What is Digital Disruption? (Part 2)

What is disruptive about digital change?

Our observation is that disruptive change is change that disrupts our understanding of the world.

Digital disruption changes the basis on which we make sense of, give meaning to and understand our business and work-life practices.

An example might illustrate this. The emergence of devices such as the iPad has changed fundamentally not only how we consume data and documents, how we communicate, how we learn and how we perform various business practices but also more fundamentally our understanding of what a computer or phone is, what counts as a workplace, or what an appropriate business meeting looks like. In consequence it has also brought about new professional identities such as that of the modern tech-savvy road warrior manager.

The nature and magnitude of these changes was hardly predictable when the iPad was released (it is worth googling and reading the commentary at the time). Rather, they are the result of continuous social sense-making and adaption processes.

We argue that digital disruption does not simply change markets, or present innovative business ideas (although that is one result).

Digital disruption is not merely the digitisation of an existing business model or the replacement with a digital alternative, such as putting University lecture content online or selling products through online shops. This is a far too limited understanding.

How to understand Digital Disruption?

Disruptive change cannot be grasped by merely extrapolating into the future what we know today. Such an attempt at forecasting leaves out that actors within traditional business practices innovate using digital technologies, they do not merely stand still and wait to be disrupted by some mysterious force.

More importantly, as these business practices change so does our understanding of what counts as meaningful, valuable, and the right way of performing these business practices, which brings about further changes.

Consequently, the main argument is that some digital innovations disrupt the very basis on which we understand the concepts by which any extrapolations into the future are made, such as ‘business value’, ‘communication’, ‘what counts as a transaction or content or a product’, ‘ ways of working’, ‘what counts as a workplace’ and so on.

Forecasting the impact of digital disruption becomes impossible when the disruption occurs to the very basis on which we create a predictive model. When what counts as a fact changes, any attempt to build a prediction on the known facts of today will fail. All data collection, even big data, involves some data selection and interpretations which are always based on these notions of self-evident fact.

What can we do then?

What is needed instead is a better understanding of how to cope with and shape disruption, how to engage in productive sense-making processes in order to advance our understanding of industry processes, business value etc. and thus to innovate and adapt as digital disruption unfolds within a particular sector or industry.

As a consequence, we need more:

1. foundational research into the particular nature and structure of disruptive change processes and
2. applied research initiatives as part of an ongoing sense-making and adaption process in order to shape the disruptive processes as they occur in particular sectors and industries.

Author : Associate Professor Kai Riemer
Chair of Discipline of Business Information Systems, University of Sydney Business School
Kai's research covers the areas of Enterprise Social Media, Digital Disruption, Technology Appropriation and Sense-Making, Virtual Work, and the Philosophy of Technology. You can read more at his blog. Also follow Kai on Twitter.

What is Digital Disruption? (Part 1)

Digital disruption refers to changes enabled by digital technologies that occur at a pace and magnitude that disrupt established ways of value creation, social interactions, doing business and more generally our thinking.

Digital Disruption can be seen as both a threat and an opportunity:

• ICT-induced change happens at a pace and scale that impacts on existing business practice in disruptive ways, threatening and invalidating existing business models. 
• Digital technologies offer new opportunities for the creation of innovate business models for entrepreneurs to compete with established business practices in a wide range of industries. 

Digital Disruption can occur on various levels: 

1. Disruptions to individual life practices (example: Mobile connectivity disrupts established work-life boundaries) 
2. Disruptions to work practices (example: Narrating work via microblogging in the workplace changes what counts as (valuable) work)
3. Disruptions to business practices (example: Workplace social media disrupts the way information travels in the organisation and induces shifts in power relationships) 
4. Disruptions to industry structures (example: Digitisation of media content and user-generated content disrupts traditional value chains of content production and delivery) 
5. Disruptions to societal systems (example: Social media participation disrupts traditional practices of public opinion making) 

While the above examples point to profound changes to established business practices, they do not fully illustrate what exactly makes these changes truly disruptive.

Have you came across digital disruption at your business or workplace?

Stay tuned for more discussion on this topic next week.

