Haydn Shaughnessy: Digital Transformation needs a thinking in terms of a destination than just the journey!

HaydnShaughnessyAs published before this year’s Enterprise Digital SUMMIT puts the idea of the platform as future blueprint for the business, operational and technological model of the digital way of organizing the enterprise at the center of the keynote discussions. For this we have invited Haydn Shaughnessy as opening keynote speaker to the future day of the conference in Paris on June 1.

He is the author of two books on the changing economic landscape, Shift and The Elastic Enterprise – and with another one just in the publishing process. With the background as an economic historian and a sociologist he has a good understanding of how change unfolds and is continously studying the changes taking place at different levels of the economy and analyzing patterns of disruption.

In the preparation for the conference we have asked him some questions regarding his talk and his views on the platform ideas as new business as well as operating model for the enterprise.

(1) Haydn – you will be talking at Enterprise Digital SUMMIT / Paris about the key challenges of the platform economy and how this is affecting the organisation of the digital age. What are the three tags that we can flag your talk with?

I think first of all that attendees and anyone concerned with digital has to think more in terms of a destination than just the journey. It is not enough to work at being more digital or more agile or more E2.0. The enterprise needs to work out its destination.

I obviously believe this should be a platform. By the way my new book Platform Disruption Wave is out 25th May – just in time for the conference!

The final point I think worth making is that most people do not understand disruption – we have a very outdated notion of it and need to start thinking again about the broader context of change that companies operate within. I will offer a brief overview of a new theory of disruption.

(2) Why do we need to consider the platform idea as business & organizational model for the digital age?

Platforms are a new organizational form. In the 1920s you might be running a factory but you would have been smarter to switch to an assembly line. In the 1980s if you were in manufacture you’d have been smarter running a global supply chain. Its the same logic, Platforms are a better organizational form, particularly for a low growth economy.

(3) What are the characteristics of the platform model that are impacting the business & organizational strategies?

This is an interesting one, There are two related elements. The first is we can now manage at infinite scale and platforms are the right setting for that providing they are nimble in IT. But the connected idea is that they also allow the firm to leverage third party assets. There are many reasons why that is the right dynamic, not leas that it is difficult today to identify assets that you can take into the company and exploit successfully.

(4) So the future of the organisation is a platform with co-workers and partners being organized in an service-orientated ecosystem?

You’ve certainly hit the nail on the head with the service ecosystem. 4 years ago I analyzed the Harvard Business Review archives and discovered that over the past 20 years the number one hot topic was the failure to grow a service culture. Platforms have resolved that deficit.

(5) What are the consequences for the transactional processes as the backbone of the corporate structure?

I think it means ultimately that successful companies will integrate many services including finance. They will be bank-like and they will run logistics and any other service to satisfy a customer’s needs. THis is going to have a drastic impact on price. I might price y financial services at zero in order to get your transaction business or logistics business, for example. That is where European companies will feel most pain. Obviously some people think the backbone ledger will be the blockchain. In some cases that might happen. But I place more emphasis in being customer centric enough to serve as wide a range of their needs as is economic to do.

(6) In your book “The Elastic Enterprise” you point that the platform organisation needs a new kind of leadership that sustains the business ecosystem? What do you mean by this – is the function of leadership the organizational glue of the platform organization?

I said leaders need to be more peer like, have strong attraction skills and know how to orchestrate ecosystem activity through influence. Ecosystems cannot be managed in traditional ways. Or to be more accurate if you are giving people a shot at being taxi drivers you can treat then badly and get away with it but if you are dealing with people who have a complex skill set you have to win the right to lead them through the skills I mentioned above.The same skills need to be applied also to major partners that you rely on for services.

(7) How do we need to organize the transition from the old model to the new model? Is there an evolutionary path to go – or is there only the disruptive way?

This problem besets every instance of change. I don’t think it is any different with platforms. However I have noticed that there are instructive differences. In US platforms the developer culture dominates. In China platforms the business innovator dominates. The China system seems to me more powerful but we will have to wait and see. Nonetheless the important transition catalyst is having IT and business speaking the same language and interacting as true partners. Time and again the IT/business dialogue sabotages change. There are other important factors and of those I write about the two that I think are pivotal are knowing what to externalize so that executive bandwidth is freed up for strategy, and being really smart about releasing executives from the core competency mindset and experimenting with some solid adjacencies – businesses you are not really in. These two can help create a more entrepreneurial cadre in a company.

(8) What is the future for the enterprise beyond incorporating the platform model?

The wave of change that is hitting us is infinite scale. If you cannot scale rapidly, if you cannot function in the hundreds of millions of customers then you will not compete with Chinese companies and you cannot innovate at their pace. Europeans need to be very smart about how to combat scale advantages and I believe the way is to innovate around customers. I don’t mean lean. I mean build systems that support the buy side not the sell side of commerce.

(9) What are your expectations for the Enterprise Digital SUMMIT?

I am hoping for a dialogue with people on the front line of change. I want to test some ideas out on them and I hope they will test me