Digital Transformation Opens New Questions — and New Problems to Solve

In a recent conversation, John Donahoe, the former CEO of eBay who currently runs ServiceNow, told me about the most important phase in a company’s digital transformation: the part where you start asking better questions. Instead of seeing new technologies as a means to develop more efficient answers to known problems, managers should view them as opportunities — even requirements — to revisit the problems themselves. They should go back to first principles, Donahoe says, and ask, “Have we identified and framed the core issue in the right way? Instead of solving for X, should we be solving for Y?”

Marc Benioff of Salesforce is thinking along similar lines. At the company’s new headquarters in San Francisco, the top floor has been designated an “Ohana” floor. The word, Hawaiian for “family,” is a nod to the island culture that Benioff values so much for its spirit of collaborative work and play. One of the biggest uses of this and the company’s other Ohana spaces is to host clients for Ignite sessions, where they think at a strategic level about what enterprise software should help them achieve. It’s a space where people are prompted to ask big questions that could change how their companies compete.

Given the businesses they are in, Donahoe and Benioff have front-row seats to thousands of companies’ efforts to digitize their operations. As they’ve observed, many management teams begin that journey by asking how they can make back-office functions like help desks and HR information centers more efficient and less expensive through automation. That’s the low-hanging fruit; the business case can be made based on near-term productivity improvement alone. Things get much more interesting, both executives believe, after those systems are in place. New information starts flowing, and more intriguing questions materialize. As managers begin to see patterns in users’ activity, they often find surprises lurking there. They’re inspired to ask, for example: Is there a basis here for us to build a predictive model? If we’re worried about retention risk, could seeing patterns in employee HR queries help guide better employee engagement strategies?

That’s how breakthroughs happen in many digital realms. Modest questions about how today’s problems could be better solved lead to applications of technology with easily foreseeable gains. And experiences with such early applications inspire people to ask more ambitious questions — questions I like to call catalytic, since they knock down mental barriers and channel energy into new, more productive pathways. The most catalytic questions challenge basic assumptions about how a problem has been framed, opening up space for solutions that are more creative.

Think of the first questions raised by business managers as the foundations of the internet of things were laid. In the beginning, most people thought only in terms of the products they had already created and how they could be made “smarter” — like the deeply unexciting but often-invoked example of the refrigerator that knows when to order milk. Some of these innovations were wonderful improvements, as when sensors were added to jet engines, which allowed them to be monitored remotely for signs of wear rather than routinely taken offline for “just in case” maintenance that might be unnecessary. Soon enough, more catalytic questions began to occur to people: What else could be better understood through remote, networked sensors? If it is now possible to monitor anything inexpensively, what real-time information would be valuable to gather that we don’t see and act on today?

Questions are evolving fast in applications of AI, too. As Tom Davenport and Julia Kirby put it in Only Humans Need Apply, the tendency has been for managers to ask the same old question about productivity-enhancing technology: How can we use machine intelligence to automate work so we can get rid of expensive people? Now it is dawning on managers to ask a new question: How can we use it to augment human strengths — which, in an AI-filled world, will remain the scarce, differentiating strengths that give some companies a competitive advantage. At the Mayo Clinic, Dr. Wyatt Decker, who is in charge of exploring uses of AI across all locations and practice areas, builds on that question: What are the tasks in a research-oriented medical setting that humans find tedious and don’t learn much from by performing repetitively? And what are the tasks humans would love to accomplish if only they had greater powers of information consumption, pattern recognition, and computation?

And then there is the realm of cybersecurity — very much tangled up in companies’ digital transformation efforts, and the source of one of the best examples I came across in research for my book Questions Are the Answer. I interviewed Lior Div, who cofounded Cybereason in 2012 with two other veterans of Unit 8200, the Israeli military’s elite cybersecurity unit. Based near my office in Cambridge, Massachusetts, the company produces software that can detect and contain complex cyberattacks in real time.

Cybercrime, as Div well knows, is an underworld full of “unknown unknowns,” with its legions of shadowy hackers relentlessly devising new ways of breaching allegedly secure systems. And unfortunately, the numbers are all going in the wrong direction. According to enterprise security company Proofpoint, which tracks cyber threats on a quarterly basis, between fall 2016 and fall 2017 there was a 2,200% rise in phishing — the sending of deceptive messages intended to infect recipients’ devices with malware. Almost two-thirds of these messages were set up to install ransomware, which renders all files on a computer inaccessible unless its owner pays a named price. Another quarter were Trojans designed to steal online banking credentials. Analysis by CyberSecurity Ventures predicts that annual global cybercrime costs will rise to $6 trillion by 2021. Since that will make cybercrime more profitable for its perpetrators than the global trade in all major illegal drugs combined, the report claims, we’re in for “one of the biggest challenges that humanity will face in the next two decades.”

Cybereason’s breakthrough came when Div recognized that most of his profession was fixating on a flawed question. Everyone, he says, was working on the problem of how to keep the bad guys out. But notice the assumption embedded in that question — that the bad guys are outside. “The thing is,” Div tells me, “they’re already in. In most organizations, when we are deploying a solution, we find an adversary active in the environment.” Once you recognize this reality, a new and critical question emerges: How do you approach security when your enemy is already through the gates and hiding? Such reframing opens up a world of different solutions. Rather than immediately ejecting the bad guys, you might pivot to monitoring what they’re doing, finding earmarks of different actors, and piecing together their intent. This strategic approach moves you beyond treating cybercrime as an IT problem and past the hopelessly reactive strategy of building higher walls and slapping on more patches. “The problem we’re dealing with,” Div says, “is not fundamentally a bits-and-bytes problem; it’s people. There is an adversary behind the scene with an agenda.”

Back in the world of ServiceNow, Donahoe tells me that the genesis of that business was a question that others weren’t yet asking. The company makes software that streamlines and improves the quality of internal services to employees within large enterprises — and is seen as the “central nervous system” of digital transformation. The easy example is the one that the company started with: IT services. On any given day in a big organization, hundreds of people encounter repair issues or identify new needs relating to the hardware and software systems they use in their work, and many of these employees need to contact an IT function for assistance. ServiceNow’s software automates much of that service experience, allowing the problem to be reported and efficiently putting someone on the case — or enabling the employee with the problem to resolve it through a self-service protocol.

What question gave rise to the company? An important reframing of one that companies were already asking as they looked at external service issues: “What’s a great customer experience?” In an economy where the competition for top talent is fierce, ServiceNow founder Fred Luddy wondered why that same thinking shouldn’t go into addressing people’s frustrations at work. Why shouldn’t people have the same kind of fast and user-friendly access to information in their roles as producers as they have in their lives as consumers? The so-called consumerization of the workplace is by now a well-established trend. But that became possible only after someone changed the central question and asked, “What’s a great employee experience?”

By now, you may be asking a question yourself: What good does it do to recognize the power of catalytic questions if I don’t know how to arrive at them? That is the question that launched my last several years of research, learning from people like Donahoe, Benioff, and Div — and other CEOs of innovative companies, like Rose Marcario of Patagonia, Ed Catmull of Pixar, and the inimitable Oprah Winfrey. The answer I’ve found comes down to this: You can’t summon catalytic questions with the snap of your fingers, but you can establish the conditions in which they will reliably arise.

The tools of digital transformation can help create those conditions for you and your team. If you let them, they can put you in a questioning mode by exposing you to surprising data and possibilities that make you feel less confident you are right, less comfortable, less pressured to transmit information — and more eager to receive.