Strategy and Lean Leadership in Digital Disruption

Business has always moved fast, but the pace of things has exponentially increased due to digital disruption.

It’s important in this age to not make rigid plans via a cumbersome and linear process. Instead, companies must adapt a process that allows them to continually plan and improve in a fluid and dynamic manner.  A more dynamic planning process allows you to more rapidly adapt to market changes and deliver on your customers’ demands.

Small-scale experimentation can be incredibly valuable to quickly gain feedback and determine direction. The key challenge is to ensure that these experiments are implemented quickly and fluidly.

Historically, disruption has been the realm of small startups, not large corporations. However, organizations of all sizes can benefit from adapting the agile principles of the lean startup.

Experimentation with the Lean Startup

Startups, by their very nature, have to move faster than their competitors. The ability to do so is their main advantage over large incumbents. If a startup cannot move faster than its competitors, it will be quashed, either by larger, more established competition, or by its own investors, who demand to see large returns on their investment over a relatively short period of time.  

The lean startup methodology emphasizes that speed, eliminating wasteful practices in order to spur more potentially disruptive innovations. “Done is better than perfect” has almost become a cliché in startup crowded environment of Silicon Valley, but it rings true. By emphasizing reaching a minimum viable product instead of a perfect one, companies can quickly discover what the market wants, and reiterate their product quickly to meet those demands.

It is a constant process of fluid and flexible planning, experimentation,  environmental analysis, and revision.

It’s not feasible for large, established companies to reinvent themselves completely as lean startups, but they can enable certain teams to operate on a leaner, more rapid basis, outside of the normal corporate bureaucracy. The challenge is in convincing key stakeholders of the benefits of implementing such a system, and getting them to stick with it through inevitable roadblocks and failures. Resistance stems from risk aversion, whether that be a risk to the existing business model, losing existing advantages, or simply wasting resources. The right leaders will enable teams to operate within a “lean startup” framework, despite the risks.

Many large companies are finding success by enabling lean startup teams to experiment. Proctor and Gamble cut their product development time from 3 years down to 1 by enabling the team responsible with lean startup methodology. General Electric managed to develop new gas turbines 40% more cheaply than the usual cost, through implementing lean startup methods in their FastWorks program. If those giant companies can find ways to cut through the red tape and develop lean teams, any organization can.

Leadership Through the Age of Disruption

With the constant turbulence of today’s business world, new kinds of leaders are needed. According to Deloitte Insights, there are five characteristics that make for a successful leader in the disruptive age.

Ambidexterity

There is always a tension between dedicating resources to present day operations, and investing for the future. Leaders must be able to do both at once successfully. Too much focus on the present, and you won’t innovate for the future. Too much focus on the future, and you won’t generate the short term success investors and other stakeholders demand.

Emotional Fortitude

Successful disruptive leaders embrace risk, in both deeds and action. They encourage employees to take well-considered risks, and applaud them whether the succeed or fail. If employee’s think that their leaders only “talk the talk,” lip service to risk taking won’t result in action. Embrace potential failure for the learnings that it may bring with it. An emotionally stable leader with comfort for risk can help an organization weather the disruptive storm.

Beginner’s Mindset

The first team any individual or organization tries to do something, the possibilities are endless. By the time that “expertise” is achieved, both people and organizations can get locked into “the way it’s supposed to be done.” By cultivating and keeping a beginner’s mindset, leaders keep themselves curious and more open to new ideas and possibilities, therefore better able to respond to the challenge of disruption.

Disruptive Jiu-jitsu

The martial art of jiu-jitsu focuses on using an opponent’s strength against them. Leaders can do the same in the face of disruption. Leaders who can recognize disruptive threats, dissect them, and leverage the parts that fit into their own business will not only survive disruption, but will thrive even further because of it.

Customer Ethnography

To stay ahead of disruption, leaders need to be keyed in to their end-user customer’s needs. Customers today are more empowered than ever through digital technology. By being an avid ethnographer of their own customer base, leaders can help their organization to constantly innovate to meet their customer’s needs.

Disruption, rightfully so, makes many businesses nervous. But armed with the right information, strategy, and leadership, organizations can face the storm of disruption head on and grow from it tremendously.