The position of CEO during the Fourth Industrial Revolution is not for the faint of heart. The digital and physical worlds have blurred, and we’re in uncharted waters. Many feel uncertain around the future of jobs. For C-level leaders, anxieties are even higher as they learn to embrace a completely new set of values and leadership practices that brush aside traditional management techniques and put the employee in the driver’s seat.
Those who forge ahead won’t necessarily be those with the biggest budgets or the most developers on staff. It will be those who listen — to their customers and their employees. Already, top leaders are doing more to integrate feedback and innovation into their company culture.
Salesforce and the World Economic Forum co-hosted a panel on Leadership in the Fourth Industrial Revolution, with insights from:
Nicholas Davis (moderator), Head of Society and Innovation, World Economic Forum
Marcelle Parrish, President, Global Digital Operations, Ralph Lauren
Stephen Bird, CEO, Global Consumer Banking, Citi
Together, panelists addressed the biggest tension points facing organizations and their C-suite leaders today:
Do I adapt or help shape the future?
Will we have to turn on a dime or can we be agile?
Is technology replacing my people or augmenting them?
These questions prompted three key takeaways:
As with any revolution, the marketplace is now split between the old and the new. There are companies being forced to adapt from legacy systems while others are jetting ahead on new technology standards, unburdened by prior foundations. This is increasingly apparent in mature and regulated industries like banking, where, Bird says, businesses were built on technologies that are increasingly becoming obsolete.
“What’s happened for the first time in history is the marketplace has already completed its systems conversion before the big institutions,” said Bird. “Everyone has already elected their favorite solutions stack — smartphones, fast networks, brilliant apps, cloud, AI. Yet, there are businesses that were built when you had physical places of business — call centers, landlines, credit operations centers, paper — and decisions made on the basis of credit. We are adopting that [new] solutions stack and enforcing the use of brand-new technology, so as not to be held back by legacy systems.”
Ralph Lauren is also in the midst of a transformation. Successfully transitioning will mean a consumer base that’s not only delighted by its products, but involved in product evolution and the ongoing brand conversation. To accomplish this, Ralph Lauren is putting data first. Whether customer data, external data, or social data, creating a consistent feedback loop using that information is critical in order to stay current and continue growing.
But data for data’s sake won’t do much good unless it empowers action. Tyson explains that healthcare, like banking, has deep-seated foundations centered around the creation of a hospital, with all other healthcare elements wrapped around it. For Kaiser Permanente, data and emerging tech are allowing it to challenge that concept with new innovations like virtual doctor visits, connected medical devices, and the ability to interact with physicians in different ways.
“With technology, you can begin to connect the dots,” said Tyson. “For me, the dots are information. How does an organization like Kaiser Permanente maintain [member] information with their health habits around eating and sleeping? How do we help in the next generation of gadgets and tools … to give the person better information about choices that he or she wants to make about their lives? The opportunities are significant in rethinking the value proposition of health.”
If there’s one thing our panel can agree on, it’s that strategy planning must be collaborative. To Tyson, CEOs need to figure out how to engage the entire organization about what’s coming — and it shouldn’t be just a few people who hold the key to decisions that affect everyone else. At Kaiser Permanente, collaborative strategy is a critical part of the change process in the 21st century. Already, Tyson has begun encouraging employees, physicians, and medical professionals to co-create the future of the organization by putting themselves in his shoes.
“We’re freeing up energy to get new learnings and insights from the people who have the best knowledge of where we are,” Tyson said.
Bird agrees with the rejection of the ivory tower of strategic development, asserting that CEOs must ask themselves and their teams if they’re future-compatible, for the good of the company.
At Citi, senior leadership (including Bird himself) takes a test to determine if they’re future-compatible based on five key character traits: adaptability, boldness, curiosity, collaboration, and determination. Because supervisors aren’t privy to the results, the test is truly about self-learning and improvement through digital literacy and practical tips. By being honest with yourself and asking how much of the true creative potential of your employees you’re harnessing and translating into value, Bird believes company leaders can be motivated every day to improve their management processes.
Being future-compatible also means changing your mindset from a threat mentality to a growth mentality. Whereas business schools are still teaching the message of total addressable market, Bird gave the example that Uber has revolutionized the industry with its view of the total addressable problem. Instead of solely focusing on the taxi industry in its home city of San Francisco, Uber has focused on the larger global problem of transportation to provide a more viable business idea with the potential for exponential growth. To adopt this mindset, businesses must do the grunt work of reconceiving their business to address the total problem, focusing on the marketplace and needs of the customer along the way.
Ralph Lauren is also focused on innovation, but instead of leaving it to decision makers at the top, it has begun farming it out to employees, who are the most in touch with customer needs. The concept, called “IdeaLab,” solicits employee ideas on topics like digitization, modernizing processes, and finding areas of friction to address within the company. In this way, the company gives employees the power and entrepreneurial spirit that Ralph Lauren himself possessed when he founded the company more than 50 years ago.
While some leaders fear the replacement of humans by machines in the Fourth Industrial Revolution, Tyson assures that healthcare will always have an element of human contact. While the future is high-tech, it can be equally as high-touch, introducing new roles instead of a strategy for replacing people. If you consider the trust and mindshare that you’ve built up within your employees, strategizing around protecting that value while chasing efficiency is a balancing act. When managed correctly, using employees’ expertise to ultimately serve more people through tech is the outcome.
“The reality is there are certain issues that are going to come up because of the use of technology,” Tyson said. “One of them is how jobs are going to change. The idea that we’ve defined all jobs on earth — we don’t believe that. We believe that technology is going to allow us to free up and think about new jobs … to meet our members’ needs well into the future.”
While Tyson admits Kaiser Permanente still has work to do in the areas of collaboration and learning, it’s already making strides to adapt to a new way of co-creating for the future. While consistency of service and thought is a benefit to members in sharing medical techniques and health practices across regions, that same consistency is responsible for the conditioning of the organization’s employees and physicians to confine themselves to a limited set of tasks instead of owning more of the company strategy. Now, Kaiser Permanente is working to increase collaboration and new schools of thought while maintaining consistent experiences for its members.
Parrish agrees wholeheartedly with the enablement mindset, making tech and training available to all within the organization and identifying what skills will be necessary for future jobs. The fact is, emerging tech has prompted a change in needs for the customer, and to keep up, retailers like Ralph Lauren must respond by being just as agile, knowledgeable, and accommodating.
“If you have that love for your customer and passion for what you do,” she said, “that creates a culture of innovation, enabling us to continually evolve to meet customer needs.”
While our panelists seem to agree that the Fourth Industrial Revolution is prompting exciting advancements, it’s not unnatural for such massive change to raise questions around the future of industries, companies, and jobs. Our panelists’ final pieces of business advice for the Fourth Industrial Revolution?
We all have a responsibility to co-create the future. –Stephen Bird [click to tweet]
Don’t get too stuck on where we are today. This is just a precursor. –Bernard J. Tyson [click to tweet]
Keep your customer at the center of your value proposition so you can continuously iterate. –Marcelle Parrish [click to tweet]
It’s time for CEOs to use their leadership positions to start conversations about change, and collaboratively pool knowledge in a way that better prepares their companies for the new revolution — and a future we can all feel good about.
This article is part of a Trailblazer spotlight series on the Fourth Industrial Revolution — a concept introduced by Klaus Schwab at the World Economic Forum to describe the fundamental shift in the business and social landscape as a result of a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres. For this series, we’ve interviewed a number of chief executives and thought leaders about the impact of the Fourth Industrial Revolution on the business world. Check out the other posts in the series: