Leading Through Disruption and Transformation

CEOs have told us that we are at a watershed moment. As the leader of IBM Canada, I couldn’t agree more. Technological advances are creating massive upheavals, with industries converging and companies transforming like no other time in our history.

Last year, IBM surveyed business leaders from 21 industries across more than 70 countries. Over 800 CEOS told us that technology is at the top of the list of external forces buffeting their organizations, that the trend of “uberization” or industry disruption caused by an unlikely competitor has become a dominant concern and that industry convergence is causing them to look at new clients from new industries. As a result, more than two-thirds of CEOs said they plan to reassess their strategic direction and explore the potential for novel, non-traditional forms of growth.

I motivate my team to continually act as challengers and not champions. We must work harder, smarter and faster than our competitors for the sake of our customers...

None of this surprises me. Disruption is pervasive—it’s happening in the tech industry (where change is the only constant!) and I see it every day in our clients’ industries. What’s most important in this time of rapid change is how leaders respond to lead their companies through it. Digital disruptors prey on complacency. Now is not the time for business as usual. All companies need to act like challengers and embrace disruption to reimagine their businesses.

So how are some of today’s top CEOs responding? As part of our research, we also looked at what the leaders of the world’s most successful companies do differently. We identified a small group of organizations that have both a strong reputation as leading innovators and a solid financial track record. The Torchbearers, as we call them, comprise only four percent of CEO interviewees, but they provide valuable guidance from which leaders and aspiring leaders everywhere can learn. 

As a leader of a company that is experiencing and enabling some of this disruption, much of what these CEOs share rings true with my experience. They realize they need to sharpen strategies, energize engagement and accelerate transformation to win. Here are some of the highlights of what they told us as well as some of my own observations…

SHARPEN YOUR STRATEGY

Pursue disruptive innovation, not just incremental improvements. Torchbearer CEOs look for ways to exploit new and emerging technologies or business models, or apply old technologies in new ways, and look at other industries for ideas. They experiment with new revenue models that might provide additional sources of value and a stronger customer experience. And when they’re launching something new, they aim to cross the finish line first.

In my opinion, speed is one of the biggest challenges but also one of the most important factors in success when it comes to disruption and transformation - speed of acceptance, speed of knowledge acquisition for the “new world” and speed of transition and execution. As a leader, you are constantly challenged with resistance to change, so creating the right environment for it is key. To help enable this, leaders need to challenge comfortable behaviours and assumptions while creating a safe environment for breakthrough insights.

I motivate my team to continually act as challengers and not champions. We must work harder, smarter and faster than our competitors for the sake of our clients and at no time act as though we are on top. I think that comes from the Hamilton, Ontario Steel Town boy in me…act like you have to fight for everything you have and fight even harder to keep it. 

I have always believed that action inspires reaction. Too many times we are waiting for something to happen or to have the perfect insight to act. I would rather make mistakes that we can correct on our path to successful outcomes than to wait for the perfect moment to act.

ENERGIZE YOUR ENGAGEMENT

There’s no question that data is increasing for every industry at a phenomenal pace. Unstructured data like videos, medical images and social content will be the majority of data in the world and is expected to reach 44 zettabytes by 2020. That’s 1.6 billion years of HD video. Torchbearers know the implications of this. They employ more sophisticated predictive and cognitive analytics techniques than their competitors to decipher their data. And with these technologies, leaders can quickly investigate new trends, identify new customer segments and engage with customers at a deeply human level, as well as make smarter business decisions. Who wouldn’t want to be able to do this? However, data insights should never supersede a leader’s intuition to take risks and take action. I use data to guide me but to stand out among our competitors I will take risks that are not just supported by data.

TURBOCHARGE YOUR TRANSFORMATION

I am never satisfied with the pace at which we accomplish our objectives. As a leader, I spend more time setting challenging timelines to success and managing and leading the team to overcome obstacles to achieve those timelines. There is no success in trying to catch your competitor, you must set the pace for your team and lead the market. 

Top leaders today realize that speed is critical and they build a culture of rapid experimentation and prototyping to accelerate the release of new business models, products and services. They are prepared to make long-term investments in innovation, not just the sort of investments that deliver better quarter-to-quarter financial performance. They define the skills they will need in the future, as industries converge and ecosystems predominate. A leader must anticipate the market demand and prepare their team with skills and investments to capitalize on it. One of my favourite quotes is: “the will to win means nothing without the will to prepare.” Focus on what the market and your clients need and partner with other organizations, including competitors, to ensure you can bring the best forward. This will only strengthen the market and your brand. There is enough business to share with competitors if we are jointly making our clients successful.

STAY TRUE TO YOUR PURPOSE AND VALUES

In addition to the guidance above from the Torchbearer CEOs, I’d like to add a couple of things I’ve learned based on my nearly 30 years of IBM leadership experience. I strongly believe that staying true to your company’s purpose and values is absolutely essential to long-term success. The world has changed considerably over the past 100 years and while there is ample evidence of IBM’s ability to adapt and reinvent ourselves to meet ever-changing marketplace needs, there is also evidence of our commitment to core values, which have always been at the centre of our transformation efforts: Dedication to every client’s success; Innovation that matters — for our company and for the world and Trust and personal responsibility in all relationships. I am personally proud to be associated with living and leading these values at IBM.

Today, we are more of a services provider and less of a hardware, software business. We transformed to a cognitive solutions and cloud platform company, yet we remain true to our heritage as a team of collaborative forwardthinkers, focused on being essential as we make business and society work better.

In order to do this, we need to remain close to our clients and our people. I am actively engaged in meeting with clients and I engage daily at all levels within IBM. I am constantly learning of what is changing and what I need to change. My team and clients can count on my commitment to listen and take action.

ALIGN LEADERSHIP TEAM TO ACTIVATE AND DRIVE CHANGE

But it’s not just my commitment that counts. This kind of commitment needs to be nurtured, reinforced and brought to life throughout the organization, with every leader leading by example. 

Transformational leaders do more than embrace change – they activate and drive change at all levels. Their mindset must be one of changing the culture, with a focus on moving the team out of their comfort zone and into a new era of doing business. Based on my experience, this requires significant communication, guidance and reassurance, while creating a strong sense of confidence in the change of direction. At the same time, a leader must quickly identify those that are engaged and supportive of the change and make these leaders of change examples to all others. It also means having the courage to move out those that resist change and fail to adapt, regardless of their institutional knowledge. They also know the value in engaging new employees and bringing new talent into the company to allow for fresh perspectives and energy to execute change.

CEOs clearly understand they need to prepare for a future in which disruption is pervasive, where competition is completely redefined and transformation is inevitable. While it will certainly be challenging, if leaders follow the guidance above, I am confident they will be better positioned to navigate these tumultuous times ahead of us. What an exciting time to be a leader!