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The key challenge of the Digital Leader — Balance HIGH-END strategy with LOW-END Bits and Bytes

Organizations must understand the evolving digital galaxy and prepare to operate in it. The digital age offers an abundance of business opportunities and risks. The option of “sit and do nothing” will work, at best, for a short time. At some point, somewhere, others are already working on a business idea, a new digital technology or both, and those developments are liable to disrupt your organization’s current business model. It pays to be paranoid in this context.

Furthermore, Organizations sometimes use the term “digital transformation” only because it’s trendy and evokes the image of an innovative organization.

One of the mavens in this field, Rob Llewellyn, warns organizations about a phenomenon he calls “the great digital illusion.”

“Change fixes the past, while transformation creates the future.” Engaging in simple projects is a good way to start cultivating capabilities, but does not provide the infrastructure for withstanding competitive pressure or for future prosperity.

Herein lies the great challenge: doing both the high strategy and the daily grind of the digital. Mastering both the high-end strategic mindset and low-end bits and bytes mindset – this is the key to digital mastery.

We tried in this book to review a wide range of aspects and issues relevant to digital transformation in order to ensure that readers are familiar with the background and theory required for action and results. And herein lies the great challenge: doing both the high strategy and the daily grind of the digital age. Mastering both the high-end strategic mindset and low-end bits and bytes mindset – this is the key to digital mastery.

Bon digital voyage!

“The Digital Transformation Should Start from the Top” say Prof. Yesha Sivan and Raz Heiferman from i8 Ventures in their The Marker Article

The Marker magazine published the new article (Hebrew) by Prof. Sivan and Raz Heiferman. The December 2018 edition of the magazine is titled “The Israeli High-tech Book” and is dedicated to the growing and almost unbelievably vibrant Israeli high-tech with a huge number of brilliant entrepreneurs that made Israel the Startup Nation that it is, and one of the most innovative economies in the world.

Digital technologies are changing everything we know – the ways an organization conducts the business, the way it manages the relationships with its customers, the way it manages its internal business processes, its innovation processes, its decision making processes. Products are constantly being digitized (cars, TV sets, home appliances, and aircraft have become digital and software driven–what we call digital product augmentation), and in some cases virtualized (music, books, maps, magazines, movies, and much more have been converted into digital products–what we call digitization.) Many products have been transformed into services (what we call servitization.) Physical places are converted into virtual places (shops, banks, and service offices are all transformed into websites and e-commerce, what we call virtualization.)

In this new and chaotic business environment, digital transformation has become imperative to all organizations, regardless of the business sector they operate. If your organization doesn’t transform, some other competitor will mobilize the digital technologies to disrupt your business,
and sometimes the entire sector (e.g., Airbnb, Uber, Netflix, Apple, Amazon, Facebook, Google, Alibaba, WeChat, and Tencent have all disrupted entire industries.)

Organizations should understand that this transformation is one of the major and significant journeys they should embark on, and it will take resources, managerial commitment, and time to succeed. To be successful in such an organizational transformation, a top-down approach should be
adopted. The board of directors and the executive management should be involved, committed, and lead the journey from its very first step and throughout the entire journey.

In order to successfully lead such a significant transformation, Sivan and Heiferman provide a set of tips: adding digital-savvy board members; educating and training the board on the new concepts and models (e.g., new technologies like AI, ML, Big Data, 3D Printing, and drones, and new concepts like digital disruption, digital maturity, digital business models, transformation types, personalized customer experiences, and much more.) Other tips are discussing the new strategic opportunities and threats, visiting and learning from the new potential startups (by organizing hackathons, investing and M&A, innovation labs and more.)

The Four Forces Framework for Agilification: Prof. Yesha Sivan and Raz Heiferman from i8 Ventures on the New Framework

Gone are the days that an organization could plan for sustainable competitive advantage and build a five-year (or even three-year) strategic plan. The business environment has become ever-more chaotic, dynamic, and disruptive. Enter agility as the new capability to develop transient competitive advantages with shorter planning and execution cycles. Welcome to the age of “agilification.”

This Advisor, published by Cutter Consortium is based on our article Agilifying You Digital Business – 6 Steps to Get Started published by Cutter Consortium on the issue of Cutter Business Technology, Vol 31, Number 7, 2018 and titled Architecture + Agile: The Yin & Yang of Organizational Agility. We focused on the important interplay among leadership, culture, business architecture, and digital architecture.

You can download the full article from Cutter Consortium website (requires registration) at the following link: https://www.cutter.com/offer/agilifying-your-organization-6-steps-get-started

“Agilifying Your Digital Business”: From i8 Ventures at Cutter Consortium (FREE Download)

We are happy to update that our new article “Agilifying You Digital Business – 6 Steps to Get Started” was published by Cutter Consortium on the issue of Cutter Business Technology, Vol 31, Number 7, 2018 named “Architecture + Agile = The Yin & Yang of Organization Agility”. This issue contains some articles dedicated to the many faces of agility.