Author : Associate Professor Kai Riemer
Chair of Discipline of Business Information Systems, University of Sydney Business School
Kai's research covers the areas of Enterprise Social Media, Digital Disruption, Technology Appropriation and Sense-Making, Virtual Work, and the Philosophy of Technology. You can read more at his blog. Also follow Kai on Twitter.

Social or not?

There seems to be a problem with the word social in particular when one wants to convince executives of the benefits of Enterprise Social Media.

Social it seems raises red flags in that any social business initiative is suspected to be a scheme for avoiding work and procrastination.

To address the problem it has been suggested to replace the term “social” with “network”, “open”, “collaboration” or avoid it altogether (e.g. to talk about Enterprise Collaboration Networks or just Enterprise Networks).

These suggestions are sometimes seen as bizarre and dangerous as the term social can then be considered anti-business!

A quick look at Wikipedia confirms that social is a pretty innocent term. Depending on context the term refers to:

• The collective co-existence with others.
• An objectively given fact characterising humans as inherently social beings. 
• Attitudes or behaviours displayed by people when they take account of the interests or needs of other people.

Hence, social either means just being with other people, or to behave unselfishly taking others into account. At no point does it say that social might be the opposite to terms such as “working effectively”, “doing business” or “being rational”. If anything the opposite of social is selfish, acting with no regard for other people.

If social behaviour means to take the needs of others into account, how can this be regarded negative in the workplace? And what does it say about a person if they think that is to be avoided and has no place in business.

On the contrary, isn’t all business necessarily and by definition social?

So, should the term be avoided? – No! Of course not.

Will that make it harder to sell the idea of social business to (some!) executives? – Maybe.

But in my view it is dangerous to give in to an overly reductionist management attitude that tries to free all business matters of “social” aspects and reduce it to rationalistic task execution. This needs to be resisted in my view. Not (only) because it is the right thing to do, but because it is good for business.

The whole point of the recent push for social business is to recognize that work in a modern knowledge economy has as much to do with effective task execution as it has with engaging in ongoing conversations and sense-making with others about collaborative engagements. How else can the organization innovate, change, adapt and evolve with the changes that go on around us in an economy that is being disrupted by the emergence of a stream of new digital technologies?

It is precisely in the vision of initiatives such as ESN to point out that overly reductionist approaches to management and work are not suited to cope with the demands of digital change.

So, my argument is that by avoiding the term social those responsible are complying with the rules of the very game that needs to change.

What perhaps needs to be done is educating people about the social nature of business, not pretending it’s not. Recognising that all business is social is an attitude, a state of mind that is a prerequisite for success in our changing economy.

But there is still hope. It might well be that being cautious about social when approaching executives is more a reflex anticipating resistance than a reflection of actual management attitudes. I know many managers and executives who are well aware of the need to engage with social business, their questions often naturally revolve more around the ‘how’ not the ‘if’.

Author : Associate Professor Kai Riemer
Chair of Discipline of Business Information Systems
Kai's research covers the areas of Enterprise Social Media, Digital Disruption, Technology Appropriation and Sense-Making, Virtual Work, and the Philosophy of Technology. You can read more at his blog. Also follow Kai on Twitter.

How can organisations best report and improve their performance?

Traditionally, reporting has been in the form of financial accounts and directors’ reports. More recently, many firms have reported their impact through separate Corporate Social Responsibility (CSR) documents. For many organisations, such as creative or social enterprises, the impact on their community or target beneficiaries requires even greater focus.

Measurement frameworks often result in complex and esoteric concepts or inappropriate consistency forced upon what is inevitably a complex picture. They also often forget the very humanity of the issues they are attempting to ‘measure’. Furthermore, reporting regimes are often forced upon an already stretched sector of the business community (often linked to grant and donor funding).

We have attempted to avoid these issues with the creation of our StrategicFrame at the University of Sydney Business School. This approach builds on over 2 years of research working with social and creative enterprises, environmental businesses, and other commercial operations. We have sought to bring the locus of understanding and measurement back to the enterprise and its beneficiaries. We explicitly privilege understanding by recognising the enterprise mission and the situation in which the enterprise operates (e.g. the beneficiaries and what needs to change). The StrategicFrame is an iterative process that can be simple or complex depending on your organisation’s needs, size, stage of development, and available time. The process of ‘measuring’ requires organisations do more than ‘count’, with the process including phases of understanding, measuring, reporting and reviewing. Each of these phases are organised by six key elements of focus.

