Lesson 2

Understanding

The Forces of Disruptive Change

Managing Digital Disruption



The forces of disruptive change are redefining conventional assumptions, bringing new problems to solve for Business and industry, Healthcare, Higher Education, Investors, Government Agencies, and Individuals. Creating new disruptive business models, new customer/patient/employee value propositions.

Digital transformation is a categorical imperative for long-term success and survival. The constant stream of new technologies is blurring industry boundaries and redefining markets, overrunning the ability of organizations to keep up. Technology will continue to get smaller, smarter, faster, more networked, and integrated into everything.

As the demographics, customer requirements, tastes, and behaviors continue to change, so must the value propositions organizations offer. Some business models have become victims of digital disruption.

Facing disruptive change and new innovative business models, organizations, and entire industries are at risk of digital disruption.

Digital transformation demands leaderships attention, understanding, and action.

It Cannot Be Delegated; It Must Be Led

It may be an uncomfortable subject for many executives but an unavoidable obligation. With an investment of time and some coaching, the terminology, concepts, and principles are understandable.

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Giving up Control to Get Results

 Disruptive change is forcing organizations to rethink longstanding business concepts. Historically, strategic planning was a senior management function that involved the identification of corporate goals and objectives. The planning process defined the business model and organizational structures, formulated strategies and actions, and was the basis for resource allocation and budgeting.

In the past, the strategic planning assumptions were based on the management’s experience, knowledge, and judgment along with the organization’s strengths, weaknesses, and the competitive position in the marketplace. In today’s environment of disruptive change, an assumption based on multiyear strategic planning is no longer a useful tool to direct and guide the organization’s growth and long-term survival. In fact, strategic planning is dead; organizations cannot plan for an unknowable future.

Framed by a complex mixture of new, innovative technologies, changing demographics, and increasing consumer options, the question is how to design a new business model, one that can adapt to disruptive change. Moreover, one that meets the changing demands of today’s customers and workforces. With a goal of adaptability and guided by the shared strategic vision, the new business model should organize as a team-based business structure designed for speed, agility, and innovation.

The old bureaucratic hierarchically structures that were designed to ensure predictability, conformity, and budget control are being replaced by a horizontal network of business units, functional workgroups, and cross-functional project teams collaborating through culture.

When freed from top-down, command and control decision-making, empowered employee teams can offer new forms of innovative thinking, problem-solving, products, services, and customer engagement strategies.

This hybrid flat and team-based structure can offer many significant advantages: both a horizontal and a vertical organizational structure; both functional and project-based; fewer traditional managers; more project managers; fluid boundaries and collaboration.

Cross-functional planning teams work together to experiment, prototype, and discover new innovative customer solutions.

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