7 Connecting the World of Tomorrow with the World of Today

In a rapidly changing world, organizations must balance innovation with continuity, operating with a future-oriented mindset without losing sight of the foundations built yesterday and today.

Many organizations struggle to strike a balance between enhancing agility on one hand and maintaining the continuity of services on the other. Simply put: how do you innovate enough to stay relevant for the world of tomorrow while ensuring the systems of yesterday and today continue to function? Using the dimensions of Strategy, Governance and organizational models, Leadership, and Decision-making, we provide a number of recommendations for structuring a successful organization. To understand the “why,” we first explore the experiences of a wide range of organizations and examine lessons learned from successful innovators, such as ING. In April 2024, the bank was named a leader in digital transformation for the second time.

From the World of Today to the World of Tomorrow

IT never stands still, and no organization can function effectively without it. IT permeates every aspect of an organization and is constantly subjected to new demands from markets, governments, customers, and technological advances. These demands bring a steady stream of new requirements, laws, regulations, and technologies that must be integrated.

Predicting the future is difficult. We live in a world that is volatile, uncertain, complex, and ambiguous. An agile organization must respond to these changes while maintaining the continuity and predictability of current services. For most organizations, standing still is not an option. Shops cannot temporarily close for renovations; think of services like benefits distribution, payments, medical care, or online shopping. The IT systems supporting these services must always work.

This poses a dilemma: how do you renovate the shop while keeping it open? Drawing on QA Consulting’s experience and lessons learned from digital-age leaders, several choices can be made to address this challenge.

Strategy

Most new strategies are conceived at the top (strategically), while the worlds of yesterday and today often operate at the bottom (operationally). As a result, strategies frequently fail to connect with operational layers and are too abstract for employees. In practice, when priorities must be set, the world of yesterday and today often dominates. This is not inherently wrong but highlights why strategies often take a long time to make a real impact.

A good strategy bridges the gap between strategic, tactical, and operational levels. It requires a strategic direction tailored to the current situation and challenges. Two elements are crucial: effective communication from leadership to employees and a listening ear for those who must implement the strategy and the obstacles they encounter.

Top-Down Strategies Backfire

Many organizations lack adequate feedback mechanisms from the operational level. This often doesn’t fit into hierarchical models where employees are expected to follow directives without question. Additionally, organizations often fail to translate strategy into actionable execution. Instead, they ask employees to explain how their work contributes to strategic goals.

A good strategy builds awareness and support for intended changes across all stakeholders. A common shortcoming is that strategies are rarely adjusted regularly. Many remain unchanged for years, even as the surrounding world evolves rapidly. Strategies often suffer from an inward focus, relying on periodic reviews by external consultants.

QA Consulting recognizes that effective strategies address all these aspects. This begins with reassessing strategies every three months and updating them annually.

Key Elements of a Strong Strategy

1. Market Analysis and Societal Trends

Identify and analyze current and future trends—economic, sociocultural, political—and adapt strategies accordingly. Modern strategies address issues like aging populations, knowledge retention, societal individualization, and the changing meaning of information (what is true?).

2. External Factors

Consider external changes such as geopolitical tensions, climate change, and (de)globalization, which will impact nearly all organizations in the coming years.

3. Customer and Citizen Focus

Gain a deep understanding of customer or citizen needs through research and feedback, ensuring services meet their expectations. Prioritize accessibility and personal contact for those unable to navigate modern systems effectively.

4. Digitalization and Technological Integration

Implement advanced technologies to optimize processes, improve customer interactions, and develop new digital products or services.

5. Balance

Too much innovation can overwhelm an organization’s capacity for absorption and implementation, while too little leaves it stagnant. Metrics like Gartner’s Run/Grow/Transform framework provide guidance, with an ideal budget ratio of 70%/23%/7% respectively.

Finally, attention to stakeholder management, risk management, innovation, and flexibility is critical. Strategy development is just the beginning. Strategic portfolio management, workforce planning, capacity planning, and monitoring are essential for translating strategy into organizational action.

Case: Defense – Sustainable Digital Transformation

The world is rapidly changing, and our security situation is deteriorating. The war in Ukraine has prompted a shift in priorities. For decades, defense focused on upholding international law and supporting domestic efforts. Today, the primary focus has returned to defending national territory. To achieve this, defense requires adaptability, speed, and combat strength. By 2035, the vision is to build a technologically advanced, information-driven force.

The question remains: how can defense achieve these ambitions? What IT investments, operational changes, and personnel adjustments are necessary?

QA Consulting developed strategic scenarios to align IT investments and operational goals with the Defense Vision 2035. These reports support a billion-euro increase in defense IT budgets.

Organizational Models

All successful agile organizations integrate IT and user expertise. Knowledge of digital processes must span strategy and execution. Rather than focusing on “business IT alignment,” organizations must embed IT within core processes. Successful organizations no longer separate users and IT; small teams integrate expertise from both.

Available Models:

1. Functional Model

Traditional, department-based organizations where IT aligns with specific functions.

2. Divisional Model:

Suitable for large companies with product/market-specific divisions and centralized shared IT services.

3. Process-Based Model

Focused on workflow optimization, integrating IT directly into processes.

4. Flat Structure

Agile and flexible, with few management layers, promoting open communication and faster decision-making.

5. Team/Matrix Models

Ideal for project-based or innovation-focused organizations, IT is often fragmented but specialized.

None of these models are universally perfect. QA Consulting analyses what is necessary and feasible based on strategic goals.

A New Kind of Leader

Many organizations are still led by executives of the old school, who often have little to no experience with digitalization beyond acting as sponsors of IT projects. In most competency profiles for senior executives, terms like IT or digitalization are rarely mentioned. Very few top executives have ever been a CIO or IT director, and in many cases, such a background is seen as a drawback rather than a benefit. This lack of experience often means that leaders need to be guided through the implications of digitalization and are ill-equipped to make informed decisions in this area.

The organization of the future requires a new type of leader—someone who is willing to challenge the status quo and step away from the hierarchical, 20th-century approach to leadership. Leaders must focus on connection and be open to gaining hands-on experience on the work floor.

Managers on the Workfloor

IKEA provides an interesting example of such leadership, where managers are required to spend a few days each quarter working on the shop floor to maintain a connection with customers and employees. This kind of model highlights the importance of leadership that is both ambitious and achievable, translating grand visions into clear operational objectives that are broadly supported throughout the organization.

Modern leaders must also be flexible and adaptive, able to respond quickly to changing market conditions and technological developments. This requires a leadership style that moves away from control and rigid oversight toward facilitating innovation and enabling collaboration across departments.

Transparent and effective communication is a critical skill for leaders in today’s digital world. They must be able to explain complex ideas and strategies in ways that are understandable to a diverse range of stakeholders, from IT specialists to non-technical employees. Additionally, leaders must foster a culture of openness and trust, where feedback and ideas are welcomed from all levels of the organization, and mistakes are seen as opportunities to learn and grow.

Leaders must also embrace data-driven decision-making, relying on real-time information and analytics to guide their choices. This requires a thorough understanding of the data and tools available to analyze and interpret it. Leaders must be able to switch seamlessly between strategic vision and operational execution—an essential skill in a fast-moving environment.

Future Leadership: Inspiring and Transformational

The organizations of the future are distinguished by their ability to adapt continually to a rapidly evolving world. These organizations are deeply embedded in networks of technological innovation, such as universities and research institutions, while fostering a culture of continuous learning and improvement. They actively monitor developments and collaborate with startups, academics, and scientists to stay ahead of societal and technological changes.

These organizations leverage advanced analytics and intelligent algorithms to gain deep insights into market trends, customer behavior, and operational efficiency. They utilize flexible personnel systems that enable rapid scaling, allowing them to seize new opportunities by quickly developing products and services. All of this is underpinned by robust technological platforms that support an agile and responsive organizational structure.

Leadership in these organizations is both inspirational and transformational. Leaders are not only strategists and visionaries but also facilitators who create environments where employees feel empowered to innovate and take risks. These leaders are willing to abandon conventional paths and embrace new, untested methods to achieve sustainable growth.