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Building a team for the digital age

Ahead of his masterclass presentation at the upcoming Beyond HR conference in Amsterdam this week, Cambridge Judge Business School Senior Lecturer Mark Thompson considers the implications of digital disruption and the ambidextrous approach to team building.

Two human hands. Connection structure. Business concept. 3D vector illustration.

Dr Mark Thompson

Dr Mark Thompson

When Klaus Schwab, founder of the World Economic Forum, suggested in 2016 that, thanks to software functionalities finally starting to properly utilise the hardware networks that power them, he suggested the digital age had ushered in a ‘Fourth Industrial Revolution’.

In doing so, he outlined a series of challenges that the new wave of digital disruption would bring. Addressing one of these, the potential impact of technological complexity on the workforce and employment practices, he wrote: “I am convinced of one thing—that in the future, talent, more than capital, will represent the critical factor of production.” (Schwab, 2016) Yet while history will tell whether talent will become more critical, managing talent has already become significantly more complex.

There can be no doubt that the modern business environment requires a new approach to organisation building. Take the Hollywood studio system, for example. A studio mogul marching onto their lot in 1930s Los Angeles wold have been master of all they surveyed. From the security guard at the gate and the waitress serving the commissary food, to the scriptwriters, showgirls and headline stars toiling on the latest production – all would have been employees of, or at least tied by long-term contracts to, the studio organisation.

On top of that – the film those harried showgirls, writers and riggers were working on would have been distributed by the studio, and shown either on a platform (i.e a cinema) owned by studio, or an independent cinema operator coerced by the studio. It was text-book vertical integration – creative, production, distribution and platform all housed within by a single top-down organisation.

Look at it now, and it’s a very different system – yes, the studios may finance a film but the ecosystem of the industry as a whole has been radically altered. Not only is the creative expertise (i.e actors, writers, technicians etc) now largely independent, so too are the platforms, distribution networks and promotional channels. The collection of skills required to find success, or even mere survival, for an enterprise in such a fractured environment are radically different – this is a complex adaptive system, and it requires a new approach.

‘Complex’ implies diversity and connection between a variety of distinct elements; whilst ‘adaptive’ suggests the ability to change based upon learning and experience; and ‘system’ implies interdependency between independent agents, be they employees, suppliers, partners or other organizations (Begun, Zimmerman and Dooley, 2003).

Clearly, in such a system individual agents all have the freedom (and in some cases the desire) to act in unpredictable ways, and as their actions are interconnected with each other’s actions it makes the process of architecting an over-arching, top-down corporate strategy years in advance essentially meaningless, condemning the Taylorian command and control approach with which our hypothetical movie mogul might have been familiar to the history books.

Variation in situational needs now requires a far wider repertoire of organisational capabilities. Work-force homogeneity – in terms of a focus on hiring candidates who fit the right skills template and have “The Right Stuff” – is over. To survive and thrive, an organisation must embrace the potential of skills diversity, encouraging the creation of a multi-specialised network that can connect with a variety of distinct elements both inside and outside.

Of course, every organisation needs people who are industrialised, who are driven by process. These are the accountants who monetise your product, the producers who make it and the analysts who squeeze necessary new variation – and thus efficiencies – out of existing process. This is the engineering end of the universe – the people who make stuff happen – and it will always be critical.

But there is now just as pressing a need for people who are more chaotic, more uncertain/unpredictable… these are the big-haired (and often bearded) creatives who can find genuine new value in complex adaptive systems. By identifying potential connections between disparate network nodes, by building previously unthinkable alliances or by creating new platform pathways to reach your market, the creative thinkers are the key to adapting legacy organisations to the fractured business eco-systems of the digital era.

What’s called for is the ambidextrous business model: the development and nurturing of a work-force that can both embrace the chaos from which new thinking emerges, and the engineering disciplines required to connect stuff together. Some elements will embrace agile ways of working, adapting to – and generating – new thought processes. Others, meanwhile, will find greatest efficiency in more ordered, industrial approaches that prioritise results and targets over the pursuit of needless innovation.

Success will come from embracing the concepts of leading across multiple cultures, of hiring the right mind-set for the right role, and of ensuring that these teams will happily co-exist within/align around the organisation’s core values.