Why organizations don’t need a digital strategy

Many organizations unduly focus on crafting a digital strategy as a business imperative. However, (Nieto-Rodriguez & Speculand, 2021) state ‘You don’t need a digital strategy. You need a strategy for a growing digital economy.’ It’s critical to recognise the difference. Strategy is the deliberate ‘choice to perform activities differently, or to perform different activities, better than market competitors’ in the delivery of your organization’s value proposition (Porter, 1996). If there is one point to understand, strategy is simply about ‘choice’.

Unfortunately, organizations repeatedly make mistakes about choice by planning to adapt to the digital infrastructure as it exists today. They don’t consider that by the time they complete the digital transformation to today’s environment, the technological environment to which they have adapted will be entirely different. Therefore, digitally savvy leaders recognize technology as a moving target and begin to adapt their organization and business model to the infrastructure of the future. Any quarterback, football player, or hockey player can tell you that you need to lead a moving target if you are going to hit it - aiming where it is going to be rather than where it is (Kane et al., 2020).

McGrath (2019) advises that shifts in the business landscape - known as inflection points - can either create new, entrepreneurial opportunities (e.g. Amazon and Netflix) or they can lead to devastating consequences (e.g. Blockbuster and Toys R Us). An inflection point, as defined by former Intel CEO Andy Grove, is the ‘point of time when business fundamentals are about to change’ (Nieto-Rodriguez & Speculand, 2021).

Only those leaders who can ‘see around corners’ or, more specifically, spot the disruptive inflection points developing before they hit are poised to succeed (McGrath, 2019). The change can be an opportunity to rise to new heights or the beginning of the end. For example, aerospace leader Airbus testing hydrogen combustion technology to deliver a world-first zero-emission commercial aircraft by 2035. For Airbus the change represents an opportunity to ‘lead a moving target’ while for its competitors, the inflection point could represent the beginning of the end with reduced market share.

Digital disruption to our economy and society continues to be driven by new technology at an unprecedented rate. To survive, organizations need to build a future where they invest in the skills and ingenuity of their people. That is a future where people are empowered to optimally harness new technology to build platforms that serve or enable new innovative products and services (Deloitte, 2017). Platforms are an architectural foundation for organizations to offer complementary goods and services of technology to customers.

Amazon is a prime example of the new breed of ambidextrous organizations that are in constant search for the most innovative business ideas, where it strives to deliver on customers’ needs even before people realize that they require them, e.g. free delivery. Simply, organizational ambidexterity is an organization’s ability to manage its business today while developing innovative strategies for coping with tomorrow’s changing demands (Lerner & Zieris 2019).

Today, a strategy has to encompass carefully coordinated choices about the business model with the highest potential to create value, the competitive position that captures as much of the value as possible, and the implementation processes that adapt constantly to the changing technology while building the capabilities needed to realize value over the long term’ (Collis, 2021). This is why (Blain, 2021) says “The fast pace of how we live and work today is driving incremental and radical change in business and is becoming the new normal”.

Some organizations are coping with this fast-paced change, but many are being left behind. The rate of change is catching organizations unaware, across the world. Transforming organizations to prepare for a digital future is no longer a question of when and whether it’s a good idea; it has become an urgent question of how to transform (Blain, 2021).

Canadian President, Justin Trudeau once said “the pace of change has never been this fast, yet it will never be this slow again”. There is a wonderful thing about technology, particularly in a digital environment. It changes everything!