The issue of transforming the organization into an agile organization has become in the last couple of years a strategic issue. The business landscape has become very dynamic and competitive and organizations are having a hard time to establish their long term strategic plans. The new competitive environment forces organizations to move from the concept of sustainable competitive advantage to transient competitive advantage, a term coined by Prof. Rita McGrath from Columbia Business School in her famous book “The End of Competitive Advantage”.

Our article presents 6 steps that we recommend organizations for their transformation into agile organizations:

  • Recommendation #1: Appreciate the Mental Challenge of Agility as 'Building Flexible Buildings'
  • Recommendation #2: Develop & Share 'Visions' of What to Expect from Agility
  • Recommendation #3: Build 'Abilities', that allow for 'Visions'
  • Recommendation #4: Initiate 'Actions' that Build 'Abilities', that Allow for 'Visions'
  • Recommendation #5: Master the Interplay among Leadership, Culture, Business Architecture, and Digital Architecture
  • Recommendation #6: Shift to Deadline-Driven Smaller Projects

To get the article, subscribe to Cutter Consortium or download (PDF) by filling your email here:

“0 to 1 to 100” The magic of Israel-China venture relations

By Fang Ying, Senior Writer, China Business Knowledge @ CUHK

Israel has always been dubbed the “Startup Nation”. With 140 scientists, technicians, and engineers per 10,000 employees, it boasts the highest number of scientists and technology professionals per capita in the world. More than 250 multinational corporations, including Google, Apple, and Microsoft, have R&D or innovation centers in the country.

What are the secrets behind Israel’s miracle? How is the startup environment there different from that of China? Are there any opportunities for the two countries to work and benefit each other?

Prof. Yesha Y. Sivan, Tel-Aviv based visiting professor of innovation and venture at the Chinese University of Hong Kong (CUHK) Business School, shares his insights with China Business Knowledge (CBK) @ CUHK.

CBK: AS AN ISRAELI, WHAT DO YOU THINK ARE THE SECRETS BEHIND THE SUCCESS OF ISRAEL?

Prof. Sivan: The Israeli venture ecosystem (venture is defined as the combination of innovation and finance) is unique, which I believe is one of the most advanced and flexible ecosystems in the world. In recent years, Israel has become the Mecca for entrepreneurs, venture capitals, multinational companies, and experienced professionals. It is efficient, particularly in terms of digitalization, information systems, cyber technology, and artificial intelligence.

The development of Israel’s venture ecosystem started with the Israeli government’s heavy national defense investments combined with Israeli people’s creativeness. It continued with Yozma (Hebrew for “initiative”), an Israeli government initiative in 1993, which offered attractive tax incentives to foreign venture capital investments in Israel and doubled any investment with funds from the government. These Yozma funds commercialized the defense ideas to successful firms which went global later through IPOs or M&As, which, in turn, continued the upward cycle with more venture capitals, experienced managers, and super-angles.

Today, in my mind, the biggest advantage of Israeli venture ecosystem is the presence of multinational companies. There are already 250 multinational companies which have set up their R&D centers in Israel. They are top players in the global economy, including IBM, Intel, Amazon, Google, Facebook, and Huawei. I believe many of these big names have already realized how beneficial a presence in Israel can be. It is often said that if an engineer from Microsoft wants to talk to an engineer from Google, they better to do it in Hebrew, in Israel.

At the same time, the fact that the Israeli startups can learn from these big players is a wonderful plus for them. In recent years, we have seen some local companies that started from Israel to become unicorns in some industries around the world, for example, Checkpoint, Wix, and Mobile Eye (recently merged to Intel for $13 billion USD).

CBK: BASED ON YOUR OBSERVATION, WHEN IT COMES TO INNOVATION, WHAT ARE THE DIFFERENCES BETWEEN CHINA AND ISRAEL?

Prof. Sivan: China (1.3 billion people) is obviously different from Israel (8 million people) — China’s scale is much bigger than that of Israel. In simplest terms, I would say that Israel focuses on “zero to one (0–>1)”, while China focuses on “one to one hundred (1–>100)”. This is also the source of mutual fascination.

Israel is good at creating something from nothing; Israelis are used to offering new solutions for new problems. Think about ICQ, which is the “father” of QQ and the “grandfather” of WeChat. There was almost nothing at first, and then suddenly there is something. That’s what Israel has been doing in the last 70 years since 1948. Israelis seldom pay attention to the local market – they are always targeting global markets. They were born global.

In contrast, China is good at scaling up from one to one hundred. The market is vast in China, and so they need to come up with scalable solutions. They can easily achieve success by only focusing on the local market (which can be a honey trap – as some Chinese firms are globally impaired).

And that’s the basis for the two countries to cooperate. In fact, many deals are happening now: Chinese companies are going to Israel to find the idea or technology (from zero to one) whereas Israeli companies are going to China to scale their markets (from one to one hundred). Lumenis is one such example – it’s a globally based Israeli medical technology firm which has been bought by a Chinese PE firm in search of expansion.

