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By Fast Company Executive Board
Digital disruption — that is, the rapid change that occurs as a result of technological advancements — is the most powerful force shaping our world today. It is transforming business and industry. It causes ethical quandaries and necessitates difficult decisions.
But it is inevitable and irrevocable.
Innovative leaders have no choice but to ride the bull of digital disruption and see where it takes them. It is a wild ride, and even the most forward-thinking CEOs and visionaries may have doubts about how to navigate the fast-paced and constantly evolving digital landscape.
Here are several strategies that may help.
Embrace Emerging Technologies
First, the innovative leadership style demands embracing, not resisting, change.
It’s easy to get locked into an idea, policy, or procedure that has worked in the past and never consider other options. “If it ain’t broke, don’t fix it.” But as technology proliferates at a breakneck pace, it’s vital to continuously verify that good solutions are still the best solutions.
For example:
- Jeff Bezos, founder and former CEO of Amazon, disrupted retail with the e-commerce platform that took the world by storm.
- Arianna Huffington, co-founder of Huffington Post, disrupted traditional news media with her online platform.
- Jeff Immelt, CEO of GE, developed an advanced analytics platform that leverages machine learning and AI to optimize operations and reduce downtime.
How best to explore new options and opportunities? CEOs and executives should stay informed about new developments in their own and other fields as much as possible. But no one person can do it all. Consider appointing a team or committee of technophiles to keep an eye on new developments and present [findings/options] every few months. Staying up-to-date on the latest technological developments and being willing to invest in new tools and platforms is how forward-thinking leaders stay ahead of the curve and create opportunities.
Develop a Culture of Innovation
A culture of innovation fosters creativity, experimentation, and risk-taking. It encourages employees to think outside the box, leading to breakthroughs that create significant competitive advantages. In an innovation culture, both leaders and employees espouse a growth mindset. They embrace failure as an opportunity for growth and improvement, using failures as a stepping stone to better solutions. Teams employ experimentation, testing, and prototyping, leading to faster iteration and rapid development.
For example, Google once implemented the “20% Project,” allowing employees to spend 20% of their time working on projects that interested them and might benefit the company. This project led to the development of several successful products, including Gmail and Google News.
Use Data To Inform Decisions
To help determine which new tech is essential for forward momentum and which isn’t, industry disruptors should lean on data and testing. Data-driven decision-making leverages data analytics to gain insights into customer behavior, market trends, and other key metrics. Better data means better decisions.
For example, Netflix leverages data analytics to inform content decisions. The company’s sophisticated algorithm analyzes viewer data and recommends personalized content based on user preferences. Netflix’s ability to serve up personalized content is one of its key value statements.
Shift Your Business Model
Some tech advancements are so big, they suggest (or even necessitate) a complete change to business models. Big risk, but also a potentially big payoff.
Take the shift from traditional software, sold on discs in boxes in retail stores, to software-as-a-service. In 2012, Adobe replaced priority licenses with Creative Cloud, a SaaS version of its software. In 2015, Microsoft followed suit; now if you want Word or Excel, you need Office 365, Microsoft’s SaaS subscription. Approximately 70% of software today is sold on the SaaS model, with the percentage forecasted to reach 85% within a couple of years.
When a major industry fluctuation like this comes about, you don’t want to miss the opportunity and get left behind. It’s even more exciting if you are the visionary who gets the idea rolling.
Build Partnerships
All this change can be expensive. Cash, manpower, technology, and time are required for every advancement or innovation.
One way to overcome the resource problem is to join forces with other organizations. Relationships among businesses and stakeholders allow them to leverage one another’s expertise and resources.
For example, IBM partnered with Apple to develop enterprise-level mobile apps, and with Salesforce to integrate their cloud-based platforms. These partnerships have helped IBM expand its reach and capabilities and stay competitive in a crowded marketplace.
Recognize the Infinite Nature of Digital Disruption
Digital disruption is not a one-time thing. You can’t make a change and be done with it. Technology is constantly evolving, and the speed of evolution is increasing, so businesses and leaders must continually adapt. Implement a new thing. Observe market and technological changes. Rinse. Repeat.
For example, Reed Hastings, co-founder and CEO of Netflix, disrupted the entertainment industry, first by turning the video store model on its ear with DVDs delivered to homes, and then with a subscription-based streaming service. The first iteration, DVDs by mail, was a disruptive innovation in itself. But Netflix didn’t stop there. When technological advancements allowed, the company embraced the new potential and transformed into a streaming service, making it the media giant it is today.
You’ll never be done adapting, and that’s ok. That’s the plan.
Manage Digital Disruption in Your Business
Innovative leaders who are able to navigate digital disruption are critical in today's tech-drenched business environment.
By embracing emerging technologies, developing a culture of innovation, using data to inform decisions, shifting business models when necessary, building partnerships, and accepting the infinite nature of adapting to change, businesses can stay ahead of the curve as the digital world evolves.
If you’re an innovator working on the cusp of digital disruption and have expertise to share with fellow leaders or the business world at large, you might belong in Fast Company Executive Board, a community of visionary leaders defining the future of business. See if you qualify.
