The end goal of Digital Transformation is the creation of Exponential Organization (ExO). When digital technology becomes the backbone of the organization to offer innovative products / services, novel operational capabilities, innovative business models and novel organizational techniques, that enables them to deliver disproportionality large, at least ten (10) times large impact than their peers becomes a fully transformed organization.
This is an Organization that displays all ExO traits.
The organization is fully digital providing hugely personalized creative value to customers with innovative business models.
The workforce is digitally savvy.
The organization displays a high level of ExO traits.
The organization delivering industry leading customer results, innovative digital products, and best-in-class operational efficiency.
The organization displays certain amount of ExO traits.
No corporate-wide strategy yet or it’s at an initial stage.
The organization has a mix of old and new digital business models, processes, and products.
The organization is in the process of “digitalizing” its operations and seeing “scale” benefits.
The organization has a basic level of automation and adoption of digital platforms.
The Massive Transformative Purpose (MTP)
Transformational purpose that goes beyond a Mission Statement.
Aspire to deliver significance to the whole world
Mission is broader than serving end customers
Mission aims to bring positive change to our entire ecosystem.
Mission focuses on our core values as an organization and extending beyond delivering products and services
Mission focuses on delivering the best products and services
External Traits of an Exponential Organization
Staff on Demand
Mostly uses on-demand contractors in addition to a small full-time core team
Some on-demand contractors to augment mission critical areas (e.g. operations, production, HR, etc.)
Mostly full-time employees with some on-demand contractors in non-mission critical areas (e.g. IT, event production, etc.)
Only use full time employees
Community and Crowd
The community heavily influences the organization (e.g. product ideas, product development)
Actively use the community for outreach, support and marketing.
Leverage community for market research and other listening activities
Passive involvement with community (i.e. use of some social media)
No engagement beyond standard customer service (e.g. traditional CRM)
Products and services are inherently designed to convert crowd into Community (e.g. shareable memes like the Lyft mustache or Hotmail signature)
We use gamification and incentive competitions to turn crowd into community
We leverage social media for marketing purposes
We use standard techniques like PR to increase awareness.
Our products and services are built around algorithms and machine learning (e.g. PageRank)
We use Machine Learning algorithms to analyze data and drive actionable decisions
We collect and analyze data mostly via reporting systems
We don’t do any meaningful data analysis
We emphasize agility - even mission critical functions are outsourced as variable costs rather than fixed costs
We outsource some mission critical functions (e.g. Apple & Foxconn)
We outsource some administrative and support functions (e.g. AP, AR, help desk, facilities, etc.)
Most business functions are handled by internal employees
Internal Traits of an Exponential Organization
We have automated processing of several externalities (e.g. Indiegogo, Github, Uber, Kaggle, Wikipedia)
We have automated processing of one externality (e.g. Elance or DonorsChoose)
We have dedicated staff to manage externalities (e.g. X Prize creates one-off prizes, TEDx applications handled manually)
We don’t leverage externalities or we have no special processes to capture or manage externalities
We collect real-time traditional metrics and Lean Startup (value and learning) metrics like repeat usage, monetization, referral and NPS
OKRs are used across our organization with full transparency (e.g. Google - everyone can view each others’ performance)
We collect all real-time, traditional metrics and use some Lean Startup metrics and OKRs are used across our organization (e.g. LinkedIn)
We collect some real-time, traditional metrics from transactional systems (e.g. ERP). However OKRs are only implemented in innovation areas or at the edges of the organization
We only track traditional KPIs monthly/quarterly/annually (e.g. sales, costs, profits) and use traditional quarterly/annual performance reviews or 360 reviews or stack ranking
Failure and risk-taking are expected, pervasive, measured and even celebrated across the organization (e.g. Amazon, Google, P&G Heroic Failure Award)
Failure and risk-taking are allowed and measured, but sandboxed in skunkworks or very defined boundaries (e.g. Lockheed Skunk Works)
Failure and Risk are encouraged, but in name only and not tracked or quantified
Failure is not an option (NASA) and is a Career Limiting Move (CLM)
Small, multi-disciplinary, networked, self-organizing teams are the primary operating structure across the organization (e.g. Valve)
We have some small, multi-disciplinary teams accepted and embraced within the core organization
We have some small, multi-disciplinary teams operating at the edges, away from the core
We have a traditional corporate hierarchy with large, specialized groups operating in silos
Use of social tools is mandated across the organization as policy
Most business units use social tools (and some external vendors/partners, though often unauthorized)
Some teams use social tools, but not across the organization
email is our primary communication vehicle