The application of The StrategicFrame need not replace other tools in the impact measurement space. It is a framework for organising thinking around impact in a more holistic and strategic manner.

Author: Dr Richard Seymour
Senior Lecturer, Innovation and Enterprise Program Director, and Co-Director of Innovation & Entrepreneurship Research Group at the University of Sydney Business School

The Business of Creating Social Dividends

I don’t know anything about the science of ecology, but that doesn’t mean I can’t apply my own brand of expertise to making a significant difference to the environment.

As Business Development Manager of Greening Australia, it may seem strange that my background is actually in the seemingly unrelated fields of oil and finance. However, it’s because of this background that I’m now able to offer an insight not typically available in NGOs. For instance, I’m good at understanding the financial implications of the work we do and talking to business about that in terms of return on investment. I’m also good at managing the interactions with key stakeholders while recognising the complex interaction between food, water and energy. These things are key to ensuring positive outcomes.

So why the major career deviation? Simply because applying my corporate skills to creating a meaningful social dividend is something that, today, I place a huge importance on. This need to do good is something that often materialises following the completion of academic qualifications. Some people experience that calling early in their careers. Others like myself experience it later. Whatever the timing, creating this dividend represents a great opportunity.

Importantly, many of those with finely-tuned corporate or professional skill sets have a lot to offer. Maybe it’s their ability to innovate or overcome difficult obstacles, or provide access to networks and the opportunities those networks can engender. It’s all about asking the question: how do I assist in creating a social dividend through the work I do? How do I align my skills to provide that capacity within organisations or industry?

It’s a question I love inspiring others to consider. Indeed, what particularly appeals to me is the chance to provide that insight to students as they’re going through their university studies, to get them to think about it as part of their natural career progression. My on-going involvement with The University of Sydney, including my central role with the Business School’s Capstone project on the business of doing good, is one such opportunity.

Author: Chris Andrew – Business Development Manager - Greening Australia

The journey from employee to entrepreneur

I studied economics at Sydney Uni a long time ago… back in the day when ‘economics’ was still a faculty unto itself. I would spend hours sitting in the Wolstenholme Library trying to make sense of something that to be honest I didn’t ever really grasp, but worse still I was never really interested in or passionate about.

But I got through the degree (just!) and then I ‘did as I was told’ – or at least what every other economics graduate did at the time. I started to climb the proverbial corporate ladder.

I climbed it pretty quickly and fortunately I climbed pretty high too!

A few years ago, as the Hong Kong Director of an international recruitment business, I was having lunch with a client, when he put down his glass of mineral water and out of the blue said, “You know what Paul, I have to admit you really are very good at what you do. Surely at some point you’ve considered going out on your own.”

Of course I had thought about it. But somehow I had always had an excuse. The timing had never felt quite right and I had never considered myself much of a risk-taker.

Today, I am one of the cofounders of RecruitLoop – an online recruitment platform reinventing the way the recruitment industry works – the industry I have spent my entire career in.

I’ll never forget my aha moment when after 15 years working for someone else, the penny finally dropped and I realised that I am in fact a risk-taker. And I can honestly say that leaving the security and stability of the corporate world and getting involved as a cofounder in a tech startup has been the best (albeit by far the toughest) decision I’ve ever made.

Making the transition from employee to entrepreneur has given me an incredible sense of personal achievement, and today I couldn’t think of a better business to be building or a better team to be building it with.

I admit that the idea of starting out on my own had been niggling at the back of my mind for many years. But I had always been comfortable (there’s that dreaded word!) so I never let the idea gather momentum.

The notion of comfort zone plays a huge part for anyone weighing up the pros and cons as to whether or not to go it alone.

Ask anyone who’s taken the plunge and opened the doors to their own business venture, and they’ll tell you there was a particular moment in time when it became a no brainer.

Many people fall for the romantic notion of starting their own business – the flexibility, the freedom, the autonomy. But let’s face it, not everyone is going to be an overnight success so it’s important to balance the positives (which don’t get me wrong, are liberating) with the downside – potential isolation, the need to keep yourself motivated 24x7, not to mention a severely reduced income as you build the business.

