Thinking in Zeros and Ones: Embracing Digital Mindset
What does ‘digital thinking’ mean?
Some years ago, I conducted a strategy project for a DIY retail chain in an emerging country.
When we began, the founder and CEO told me he shied away from the threat when the first online DIY stores appeared in his country.
“I didn’t take it too seriously,” he said, “I’d never thought consumers would start buying electric drills or cables online.”
But they did.
The CEO tried out a few Hail Mary strategies. For instance, he tried to copy the interface of his digital rivals’ websites – but failed.
“They think differently than we do,” he said, “We try to apply our conventional thinking to the digital world, but they think digitally.”
“To think digitally” sounds like a bold motto. But what is the real difference between how managers in legacy and digital companies think?
Digital thinking
Imagine a group of executives trying to change a traditional company’s workflow. Most likely, they will make general, high-level decisions and then cascade this task down to lower levels of the corporate hierarchy.
At best, their subordinates will change work instructions and retrain their staff. Some managers will get new KPIs to help their superiors track the outcomes.
However, it is unlikely that these new instructions will detail the updated process. Middle and line managers will rely on their employees, their experience, and general knowledge of how they should perform this process.
And if something goes wrong, neither executives nor line managers will know exactly what’s the reason. The problem may lie either in the guideline itself or in workers who don’t comply with it. They will need to spend some time to dig deeper, find it out, and fix it.
In traditional companies, managers at all hierarchy levels rely heavily on their staff’s experience and common sense. No instruction can describe any possible situation that may occur. And when something that isn’t covered by the instruction happens, in many cases, workers can fix the problem themselves.
So, nobody knows with 100% accuracy how all the processes are executed. When a company’s leaders want to learn it, they hire consultants.
This is an unaffordable luxury for digital companies since algorithms perform most procedures.
They can’t rely on the staff and their experience. Algorithms don’t have common sense; they work in strict accordance with their code.
When a company decides to change a workflow, somebody needs to dig deeply into it and change the code. When you use a website, mobile app, or social platform, the quality of this interaction depends solely on the quality of the algorithms underlying the interface.
And if you take any process, somebody in the business knows exactly how it works.
Pros and contras
“Digital thinking’ has its flaws. If an algorithm works well, it does so day and night. But if there is a bug in it, it spoils the customer experience also 24/7. There is no chance a bot or a machine will see the problem and take the initiative.
Algorithms are not creative. They can’t spot a problem and offer a solution.
On the other hand, if a procedure doesn’t work perfectly, it ordinarily takes traditional companies longer to find and fix it.
Guys in digital companies think more in terms of processes than relationships.
But when a CEO of a conventional company initiates a change, they always must think about employees and the implications the change will bring.
Good insights. Thanks for sharing.