On May 13 and 14, Building Design+Construction held their third Accelerate Live event in New York City. The event brought together some exceptional speakers who showcased work on transforming their businesses and teams with digital capabilities. For my talk, I chose to challenge some underlying assumptions about digital transformation and the need for strategies that address a holistic view on business health and team culture. Below is my narrative – cleaned up for reading. (thanks to Joe Williams (Twitter @vdcjoe) for taking the photo from the audience!)
There is no doubt that the building design and construction industry is going through some profound changes. Today I am sure we will hear my fellow speakers discuss how their organizations are in an arms race – pursuing AI, machine learning, generative techniques, among others – and trying to collect the ‘superusers’ into their ranks. However my experience at Proving Ground in the trenches of consulting and running a business has led me to a very different set of conclusions about what organizations, and teams need to be doing to stay relevant, take advantage of their data, and build a better world.
Let me illustrate what I mean by drawing a comparison between two similar projects which I will keep anonymous. Both are of the same building type, similar team structure, similar tool availability, and a similar scope of work for us where we were tasked with creating geometry workflows for design and documentation.
- Team A had access to top notch digital talent along with the latest tools.
- Team B had a more conventional set of architecture skills at their disposal.
As the project’s played out, the true differentiating factors between the teams became readily apparent. Team A struggled with a poorly defined decision-making chain, experienced persistent communication issues among the wider team of consultants and had frequent disagreements about contracts and scope. Team B – the arguably lesser technology savvy team skills-wise – had a PM who knew just enough about digital models and data to know what to ask for, held the team and consultants accountable for their deliverables, and together they made decisions and stood by them.
We often think of differentiators in terms of smart capabilities. However, experience shows me that it is the health of our team culture and their behavior that allows us to excel.
These are not mutually exclusive conditions but I use these examples to illustrate a point – we often think of differentiators in terms of smart capabilities. However, experience shows me that it is the health of our team culture and their behavior that allows us to excel. Experience also tells me that, over time, Team B stands a better shot at growing smarter capabilities than Team A has a shot at growing healthier business practices.
It is estimated that today roughly 84% of digital transformation initiatives fail and only 1 in 3 change management initiatives succeed with the number one cited reason the inability to change behavior. This is why I constantly remind my clients that culture eats the best digital strategies for breakfast.
That is to say that I assert that you can hire the smartest group of experts money can buy and equip them with all the tools you need but if you don’t actively address the barriers and red tape that impacts overall business culture, including leadership, accountability, ownership, and behavior – you should be prepared for failure.
I assert that you can hire the smartest group of experts money can buy and equip them with all the tools you need but if you don’t actively address the barriers and red tape that impacts overall business culture, including leadership, accountability, ownership, and behavior – you should be prepared for failure.
So what can design and construction organizations be doing?
I will discuss a few indicators of success for digital transformation strategy which I’ve positioned based on my experience creating similar roadmaps for many leading AE organizations.
Let’s first look at an organizational example of cultural impact – the following pairing of pictures tells two different stories about transforming the same business culture. Both groups are huddled around the same kind of computers and are testing out the same technologies – in this case computational design tools like Grasshopper and Dynamo. You’ll notice a distinct difference in the demographics.
- Workshop A on the right seems ‘familiar’ to us – a workshop of younger, presumably production-oriented design staff learning how to use the tools in a productive way.
- Workshop B is made up of managers and directors – people who are rarely known to open up models or even drawings on a regular basis yet are still charged with figuring out team staffing and making critical business decisions.
Typically, I see firms focus on strategies that focus 100% at capabilities of the doers: get a super user, some implementers, and have them equip the general staff with skills. However it is equally important that we drive change at and from the top – Leaders need to be brought on board. If I look across the organizations that we work with, it is remarkable how disconnected business owners are from the means of production and the effort it takes to steer an organization towards meaningful transformation. One of the biggest mistakes I see in digital strategies today is neglecting to address transformation at the top.
Leaders and Executives
Digital transformation is not successful through grassroots alone. I’m all about bottom-up transformation in many contexts and businesses need this – but when it comes to running a business, leaders need to be accountable and lead by example. Firm leaders need to be able to walk the walk and be involved – demand outcomes, demand the dashboards to make decisions, and change how they communicate what is valuable and how they are measuring the success of others.
Leaders set the terms for accountability for their teams. If those terms do not change, the staff will not.
Leaders set the terms for accountability for their teams. If those terms do not change, the staff will not. If I look at the companies that are making things work, they are investing in leaders that can help set the vision at the executive level and educate their partners. In the last 2 years I have seen a notable uptick in the creation of C-level positions such as CIOs and CTOs to help leaders in firms calibrate their strategies. We have also seen increased attention to creating organizational structures in the form of roadmaps that can guide leaders in a business towards successful change.
Using the accountability structure and leadership expectations, a digital strategy absolutely needs to be looking at transforming middle management and team management. These individuals are the gatekeepers of a project’s success. Their management approach drives how a project is going to play out and sets the priorities on the ground.
Project managers are the gatekeepers of a project’s success. Their management approach drives how a project is going to play out and sets the priorities on the ground.
A digital transformation approach should be about equipping them with insight, educating them about changing risk and liability, and showing them how to better calibrate their team to perform. In a project-centric industry, strategies that slow to a halt or fail is because these individuals are not brought on board or measured by their direct reports for their ability to successfully implement the transformation.
Digital transformation needs to work at scale and for this feedback-loops are important. Research and innovation may start out occurring as point-solutions project-by-project but the danger is that lessons learned fall off and teams are doomed to repeat past mistakes and re-discover successes. Presently the “project” is the fundamental module by which the construction industry conducts business. Yet transformation goes beyond a single project and sits across many projects and sectors.
The most sophisticated technology that excites us today – AI, machine learning, the internet of things – requires us to calibrate processes at scale. In our estimation working with many of the top AEC organizations, design and construction businesses are largely woefully equipped to leverage reusable data and algorithms. The firms that are gaining momentum are establishing tangible data resources, capturing lessons whenever possible, adopt agile process improvement, and strive to grow a bespoke solution to something readily reusable and improvable.
The firms that are gaining momentum are establishing tangible data resources, capturing lessons whenever possible, adopt agile process improvement, and strive to grow a bespoke solution to something readily reusable and improvable.
These are hard things to achieve – they require engagement at all levels of a company, and ultimately require companies to think about their culture, confront their biases, and re-calibrate their processes.
If you’re serious about getting the lead out and pursuing profound and long lasting digital transformation be prepared to prove it by making meaningful strides to transform your business culture holistically – not simply getting caught up in the hype of new technology trends that you are otherwise not equipped to follow through with.