, I guess, the first step and hence our message about leaders being people too.

Nice.

And Cheryl, did you have anything to add on that?

No, really think that treating leaders like people and really enabling them. We finished the project again last year where we really focused on the top 100 leaders in a company. And they were able to cascade to thousands of employees in 210 countries with digital transformation and get it right.

But making them super confident in what they were saying and what they were doing and how they were going to answer questions was just so critical.

Nice. And quickly. Final question. You mentioned about workforce reactions to the announcements of transformation projects. What are the key things to consider when making an internal announcement for the best impacts?

Okay, so, Cheryl, I’ll take this one as well. So, when we think about taking the – when we’re talking about making a big announcement, we call it – it’s at the front of the curtain, right? So, we’re making this big announcement, we’re launching this big initiative. But what a lot of people don’t realize is that the announcement actually isn’t really the start of the journey because the people that you already have to rally around it would be your people managers, would already be some change champions who are there and they’re rooted within the work force themselves to sense the sentiments around.

There’s also this idea that announcements are just announcements if they’re not meaningful to the people listening to them. So, how do you make sure that your announcement has a clear message of where you need to go? That very clear, compelling vision? What does this actually mean when people are hearing it? So, what do they need to hear when you’re having this announcement? So, getting your support team around that so that when you actually launch that big announcement – that’s already pretty much a two to three months preparation. Once you’ve determined that you’re going to launch this new digital transformation initiative.

When you think about the biases that we talked about today, we know those biases are going to be there. We know you’re going to stare at the Zoom screen and the smiling faces and have those “What about me thought bubbles happening?”

So, that should be the clue on make sure your messaging and all the prep you do with leaders is preempting status quo bias, loss aversion bias, all the different types of biases. You know it’s there. Get ready with the messages. Get the leaders ready to look for it and tackle it and counter it.

Nice. Well, Ning, Cheryl. That’s that’s all we’ve got time for in the Q&A. This topic we could talk all day about, and I really appreciate you being able to join us for the Q&A session and also for the great presentation before that. So, a big thanks to both of you. Ning, I know you had some contact details up on that last presentation slide. So, if people do want to continue the conversation they can follow the link, the QR code given on there

Thank you. Very happy to.