CBK: MOST PEOPLE THINK THAT HONG KONG IS FALLING BEHIND IN THE INNOVATION/VENTURE GAME. WHAT KIND OF ADVICE WOULD YOU GIVE TO THE HONG KONG GOVERNMENT TO BOOST ITS DEVELOPMENT?

Prof. Sivan: Hong Kong used to be a strong player in innovation and entrepreneurship. However, it failed to find its 21st direction, as compared with other cities, such as Shenzhen.

Given the high land price in the city, small companies may not be able to survive. So the Hong Kong government should take a unique positioning, for example, by bringing big innovation players to Hong Kong to further support innovation. Giants can create giants.

We don’t do innovation for the sake of innovation. What we want is to create and keep jobs in the city and improve people’s quality of living. So the Hong Kong government needs to think about how to keep companies in Hong Kong by supporting them, which is the basis for long-term development. I call this HK 3.0.

CBK: SOME CRITICS THINK THAT CHINA’S INNOVATION PERFORMANCE IS RELATIVELY WEAK WHEN COMPARING WITH ITS R&D INVESTMENT. WHAT IS YOUR VIEW ON THAT?

Prof. Sivan: We have different data and measurements to evaluate innovation performance. But no one can deny that there are now several new-era companies in China becoming global players, such as Tencent, Alibaba or Mobike. These companies are growing with new technologies and business models for the 21-century. They are the top players in their markets – globally. In the future, I believe we are going to see more and more such china-born companies.

By analogy, China-born companies should not be satisfied with conquering just the Chinese market; they need to think more globally. The truth is even when you don’t think about going global, your competitors will be thinking about that and will take over your market eventually. So thinking globally is important to a company’s long-term development.

CBK: NOWADAYS CHANGES, PARTICULAR THOSE BROUGHT BY DIGITAL INNOVATIONS, ARE EVERYWHERE. AND COMPANIES IN ANY SIZE ARE FACING TREMENDOUS PRESSURES TO ADAPT TO THE NEW ENVIRONMENT. WHAT WOULD BE YOUR TIPS FOR THEM?

Prof. Sivan: This is my focused area of work, and digital transformation is the theme of the main courses I am teaching here at CUHK Business School. In the digital era, suppliers, customers, and shareholders are all expecting changes and should act quickly to adapt to changes. I believe there is one universal panacea to deal with external change – and that is the internal ability to change, and change often- namely being agile.

For example, in recent years, we see that physical marketplaces have transformed into digital and virtual market spaces. So companies today must understand the dynamics of such a new environment and become more responsive to operate in our digital world.

When it comes to innovation, even the well-known process of disruptive innovation, which in the past could take years to disrupt any industry, has now accelerated into a matter of months, or even weeks. So companies should all learn how to transform from disruptive innovation to “killer” innovation.

Facing today’s ever-changing digital environment, I would say being agile is one of the keys to any company’s success.

You can receive China Business Knowledge (CBK) monthly articles by subscribing here.

For other CBK stories see here.

2016 Book: Handbook on 3D3C Platforms by Prof. Yesha Sivan (Ed.)

Y. Sivan (Ed.)
Handbook on 3D3C Platforms
Applications and Tools for Three Dimensional Systems for Community, Creation, and Commerce
Series: Progress in IS
  • Provides a single, comprehensive resource on the emerging phenomenon of 3D3C worlds
  • Includes an introductory chapter on the history of the field
  • Offers insight on the variety of applications and future research directions
  • Includes a sample visual Appendix on one Kind of 3D3C world

This book presents 3D3C platforms – three-dimensional systems for community, creation, and commerce. It discusses tools including bots in social networks, team creativity, privacy, and virtual currencies & micropayments as well as their applications in areas like healthcare, energy, collaboration, and art. More than 20 authors from 10 countries share their experiences, research findings and perspectives, offering a comprehensive resource on the emerging field of 3D3C worlds. The book is designed for both the novice and the expert as a way to unleash the emerging opportunities in 3D3C worlds.

From the book cover:

This Handbook maps with breadth and insight the exciting frontier of building virtual worlds with digital technologies.
David Perkins, Research Professor, Harvard Graduate School of Education

This book is from one of the most adventurous and energetic persons I have ever met. Yesha takes us into new undiscovered spaces and provides insight into the phenomena of social interaction and immersive experiences that transform our lives.
Cees de Bont, Dean of School of Design & Chair Professor of Design, School of Design of the Hong Kong Polytechnic University

When you read 3D3C Platforms you realize what a domain like ours — 3D printing — can and should do for the world. Clearly, we are just starting. Inspiring.
David Reis, CEO, Stratasys Ltd

This book provides a stunning overview of how virtual worlds are reshaping possibilities for identity and community. The range of topics addressed by the authors — from privacy and taxation to fashion and health care — provide a powerful road map for addressing the emerging potential of these online environments.
Tom Boellstorff,
Professor, Department of Anthropology, University of California, Irvine

Available at Springer or Amazon.