3 leadership learnings from going back to school at MIT

  • Posted on June 29, 2022
  • Estimated reading time 3 minutes
3 leadership learnings from MIT

It is a benefit of working at Avanade that we have full access to the research and insights of the Center for Information Systems Research at MIT Sloan (MIT CISR) and are also able to bring these resources to our clients. Recently, we had the additional personal privilege to participate in the MIT CISR Summer Session, an annual executive education course held on campus at MIT in Boston.

As we reflect on the course – entitled Getting to Future Ready – both the insights and frameworks presented by MIT CISR researchers and our interactions with executive peers reinforced that, even with the accelerated pace of change, leaders continue to be challenged by three issues: governance; stakeholder engagement; and value realization. For us, three topics at MIT CISR Summer Session were particularly thought-provoking:

  • Becoming Future Ready: To remain Future Ready, an organization must be ambidextrous, balancing innovations and offerings on two dimensions: operational efficiency and customer experience. MIT CISR finds there are four pathways to become Future Ready, as this image illustrates:

    4 pathways to Future Ready

    It is possible for organizations to pursue multiple pathways simultaneously, however these must be coordinated, which is arguably more challenging in a world of continual change. Nonetheless, embracing the Four Pathways governance approach has clear profitability benefits. MIT CISR research finds the approximately 20% of organizations that are Future Ready enjoy average net margins 19.3 percentage points higher than industry average.

  • Driving breakthrough experiences: The only constant in the world we now live in is that change is ultimately people change. MIT CISR finds that the digitalization journey necessarily challenges people’s existing cultural mindsets, which requires leaders to embed needed changes in concrete behaviors. Digital technologies like AI can help create frictionless experiences for customers and employees. However, we were warned that while nudging is a powerful tool, it can quickly become manipulative. When it comes to change, the key is to first understand the decision touchpoints customers and employees experience. Processes should then be developed that give humans the agency and autonomy to improve choice, instead of automating them out of decision-making.

  • Becoming Future Ready with digital innovation: MIT CISR research shows that organizations innovate greater strategic value faster by balancing investments across four areas: employee experience; business operations; customer facing; and new business models. Top performing organizations don’t binge in any one area; they typically invest across all four and allocate no less than 10% and no more than 50% of their total innovation budgets in any one area. Another key insight from MIT CISR research is that innovation initiatives should be resourced based on the business value they realize, not how large they are or how much they cost. MIT CISR also previewed a framework to help organizations rapidly test and learn, so they can drive value from innovations and adapt strategies based on evidence from experiments.

To cite MIT CISR, “[d]igital transformation is not about technology—it’s about change.” The rigorous field-based research and insights presented at Summer Session are useful as tools for helping leaders align and prioritize digital initiatives, but they cannot be uniformly applied in a world of continual change. As one of only 10 research patrons of MIT CISR globally, Avanade is able to help our clients use MIT CISR frameworks to address governance, stakeholder engagement and value realization challenges and to adapt and evolve to embrace continual change.

To receive complimentary access to all of MIT CISR’s research or learn more about how Avanade can help your organization apply insights in your organization, contact us.

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