Key takeaways at a glance:
The pandemic taught businesses how critical it is to digitally transform when change strikes. But when that change is economic downturn or uncertainty, securing the resources to transform isn’t easy
In times of economic uncertainty, teams need to be very selective about the capabilities they invest in, to ensure their constrained budgets deliver maximum value
The Digital Fluency Model can help organizations pinpoint the changes they need to make, and the capabilities needed to make that change happen
By helping teams align on specific outcomes and respond quickly and precisely to emerging challenges, the model can help them continuously transform in an era of constant change
The COVID-19 pandemic taught businesses a lot of valuable lessons. But the biggest by far was that when change strikes, organizations need to evolve and adapt to meet new employee and customer needs, fast.
The trouble is, in the years since the pandemic began, the pace of change and volume of economically and operationally disruptive events haven’t just continued — they’ve grown. From global supply chain disruptions to geopolitical instability, every month seems to have brought a new major challenge for organizations to adapt to.
Recently, we’ve entered an era of intense global economic uncertainty. Consumer spending power is down. The cost of living is up. And with the lessons learned from the pandemic fresh in their minds, organizations are looking for ways to adapt and quickly rise to shifting market and consumer demands.
Businesses know they need to transform, but they’re feeling the economic strain too. Resources are limited, and companies simply can’t afford to invest in the wrong capabilities or take big bets on transformations that don’t end up delivering the right kind of value.
They don’t want to stand still. But finding the right path forward with limited resources isn’t always easy.
Finding the right way to change
When it comes to identifying the digital capabilities you need and the right way to transform, organizations should avoid:
Benchmarking themselves against others and constantly trying to keep pace with what their competitors are doing. What’s right for their competitors isn’t necessarily right for them — even when they operate in the exact same market
Focusing their efforts at the bleeding edge of innovation and leaping to adopt high-potential technology, without a very clear view of what that technology should help their business achieve
Casting too broad of a net and trying to transform too much too quickly. If you’re overly ambitious from the beginning, there’s a good chance that you won’t see that broad vision become a reality
Instead, what organizations need to do is focus in on what they really want to achieve — the immediate needs of their organization and customers that have emerged amid today’s economic uncertainty. That’s why Thoughtworks encourages organizations to follow the Digital Fluency Model when planning and scoping transformation.
The Digital Fluency Model
Through transformation, organizations are ultimately working towards becoming a modern digital business. Modern Digital Businesses can survive and thrive amid challenging conditions like the economic uncertainty we’re experiencing today, thanks to their capabilities across five key building blocks:
A frictionless operating model that’s adaptable to any kind of change
Platform strategy that helps ensure technology can easily evolve alongside the organization and its operating model, supporting innovation and helping companies lead change rather than just adapt to it
An iterative approach to product and experience design to continuously improve what the company delivers to its customers and people
Intelligence-driven decision making and an appreciation for the diverse value and use cases that can be powered by the company’s data
Engineering culture and delivery mindset ensuring the rapid delivery of high-quality software that’s well-aligned with user needs
The Digital Fluency Model helps organizations map out their desired level of capability against those building blocks, working down to identify the specific capabilities they should invest in as part of their transformation, and giving them a roadmap to work towards it.
In times of economic uncertainty, it’s a hugely valuable tool for helping organizations avoid overspending and gain confidence that the steps they’re taking are going to deliver the right kinds of value.
But beyond that, the process of asking critical questions and drilling down to the exact capabilities an organization really needs can change the way they think about transformation. It helps teams set better goals that lead to stronger outcomes, and start building a culture of iterative change and evolution.
Getting aligned on high-impact outcomes
If you work in the digital field in any capacity, chances are you’ve seen this statistic thrown around a lot. According to a 2020 study by Boston Consulting Group, 70% of digital transformations fail to deliver on their scoped goals. It’s a powerful headline. But it’s also led a lot of people to draw the wrong conclusions.
When we look at a figure like that, we immediately start to imagine all of the diverse pitfalls and barriers that have prevented those organizations from making their transformation vision a reality. What we don’t do is question the most important part of the statistic — the goals themselves.
So much discourse revolves around the transformation process and breaking down the barriers to effective transformation. But the fact is, if we set more focused and relevant goals that the organization was truly motivated to achieve, we’d all be a lot better at achieving them.
By focusing organizations on the core of what they really need — the customer and employee-centric non-negotiable outcomes of a transformation — the Digital Fluency Model is helping to move the needle on goal setting.
It’s the difference between setting a reasonably abstract goal like ‘increasing customer engagement’ and one that’s highly specific like ‘cutting the time it takes customers to transact through our app in half’. The second is aligned to both specific digital capabilities and a tangible customer outcome, making it both easier and more desirable to achieve.
Reaching a state of continuous transformation
It’s the precision and specificity of the Digital Fluency Model that makes it such a valuable tool for organizations facing economic uncertainty today. By uncovering the specific capabilities teams need to invest in, the model can then help them:
Set highly specific goals that are aligned with customer and employee needs, delivering the things people on both sides really want from the business in times of crisis and change
Shorten transformation cycles by focusing on individual capabilities and narrow value cases
Put their limited resources where they’re likely to deliver the best return and start driving big outcomes from smaller, more iterative transformations
By cutting cycle times, aligning teams around specific value-based outcomes, and supporting iterative evolution, the Digital Fluency Model can help organizations not just manage continuous change — but embrace it.
Whether it’s economic recession, supply chain disruption, or another global pandemic, the mindset that digital fluency enables can help organizations respond precisely to whatever change comes next. And the next big change after that.
When a crisis strikes, they’re able to quickly identify how conditions have shifted, what people need from them as a result, and the capabilities required to deliver that. Together, that makes them exceptionally agile and adaptive — exactly what they’ll need to be to thrive as the next waves of economic and operational disruption emerge.