Being a truly digital company is about more than digital products and services. It’s a journey that’s constantly changing. To advance along this journey, organisations must strengthen their digital core and tap into the power of innovation in tech.
We sat down with Graham Baxter, former COO of Hutchison Three UK, to discuss his experience leading digital transformations and critical success factors across the telecom sector. This is the first of a two-part series where Graham shares his insights on how to lead a successful digital transformation.
Most organisations have started a digital journey, but none have reached a final destination. After all, digital transformations are rarely as simple as moving from Point A to Point B. While we’ve found that a minority of companies are rapidly transforming with a CEO-led program across the enterprise, most organisations take an iterative approach across a multi-faceted digital core. Their weakest area often limits the overall progress of the transformation:
While all aspects of the digital core—digital partners and supply chain, workforce enablement, customer engagement, IT, and business model disruption—need to be considered, we will focus on digital workforce enablement in this blog. To succeed, digital transformation must be accompanied by a fundamental shift in organisational culture and ways of working. Becoming a truly digital business requires placing the following elements at the center of your transformation:
- Leadership: Establish supporting lines, not reporting lines, for delegated empowerment.
- Operating model: Learn, build, measure, and adapt.
- Culture: Build shared purpose, ownership, and connection.
Leadership: Establish supporting lines, not reporting lines
Recent studies have found that most organisations’ digital transformation efforts slow or stall at some point. There is often a perception that failure stems from external factors. In reality, many leaders attribute transformation challenges to internal factors, including poor leadership or a lack of vision.
Graham Baxter shares this perspective. Based on his experience leading digital transformations in the telecom industry, he remarks, “establishing a high-performing leadership team aligned to the cross-functional implementation of the vision is critical to the success of your digital transformation.” An important part of this involves overcoming the siloed leadership that traditionally exists within the telecom industry. In many cases, the CIO can help eliminate these silos.
The role of the CIO in digital transformation has shifted from delivering IT to the organisation to playing the role of an orchestrator. This critical role brings business leadership into IT, provides an enabling technology foundation, and helps the entire business make the most out of its digital investment.
For digital transformation to succeed, every leader involved must model the new ways of working and embody the continuous change and improvement mindset that they’re trying to propagate across the workforce. This might come naturally to companies that are digital natives, as their organisational structures likely already support this way of thinking.
Telecom operators, however, are more likely to be digital immigrants that have had to adapt to new technology. As such, they face a greater challenge in uniting teams across siloes to deliver a truly enterprise-wide transformation. Building a cross-functional team with the right leadership behaviours starts with the C-suite. Collaboration across the digital core is essential to meaningful outcomes.
- Maturing customer engagement: CIO, CMO, Chief Sales Officer
- Modernising digital workforce: CIO, CPO, CHRO
- Digital operating processes: CIO, COO
- Digital core technology: CIO, CFO, Chief Procurement Officer
- Digital future: Chairman, Non-executives, Board, CIO
Operating model: Learn, build, measure, and adapt
More than ever, businesses need to architect for continuous change by embodying the characteristics of a digital organisation: They need to learn, build, measure, and adapt.
“You can only make the most out of your technology if your whole operating model is adapted accordingly,” Baxter says. “Your operating model (technology, process, people, partners, structure, and metrics) across the entire business should be built for change, not built to last.”
While most organisations have already embedded agile ways of working, DevOps can help them fully realise the benefits of agility. This change will impact operations significantly, because it requires the function to own and embrace regular change rather than perceiving it as a risk to the business. It demands a shift in mindset toward the continual deployment of incremental improvements.
While these ways of working help to break down long-standing siloes across the business, they also foster a product (and service) mindset. This is a typical experience for large organisations on their digital transformation journey. Many of them face considerable challenges along the way—including the risk of introducing new siloes across traditional functions, such as procurement and finance, as the product (and service) mindset builds across the organisation.
While collaboration across functions is critical in any organisation pursuing digital transformation, it’s acutely important for telecom and wireless companies. Consider, for example, the case of British media and telecommunications conglomerate Sky, developing the online television service Sky Go.
“Historically, as an organisation, Sky’s legacy businesses generated its most profitable revenues and margins,” Baxter notes. “However, Sky still chose to embrace digital disruption and the development of Sky Go even though that meant that its legacy business was at risk of being cannibalised by these new ‘digitally enabled’ revenue streams. That kind of bold decision requires company-wide alignment.”
Culture: Focus on shared purpose and connection
An organisation’s culture is partly comprised of its peoples’ values and mindsets. It should be led by its people and ultimately drive the business strategy forward. As a result, cultural transformation requires intentionality and vision to be successful.
“As with any transformation, neglecting culture change poses a significant risk of failure,” Baxter says. His assertion is supported by a long string of studies finding that culture-focused companies drive improved performance.
As you embark on your digital journey, you will start to face challenges from different parts of the business. To rally your workforce behind the changes underway, you need to fundamentally shift the perception of change from fear to opportunity—and do so across the company.
“Whether you see digital transformation as an opportunity or a threat often depends on where you sit in the organisation,” Baxter says. “You need to shift the mindset of your people from ‘What does this mean for me and my job?’ to ‘What opportunity could this create for our business?’’’
Read the next blog in the series to hear Graham Baxter’s takeaways and thoughts on what the future holds for the telecom operator.
About Graham Baxter
Graham Baxter is an accomplished technical and commercial leader with 25 years of experience in mobile communications.
Graham joined Orange UK as Head of Network Design and Systems Infrastructure in 1995, just after the launch of the company's 2G network. He successfully managed its network evolution through a period of unprecedented subscriber growth and the introduction of the first mobile data services.
Graham moved to Three UK in 2004, a year after the launch of their pioneering 3G network. He became CTO in 2007 and established the world’s largest network share, nearly doubling the Three UK site count whilst significantly reducing network operating cost. This initiative contributed to a £1 billion financial turnaround between 2007 and 2011.
Graham was promoted to COO in 2011. He led the Three UK technical workstream and joint consolidation team for the proposed acquisition of O2 (Telefónica UK) between 2015 and 2017. Following the EU’s blocking of the deal, he also led a three-year, £2 billion technology-enabled business-wide transformation at Three UK.
Graham left Three at the end of 2019 to set up his own consulting business. His firm, Grey Bee Ltd., advises, consults, and mentors for technology-enabled business transformations.