Strategy in the Digital Age: Mastering Digital Transformation
Michael Lenox
Stanford Business Books/Stanford University Press (June 2023)
How to respond effectively to “The Strategist’s Challenge”
I agree with Michael Lenox: “digital technology is changing the underlying basis of competition for a wide swath of businesses and industries.”
In The Innovation Ultimatum, for example, Steve Brown focuses on six technologies that intimately connect the digital and physical worlds: Artificial intelligence (AI); Sensors and the Internet of Things (IOT); Autonomous Machines — robots, cobots, drones, and self-driving vehicles; Distributed leaders and blockchains; Virtual, augmented, and mixed reality; and Connecting everything and everyone: 5G networks and satellite constellations.
Brown suggests that these technologies be viewed as primary colors on a palette on which innovators mix and match in appropriate combinations and configurations. The companies that thrive in months and years to come “will be the ones that never rest on their laurels. These companies will fully embrace every one of these six technologies and combine them in creative ways to leapfrog competition…Winners will create massive value in the digital domain and use the six technologies to bridge that value into the physical domain, streamlining operations, delighting customers, and creating exciting new products and services.”
According to Lenox, “The Strategist’s Challenge is to envision and secure value-competitive positions at the intersection of the organization’s values., the opportunities created in the marketplace, and the unique capabilities of the organization. An organization’s values are its north star. They define the organization’s overall mission and purpose, the domains in which it wishes to play (or not play), and the vision for its future.” (Page 13)
A common theme running through Strategy in the Digital Age is that digital technology is changing — sometimes totally disrupting — the underlying basis of competition for a wide swath of businesses and industries…Most important, this book is about how to lead a digital transformation in your organization –not only paying attention to the technical details but also tghinking through the human dimension and being sophisticated about the numerous social and policy changes raised by digital technology.”
These are among the other passages of greatest interest and value to me in Part I (Chapters 1-4), also listed to indicate the scope of Lenox’s coverage:
o The Exponential Growth of Three Core Technologies (Pages 3-6)
o The Power of Aggregation (8-11)
o The Eternal Straztegist’s Challenge (13-17)
o Framework 1: Setting a baseline (18-20)
o The Importance of Enabling Technologies (27-30)
o The Quest for Platform Dominance (33-38)
o The Dynamics of Competiti8ve Life Cycles (38-43)
o Framework 2: Analyzing the Digital Environment (43-45)
o Deconstruction of the Value Chain (47-52)
o The New Forms of Value Creation (52-56)
o The Evolution of Competitive Positions (59-62)
o Framework 3: Formulating a Digital Position (67-69)
o The Importance of Complementary Assets (76-80)
o The Innovation Imperative, and, The Return of the Strategist’s Challenged (80-82 & 83-85)
o Framework 4: Specifying How to Capture Value (85-87)
o The Recruiting ofv Digital Champions (96-100)
o Framework 5: Planning Your Digital Transformation (107-109)
o “The Terminator and Other Dystopian Futures (114-117)
o Framework 6: Preparing for Digital in Society (126-127)
o The Journey to Transformation (130-134)
Strategy in the Digital Age is a brilliant achievement. In this volume, there is an abundance of information, insights, and counsel that can help prepare leaders in almost any organization to plan, implement, and then manage a digital transformation in months and years to come, making whatever revisions and modifications may be necessary to ensure that their organization continues to achieve its strategic objectives. Obviously, it remains for those leaders and their colleagues to do that in ways and to the extent most appropriate for their organization.
These are Michael Lenox’s concluding thoughts: “The digital age may be scary, but it can also be transformational. Digital technology holds promise to help address the world’s most pressing challenges even as they create new concerns and issues. The question is, How will you and your organization leverage digital transformation to transform the world for the better?”
I presume to offer two suggestions while reading Strategy in the Digital Age: Highlight key passages, and, keep a lined notebook near at hand in which you record your comments, questions, action steps (preferably with deadlines) and page references. These two simple tactics will facilitate, indeed expedite frequent review of key material later.