The pitfalls of digital transformation
Nowadays many principles are given numerical values to indicate that they’re work in progress. Enterprise 2.0 becomes Work 4.0 while Smart Production turns into Industry 4.0. Then comes lean administration, decentralized organisation, team work – the number of key words for a change of direction is becoming inflationary. Leaving aside for the moment terminological differences and special features, all these concepts seem to me to pack the same message – that the productivity reserves of enterprises and administrations lie in the minds of the people who work there. These reserves can be mobilized by a new form of organization that avoids superfluous interfaces and offers workers at ground level the freedom they need to take many of the organizational and controlling tasks – long the domain of indirect departments – into their own hands.
The principle expounded by Work 4.0 is so simple and so illuminating that it really does inspire senior management, and especially individual company executives, to roll up their sleeves and in the fullest confidence start tackling restructuring of the company. The organisation of work only needs to be purged of unnecessary constraints and meandering detours, and the workforce schooled in the techniques of self-responsibility and team work for the company to rise like a phoenix from the ashes of Taylorist organisation and wing its way to unsuspected heights of productivity.
Unfortunately, in my view, what is often overseen here is that a clear and simple principle isn’t always easy to realise. In terms of actual operational practice, it must assert itself against a massive solid block of reality which cannot be vanquished by merely evoking the superiority of the new, the digital and the networked internet of things.
Pressure to succeed starts with the project manager
Project managers are usually employed to bring order and a breath of fresh air into the company. Their main remit is typically to increase flexibility and boost clout by lowering costs and run-through times. They are almost always the ones to bring in decentralized organisation once senior management has given the green light. In all such cases the long-term goal is digitisation of processes and having the whole company pledge allegiance to the new principle of Work 4.0. As always, the success of the project is critical for the project manager’s own career so that company success is synonymous with personal success. Some project managers even give themselves a serious handicap by frequently failing to obtain more than authorisation for an organisational experiment from senior management. They content themselves with setting up a laboratory when what is needed is a strategic decision for which the most senior management bears responsibility.
What I’ve found is that they do this in full consciousness of the risks they are taking. They are convinced that as top company management has hardly any interest in organisational issues and decisions, they will have to roll out the project under their own steam. Others, however, in the planning phase, simply underestimate the resilience of established structures which is nearly always the most contentious problem of them all. They recognise too late that by activating company employees they have unleashed a development they can no longer fully control. Outcomes delivered by individual planning groups are usually at odds with established structures. Whole problem fields suddenly emerge with which they didn’t want to deal, at least not at that particular moment. It’s an assault on the whole delicately balanced company power structure – which causes anger on all sides.
That success is hardly possible without removal of the old organizational ballast is expressed neatly in the (German) proverb “a sleeping dog only wakes up when you stumble over its bone.” The magic spell which the Work 4.0 concept with its decentralised organisation rightly casts often blinds us to the fact that on the road that leads there by no means everybody sees themselves as winners.
Yet the administration and the senior management most certainly do. The direct administration area is freed of meddling interference and gains freedom and autonomy and thus more weight in the company. Management enjoys the prospect of lower costs and smooth uninterrupted workflows. Both these groups can embrace the new principle with relatively few qualms. Similarly, in most cases the works council sees more pros than cons for its clientele. Middle management, however, from the foremen upwards – and particularly the indirect areas – see the new principle of process digitisation primarily as a threat to their own status quo which is not off-set by any directly perceivable benefits for them. They should surrender know-how, perhaps even workers. Thus they form the natural opposition to flexible models of work and digital transformation concepts.
Advocates of this new organisation are very quick off the mark to accuse this opposition of malice, backwardness or small mindedness if they don’t instantly acknowledge the innate superiority of Work 4.0. Yet such opposition is generally led by seasoned old hands who know the company inside out and have already seen the miserable failure of a great many attempts to turn it upside down. They know the value of those procedures and channels with which administration has dealt so successfully. It’s not the fear of losing power that makes them sceptical as much as the weight of their own experience. The very people who time and again have seen that even the best BYOD concepts and Work 4.0 coordination systems fail to deliver all they could due to human shortcomings - should they suddenly stand by, watch and accept as vital functions now fall into the hands of these unreliable nomadic colleagues?
When Generation Y, which always (even in the family) has to have everything precisely pre-planned, now gets a say in the coordination, things can only go wrong. Things taken for granted over the years are now suddenly called into question and a confused and confusing conflict situation is created composed of anxiety about the company on the one hand and anxiety about personal gains on the other. Faced with this, many project managers succumb to the temptation to first evolve the new organisation in a small circle of the faithful, expecting all the rest to give their assent when presented with a more or less complete package. This hope, as I have found to my cost, is generally illusionary.
But how to root such a novel principle of organisation when it doesn’t match up with the winding workflows of standard practice? Process and organisation must be compatible! In all other departments affected by the changes, the people concerned need to be involved in the change process to at least an equal extent. Early on in the process, serious efforts should be made to convince at least some of the sceptics that the whole point of the exercise is not to undermine their authority but to create a much more efficient organisation that would also free them of tiresome routine and coordination work, and give them time to concentrate on more important matters. This might be an uphill struggle but it’s also one that pays dividends. And also calls for hard data. 
This holds particularly true in cases where management still isn’t fully behind digital transformation. In such cases digitisation opponents are particularly assiduous in seeking out the offending hair in the soup. Above all, the administration is marvellously adept at finding whole bushels of hairs and weaving them into a rope with which to hang the project. If no agreement can be reached at this point, the project escalates into a power struggle which will be won by the side that succeeds in attracting the support of company management. Naturally, project managers also seek allies. Only they are not those who sit secure in their seats in the upper echelons of old well established structures but tend rather to be the young, the up-and-coming generation ready with fresh ideas to advance the company’s cause and their own.

