The story is often the same. Companies start with an innovative first product.
As they grow into successful stable businesses, they lose the ability to innovate. But there are some companies that keep innovating, and thereby sustain their success. What is the difference? Companies with an open culture continue to reinvent themselves and their successes. These organizations are open to new ideas, favor transparency and support taking good risks. All three are success factors in any digital transformation.
Open Culture and Digital Transformation
Most of us know how important a good business culture is for succeeding in challenging business situations. The research backs this up as well, citing “cultural issues” and “changing the culture and ways of working” as some of the biggest challenges companies face in transformations. Ironically, when implementing digital strategies, the culture of a company often recedes into the background. Too often the focus is placed on tools, timelines and technology. But to achieve the challenging goals of digital transformation, culture needs to be in the foreground. Digital transformation requires establishing a new Growth Mindset that is open to change and embodies the values and vision of the company.
What we can learn from Startups about Open Culture
For examples of Open Culture we can look to startups. Startup employees are known for being extremely motivated. They identify deeply with the culture and values of their company because they know the purpose and vision they are building toward. Thanks to an open culture, they feel engaged and as valuable contributors to the company’s progress. To create an open culture that enables continuous change, leaders in companies have to trust their employees, allow them to take on responsibility, and enable them to use their strengths.
Build trust by communicating often and openly
Our experience has shown that continuous communication on all levels is crucial for employee satisfaction and motivation. It builds trust, which is necessary for taking steps toward change. Transparent communication, open dialogue and respect for all contributors builds trust. Open dialogue has a positive effect on all areas of a company, particularly when it leads to a transfer of knowledge across all departments. This knowledge transfer promotes holistic, cross-functional thinking and creativity, but also gives every employee the feeling of being heard and respected, in short, of being an important piece of the puzzle.
Executives model how to decide, instead of how to control
An open culture is a prerequisite for fast, agile and customer-oriented action. This is best achieved by supporting independent thinking and co-operation throughout all departments, and also by involving employees in the change and letting them contribute to the change process. Digital transformation disrupts traditional silo culture. The executive team must be the role models for open culture. They set the example by living the desired culture, communicating the vision, and accelerating progress by trusting their employees to make decisions on their own.
Netflix and fast decision-making
One well-known company that embraces an open culture is Netflix. There they call it leading with “context, not controls.” Erin Meyer, Senior Affiliate Professor of Organisational Behaviour at INSEAD, co-authored a book describing their culture. She explains the ogranization is designed as an inverted pyramid of more traditional hierarchical decision making. In the traditional organization big decisions happen at the top, where often the context and understanding of consequences is missing. But at Netflix the important decisions are made by lower-level managers who have the knowledge and context to make those choices.
“Think of a tree. [The CEO is] at the root, and he’s talking about the goals and future direction of the organisation, where future income will be coming from. And then at the next level, the next VP is setting more context for his organisation. The director, more context for her employees. Up until you get to the lower-level managers, who are really the big decision makers in the organisation.”
Meyer explains why this is faster and more agile: “with a tree, with many, many branches, you can make lots of decisions all at once. And there is a much faster growth that comes with that.”
Celebrate positive outcomes
Based on our experience, we know that communicating the positive outcomes builds culture and courage to change. This includes small wins, like the implementation of a work process, and big ones too, like achieving a major milestone in the transformation plan. The company culture evolves automatically with every small step and success, which convinces even the biggest skeptics.
A company that promotes a culture of cross-functional teams, flat hierarchies, transparency and diversity creates precisely this sense of unity that characterizes the startup scene. In this way, the entire corporate culture can be gradually transformed into an open, dialogue-ready communication culture.
For more on Open Culture and Digital Transformation send me a DM or download the Digital Fitness White Paper here.
Early in my career at BCG, I attended a global conference for #ChangeManagement. One of the senior executives attending shared with me this #NuggetOfWisdom:
To implement change programs, start by identifying the people and processes that drive communication within the organization.
In my experience with digital transformation, this is still true. But I have found there are also 7 “Musts” for when, why and what to communicate when implementing change initiatives over time.
Nr. 1: Communicate. Implement. Repeat. ✅
To drive consistent change required for digital transformation, communication must become part of an ongoing cycle: Communicate. Implement. Repeat. In the enable2grow Digital Transformation wheel, we represent this cycle as the container holding all of the other areas of digital transformation. Maintaining momentum in this cycle is vital to success in digital transformation projects. Why? Because consistent communication and implementation – even of small steps – keeps your organization engaged, informed and motivated.
Because consistent communication and implementation – even of small steps – keeps your organization engaged, informed and motivated.
Nr. 2: Communicate early ✅
While communication seems simple in comparison to the complex technology changes that are being implemented, “consistent communication & implementation” is not to be underestimated. If you don’t communicate – if you don’t start a small implementation of something – you will never get to the point of quick wins, let alone to long term wins. And that leads to frustration which undermines the motivation and participation of your whole organization. INSEAD’s Harry Robinson cites failure to communicate adequately as one of the leading causes of digital transformation failures, explaining that “People throughout the organization don’t buy in, and they don’t want to invest extra energy to make change happen.”
Nr. 3: Communicate clear goals & milestones ✅
To succeed, communicate every step of the way. Define your goal, set milestones and implement step by step consistently. Communicate those clearly defined goals and milestones, and your progress to help all in your organization maintain an overview. I liken the process to training for a race. Only, digital transformation isn’t a sprint, it’s a marathon. And hopefully, like with a marathon, after your first successful one, you’ll want to sign up for the next one, improving your process and results with each next challenge.
Nr. 4: Communicate changes (and what caused them) ✅
A transformation process is not based on a set master plan. Rather, every company must find its own individual transformation path. While the implementation will be consistent, there will be changes along the way, in iterative cycles which also need to be communicated. The changes may be due to external factors, or may be a result of new learnings. This is similar to when Google maps changes your planned route due to an unexpected traffic delay. Your destination or goal remains, but the required change – and the reason for that change – needs to be communicated to keep all up to date on shifts in the path.
Nr. 5: Communicate progress & failures ✅
Implementation is accelerated with consistent communication of progress – and failed attempts, too. Good leadership requires open and honest two-way communication across all departments. When employees and management are in a continuous, open dialogue, decision paths can be shortened and silo thinking can be broken up. The establishment of a #BuildTestLearn methodology ensures that new ideas are tested with real users at an early stage and constantly optimized, to result in a sustainable product. Testing requires some results to be failures, and the sooner these are communicated, the sooner all can move forward toward new tests until workable solutions are found.
Nr. 6: Communicate consistently ✅
The digital transformation of a business will never be complete, because successful companies are in a constant evolution. Achieving each new milestone requires ongoing learning and persistence, as the digital environment is more complex and dynamic than ever. Digital transformation succeeds when everyone works together consistently on implementation and communication.
Be extremely transparent, starting
from the first day.
Nr. 7: Communicate transparently ✅
As the path toward your digital vison develops, it important to continue to communicate the big picture and your purpose, while also paying attention to the small components. You may feel you’re repeating yourself. But you can never overcommunicate. From all my experience supporting clients in their transformation journeys, I’ve learned this: Be extremely transparent, starting from the first day. It takes courage to make mistakes and learn from them, and even more courage to communicate them openly so all can learn together, faster. A healthy open culture with leaders who support risk-taking and communicate with extreme transparency are essential for a successful transformation.
In the spirit of fostering an open culture where learning is prioritized, I’d love to learn what’s on your checklist for communication. Send me a message or comment here below!
To learn more about how we at @enable2grow support digital transformation download our white paper here: