Image source: @VisualChina
Text | Wang Jizhou
01 The CIO is not fighting alone, it needs to line up and close the loop
In today's era, it is no longer necessary to discuss whether to digitally transform, but how to do it. In advance, people must first identify the participants. Isn't that what CIOs or CDOs (chief digital officers) are all about? However, the 99% failure rate of digital transformation tells us with tragic facts that it really can't all rely on the CIO and the team he leads. On the way to the West Heaven to obtain scriptures, it also needs the escort of various immortal CXOs.
In the author's more than ten years of experience in the operation and management, entrepreneurship and digital transformation of leading enterprises, he has been responsible for various departments such as operations, supply chain, BI, finance, financing, strategy, etc., and has directly dealt with various CXOs, and deeply feels that transformation is actually a history of love and killing of various "O".
Next, we will look at what the transformation includes, what the CIO can do, and what needs the cooperation of other departments, and finally interlocking into a complete closed loop, arranging all CXOs on the closed loop, rather than rushing forward and chaotic together without any order, in order to complete the transformation cause. It's not hard to find answers to how to do each point, but why is the patchwork of luxury still losing battles? CXO is common, and the thread that strings CXO these pearls together is not often, this line is a closed loop.
Let's start with a story that seems bizarre and worth pondering. One day, Mr. Chen Shaopeng, a well-known entrepreneur and Lenovo Holdings, invited the author to give a speech on "digital transformation" at the mid-year meeting of the management committee of Lenovo Jiawo Group. I have never thought of myself as specializing in "digital transformation" before, and I have not even managed the R&D department.
It turns out that in the eyes of others, the author was engaged in "digital transformation" before, and on the surface, it did use some digital, data thinking and tools to transform traditional industries, thereby achieving increased profitability, rising valuations, and financing success, but is this just a matter of IT technology?
In fact, in the 4-hour speech, it was about the cooperation of technology, business, organization, culture and other links to achieve the final transformation results, of course, this is also the intention of the invitation, to let the senior management recognize. Version 1.0 of the closed loop of digital transformation was born.
02 From business value backwards application, CEO/CFO go in both directions
What was even more unexpected about that presentation was that for the first hour or so, it was mainly about financial modeling/business planning. This seems to be further away from digitalization, especially the executives and entrepreneurs of the group and subsidiaries, need to use the time of the mid-year conference to learn finance?
But this part has become the strongest response, in fact, at that time, it was about how to start with the end, from the quantitative expression of business strategy, that is, financial model, profit model, step by step to launch real effective business measures, operating models, and finally effective digital hand construction. Through a technology, business, financial/strategic perspective, we try to quantitatively measure the ultimate value of digital construction: the improvement of earnings and market value valuation.
Doing the right thing is more important than doing it right. To achieve digital transformation, we must first understand what the ultimate goal is, which can be divided into three levels.
- At the most superficial level, the internal technology is advanced, and the external is to improve the user experience. However, business decisions have always been a trade-off between input and output, and the "ultimate user experience and technology improvement" regardless of cost are all hooliganism, and a large number of companies that burn money alone have died in recent years.
- There are also people who realize that digitalization needs to meet business needs, but is this the end game? In reality, the improvement of some business indicators does not equal the improvement of profits, or even counterproductive, such as blindly expanding the scale when UE (unit profit model) does not run through, the more you sell, the more you lose, and the faster you die; Some business efficiency improvement is not necessarily the key to profitability, such as a large number of unsellable products in inventory, at this time to optimize the production system, improve operational efficiency, the opposite is different. The "efficiency" perceived by some enterprises is only execution efficiency in a narrow sense, and does not include decision-making efficiency; The cognitive "business metrics" are also narrow.
- It can be seen that not only technology exists from self-hi, but also in business, and effective business models, indicators, and efficiency need to be reversed through the ultimate purpose of profit, and Huawei's IPD "customer business model success" is the highest level of customer success.
