A Bottom-Up Path to Innovation – Obviate your Open Jobs

Bottom-up Innovation

In many industries in the modern business environment, Digital Transformation is no longer an option – it’s a necessity. Amid this shift, organizations must thoughtfully decide where to direct their efforts. This article will summarize one of the tools in the Innovation Vista toolkit, which for some organizations is more feasible and more palattable to leadership than the more common “top-down” planned innovation/transformation approach. This alternative approach begins not with a strategic vision of a new org-chart and business model, but with a “bottom-up” prioritization of automation efforts aimed at the duties of roles for which you currently have openings in the organization.

 

Limitations of the Top-Down Approach to Digital Transformation

In some organizations, a traditional top-down approach to deep Innovation and Digital Transformation meet an obstacle for which there is no real antidote – human nature.

Traditionally, companies have approached Digital Transformation from a top-down perspective, re-imagining not just the business model, but the organizational chart, in a new context of technological capabilities. While this method yields the broadest vision strategically, it sometimes suffers from a few weaknesses resulting from human nature:

  • Distractions: Leaders in the organization may struggle to participate in the process fully due to other demands on their time, and more crucially, their mental energy
  • Tribalism: Leaders may also become defensive about the results of the direction of digital transformation on the size of their “territory” on the org-chart. They may be especially counter-incentivized to offer potential efficiencies if the company’s compensation model tends to reward leaders of larger departments
  • Priorities: Leaders who are satisfied with the financial results of their companies, and who prioritize loyalty to their staff more highly, may decline to initiate a Digital Transformation at all, even if there are significant potential opportunities for improvement and/or new capabilities
  • Passive aggressiveness: Staff and middle managers have heard stories of transformations resulting in mass layoffs; this often creates a reluctance on their part to offer full disclosure on their processes for the purposes of potential automation, even if leadership has promised that cutting staff is not their goal
  • Speed bumps: Working from misinformation and/or incomplete information, the Digital Transformation project team may make mistakes or may deliver capabilities with limited impact, either of which reduces the credibility of the effort overall and can sometimes cause it to be cancelled

 

These limitations vary in their impact from organization to organization, of course. Where these issues are minimal, the benefits of a top-down approach are significant and will likely justify that approach. But where these issues are significant, Digital Transformation may only be possible with a different approach that avoids the worst of these limitations…

 

A Bottom-up Approach: Automating the Duties of Open Jobs

Identifying Opportunities for Automation

The first step is identifying open roles within the organization that are comprised (mostly at least) of duties which can be automated. Both employee feedback and data analysis can be invaluable in this process. The analysis is somewhat similar to decisioning about whether a role is suited to being offshored or outsourced, so there are many resources available to aid in this judgment.

Planning and Executing Automation Projects

Once potential roles are identified, organizations can then design and implement automation projects. This process should involve stakeholders from across the organization, ensuring that the automated systems will meet the company’s needs effectively. In most ways these projects should be governed like any other IT project; however, leadership should be cognizant of the “pressure building” on the team in the interim, as workaround processes handle the workload (see below). Stop-gap measures are ok for short periods of time, but they can break down or do cultural damage if they are extended for a longer term.

Change Management – Training and Re-Skilling Employees

As automation is implemented, organizations should also focus on training and developing their existing workforce. This enables employees to take on more complex tasks that cannot be automated and ensures that they remain engaged and valuable members of the company. The flexibility to handle these situations one role, one process – or even one person – at a time is one of the key advantages of this approach to innovation vs. a traditional top-down vision reset.

 

Operational Considerations – not often forgotten, but too-often over-simplified

The concept of automating open jobs within the organization has many benefits, but there are operational factors to consider as well, to minimize disruptions to existing employees while filling gaps in the workforce with automated systems. Automating “enough” duties to enable removing an open role altogether inevitably takes longer – sometimes significantly longer – than recruiting a replacement for the role would have taken.

Handling the Workload in the Interim

Depending on the situation, this approach can take on several forms operationally for each open job targeted for automation. The ease or difficulty of handling the workload in the interim should be a key factor in determining the order in which automation projects are undertaken:

  • If there are more than 5x people still in the job vs. the number of openings, it is often possible to cover the interim workload with the rest of the team. If overtime hours are needed, these costs will be recouped once the process automations are deployed. Of course, with a sizeable team in this role as its functions are being automated, change management – particularly leadership communication, training and re-skilling – are critical to ensure that the staff being relied upon in the interim know their place in the evolution that is coming.
  • If there are fewer than 5:1 people:openings in the role, it may be necessary to train a few others, or to onboard a few temporary team members, to handle the workload in the interim.
  • If the open role had been filled by a single person, it is sometimes possible to re-engineer the process “around” the role, at least for an interim period. Forms of this include adjacent process absorption, quality checking by colleagues, paired approval delegation, etc. If this is not possible, bringing in a temp or sharing the workload are options, as mentioned above.

 

Applying this Approach to Small & Midsize Companies

Most of us have seen case studies wherein large companies such as Amazon and Tesla have successfully implemented this strategy, leveraging automation to obviate open positions, while simultaneously upgrading their employees’ skills to meet the demands of the digital age. What most people don’t realize is that this concept works just as well, if not better, for small & midsize organizations.

Many of our clients believe that only large companies will find automation opportunities, or that only large companies will see sufficient ROI to justify the project needed to automate target processes. Our experience has been the exact opposite: large companies have often already automated more processes which don’t require human intelligence; small & midsize companies generally have far more low-hanging fruit in this category. And as a benefit of doing this automation now, in 2023, they can leverage tools that are far more powerful, flexible, and affordable to do so – all of these factors juices the ROI for many projects considered by SMB for the automation of even 1-person roles or small teams.

 

An Alternative Approach to Innovation with much to Recommend it

Starting a digital transformation project by prioritizing the automation of open jobs is an effective approach that minimizes disruption while maximizing efficiencies. While it may appear at first glance to be more reactive and less strategic than a top-down Digital Transformation re-envisioning, there are many strategic strengths to the approach:

  • Departure of staff from a role may indicate a higher risk of other resignations or needful terminations later, of their colleagues or replacement in the role. Targeting automation efforts at these duties therefore mitigates a risk of repeated turnover.
  • When a job opening is one of many on a team, automation offers a chance to elevate the job function of those team members to function which require human intelligence, likely improving their job satisfaction and the likelihood of retention. Even if they require training to perform their new functions, and even if this elevation means they will eventually have a higher market value in compensation, the organization benefits by having these professionals starting at the low end of a compensation “ramp” in the interim, and contributing at a higher level to future prospects for the organization.
  • The cultural impact of this kind of role elevation, and generally of being an “innovative” organization, are significant. Not only do companies of this type keep their staff, they retain their best staff, and more importantly, that staff they retain are far more engaged, creative, and productive.
  • Embarking on a programme of innovation in this way enables organizations to “digest” the change in smaller portions than a top-down Digital Transformation often allows. In this way they avoid some (not all) of the risks of large-scale high-speed change.

 

Perhaps most importantly, this approach puts real business model innovation within reach for many organizations for which the traditional top-down approach is not feasible or prudent. As the digital landscape continues to evolve, organizations adopting this strategy are poised to maintain or even to build their competitive edge in a way that fits their leadership team and company culture.