So before you get caught up in the excitement of it all, pause for a moment and think realistically whether it is in fact the right move for you.

I know many people coming straight out of university with the mindset (and the ego!) to start their own business and take the world by storm.

Personally I was never one of them and I certainly didn’t have the entrepreneurial spirit the day I accepted my degree in the Great Hall.

I definitely needed to spend a few years in the corporate world. OK so maybe I spent a few too many years enjoying the ‘corporate comforts’. But without the experience I gained (locally and internationally), and without the guidance and mentorship I received from some amazing bosses (who I am still in regular contact with), there is no way I would be the entrepreneur I am today.

There were times when I thrived climbing the corporate ladder. But looking back, making the actual decision to forego the big income (and the prestige) was in some ways harder than facing the obstacles that have presented themselves along my entrepreneurial journey to date.

For anyone stuck at the crossroads as to whether to climb the ladder as opposed to actually building it (and this is coming purely from personal experience), as long as your motivation to start the business is consistent with your passion and enthusiasm for whatever it is you are delivering, you’ll never look back!


Author: Paul Slezak
University of Sydney Business School alumnus

With nearly 20 years in the recruitment industry and having worked for both an international publicly listed group as well as a global niche recruitment business, Paul Slezak has been a hands-on recruiter, manager, trainer, coach, mentor, and regular speaker for the industry across Australia, Asia, Europe and North America.

Today Paul is a cofounder of RecruitLoop a new online recruitment platform that’s set to reinvent the way recruitment works by providing employers with a totally flexible and stress free recruitment solution charged at an hourly rate.

Can “Brand Mongolia” be a reality?

Recently the Mongolian Prime Minister started a conversation about the opportunity to create a new global brand. Let’s call it “Brand Mongolia”. It was reported that the Prime Minister pointed out that some countries represent a brand themselves, such as Scotch whisky, Swiss watches and Japanese cars and that Mongolia has yet to establish its own brand and unique signature in the world market. The first challenge to creating a brand from scratch is agreeing on what unique aspects of the culture or geography should be chosen to form the anchor of a national brand.

Mongolia’s tourism is seen by some economists as the logical inflection point to diversify the heavy reliance on mining exports in the Mongolian economy and there are many interesting plans to increase international tourist arrivals to the country. Besides, if you were looking to build a new and sustainable brand you might be persuaded by the argument that some economic sectors, such as agriculture or mining, only generate short and medium-term gains in an economy, but tourism is the “oil that never runs out”.

Mongolia attracts around 450,000 international inbound tourists each year to enjoy its numerous tourist attractions such as untouched natural wonders and rare paleontological finds with its dinosaur fossils being one of the biggest tourist attractions. Tourism currently accounts for 3% of total employment in the country and contributes 9% of GDP. So perhaps it makes sense to use tourism as the anchor to build a national brand?

With Mongolia myopically focused on internal issues such as its political instability, crumbling infrastructure and a failing education system, it is easy to understand why the outward-focused tourism sector has received so little state support to date. However, the lack of essential ‘hard assets’ such as these in the tourism sector can realistically be resolved with the right political policies and inducements for experienced foreign investors to commit the much needed capital into this quarter of the economy.

What Mongolia would need to bring to the table to make “Brand Mongolia” a reality will be the ‘soft assets’; the human capital that will provide the service components behind the tourism product. A recent publication by the World Economic Forum may provide some insights for the Mongolian policymakers to consider when contemplating how they might deliver of this challenge.

The report entitled The Travel & Tourism Competitiveness Report 2013 ranked Mongolia 99 overall out of 140 economies in a benchmarking study but received some of the lowest global rankings for its service and attitude towards tourists, specifically the degree of customer orientation. As if that is not enough bad news when you’re about to embark on building a globally competitive tourism brand, the report also pointed out that the attitude of the Mongolian population towards foreign visitors was among the worst in the world which, in my view, only exacerbates the problem of a lack of customer orientation.

Clearly there is much to do to bring about a vision of international tourism being the globally recognised brand for Mongolia, but like all leading brands, the quality of service is a major intangible driver of brand value and one which “Brand Mongolia” can’t afford to ignore.

Nigel Finch
Director of Admissions, Associate Professor at the University of Sydney Business School