CIOs need to participate in the design of the company's business model, digitalization should be integrated into the profit model, business plan, of course, this often has challenges for CIOs with technical backgrounds, on the one hand, they must rely on their own business field to learn, on the other hand, CEOs, CFOs (CFOs) must also understand digitalization, closer to CIOs, rather than only digital investment as a bottomless pit that cannot measure business value "follow the feeling", CIO and CEO/CFO "two-way rush" is king.
03 From application to data, CMO/COO drives the aircraft who will build the aircraft
After completing the first step of backwards business application scenarios and operational measures from profit accounting, is everything fine?
Many companies have seen peers introduce digital business "application-oriented" masters of Internet giants, such as digital marketing led by CMO (chief marketing officer), growth team represented by CGO (chief growth officer), operation or offline team under COO (chief operating officer). So he drew a scoop based on the gourd, but soon found that he had mastered a "dragon slaying technique" in the air, and the luxurious lineup quickly left.
Because these "light pole commanders" in the past capabilities were based on the mature data foundation and supporting teams of Internet manufacturers, perhaps they were excellent "pilots", but not "engineers" who built aircraft, and lacked the guidance of BI "ground handling team". The construction of the data platform is not as simple as "doing one according to the background of Tmall Jingdong" as imagined, otherwise there would not be so many large companies and even Internet giants, although they have their own strong production and research team, but they will still purchase third-party data products and services.
Digital CMO, CGO, COO, and BI team, data platform product development team is mutual achievement, good pilots need advanced aircraft, good aircraft also need excellent pilots to pilot.
04 From data backwards informatization, CTO Dayu water control
After experiencing the second pit, I began to honestly build a data platform, but the third pit followed.
The data governance foundation of traditional industries and pure Internet enterprises is very different, and the informatization foundation itself is relatively weak, and many data are not buried or obtained, or the original data of "water sources" can be obtained from information IT systems such as ERP before further processing can be done with algorithm models, and many sources themselves are dirty and messy. Especially when the information system has problems and paralysis, it will affect its downstream - DT data system. This is not uncommon.
Even the top data service providers, it is difficult to solve the problem of the information system itself, "building aircraft" is also divided into building "fighter" DT system, or manufacturing "tanker" IT system that provides information source fuel for fighters, many traditional enterprises can not distinguish the difference between the two, resulting in tragedy. Further, what type of oil is also added to the "tanker" - different data types, whether it is "diesel" behavioral data, or "gasoline" transaction data ...
Therefore, at the technical level in this closed loop, for the transformation of enterprises especially distinguish between data and informatization two different links, its system, employment are often different, informatization is often the premise of data, water source governance, use good water quality to cook delicious, CTO is the "Dayu" of water control.
05 From the information matching process, COO please be in place
After crossing the third hurdle, the source of informatization is also well managed, can digitalization land?
It is a common occurrence that IT systems do not work. Whether in listed companies or startups, the author has encountered such problems, the reason is neither that the system itself has bugs, nor that the operation training is insufficient, or even that the use of the system has no impact on the business - because manual operation has had serious accidents. Finally, it was found that the headache doctor could not solve the problem at the level of informatization. The "Three Lessons" platform has also adapted this series of experiences into courses so that everyone can avoid detours.
The essence of informatization is often process-oriented online and electronic. Recall that financial software moved bookkeeping statements online, but accounting standards remained the same; OA reimbursement, who should approve or who approves, the process node has not changed; ERP, procurement production is similar. Therefore, first of all, it is necessary to clarify and sort out the process of the business itself, including the unification of standards such as weights and measures.
The process is a business problem, the CIO can not help, especially in the traditional industry is not as "light" as the Internet business, if the superstition "using tools can force the process" to suffer a big loss, or even stop work. The COO is now in place. The system can finally be used, all of which is matched and adjusted to the business process, and then the system is successfully implemented.
How big is the need for process? German company Celonis through data mining, machine learning and other analytical means, the analysis of enterprise software and information system logs, so as to find, detect and improve real business processes, improve business efficiency, valuation has exceeded 13 billion US dollars, it can be seen that process is also an important part of digital transformation, can give birth to hundreds of billions of companies.
06 Process matching organization, CHO is indispensable
After experiencing the fourth difficulty, I invited a COO to solve the business process problem, and successfully obtained the real scripture?
The adjustment of the process actually involves the scope of responsibility corresponding to the organizational position, the organization is the skeleton, and the process is the muscles and blood vessels attached to it. Therefore, when the adjustment is large, the organization must also make corresponding matching, otherwise "no one will pay attention to you if you break your throat".
The optimization of the organization, from the perspective of digital transformation, has a measurement standard, whether it is conducive to the optimization of the process and then makes the process into the system and the system used. If you violate this principle and blindly copy the organizational structure of other companies and Internet giants, it is often counterproductive to draw tiger dogs. For example, blind "decentralization" messes up the process, blind "horse racing" allows different departments to sell the same products in the same channel, and even the after-sales service standards are different, but the user's brand perception is disordered.
Process is most directly affected by organizational structure, especially in the process of digitalization, and CHO is duty-bound.
07 Organize and match culture, starting with the number one
The fifth hurdle has also passed, and many companies quickly found that the imitation of the organizational structure, learning the shape but not the god, quickly changed back to the original after a moment of freshness, and even the new people recruited at high prices quickly became old people, because the cultural soil has not changed.
Taking history as a guide, people's cognition began from only learning the technical level of the unchanged system of artifacts, and it turned out that advanced tools and advanced weapons would still fail miserably; Then there were changes in the operational level and the tactics system, which was short-lived; In turn, the cognition has been upgraded to the organizational level, changing the structure, but it is still not complete; Ultimately, it is the recognition of the cultural dimension that is the fundamental change.
Culture is not just a narrow sense of "the habit of using data and using systems", but also people's cultural demands. In this year's live broadcast "PK" and the founder of Shence Data, the 2.0 version of the closed loop of digital transformation was released, and a lot of space was devoted to the layered penetration of cultural → organizations → business → technical levels, such as why the OKR system cannot fall to the ground, which is obviously not explained by lack of usage habits, but from the inner appeal of establishing hierarchical order by relying on opaque information monopoly and highlighting authority by mystery. There is no doubt that culture is a first-hand project, permeating from top to bottom, but ultimately involving all employees.
08 Digital Transformation Tai Chi Closed Loop and CXO Guide
So through the above six links, as shown in the figure below, the plan was introduced step by step. From profit accounting backwards to applied business scenarios, from applications to supporting its model of data grabbers, from data backwards to the required information foundation and source, and then matching and information adaptation of process combing, and then matching process and organizational adjustment, and finally organizational change also needs cultural soil improvement, as shown in the figure below.
The implementation is positive, what kind of philosophy and culture determines what kind of people to attract, what kind of organization, the organization determines what business can be done, adjust the process in place, the process can enter the system to let the information land, the source of information to ensure the operation of the data platform, and then data and digital tools can support new business scenarios and operational measures, and finally effective business applications to achieve the purpose of profit and market value space improvement.
Just like the Taiji Cloud Hand, one hand counterclockwise and the other hand clockwise, can eventually meet. Transformation is business change, and the origin of business management, whether it is "grasping philosophy with one hand and grasping the abacus with the other" mentioned by Mr. Kazuo Inamori, Konosuke Matsushita's "one-hand Analects, and first-hand abacus", or the "concept + accounting" advocated by many entrepreneurs, are all similar views: one end is utilitarian, rationally calculated profit accounting, and the other end is non-completely utilitarian, emotional philosophical culture. Enterprises have their own mission and vision values, not only for profit gangs, the animal nature of the "self" and the divinity of the "superego" constitute the human nature of the "self".
The double origin constitutes the so-called enterprise strategy, layer by layer penetrates into the closed-loop every node, each CXO territory, positive and negative continuous reciprocity, mutual transformation, business operation and even the pursuit of life is such a process, if only pursue one end we find that sometimes we will fall into an unsolvable situation, this is the core of version 3.0 digital transformation closed loop (commonly known as Tai Chi closed loop).
Along the old map, the New World is not found. I hope that this closed-loop and CXO guide can allow everyone to see the "formation map" of digital transformation more clearly, master the methods of working together to turn the digital transformation of enterprises around, and hope that more people will join the cause of improving this closed loop.