Technology has changed every aspect of the way businesses operate, and never in history has that change occurred so fast. The velocity of change we are seeing in the technology is unprecedented. We are witnessing the fourth industrial revolution, where Volatility, Uncertainty, Complexity and Ambiguity (VUCA) challenges are primary, and the boundaries between man and machine are questioned.
We Need “New Rules of Management” to win in a VUCA World.
# Rule 1 - Innovate and Shape the Future
Traditional ways of looking at the market are no longer relevant in a VUCA environment. It’s not enough to operate within the construct of the existing market - you cannot consider the market as a given and stay within its constraints. Today, success is all about how you shape the market with creativity and disruptive innovation.
# Rule 2 - Strategy is by “Connecting the Dots”
Earlier, strategizing meant creating a long term vision, planning, analyzing and reviewing it. It was fixed and it guided an enterprise like the North Star. However, business requirements change every six months now and there’s a need to review it often. The way to get there is through shorter sprints and execution. Don’t let strategy restrict your growth. Rather, it should open up new paths for business opportunities.
# Rule 3 - Co-create with Customers
The importance given to a customer isn’t a new concept but the intensity has changed. It’s not only about delivering to the customer, but about creating for the customer. The industry is constantly recreating and personalizing for the customer. Besides, segmentation is no longer relevant because you can reach a customer with personalization.
# Rule 4 - Every company has to be a Technology Company
Businesses can’t afford to sideline technology as an enhancing factor to their business. Every company must be a technology company and it should have core technological abilities which can define the new capabilities of your business. India has a large services industry but a limited number of people who understand the integration of business and technology. Organizations need to provide the culture for such skills to grow.
# Rule 5 - Simplify Org Structure and Processes
At most enterprises, organizational design revolves around risk management that tends to slow down various processes. In a VUCA world where speed is paramount, it becomes a trade-off. Enterprises are recommended to factor in speed before risk management. For this, the organizational design needs to be simple and structured – it implies control in layers. If you want speed, the empowerment needs to happen at the point of action.
#Rule 6 - Build a Web of Partnerships
The concept of how you define boundaries of an enterprise is changing rapidly. No enterprise can make it on its own at such pace as the ecosystem is constantly changing. A very open source culture is encouraged by engaging with different partners.
#Rule 7 - Entrepreneurial Talent and Culture
The main asset of any successful enterprise is its people. From a cultural perspective, learning is key to organizational growth. It is important at an individual and organizational level. Besides, there should be space for failure. Resilience is key as you’ll face failures as an organization and you should have the ability to bounce back.
Today, businesses are quick to implement changes and we now speak the language of emerging technologies like AI, IoT, block chain and robotics. Enterprise giants are vanishing and new ones are emerging. These changes open our gates to several threats as well as opportunities. While older companies face a risk of using outdated strategies and going stagnant, new companies are equally vulnerable if they rise quickly and don't pay attention to finer details.
By Nitin Seth
Nitin is the CEO of Incedo Inc.