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“It's not fundamentally about cloud or about AI or about blockchain or whatever the technologies are — it's about what these technologies allow your organization to do. It's these [digital] superpowers that allow your organization to act in different ways.”— Gerald Kane, Co-Author of The Transformation Myth
To succeed in today’s competitive business environment, companies must not only drive growth and deliver a better customer experience but must also effectively navigate disruption.
That’s the perspective of Gerald Kane, professor of information systems in the Carroll School of Management at Boston College.
In 2021, Kane and his co-authors released a book, “The Transformation Myth,” that focused on how businesses could adapt to changes in their environment and build more resilient organizations in the process.
Kane says an effective technology strategy that enables four key digital superpowers can help companies successfully weather disruption and cultivate more digital resilience.
Kane joined a recent episode of the “Unpacking the Digital Shelf” podcast, “The Technology Strategy for a Digitally Resilient Organization,” to discuss these digital superpowers, examples of companies that have harnessed them to deal with COVID-related and other disruptions, and the associated lessons organizations can learn along the way.
Brand leaders are constantly dealing with disruption, especially digitally driven disruption. Though COVID-19 is the latest, and arguably most game-changing, disruption companies have confronted in recent years, Kane says his book is about more than the pandemic.
“It's about how do you manage all the disruptions, which are increasingly defining the business environment,” he says.
The answer to this question may lie in companies building more robust technology infrastructure and strengthening their digital capabilities.
Kane says technology enables companies to develop four digital superpowers:
“It's not fundamentally about cloud or about AI or about blockchain or whatever the technologies are — it's about what these technologies allow your organization to do,” he says. “It's these superpowers that allow your organization to act in different ways.”
Nimbleness is the first digital superpower technology enables. Nimbleness is “the speed at which organizations act and the ability to pivot when conditions change on the ground,” Kane says. He provides two examples of companies that embody this principle: Marriott and Hitachi Vantara.
During the pandemic, Marriott experienced a 90% drop-off in demand. As a result, the hotel chain decided to repurpose its digitally enabled call center. It contracted with the state of New York to redeploy the call center to handle a surge in unemployment claims. Marriott quickly retrained its employees for this new task, allowing the hotel chain to retain some workers and bring laid-off employees back as demand shifted.
“That’s pivoting the entire organization on a dime,” Kane says.
Manufacturing company Hitachi Vantara showcased a different form of nimbleness during the pandemic. The company had already converted its factories to smart factories before the pandemic, using sensor-based technologies to optimize its production processes.
Over a two-week span, the company conducted a hackathon and found a way to retrofit its existing technology using machine learning to monitor social distancing in its factories.
Hitachi Vantara also uncovered bottlenecks in its production processes and addressed them to improve factory safety. Kane says having this existing technology in place allowed the company to be nimble.
“They were able to get back up to speed much more quickly than they would've been able to do otherwise [with] changing the entire infrastructure of the organization,” he says.
Scalability encompasses the ability to ramp up or down quickly to handle an unanticipated increase or decrease in demand.
Kane cites the airline industry as a key example of this superpower. Like the travel and hospitality industry, airlines faced a significant drop-off in demand. However, some companies leveraged data to see where demand was coming back — empowering them to increase routes in these locations to better serve customers during the transition.
Hilton Hotels offers another example of scalability. The company created partnerships with grocery stores, Amazon, and UPS, among others, to help their employees find jobs using Hilton’s own internal HR systems.
“The logic was if they treated their employees humanely, they'd be more likely to come back when that demand shifted away from the Amazons and the Zooms or the Amazons and the UPSs back to Hilton,” Kane says.
Hilton ultimately was right. In 2020, during the height of the pandemic, the company was voted the third best place to work in the world. Because Hilton treated its employees humanely and helped them find other jobs after their layoffs, the company also was able to use these same systems to bring employees back.
Stability, the third digital superpower, is the ability for companies to maintain operational excellence and a results-driven orientation, even while pivoting and scaling rapidly.
Kane says the cloud is a key enabler of stability within organizations during times of disruption. It helps them build digital resilience because it provides the massive computing power companies need to handle changes in demand. We saw this occur during the pandemic as organizations rapidly shifted to remote work to ensure business continuity.
“What good is it to be able to be nimble and scale if you fall apart or if you end up with security breaches, which can turn into much worse situations. So, stability is key.” — Gerald Kane, Professor of Information Systems in the Carroll School of Management at Boston College
The cloud also enables optionality, the fourth digital superpower. Optionality is the ability to add new services and capabilities relatively easily.
“In the book, we talk about cloud services as Lego blocks. Basically, you just build whatever computing infrastructure you want, and as you need a new capability, you just add the new brick on top,” Kane says.
Olo, a platform that integrates all the digital capabilities restaurants need, is a prime example of this superpower. The company pivoted its product to facilitate deliveries for restaurants practically overnight.
“Restaurant chains were able to add on delivery through Olo — add on UberEats and add on Postmates — just by subscribing to the service,” Kane says. “If you had thought about having to try and start up a delivery service on your own, that's a massive investment, as opposed to just being able to rent a service from someplace like Olo in the course of two weeks, do whatever integration is necessary, and then you're able to now do delivery.”
As an example, the restaurant chain Portillo’s used the Olo platform to turn their wait staff into call center employees and delivery drivers rather than relying on third-party delivery services. The shift allowed Portillo’s to launch its own branded delivery service, better serve customers, and even help its wait staff make more money.
“This is what optionality is. By going to the cloud and creating a solid cloud infrastructure, you are making an investment,” Kane says. “It's not a small investment, but having that platform, you can then add on services as you need them and allow your organization to develop new capabilities.”
These technology-enabled digital superpowers allow companies to effectively pivot, shift their resources and capacity based on demand, maintain their operations under intense pressure, and build new capabilities when necessary.
Taken together, this is the definition of digital resilience. Going forward, organizations will continue to face both short- and long-term disruptions, but they’ll only be able to be digitally resilient if they have the right technology strategy in place — one that’s proactive and flexible enough to change with them as their business needs evolve.
“It's still all about change. And the bottom line is the organization of 2010 is not capable of competing effectively in the competitive marketplace of [today],” Kane says.
“I would argue we were stuck in 2010,” Kane adds. “We were about 10 years behind when COVID hit, but we’ve caught up to where I think we should have been now, and I think we're going to see massive changes in the next five to 10 years … and just a massive competitive reshuffling in the coming five to 10 years as companies seek to take advantage of this [new] environment.”
Listen to the full podcast episode to learn more about how the right technology choices can enable the qualities needed to thrive and build digital resilience.