Involving critics of Work 4.0 at an early stage

They’re usually very eager and highly committed, have excellent ideas, and get on well with their colleagues. However, they’re still rather low down the ladder and dependent on those on the upper rungs. There are also times where the project manager has to abandon the New Forms of Work project in order to ensure his own survival. Mercifully, most change projects aren’t fought out in a show-down like in some western. They tend to move in the confines of a triangle whose three corners are confrontation, resignation and integration. As they tend to run over a considerable period of time, they go through phases in which they approach or distance themselves from the single corners of the figure. Resignation is a common reaction to lost conflicts or disappointed expectations. Mistrust and a defensive attitude culminating in complete inner withdrawal are the consequences. This is frequently the type of attitude found at the beginning of group work among colleagues on the lowest echelons of the hierarchy who expect that the innovations ordered by those above will bring nothing good.

I’ve also seen in practice that many members of management (for instance, supervisors) are equally over-challenged by such innovation from on high. They find it difficult to see sense and purpose in the new, permissive, self-determined regulations of the work model. Accepting that they should shape their own work environment is such a highly unusual thought for many of them that they shield themselves and block it out. Since ordinarily there’s not too much time available to break down this block, overcoming resignation and confrontation, and shepherding them to collaboration can be a most useful move. What’s also proven its worth is tying in with familiar procedures and presenting colleagues with a solution from on high that they could really never accept. When the inevitable objections come, it’s time to respond along the lines of, “If you don’t make a counter proposal now, then don’t go complaining when this happens to you!” If “those up there” are then shown how it can be done better, and if this counter-proposal is accepted, then the way is free to a genuine form of collaboration. When the workforce – as in the case of Westaflex – sees that their views really are taken seriously, they see themselves as true partners in the digital transformation and contribute new solutions without any prompting. Even so, very often confrontation must first be used as a means of shaking them out of resignation.

Opposition to digital transformation from established departments first of all takes a defensive mode. If they fail to embrace cooperation despite all the numerous offers made, confrontation must be accepted and the conflict waged out. If senior management is convinced of the need for digital transformation and determined to embody and exemplify the new form of work, and if the conflicting parties are reasonable enough not to want total victory, once more the basis for collaboration is set. Even so, it does happen now and then that the advocates of the old structures resignedly accept that they cannot win the battle and adopt a stance of passive resistance in which they make an outward display of willingness to cooperate whilst at the same time hindering change internally wherever they can.

The favourite means here are rumours and smear campaigns (“in any case the project manager is soon leaving and that’ll be an end to the whole nonsense”) or the refusal to release colleagues for meetings and training courses (“all these changes cause such a lot of extra work that every hour’s precious”). For the same reasons, appointments and important milestones can’t be kept and data can’t be compiled or only inadequately. One particularly favoured method on which a great deal of ingenuity is lavished consists of burdening the unloved project with overheads which have the unfortunate effect of blurring its economic viability. In short, the keyboard of the old organisation is played with great virtuosity to drown out the sound of the new melody. Since such submarines are difficult to pinpoint in the beginning, they can pose a much more serious danger than direct open opposition. They don’t always live in the ranks of middle management alone but can be found on all levels of the company. In my opinion, the only effective solution against them is a clearly defined and official policy statement from company management that whoever wants to work on management level for any length of time must endorse and actively embody the new form of organisation.

Organisational niches will then be created for the naysayers where they can continue to use their know-how whilst being kept at a certain remove from the new channels and workflows. Such compromises, which often come with promotion, help to change resignation into willingness to cooperate. Even an objectively argued refusal can show that the person has taken the proposition seriously and values continued collaboration. At this point in digital transformation, there can also be a tendency to throw the baby out with the bath water.  Many project managers underestimate the dynamics of group processes and are so fixated on solutions for minor details that they lose sight of the actual propulsive force of the system, the productivity that comes from the collaborative work of responsible and empowered employees. Furthermore, misunderstandings and conflicts have their origins in the fact that the promoters of transformation are also the moderators of the group processes it requires. Their allies, on the other hand, are usually their superiors.

on CeBIT

Thus, particularly at the outset and in the SME sector, it’s a smart move to have outside forces unconnected with the company hierarchy take care of moderation. They will be more readily accepted by groups of employees as impartial instances who can arbitrate between opposing standpoints. This is a major step towards ensuring that the system runs on its own traction, and once it’s accomplished, third party intervention can be limited to dropping in every now and then to check on how things are going.

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