I am honored to collaborate on this week’s blog with Fran Willis White, an industry expert on the role of change leadership and employee empowerment to drive cultural transformation. In collaborating on this blog, I discovered many similarities in the role of empowerment in the data science development process to optimize business outcomes, as well as the role of empowerment of the frontline business stakeholders to reinvent those same business outcomes. Thanks for the journey, Fran!
AI is a generational opportunity for organizations of all types and sizes to optimize their key to grow your business and operational processes, mitigate financial, compliance and regulatory risk, uncover new revenue streams, and create a more compelling customer experience. And the potential of AI is fueled by data, which is driving the desire for organizations to become data-driven.
Unfortunately, organizations are failing at becoming data-driven (see “Data and AI Leadership Executive Survey 2022” from Tom Davenport and Randy Bean). That’s because the organization’s intention isn’t to become data-driven. Data is only the means to an end. The end is to become value-driven; to derive and drive new sources of customer, product, service, and operational value. In short, to deliver that compelling customer (and employee!) experience (Figure 1).
Figure 1: Organizations Flailing to Create Data-driven Culture
Becoming value-driven through the continuous learning and adapting capabilities of AI / ML requires an organizational cultural shift. Exploiting the full potential of AI /ML requires we shift our focus away from data to value and a culture shift from command-and-control to learning-based empowerment from the teams on the front lines of customer engagement and operational execution.
Empowerment: The Key to Culture Shift
What is learning-based empowerment? And why is it key to a culture shift? Bill’s definition of empowerment is “being able to make mistakes without getting fired”. A culture of learning-based empowerment makes a critical distinction between mistakes and learning. Mistakes are made by folks when they’re executing familiar, existing processes. Learning is what occurs in the trial phase of change.
Each individual attempt at a new way of working generates valuable data to accelerate learning for the team or organization. When individuals and teams understand the value of learning-in-service-of-change, the natural desire to “hide” what didn’t work is circumvented and the velocity of organizational learning increases. We might think of the organization as the machine that learns continuously from the data generated by human-to-human learning.
Learning that occurs at points of engagement with the customer provides the shortest path to driving new value. The greater the speed of deployment of that information, the greater the quality of decisions made based on that intel. Speed and quality of decision-making put the “power” in empowerment, and the value in customer experience.
It is this employee empowerment that sets the stage for the cultural shift necessary for organizations to exploit the full potential of AI / ML to become value-driven. Cultural shift is not a technology problem; it’s an employee empowerment problem.
The interdependence of employee empowerment and leading a culture shift is like a dance. Both partners are required to “tango”, and the dance is nuanced. Many leaders are surprised to learn that employees want to be led at the beginning of a transition, especially in a culture shift. And let’s be clear—throwing responsibility for a culture shift over the wall isn’t being led, and it isn’t empowerment.
Cultural shift is about blending the continuous learning and adapting capabilities of AI / ML with the innovative, reinventive, exploration, experimentation, and learning the power of humans. It’s about mining, sharing, and refining the learning in your organization for speed and insight. (Figure 2).
Figure 2: The Empowerment and Democratization of Ideation
For organizations looking to fully exploit the power of AI / ML to become value-driven, employee empowerment isn’t something nice to do; it’s an imperative! It’s about liberating and nurturing the intuition in your people’s minds to 1) identify where and how data and analytics might provide new sources of customer and operational value and 2) uncover those variables and metrics (features) that might be better predictors of behaviors and performance.
Change leadership will become critical to institutionalizing the culture shift. But change leadership cannot sustainably happen without empowerment. In fact, empowerment is the lead indicator to the lag indicator of change leadership – empowerment must happen first if change leadership is going to be successful and scale.
Change leadership is critical to making and sustaining a culture shift. Empowerment is a key aspect of change leadership because empowerment fuels faster decisions. Faster decisions accelerate change, and fast is the leading indicator of successful change and of adaptive cultures.
Culture Shift Key to Value Creation
A cultural shift to empowerment is key to driving the organization-wide mandate that demands value creation, especially at the frontlines of customer engagement and operational execution.
But how does your organization define value? What are the organization’s key initiatives that are designed to create customer, product, service, and operational value? And what are the metrics against which an organization measures its value creation effectiveness?
Fran says that answering these questions is “aligning with context”. Context is the set of conditions that determine what will work and what won’t. It’s impossible to define value without understanding the context for success (Figure 3).
Figure 3: Value Engineering Framework
While “value definition” might be a top-down approach, “value creation” is multi-directional and continuous. And a multi-dimensional value creation process exploits a continuously learning and adapting organizational mindset by using every customer, employee, supplier, and operational engagement as an opportunity to learn, adapt and create new sources of value.
Summary: Empowering to Drive Cultural Shift
To drive the cultural shift necessary for organizations to exploit the potential of their data (the most valuable resource in the world according to “The Economist” and the potential of their employees (the most valuable resource in the world according to Fran and Bill):
- Organizations need to focus on becoming value-driven, not data-driven
- Becoming value-driven requires a cultural shift of employee empowerment (that ultimately drives and institutionalizes the necessary organizational change)
- Empowerment is about eliminating the constraints and liberating (and democratizing) the ideation necessary to drive value realization and creation at the points of customer engagement and operational excellence
Wanna become value-driven? Empower your employees to make that cultural shift necessary to exploit the synergistic potential of your data and your people.