By: CI&T Team
In this article, you'll learn about:
- New strategies to deal with the current state of the world
- Digital Lean, a powerful transformation methodology
- The new model for leadership
"Currently, the main question for big and successful companies is how they should react to this digital storm."
Cesar Gon, Founder, and CEO of CI&T
The world is in the midst of a great crisis, a turning point in modern history that will profoundly change people's lives and behaviors. This change touches all society sectors – social, political, and economic – and traditional business organizations. Until recently, large companies had a clear view of the playing field as they gradually adapted to a more digital world. Now, those same companies have had to rethink modes of operation in weeks and make profound transformational changes in just a few months.
Given CI&T's background as a purely digital company, we've had the unique opportunity to advise clients with their digital transformation efforts in ways that are safe, proven, and most likely to contribute to bottom-line success in the future. Based on our 25-year history of helping organizations, our Founder and CEO, Cesar Gon, and our CSO, Bob Wollheim, recorded a podcast, in which they analyze and reflect on what the world is currently experiencing.
According to Cesar, two essential perspectives should support companies' future-focused efforts:
1. A flexible and continuously reevaluated strategic redirection
2. A new leadership model.
Building a strategy to deal with the new world
"The change in consumer behavior accelerated unexpectedly, widening the delivery gap that already existed between companies and consumers; this opened up an excellent space for disruptive innovation. "
Speaking about the need to take advantage of the opportunities that the moment brings and build a strategy focused on growth and disruptive innovation, Cesar referred to the evolutionary model of companies coined by author and professor Clayton M. Christensen. According to this model, three different and gradual strategic focuses drive company growth:
1 - Continuous improvement of the core business
Improve existing processes, products, and services.
2 - Expansion of the core business to new consumers
Use marketing and design strategies to reach new targets.
3 - Create truly disruptive options for the future
Modify mental models and ways of operating the company to put the consumer at the center.
Most companies focus 70% to 80% of their investments on the first strategy, expecting short-term results. They leave 10% to 20% for the second initiative, intending to reap the fruits within two to five years. They reserve a maximum of 5% of their efforts and budget for the most disruptive initiatives, considering results in five to 10 years.
"I think there is a new way of looking at strategy in today's digital world. It is necessary to correlate technology with an innovation base. The idea should be to invest more in the third initiative, focusing on taking advantage of new technologies and new opportunities to build aggressive disruptions before your competitors."
According to Cesar, one way to start adopting this new approach is to classify what your company is doing to take risks. The need is to test, take risks with new marketing strategies, new technologies, and, mainly, with new ways of delivering value to consumers.
"If you look at iconic companies like Netflix, Airbnb, and Uber, you will notice that, probably for the first time in history, these companies became dominant by focusing on the last two initiatives."
We support large companies in their digital transformation processes precisely by helping them deliver more and more value to customers in new and surprising ways. The basis of these customer journeys is a methodology that CI&T developed, combining Lean management philosophy principles with the tools, practices, and processes of Agile and Design. This is Lean Digital.
"Lean Digital is the combination of disruption in terms of aggressive use of data, design, and technology with the discipline of leadership and Lean mindset."
Digital Lean: a powerful transformation methodology
By following our clients and observing the market, we learned that digital transformation journeys in the most traditional companies depend primarily on the reformulation of three pillars: digital product development processes, the management system, and how to lead.
Using the principles and tools of Lean Digital, it is possible to reformulate these three perspectives in a gradual, consistent, and sustainable way. To learn more about this methodology, you can access our blog or read our e-book Faster Faster: The Dawn of Lean Digital. We share how we developed Lean Digital, its practices, and some of our clients' transformation cases, such as Itaú and Coca-Cola.
"You need to change the way your company evolves the digital experience it delivers, its digital platforms, reshape the path you take with your digital products, the way you handle your data. Of course, I'm talking about having squads, about Agile, DevOps, Design Thinking, Microservices, Cloud, Advanced Analytics, Machine Learning, and a huge list of methodologies and techniques. But it is also necessary to redesign Management Systems, how planning and budgets are carried out, and how the company operates. You need a management system that is laser-focused on connecting strategy with the squads' daily work. And finally, you need a new approach to leadership development. "
The new leadership
"We don't need bosses; we need leaders. This is a radical personal change in leadership and management and is perhaps the most critical part of the process of gaining speed in change. The problem is 'us': the leaders, managers, and executives who have very successful careers, built in the corporate world of the past."
Analyzing the third pillar on the formation of leaders more deeply, Cesar draws attention to the fact that, having built solid careers with modes of action focused on command and control, most senior leaders are not prepared to take on a more digital profile.
"We found this success using ancient leadership methods: being in control, knowing the answers, not making mistakes. It is almost impossible to have innovation and agility using this classic form of leadership style based on command and control."
According to Cesar, new leaders must be prepared to collaborate more than to command, ask the right questions more than to give the answers, and give autonomy instead of controlling. Leadership in digital times - especially in uncertain times like today - must be aimed at developing a constant learning mentality - both in itself and in the company - and creating environments that encourage experimentation and risk-taking.
Leadership must modify its view on errors and problems to make this work. Mistakes must be seen as growth opportunities and levers for innovation and understood as part of the natural process of developing new products, services, and experiences.
The skills required for new leadership are directly linked to the ability to understand people, says Cesar. It is the people, their engagement, their talent and their creativity that will build the company's success.
"In 25 years of living passionately in this crazy technology industry, there is one thing that I learned, and that might define me as an entrepreneurial leader: the more technology is the protagonist, the more the human dimension matters. When I really look at what happens, technology doesn't innovate - at least, not yet. People do that. Technology is not disruptive; people are. So, my advice to leaders is: as long as you maintain your hard skills, such as finance, marketing, operations, and technology, put a lot of effort into developing your soft skills."
And what are the soft skills that Cesar refers to? They are mainly those that help with understanding people. In other words, empathy, collaboration, co-creation, and a sense of how to engage your team members and how to translate the company's strategy into a greater purpose.
"Being a leader is, above all, putting the human face in the lead."
The full chat between Cesar Gon and Bob Wollheim is in this podcast.