Digital Innovation in a Classic Manufacturing Company: How to find the right people and how to keep them on-board?

Anett Hötzel, Head of Digitalization, Felix Schoeller Group

A while ago I stumbled across a saying from the Silicon valley: “Uber yourself before you get kodaked.” Or in other words: Disrupt yourself before you get disrupted.

The Felix Schoeller Group has experienced disruption firsthand some years ago.

"Because digitization is developing exponentially, new opportunities and risks are constantly arising for companies."

We are a global manufacturer of specialty paper, founded in 1895 with photo paper as our core business. But with the rise of digital cameras and then smartphones the market significantly shrinked – by 75 percent.

So we know how it feels when disruption hits and this experience might be one of the reasons why our company so actively embraced the chances that the mega trend digitization offers. Today, we look back at 4 years of experience in building a team for digital innovation – so what have we learned about how to find the right people and how to keep them on-board?

The right people – for what kind of environment?

The search for the right people starts with the question “For what kind of environment?”

Faster, better, simpler. Anyone involved in digitization quickly realizes that certainties that once seemed immovable are suddenly wavering. Change is taking place at a rapid pace and it is becoming increasingly difficult to assess what will come next and when. Because digitization is developing exponentially, new opportunities and risks are constantly arising for companies. At the same time, we sometimes don't even notice how quickly we get used to new technologies. When did the smartphone come onto the market again? When were cloud technologies introduced?

VUCCA gets to the heart of how our world is now shaped - ever more volatile, uncertain, complex and ambiguous. Those who are now asking themselves "Wasn't that called VUCA? Where did that second C suddenly come from?" - we've taken the liberty of adding a 5th phenomenon to this acronym. The balance of power is gradually shifting away from the suppliers of a market to the demanders, and we are increasingly dealing with customer (buyer’s) markets.

The art for companies today is to be aware of these phenomena and to expand their own toolbox of methods & approaches instead of sticking rigidly to established procedures.

Volatility: Established solutions receive competition as if from nowhere and may be replaced within a short time. New trends and technologies emerge and offer unforeseen opportunities and risks.

• Maintain decision-making leeway, avoid getting into a position that only allows one decision

Uncertainty: Forward-looking forecasts and reliable assessments of developments are becoming increasingly difficult or even impossible. Hardly anyone can reliably predict how a market will develop; the future is uncertain and full of hypotheses.

• Test / validate knowledge and take small steps so that mistakes lead to correction instead of catastrophe

Customer (buyer’s) markets: As a result of global networking, consumers today have significantly more purchasing options and information at their disposal than in the past. They compare prices and exchange experiences without manufacturers being able to intervene. Many people have also become more selective about where they buy their products and are scrutinizing purchasing arguments more closely than before

.• Make sure to understand the pains and needs of the users and develop the value proposition from there

Complexity: Situations and facts are so multi-layered that correlations of cause and effect can hardly be overlooked and thus reliably assessed.

• Rely on collaboration and multidisciplinary teams to see things from different perspectives and not jump to conclusions too quickly

Ambiguity: Companies increasingly have to meet contradictory user requirements and react to opposing, partly paradoxical tendencies. E.g. for certain products the tendency toward massification and on the other hand the tendency toward exclusivity exist simultaneously. Which means that both strategies can be successful.

• Recognize and tolerate contradictions instead of cognitively fading them out because they disturb our need for harmony

Implications on mode of working

A VUCCA shaped world also has implications on the mode of working of employees.

When developing products and services, authentic user-centricity is key - engaging in a constant exchange with real users to understand their needs and wishes first-hand.

Rather than trusting your own gut feeling VUCCA requires continuous validation of assumptions and testing of ideas in order to let go of solution concepts with little to no user interest.

In a volatile uncertain world, projects benefit from short sprint cycles with clear intermediate goals and an iterative approach where ideas and solutions are optimized by going through a circle of “build – measure – learn” several times.

To address complexity and ambiguity teams should be set up multi-disciplinary to integrate different backgrounds and perspectives.

Implications on inner attitude

This mode of working requires a certain inner attitude.

Team members need to be resilient, meaning that they are capable to deal with uncertainty and insecurity confidently.

Constant testing, validation and iteration requires mental agility in order to act flexibly even under changing conditions:

Self-reflection helps to defer or critically question one's own assumptions and be open for feedback from customers.

Developing a new service or product it takes an entrepreneurial attitude - taking continuous action on ideas, being decisive, learning from mistakes and embracing responsibility for results.

Ultimately, a growth mindset, i.e. the inner conviction that new situations are an opportunity to learn and develop, is crucial in a VUCCA world.

Roles and competencies

An ideal startup team consists of three people – a developer, a designer and a marketer.

The designer is the creative engine and interested in the human side of a problem - providing an experience to your customers.

The developer makes sure that your product does what it should do as – using technology to solve a problem.

The marketer knows how to best reach your target group and sell your product – making sure that customers are happy and bills can be paid.

For a unit driving digital innovation you need similar roles and competencies:

• Unit manager – acting as the central point of contact, stakeholder & partner management, in charge of the realization pipeline & budget

• Project manager – responsible for project execution & management, conducting interviews and product ideas, analyzing markets & trends and know-how development

• Product manager – steering product management, developing prototypes & test scenarios

• UI / UX designer – providing design concepts & screen designs, focuses on usability & user experience

• Frontend & backend developer – creating a coded solution, taking care of software architecture

• Sales & Marketing – developing communication strategies, implementing online campaigns (e.g. via email or social media),

How to keep the right people on board - implications on leadership

Of course, there is no “one fits all” recipe to keep the right people on board, but there are some principles that show your people that you care about them and appreciate their contribution.

Set goals together: Teach your team to set smart goals and to come up with targets they feel committed to. Give the OKR method a try if you are not familiar with it yet.

Lead with focus on strengths: Each of your team members has a unique set of strengths so make sure everyone knows them and uses these strengths to be successful.

Avoid “hippo* decisions”: Whenever you can, take decisions data driven rather than based on gut feeling. *Hippo = highest paid persons opinion

Encourage development: Inspire your team to learn new things, to make mistakes and to grow.

Be positive: Not only but especially in tough times a positive mindset is key. It creates an atmosphere of confidence, optimism and stamina which will help your team to believe in their strengths, act impactfully and ultimately not only achieve their goals but make the company’s vision come true.

 

Weekly Brief

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