Changes in culture and technology tend to break things in organizations that were previously working just fine. In our research and client work so far, we’ve seen a few different types of breakdowns related to the increasing pervasiveness of digital technologies. All of them have to do with mis-alignment between three key things, pictured in the diagram below, and all of them can be helped by increasing an organization’s digital fluency:
Before we go further, a note to those of you who are astutely thinking to yourself: “Isn’t the overall desired outcome for an organization the same today as it was before the rise of digital technologies?” From my perspective, the answer is both yes and no. First the “yes” part: Organizations have always worked toward the outcome of maintaining a healthy, profitable relationship with their customers, suppliers, partners and the public, so nothing has really changed there.
And now for the “no” part. When the nature of what these parties know and how they interact with each other changes, so does the nature of the relationship that makes up that desired outcome. As a simple example, the customer of the 1960’s was limited in his knowledge of products to the information that he could gain from television, radio, print and phone calls with friends. The customer of today can type the name of a product into google from her phone and be bombarded with thousands of product reviews, recommendations, company sustainability ratings, competitive prices, etc. This changes the nature of a company’s relationship to its customer, and therefore the outcomes is may need to hope for. Read on for more on what i mean.
Let’s start with an obvious example of good alignment. If our desired outcome is to sell more widgets to people who can only learn about products primarily through mass media like tv, radio and print, then our organization will need to align itself like this, and all will probably be well in our organization:
In fact, this sort of alignment has worked well for decades. But now, increases in the use of digital media to recommend, rate, review, collectively bargain for any widget has changed some things, forcing organizations to re-think these three parts of what they do. The first thing many organizations try to do, though, is to apply new technologies to old strategies, old goals and old outcomes, as is pictured in the diagram below (i’ve bolded the part that has changed):
In this example, a change has caused a misalignment between the goal of controlling a brand message which requires a finite number of communications channels, and the use of social media, which tends to create an unknowable number of channels through which people communicate a brand message, each one tweaking it a bit, changing it bit by bit. This sort of misalignment often happens when someone in the marketing department has become fluent enough in social media to see its value for reaching customers, but the people who set strategic goals and the overall outcomes for the organization are still not fluent enough to feel comfortable with changing these goals and outcomes.
A second misalignment often occurs when the people involved in setting the strategic goals for the organization are digitally-fluent enough to realize that goals need to change, but people at the highest level of the organization not, so the strategic goals move out of alignment with the desired outcomes (and often the associated measures of return on investment):
Still another sort of misalignment can occur when the people responsible for determining the overall outcomes for the organization (typically this are the people in C-level roles) are digitally-fluent enough to see the need to change those outcomes, but the rest of the organization is not:
So what is the solution?
First of all, it’s important to note here that the solution is not the same for every organization or situation. For some organizations, the customer base may still primarily consist of people who use mass media as a way of learning about their products or services (though the number of cases of this are dwindling). In that case, the second diagram from the top on this page may depict a well-aligned configuration for such an organization.
So the solution is simple to say, but difficult to achieve:
Alignment through digital fluency
In other words, in order for an organization to be aligned, there needs to be a sufficient level of digital fluency in work roles, where people are able to think about how to use digital media to achieve strategic goals. There also needs to be a level of fluency in management and leadership roles, including CEO’s, CFO’s, etc., so that strategic goals and desired outcomes of the organization are determined with a full, accurate knowledge of what is and what is not possible for that particular organization in the digital age.
..and one final note: I have used a marketing example above, but digital fluency is also necessary for alignment in other situations as well: