To me digital is ‘power’ and then ‘empowering’
The COVID-19 pandemic has changed the way businesses have been addressing issues and problems. In these times of uncertainty, agility is the key driver.The inherent entrepreneurial approach of businesses and communities is rising up to face the challenges is a remarkable way.
Venu Malik, Associate Director, Risk Management Service, EY shares her learning and experiences with Abhishek Sinha, Director, Digitales in an exclusive chat. Here are the excerpts –
Q.1 Digital transformation is reshaping the world creating endless opportunities and some threats as well. How effectively have you embraced digital disruptions?
Ans 1: If you would have asked me this question Pre COVID times the answer would have been very different. Today, digital disruptions have become a need of the hour vs a thing of the near future or part of the 3 year/ 5-year visions of organisations. There has been a huge shift in this area whether at an individual or at an organisation level. If I were to plot this on a graph…it will be a sharp north facing graph. The key thing to note here is that it is no longer limited to an age group or a section. I personally feel that all of this is leading to a cultural shift as a society. To me ‘disruption’ would imply ‘evolvement’ vs ‘interruption’.
We have seen as much disruption in last eight months as the world would have seen in last 20 years! The biggest disruption to me is the mindset and behaviour change…which has catapulted us into immense transformation.
Few examples that I can take form my personal experience is the 100% work from home situation, 100% onboarding and training candidates, usage of tools like MURAL and Think tank for Design Thinking and agile methodologies on a separate and lighter note digitisation of school teaching.
For a digital disruption to be effective, it is a two-pronged approach: mindset change and technology. Digital disruption has been extremely effective due to the current pandemic situation. The mindset and behaviour of the teams/ people is around ‘how’ and ‘how much’ vs ‘why’ or ‘when’.
Q.2 How do you mitigate the risks such as breach of privacy that digital transformation creates? Would you like to mention a case study for us to emulate and evolve?
Ans 2: With the amount of transformation that we are seeing, Risk Management as a function is moving from reacting or avoiding to a risk to proactively apprehending and then managing/ mitigating it. The range of reasons why an organisation undertakes risk management are mandatory, assurance, decision-making, effective and efficient core processes (MADE2). Risk management of digital transformation will also fall under each of these categories basis the area or the purpose. There are detailed frameworks and rules existing regarding these and evolving as we speak today.
I am trying to answer this in a very simple, layman language and in a relatable way. The reason for the same is that each one is not only a participant but a change agent of the digital transformation. So, each one of us must have two things in mind: awareness and impact. Awareness of potential risks and impact it will have on us as an individual (personal data breach) and at an organisational level. The mindset should be “yes and …” vs “no, because”. The first kind of mindset will make us think about the risk and hence its mitigation the second will keep us siloed.
I do want to mention that it is extremely important to raise hand and seek guidance and then organisation should have robust support system to guide and take actions.
One thing that I have learned through experience is to have a member of the risk team part of the core team of any large project involving databases, systems, clouds etc.
Q.3 While organisations are fast embracing digital first or digital only strategy, they often struggle with the right approach – incremental to big bang. What would be your key advise to help them swiftly achieve desired results.
Ans 3: Like I said the world is seeing since last eight months it has not seen in last 20 years – the velocity and pace of change. The approach has already changed to big bang. The ones who are unable to evolve or keep up with the pace are eventually going to left behind. Digital strategy is not only helping us to manage the pandemic challenges but also the social and economic ones.
To answer your question an organisation strategy will have to be a combination of industry (example could be data intensive or asset/ technology intensive, adjacent industry like package delivery with automotive industry) and the value (cost, value, platform) that is being created for the customer. Some biggest competitors like Amazon, Google will focus on a combination of these.
Commonly used strategy or models are Harvest: Netflix still being able to continue with its DVD operation share of 23% of its profit in US through streamlining and digitally automating the warehouse. But everyone knows while it can continue; the momentum is diminishing. Disrupt: Netflix, Hotstar is a good example where they have disrupted the traditional media/ movie screening market. Occupancy: strategy will imply that you want to expand the segment, market share or value enablers through aggressive approach not just with the competitors but one’s own products. Organisations like Amazon will fall in this category.
Q.4 We understand that digital is just the medium; it is leveraging knowledge that creates competitive advantage and sustainable profitable growth. How do you ensure that knowledge capital remains key factor in this era of digital transformation?
Ans 4: Saying that digital is just the medium is undermining its true potential. To me digital is ‘power’ and then ‘empowering’. Its being said: ‘data is the new fuel’ and that’s what digital brings for us. Nevertheless, knowledge is indeed the key and in today’s times more difficult to keep abreast and skilled. The skills of today are no longer the skills of future. One very common example that I share with my teams is that of average young millennial or gen Z wanting to buy a pair of shoes. He/ she figures out the budget/ amount that they want to spend, set of brands they are okay to explore, and quality. Then comes checking out various websites for price, schemes, vouchers, reward points and at times even physically visiting the store before clicking on the buy button. Think of the amount of data that they are analysing before taking these decisions. Now think of how we used to buy a pair of shoes.
So I guess the point that I am trying to drive here is that there are cultural and behavioural changes that are leading this upward curve of knowledge capital. Many organisations are proactively upskilling their employees. From my organisation as an example a set of courses have been identified across the breadth of future topics and employees are encouraged and given time to complete these ‘badges’. These are even leading up to an MBA degree once the prescribed structure of learnings has been completed. Also, the education system is being revamped…the amount and variety of courses that are being offered didn’t even exists few years ago, the recent change in education policy and the alignment of it with international standards will also pave way for strong foundations.
Q.5 India is a multi-track, multi speed nation when it comes to adapting digitally powered technology and practices. How should we create an atmosphere where all industries show same level of enthusiasm and preparedness to embrace digital transformation?
Ans 5: This is a very thought-provoking and pertinent question and a must for the government and other regulatory bodies. I believe there is lot of enthusiasm to embrace this, preparedness is the area to focus upon. Government will have to play a critical role in setting up infrastructure and ease of doing business. The memory of demonetisation shows how even the smallest of the vendors like a street hawker became digitally savvy overnight. While I can give an answer framed around suggestions for the government or the institutions, I will want to answer this more from again culture and mindset perspective. It will have to be hand in hand of policies and transparency.