Why your organization needs to invest in adaptive capacity to survive

To remain competitive, the enterprise needs the ability to adapt

porting converting repurpose code birds in flight transformation
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As products and services increasingly go digital, the idea of a business being shackled to any technology is abhorrent. The digital-centric world we inhabit is just too fast-paced, and nothing is certain any more.

What’s more, change is perpetual. Only the nimble are in a position to react and adapt. Only organizations that have developed a competency for digital transformation can keep up. Only those that have used that competency to architect their organizations with modular technologies, hackable processes, and an experimental culture will prevail.

The need to transform

The concept of transformation is nothing new—it emerged in the mid to late 20th century when globalization forced the manufacturing industry to adopt a new set of practices to remain competitive.

Today, the need to transform comes from the perpetual parade of emerging “game-changing” technologies. Startups are aggressively deconstructing established business models and innovating new ways to disrupt them. It’s a death by a thousand cuts, and the lumbering incumbent enterprise is too slow to respond.

To remain competitive, the enterprise needs the ability to reconstitute itself. Take its outdated processes, systems, methodologies and workflows, and digitize them; that is, make them software-defined.

The challenge of continuous transformation

While digital technologies present an outside threat to mature businesses in the hands of startups, they also present an inside threat by forcing a challenge to the status quo.

Going digital with business operations alters everything about the organization. It changes how we do our work. It gives power to some and takes it away from others. It breaks our mental world—ungrouping, redistributing activities across a new set of functions and departments; demanding that we rethink how, where, when, and by whom our work should be performed; and changing our culture, reorganizing teams, creating new organizational structures, and asking us to have a new perspective on the world.

To remain competitive, organizations need to continuously seek out and find the next process or system to define in software, unearth new flow efficiency bottlenecks, and pinpoint additional transformation initiatives. Meanwhile, disruptive practices and technologies are continuously emerging in the marketplace that fuel the sense of urgency.

In contrast to the lean transformations of old—that is, the companies selling widgets in the previous century—the modern enterprise selling digital needs to engineer itself for continuous transformation. The challenges presented are not singular events—they are ongoing and appearing at an increasing rate.

A continuous transformation competency

The ability to manage digital transformation initiatives needs to be a native capability of all large organizations. It’s a skill set that will guide thinking about products instead of projects. It involves knowing how to restructure roles and responsibilities without threatening peoples’ livelihoods. It means executive-level understanding of concepts like how to manage technical debt and when to expect cultural debt.

At its core, the competency of continuous transformation is about understanding and rationalizing the organizational impacts of technological change. For that reason, it needs to be developed as an internal skill set—it is not something that should lightly be outsourced or entrusted to consultants. It is a capacity that needs come from a source within, one that is continuously exposed to the unique struggle of the business.

Investing in this adaptive capacity is difficult to achieve and even harder to maintain, but this will be the key factor in the next round of winners and losers in the digital economy.

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