Business often appears to develop from one level to the next, not always without stumbling blocks or teething troubles, and before you realize it, it's been passed down from generation to generation.
The difficulty with this type of organic development is that, though the business appears to develop and succeed, it may be lacking in some key business design elements.
There are a number of reasons why family businesses should consider restructuring the several stables that comprise their operation. Another possibility is that, like other businesses in today's digital environment, you've discovered that the old structured company model is no longer applicable and are aiming to implement more agile working practices.
Never before in human history has the speed of business increased at such a quick rate. This is partly due to the advent of digital business models, which has been aided by rapid technological advancements.
There is a lot of information out there claiming that we are in the fourth industrial revolution, and that the fifth is on its way.
The exponential rise of technology, a gap in human adoption of that technology, and huge changes in how firms work in order to migrate from traditional company to digital business are three primary causes that point to a shift to the next age. It's vital to understand the difference between traditional and digital business in order to embark on this road.
What are the differences between traditional and digital businesses, and how can a family firm be redesigned to be more adaptable in the digital age? The full story will be told in the article below.
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The Digital Flow Framework
The purpose of the digital flow framework is to bridge the understanding gap between traditional and digital businesses in order to speed up the transition to digital. This framework is built around a speed metaphor.
The speed is separated into three stages in this case:
• Speed 1: Ultra runner Kilian Jornet set the record for the quickest ascent of Mount Everest, clocking in at 0.5 mph.
• Speed 2: A jet stream is even faster, reaching speeds of roughly 250 miles per hour.
• Speed 3: Solar winds can reach speeds of one million miles per hour.
Traditional business is firmly planted on the ground, with changes in business models depending on traditional technology, which might take months or years to implement.
When digital technology is fully accepted, digital business is in a jet stream, with the ability to test and modify business models in short periods of time and implement business changes in weeks or even days. All of the technology in the jet stream section of the diagram is ready to use right now.
A variety of exponential technologies in the development phase, which are being worked on by scientists, engineers, and makers, are also on the horizon for the future of business. These technologies have the ability to transform every part of life as we know it, and they will make our existing business practices appear slow in comparison.
Business Outcomes From The Digital Flow Framework
Understanding what can be accomplished at each level of the framework is a motivator for action. Real-time business models, fully automated procedures, and rapid product releases will characterize future business, resulting in frictionless transactions.
For most businesses, the best course of action right now is to keep an eye on this space. Companies that want to be technology providers at this level should be actively studying and developing their products.
When technology and new ways of working are fully adopted, digital business is defined by a near frictionless business. Full adoption allows for rapid changes in business models and process velocity, as well as a speedy time to value creation. All businesses should make significant investments in digital transformation.
Business models are largely static at the speed of traditional business, with a lot of self-induced complexity and limited procedures, resulting in a long time to value for new capabilities. The best course of action here is to freeze investments, divest from outdated modes of working and technology, and invest the money saved in digital.
The Digital Flow Framework Has Three Components To Master
To achieve digital velocity and flow, three factors must be in place: talent, operations, and technology. When it comes to talent, it's critical to shift from a scarcity thinking about a talent battle to an abundance mentality. The use of digital process accelerators to apply talent capacity planning is critical.
In terms of people, now is the time to use artificial intelligence (AI) to enhance the skill pool, reducing duplicated and data-intensive duties and continuously speeding up.
The other component of talent capacity planning is a workforce that grows and shrinks as a result of alternative talent pools like crowdsourcing, freelancing, and the gig economy, joint ventures with customers and suppliers, and IP generation partnerships with universities, customers, and other businesses.
The second aspect to master in order to achieve digital velocity is dealing with the considerable operational changes that are required.
There is a "customer in approach" with high customer-centricity in digital business. This entails being dedicated to resolving customers' problems, giving an exceptional experience, and being willing to challenge the company's business model.
Digital technology is the final component to master in order to attain digital velocity and flow. At the very least, everyone in the firm should be aware that digital technology differs dramatically from old technology. Traditional technology cannot help businesses obtain digital velocity. To discover more, stay tuned for part two of this series.
Read: Running a Successful, Drama-Free, Family Business
Conclusion
The transition from traditional to digital company is about the journey, not the destination. Because the end state is constantly changing, mastering the road is essential. It's critical to master digital talent practices, digital operations, and digital technologies in order to achieve digital velocity and flow.
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