Our Blog
Join us at the annual Kibbutz Industries Association event “From Yesterday to Tomorrow,” where Professor Yesha Sivan, CEO of i8 Ventures, will present on the subject of “The digital journey – A Case Study.” Please see registration details by downloading the brochure.
In this post, we introduce the concept of a micro-transformation, whereby a focused, walled process, is re-designed as part of a larger-scale digital transformation.
Imagine a global company headquartered in Israel with thousands of employees, relatively successful, respected in its field, which has experienced rapid growth over the last decade.
However, something isn’t quite right. It seems several of the fundamental processes within the company do not match the size and aspirations of the firm. One such process is updating and maintaining the website.
To begin with, the website uses outdated technology and most of the available energy goes towards maintenance. Some of the site has stronger content while the rest lacks. Departments are not using the same processes or terminology to move product into the web. Some sections are being ignored and lack updates. The company is preoccupied with growing their market share (as they should be), and such a fundamental process is unconsciously left to its own devices.
We began to work with this (real) company on what we term a micro transformation, using the conceptual framework we will discuss below. When the project was done, processes, responsibilities, and methodology were in sync. The website was functioning at a higher level, at a lower price.
As a founder of a growing company, if, like Rip Van Winkle (or his equivalent in the Jewish tradition, Honi the Circle-maker), you were to fall asleep and wake up a few years later, the company you would walk into would be largely unrecognizable from its first iteration. You would notice the sparkling new offices, the new departments that were added, and the different ways of getting things done. Most of this is a result of positive, necessary change as the company scaled.
But some of these changes, particularly when it comes to processes, are bloat and inefficiencies that have been picked up and passed down through the years, without anyone really noticing.
New people, mistakes, and neglect together comprise a silent game of broken telephone leaving the corporate structure partly inefficient. Despite zealously implemented standard operating procedures, templates and guidelines, the tendency is towards disarray.
This phenomenon becomes most apparent, and most troublesome, in the division of labor within a given process. When a company is first forming, management will divide labor and responsibilities as evenly and consciously as they can. Without the mask of corporate anonymity, people are held accountable at all levels.
Yet, as new people and departments are integrated into the corporate structure, the division of labor will break down. Some will do more, some will do less, and as a result of diffusion of responsibility tasks (and in our experience, even entire processes) will fall between the cracks.
A muddled hierarchy leads to undefined ownership of processes, and is thus a drain on productivity. Sorting through the tangled web is a colossal task requiring deep analysis coupled with delicate rearrangements within the organization.
How can a company go about setting things straight? Through a process we term micro-transformations. A micro-transformation is a focused appraisal of a specific process (web harmonization in our case), and streamlining that process according to your chosen methodology.
There are many methodologies of varying effectiveness; here is our model to micro-transform an organizational system, summarized in this chart:
The chart describes a model to analyze one business process, in this case web system harmonization, as an ordinal series of responsibilities, with levels 3-7 relying on next one below, and management and governance at the top.
The business goal is a sleek user-end website to represent the company and generate leads. That website depends on content. Content depends of content generation. Content needs updated web infrastructure. And all this must be supervised by management, with governance making executive decisions.
This method holds up a magnifying glass to a given process, allowing executives to begin the arduous journey of re-calibration. First identify the levels responsible (Level), then what that level needs to accomplish (Meaning)
Once the needs are defined, a thorough investigation of who provides for those needs today can be conducted (Current Situation). When the investigation is complete, decisions can then be made about who is ideally suited for each responsibility (Ideal Situation).
The influence of one successful micro-transformation is not limited to the process for which transformation was done. Turning over stones always leads to something unexpected.
By focusing on a localized issue, wider gaps in the company’s structure will inevitably reveal themselves. The second micro-transformation will therefore always be easier than the first.
Complete a few micro-transformations, and trends will start to appear. These trends allow management to pin-point specific problems affecting the entire organization (especially cross departmental processes), whether that be corporate culture, a certain software, an entire department, or even an individual employee. This methodology hands C-level executives the tools to make the necessary decisions which will increase efficiency and profitability across the entire organization.
This December 18th, Gon Nivron, Senior Digital Transformation Advisor at i8 Ventures will deliver a lecture as part of a course to Innovation Managers by the Israel Innovation Institute.
About Gon:
Gon brings over 20 years of experience in International Enterprise Software companies, including Mercury and NICE. He Served in various business and technical leadership positions, with strong customer orientation, influencing business optimization and growth. Today, Gon serves as a Senior Digital Transformation Advisor at i8 Ventures
Welcome to our November 2019 update, where we share our latest publications on Innovating innovating.
i8 Ventures is a boutique consultancy specializing in digital transformation leadership.
Yours Sincerely,
Prof. Yesha Sivan and the team
In this video, Nir Barkat, Member of Knesset and Former Mayor of Jerusalem talks leading innovation both in public office and as a private entrepreneur.
Pre-Registration has begun! Explore the intersection between business strategy and advanced technologies – and learn the skills necessary to manage and lead digital transformation in your organization. Course begins February 2020.
i8 Research
Moving From Digital 1.0 to 2.0; Know the Difference Between “Regular” and 21st Century Digital
Digital 1.0 means your organization has an ERP, CRM, and CMS. These are good things, but don’t rest on your laurels. Digital 2.0 is already here, and the time for a new digital transformation is now.
To survive, companies must increase innovative output; and the key to innovative output is digital infrastructure.
Are you on Tik Tok? Did Mark Zuckerberg miss the biggest trend in social? Has your friend told you to buy Pinduoduo stock? This is for you. For the last few decades, China has been
known as a source of cheap imitation goods. Today, that’s changing — and fast. Learn how China turned into one of the world’s innovation superpowers, and what it could mean for your organization.
(Read More …)P.S. If you got this from a friend, feel free to sign up for our updates.
On this episode of Innovating Innovating, former Mayor of Jerusalem Nir Barakat and Yaakov Eilon discuss leading innovation both as a mayor and a private entrepreneur; Watch More
Nir Barkat started his career in the hi-tech industry by founding a software company called BRM in 1988, which specialized in antivirus software. Later, the company became an incubator venture firm that invested in several companies such as Check Point and Backweb. He later helped found the social investment company IVN, Israel Venture Network. Barkat has said that he has brought the skills he harnessed in his work in high-tech to his role as Mayor: “Now I see myself as a public entrepreneur, so it’s very methodological. We use data and information, and we scale successful pilot studies, using the same approach that I took with technology in the business world to change things in the city.”
Come join Professor Yesha Sivan at his latest course in digital leadership offered through the Lahal School of Executive Education at Tel Aviv Univeristy.
Explore the intersection between business strategy and advanced technologies – and learn the skills necessary to manage and lead digital transformation in your organization.
Social Networks, Mobile Applications, Business Analytics and Big Data, Cloud Computing, Artificial Intelligence and Machine Learning, Wearable Computing, Cognitive Computing, Advanced Robotics, Internet of Things, Virtual and Augmented Reality, 3D Printing, and more.
Starting date: February 18th 2020
Meetings – Tuesday 16:00-20:00 (one Wed 11-Mar-20 due to Purim Holiday) – 42 academic hours
Many managers feel that their organization is already digital. Consequently, they don’t understand why they have to burden themselves and their organization with yet another journey of digital transformation.
From their perspective, the organization has already implemented the required digitalization and there is less need for more. To support this view, these managers will note that their company has already implemented an enterprise resource planning (ERP) system, a customer relationship management (CRM) system, a supply chain management (SCM) system, and a business intelligence (BI) system, maintains an e-commerce website, and manages its social media accounts.
In fact, this contention is largely justified – many organizations are indeed digital. However, digital transformation is not static, and the rate of new waves of “digital attacks” is only accelerating.
Most organizations have already completed what we call “digital transformation 1.0” and are now in the midst of what we call “digital transformation 2.0.” Digital transformation 2.0 means companies continuing to examine new technologies, improving their digital footing, and continuously adopting new business models at an increasing rate.
To keep pace with new technologies, the 2.0 model calls for significantly more resources diverted to digital transformation than 1.0. While on the surface this may be seen as a burden, it is absolutely necessary given the exponential rate of technological shift.
It’s no surprise that some of the largest organizations in the world already understand this, and have already constructed the relevant business models.
These are models incorporating “21st Century” digital as opposed to regular digital. For example, Amazon has launched a store without checkout counters or cash registers (Amazon Go); Domino’s Pizza is delivering pizzas with drones in a pilot project in New Zealand; factories are deploying an increasing number of smart robots; full digital banks are entering the financial market, focused on meeting customer needs; insurance companies are increasingly offering smart insurance policies based on pay per usage, and more.
Other examples of 21st century digital technologies include the Internet of Things (IoT), cognitive computing, machine learning, advanced robotics, 3D printers, wearable computing, virtual reality, augmented reality, voice-operated interfaces, blockchain, and autonomous cars.
The disruptive forces that bring change are only accelerating, and thus forceful action is the solution. If companies want to mitigate the fallout, and even capitalize on it, they need to act.
If management claims the organization doesn’t need to implement new digital transformation because it is already digital, be skeptical, and ask them if a CRM for Barnes and Noble helped them?
This post is in part based on the 2019 book “Tech Titans of China: How China’s Tech Sector is challenging the world by innovating faster, working harder, and going global” by Rebecca Fannin. To purchase the book on Amazon, Click Here
In the fast, messy, and global world of today, one only needs to blink to open their eyes to a new reality. One such reality is the emergence of China as an entrepreneurial and tech powerhouse.
That China could be a world leader in innovation might sound strange to a generation of westerners who grew up knowing China as an imitator of advanced western tech. Yet, the China of today has produced such a robust tech scene, that ironically, western companies are now copying from their Chinese counterparts.
E-commerce platform Pinduoduo and Messaging app WeChat are gaining recognition abroad. Bike-Sharing platforms are a Chinese innovation copied globally. Chinese advanced Electric car brands are beginning to make inroads in the US.
It remains to be seen whether China will surpass the US in innovation. Regardless, China’s rise serves as an excellent case study for the power of innovative infrastructure and goal setting for innovation within an organization.
Consider the case of Beijing-based Tik Tok, possibly the world’s fastest-growing social media platform. Since its launch, the Tik Tok app has had over 1 billion downloads. In 2018, it was the number one downloaded app in the iTunes app store. And most surprisingly, much of its new growth has been in the US.
Tik-Tok allows users to edit and post 15-second videos about anything, whether it’s lip-singing or cooking tips. While Tik-Tok has been credited with “making social media fun again,” the app’s true innovation is its seamless blend of AI technology into its user interface.
Rather than simply a Chinese take on social media, it is Tik-Tok’s advanced AI (that feeds content to users without requiring the user to ever set any preferences) which makes it stand out as a company.
The app has grown so rapidly that it is now seen as a threat to social media giants such as Facebook, which has since released its own (and not particularly successful) version of Tik Tok called Lasso.
Tik Tok is symbolic of the cycle of Chinese innovation today – rather than Chinese companies creating “Chinese versions” of apps such as youtube, China is coming up with new ideas, and the rest of the world follows suit.
China has always been a place for innovation (Paper, Fireworks, Kites), so it’s no surprise that the China of today would continue the historical trend. However, the rapid rise in innovation and the emergence of leading Chinese companies all in less than a decade cannot simply be explained as a result of organic innovative growth.
Rather, China serves as a paradigmatic meta-example of how actively building infrastructure for innovation can act as a catalyst for unleashing potential.
The steps the Chinese government has taken to foster innovation are enormous. There exist today in China numerous multi-year strategic plans to stimulate innovation and the tech sector.
For example, China has created a $15 billion “New Era technology” fund to finance Chinese tech startups. China’s education plan has encouraged student enrollment into STEM fields; by 2030, China is expected to grow its number of STEM graduates by 300%.
The Chinese government plan — Made in China 2025 — was created to help upgrade Chinese manufacturing from low-tech into high tech sectors such as robotics.
China’s latest five year calls for accelerating innovation, entrepreneurship, and research.
China is literally building innovative infrastructure by creating a mega-business region in what is known as “the Greater Bay Area” to compete with Silicon Valley. Features include a 34-mile bridge linking Hong Kong to Macau, new rail lines, and the construction of innovation hubs.
Whether government spending is the best way to fund innovative infrastructure is not the question (the right and left-wingers can duke that out elsewhere). Rather, what is clear is that innovation can prosper as a result of building the necessary infrastructure, whether by government or a private company.
When approaching the Chinese model from an organizational perspective, it is important to note that, of course, there many differences between national and corporate projects. However, there are key principles that can be distilled from a comparison.
Chiefly, that while the raw ingredients for innovation must be present for innovation to take place, such as creative talent, the rate of innovation can be increased if the right steps are taken.
A smoothie can either be made in a mortar and pestle or a blender. The result is the same. The time spent is not.
Similarly, the more innovative platforms a company has, the quicker it will turn out innovation; And innovative ability has never before been so crucial to companies’ competitive advantage.
In an ever more unstable business environment where competition can just as easily come out of Shenzhen as it can from Silicon valley, 21st Century leaders must invest in innovation infrastructure not as a luxury, but as a basic tool for survival.
2019 release by Rebecca Fannin. An excellent resource for those who want to explore China’s rise over the last decade
