Is your business ‘alive’?

Remember the DVD shops and travel agencies that used to be found on every other block in residential neighbourhoods across Hong Kong? Some are still there, but many have shuttered as online alternatives put them out of business.

The rise of digital services has caused profound changes in the business landscape globally. If companies want to survive and thrive, they need to become what we call “living businesses”. That is, businesses that almost has human characteristics – responsive, emotive, ambitious – and can shift their weight when the ground moves beneath them.

In today’s business landscape, the ground is constantly moving in unpredictable ways. Most companies in Hong Kong standing on that constantly moving patch resemble old-fashioned robots: full of cogs and wheels – and thus slow, clumsy and prone to fall.

Living businesses are not about cogs and wheels. They are about employees who are willing to continually adapt and change. To foster this, companies need to nurture their people to help them grow.

They need to put all the people in their company first and break down their existing models, particularly if their models are full of old-fashioned organisational silos that hinder cooperation and change. That means shifting the focus from hierarchy to competency; from functional silos to fluid teams; from administration to responsibility. This encourages employees, from the very top to the latest hire, to embrace a “change” mindset.

For many Hong Kong management teams this is controversial. It runs at odds with the way they have always run their business. It challenges hierarchical leadership. It requires employees to think dynamically and share their views. It throws out the window rote learning and embraces continuous education.

But winners in the digital era have successfully embraced a change mindset. This does not mean they simply hire a “chief digital officer” and call it a done deal. It means they changed their pre-digital era structures, thinking and boundaries. They have not just repeated the old behaviours of focusing on sales performance, quarterly results and managing to the numbers. They have not just stuck to the same old silos or departments that hinder true collaboration or the same old hierarchies that suppress initiative, entrepreneurship and taking responsibility.

Today’s (and tomorrow’s) successful companies create conditions in which people develop a change mindset and embrace the new business environment. How? They get their people involved in the development process to find out which of their trailblazing ideas might fly and which will fall flat. One key difference separating a living business from a traditional organisation is that decision-making is driven a lot more by competence and a lot less by hierarchy.

Consider some global examples of companies embracing concepts of a living business. US-based online clothing and shoe store Zappos has no job postings or hierarchy. Roles are created for employees, all of whom start in the call centre. Teams self-manage in circles dedicated to a purpose. These circles operate in parallel, there is no hierarchical authority from central business functions, only advice. FedEx created a six-month emotional intelligence training programme for new managers to bolster their people-first leadership in a business geared to deliver pace. They also certified some employees as emotional intelligence trainers to improve peer learning and make the competencies go deep into FedEx.

These are examples of companies that are making efforts to focus on their people in order to survive and thrive in the digital era. For each company the approach will be different but management should start with a focus on how they can inspire their people to make changes appropriate for their business in a new digital world order.

Managers should think about what it takes to make their business thrive: that means nurturing, support and space to grow. They should keep at the forefront of their mind the question: is my business alive?

Inaki Amate is managing director for Hong Kong at Fjord, design and innovation from Accenture Interactive