- Madeline Weiss, Director
ADVANCED PRACTICES COUNCIL (APC) INSIGHTS - OCTOBER 2022 MEETING HIGHLIGHTS
Advanced Practices Council (APC) members – senior technology and data executives across industries – met in Cambridge, MA in June 2022 to continue learning from exemplary researchers and practitioners (including themselves) on topics they voted as high priority for their future success.
UNLOCKING NEW DIGITAL VALUE SPACES
Most CxOs recognize their increasingly critical role in digitally transforming their companies. Dr. Didier Bonnet of IMD provided APC members with a useful approach for unlocking opportunities in terms of three levers.
The first lever is to digitally transform the company’s products and services to increase their value to customers. Companies can make offerings more intelligent, use digital data to enhance and personalize the offerings, and complement the offerings with additional products and services. Progressive Insurance uses sensors in insurers’ vehicles to capture driving data and then calculate discounted rates for safe drivers. Stitch Fix uses personal data and analytics to send the most desirable clothing and accessories to customers. Tesla enhances its vehicles by providing a complementary network of super chargers.
The second lever is to digitally transform customer engagement. Companies can create seamless touchpoints with customers, facilitate doing business with the company, and create ways for customers to participate actively in the value delivery process itself. Sephora allows customers to experiment with products digitally (increasing up-selling and cross-selling opportunities). Amazon Go eliminates checkout lines. Giffgaff expects customers of its low-cost mobile network to answer each other’s questions.
The third lever is to transform the company’s reach by expanding access or by market orchestration. Companies can access wider markets, engage ecosystem partners to help deliver digital solutions, and connect value producers and value users at scale. Alibaba created Luxury Pavilion to sell luxury items to Chinese customers who would not buy directly from Alibaba. VitalityHealth delivers health-enhancing digital solutions to UK customers of its private medical insurance through ecosystem partners. Etsy connects independent craft sellers and buyers looking for unique goods.
THE FUTURE OF WORK: MANAGING CHANGE IN AN AGILE WORLD
Dr. Kristian Hammond of Northwestern University reminded APC members of the need for agility – in thoughts, structures, processes, systems – to address the changes happening in so many dimensions of work and lives. He emphasized the growing capabilities of artificial intelligence (AI) that are contributing to these changes.
AI-powered robots will replace most blue-collar work and, ultimately, routine white-collar functions. AI will improve decision-making and redefine healthcare, transportation, and education. CxOs will have to identify and build systems that are integrated into business goals, workflows, and existing infrastructure while attending to the source and quality of the data in this ever-changing world.
Kris described the lean canvas and press release, two notable approaches to meeting the challenge in a disciplined way. The lean canvas helps companies focus on the problem or opportunity they seek to address rather than technology. It consists of problem, existing alternatives, solution, key metrics, unique value proposition, high-level concept, unfair advantage, channels, customer segments, early adopters, cost structures, and revenue streams.
Amazon requires a press release to describe anticipated digital work as though it were a completed project, articulating what the product or service is, who will use it, and why they will love it. It consists of heading, sub-heading, summary, problem, solution, quote from initiator, plans for getting started, customer quote, and closing call to action.
MANAGING THE DYNAMICS OF POWER IN ROLES AND TEAMS
Power, which is control over valued outcomes or resources, is a necessary capability for CxOs, especially in a world of digital transformation, according to Dr. Jennifer Jordan of IMD. Power comes from many sources. Legitimacy is one category of power sources. It requires a strong track record, deep commitment, positive character, and cultural fit. CxOs can gain legitimacy by meeting or exceeding expectations; understanding the boss’ priorities and delivering on them; and self-promotion to ensure that the boss notices the efforts.
Control of critical resources is another category of power sources. It involves controlling those resources that are highly prized by those the CxO wants to influence while reducing dependence on others for such resources. One way to do so is to identify and addressing problems that nobody else has noticed or opportunities that have escaped others’ imaginations.
Networks serve as a third category of power sources. CxOs can increase their networks by becoming play makers – linking people with other networks.
Jennifer pointed out that leaders who wield their power effectively are benevolent (prioritize the benefits to the group over the benefits to themselves) and exhibit self-control.
DEMOCRATIZATION OF TECHNOLOGY
All major software-as-a-service vendors currently provide capabilities that include low-code development technologies. According to Gartner research, half of all low-code clients will come from business buyers that are outside the IT organization by year-end 2025. APC members explored implications of this inevitable trend. Citizen developers can solve problems quickly and take ownership, although solutions may be risky, not well-aligned with longer-term visions, and fragile. Since citizen developers tend to be close to customers, they can envision creative solutions. Moreover, citizen developers might demonstrate that they are good candidates for recruitment into the IT organization.
APC members have taken many steps to create a relatively safe and secure environment for citizen developers. Those actions include creating appropriate platforms for citizen developer experimentation; governance structures and policies such as approval processes, checklists, guardrails, and coordinated communities of practice; and certification processes.