June 30, 2014

There is nothing new in transformation

Katariina Kravi

Executive Vice President of HR, Tieto

I have had recent conversations with several business leaders and HRs in many companies and industries, and it seems that all of them are working on their company's transformation. It's gotten to where you can replace logos of their company's slides with your own, and the content and challenges will be nearly the same – regardless of the industry.

In a recent study, Tieto highlighted very similar issues across different industries. It seems that solutions for transformational culture and leadership are very similar; you build on openness, trust, and flexibility, while having your company´s leadership role model all of these traits. Once you know the key components, how can you speed up business transformation? Are there any innovative ways to become quicker and better than the others?

What is Tieto's role?

When I joined Tieto two years ago, one of my missions was to transform the company's culture and renew the organization. Tieto needs business transformation  and more importantly, Tieto needs to help our customers transform as well. We may have a slightly bigger challenge than some of the other “transforming” companies. Since technology development will hit us with the automatization of certain jobs, it will also change the competence requirements we need. Industry analysts predict that current IT companies cited a blue collar workforce population of 70%, while their white collar workforce population was 30%. Five years from now, these percentages are going to change, since no one can firmly estimate how many jobs will change as a result of automatization. The concept of employment itself may change as well, if you look at what some companies like TopCoder are doing in the area of Human Cloud.

Tieto is 40 years old with very well-established anchors in their industry. Many parts of their company have long-term ways of working and business networks in place. Many of Tieto's customers have been with the company for a long time, even though their needs are transforming as well. So how do you start to establish new anchors, new thought leaders, and new ways of working?

Concrete steps towards change

We decided to start very practically with simple steps on our way to business transformation. We came up with the concept of Open Source Culture two years ago by using open crowd sourcing methodology to design our cultural vision. We are trying to replace some of our existing, well-established anchors like EBIT-based incentive models. This is done by linking financial rewards to preferred workplace behaviours, which are all contributing to Open Source Culture. In performance evaluations, we rate employees on four components of openness – Open Ears. Open Minds, Open Actions, and Open Doors. We have also opened our annual Senior Leadership Event to the entire organization. Anyone in Tieto can watch it as we webcast it. Many other companies are much more secretive about their top management events. We have brought in lot of new employees who we believe are going to speed up leadership and competence transfer, and ensure the existing talent in the organization will be connected to them. Tieto has started to change, and it is already a very different company than it was two years ago.

You can try to speed up business transformation by changing some of your establishment's building blocks, but in the end, what matters is being able to paint the vision and future people want to be a part of. The speed of transformation is very high and requires lot of energy, effort, a willingness to learn, and an active network with people you did not know earlier. You do not go into business transformation just because there is an incentive or process telling you to do so; you need to want it, and be passionate about it. Please remember that business transformation will also divide people. It can be uncomfortable to watch some people embrace business transformation if you are not sure about your own role in it.

I am very glad that all companies are facing the same challenges, including our customers. Collective pressure to transform will eventually make it happen, since there is no other stable environment to where we can escape. Both individuals and companies have always been able to adapt.

Katariina is Executive Vice President of HR at Tieto. You can find her on LinkedIn.

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