Here’s my hunch about the productivity paradox: When it comes to truly implementing transformational technology, companies are unintentionally faking it.
Yak Cheese Pizza and Failed Technology
I once went trekking in Nepal for several weeks. Day in and day out, my diet was the local staple of dal bhat: rice with lentil soup and a chapatti bread. You can imagine my excitement when I found a small teahouse that had 'pizza' on the menu.
I should have known better.
What came was a chapatti smeared with red lentil soup and sprinkled with yak cheese. It was like someone's cousin had once seen a pizza and described it to them. They’d done the best they could with this information to recreate the dish with what they already had.
I think back to that pizza when I see companies try and fail to implement technology-driven concepts, like social networks, knowledge management and collaboration. Again, it's as if they heard of it from someone else, and then just reconfigured what they already had.
To be fair to the Nepali teahouse, they were doing the best they could with severe constraints. Most organizations also look for the easiest route and end up faking it, even if they don’t even realize it, because it is hard to appreciate what it really takes.
I believe it’s one reason why technology doesn’t deliver as expected, which results in the productivity paradox.
Adoption and Disillusionment in the Digital Workplace
Some would argue we've seen a big increase in productivity due to IT in the 1990s. Possibly this was because in the 1990s, much of the IT was about automating transactions, trading and global data management. It didn’t require a substantial human change or a strong organizational purpose to deliver.
What makes this harder with digital workplace technology is that it's more about a concept and way of working than the technology itself.
We all know the theory: the people side of change is really important when it comes to technology. Yet when you look at actual implementations we repeatedly get this element wrong.
Consider this headline: “Gartner Says the Vast Majority of Social Collaboration Initiatives Fail.”
Not so long ago, many companies were reporting significant benefits from social collaboration, so what went wrong? It’s a pattern you see for many technologies across the hype cycle: Good concepts become dismissed as fads when they are adopted poorly by the late majority.
What happens is that the innovators and early adopters experience genuine success and the word spreads. The early majority then copy it in a diluted form, unwilling or unaware of the full investment it needs. By the time the late majority give it a try, the concept has been commoditized and the necessary enabling conditions probably don’t exist, so they don't experience any of the benefits. At this point you see the backlash and the concept enters the trough of disillusionment.
Innovators Are Hard to Copy
Let’s start with the pioneers to unpick what’s going on.
When a company has initial success with a new approach, it is widely celebrated by journalists, consultants and pundits. When it includes a technology element, all the better because you can show screenshots and talk about features.
But usually much more is going on than the tools:
- A sense of purpose. The innovating company developed the solution driven by a preexisting need that older approaches didn't meet. Clarity on why something is being done gives the momentum to keep going when the road gets rocky.
- Supportive leaders. Often the direction for these initiatives comes from the top, which cuts down on impossible demands to prove ROI or measure benefits up front. Leaders understand it is an experiment and are willing to invest in a hunch. In the knowledge management world, for example, Buckman Laboratories were celebrated as leaders for years and much of this was down to it being privately owned by Bob Buckman acting on his personal beliefs.
- Experimentation. Usually the only approach you hear about is the one that worked. A company may have tried three or four other ways of doing it that failed. That these failures don’t get reported is a real gap in how we build knowledge about business. Rarely is it the case that “the answer is X” — the better question is “under what circumstances is X the right thing to do?”
- They got lucky. Often for technology to deliver benefit, it needs enabling conditions. For example, we regularly talk about needing culture change for collaboration to work but you can’t change culture easily. So we hear about technologies working in companies where the pre-conditions happen to be in place, and never learn about the ones where it flops until we are late in the adoption curve. This is an example of survivorship bias. It’s the same logical error as thinking you need to fail before you succeed, because most billionaires did this (in practice, many more non-billionaires fail and remain broke).
Nowhere in the above list does it say “they had great technology.” Quite possibly the tools are inferior to ones on the market when the idea becomes commoditized. What matters is that the innovators had the right enabling conditions, and where they didn’t, they had the leadership support and vision to change them.
The Adoption Debt
Companies that lack enabling conditions and are later to adopt new ideas are much more likely to see smaller returns. They run an "adoption debt," because the true cost of what it takes to get the desired outcome over and above the technology costs is hard to see.
As concepts become commoditized in products, license costs tend to eat up the budget, leaving just crumbs for the ‘soft’ factors. Compared with the list above:
- They lack a sense of purpose. You know your attempt to copy innovators will be at risk when you hear challenges like, “It’s a solution looking for a problem.” Statements like this indicate the focus has shifted to the technology and people are considering it primarily because they see others using it and wonder if they are missing out. A technology change in these circumstances absorbs productivity rather than increases it.
- Leaders are not supportive. You also should hear alarm bells when leaders ask “What’s the ROI?” for non-transactional systems. It means they aren’t on board and are looking to shortcut the mental work of figuring it out by seeing if the numbers on a spreadsheet add up.
- Lack of experimentation. Without clear support, it is harder to adapt the approach to your specific needs. A technology shoehorned in is likely to meet resistance and be underused. Early adopters build up tacit knowledge about what makes it work. This is difficult to commoditize, so later adopters have a harder time knowing what's missing when they try to buy-in the same benefits.
- They didn’t get lucky. The more widely something is adopted, the less likely it will be a good match to needs.
Your Recipe for a Successful Initiative
To get the full benefit from a transformational technology, you need to have experienced it working first.
This means you don’t just plug it in, but put thought into how it should adapt to the unique characteristics of your organization. However, doing this thinking is hard without leadership support, a sense of purpose and scope to experiment.
If you are missing these factors, the technology is likely to detract from productivity rather than enhance it. Like a yak cheese pizza, it may look like it has the ingredients, but it won’t taste like the real thing.