Every manager has an idea in their head of the perfect team. It’s usually a diverse group of intelligent, driven and resilient individuals who somehow overcome their personal limitations to drive efficient business growth and enhance the culture of the entire company. An innovation machine that requires very little maintenance. Oh, and it should have a digital “growth mindset”.
“Growth mindsets” have been an industry buzzword for several years, ever since Microsoft famously overhauled its toxic workplace culture. In 2015, Microsoft CEO Satya Nadella sent an internal memo to all employees, explaining the group’s new position:
“It starts with a belief that everyone can grow and develop,” he wrote, “that potential is nurtured, not predetermined; and that anyone can change their mindset. Leadership is about bringing out the best in people, where everyone is bringing their A game and finding deep meaning in their work. We need to be always learning and insatiably curious. We need to be willing to lean into uncertainty, take risks and move quickly when we make mistakes, recognizing failure happens along the way to mastery.”
“It starts with a belief that everyone can grow and develop,” he wrote, “that potential is nurtured, not predetermined; and that anyone can change their mindset."
This became the template for Microsoft’s future growth. Employees were no longer incentivised to prove they were the smartest person in the room, or achieve success at the expense of others. In fact, the opposite was true. Microsoft decided that the company would grow faster if team members worked together and looked at their own career as more of a work-in-progress.
Microsoft may have popularised the “growth mindset”, but they didn’t invent it. The term was first coined by Stanford professor Dr. Carol Dweck, who found that most people fit into two broad categories. The first is the Fixed Mindset, which believes that intelligence and talent are static, unchangeable, and responsible for pretty much all professional success. The second is the Growth Mindset, which believes that anyone can develop their skills with education, hard work, motivation and the right leadership.
Dweck found that companies that embraced this ‘growth mindset’ rapidly outpaced ‘fixed mindset’ ones. Employees were encouraged to experiment, try new things, learn through failure, and always push themselves to do better. And, as a consequence, the company became more adaptive and more successful. In fixed cultures, mistakes are punished, creativity is discouraged, and most people are only concerned with personal advancement.
Over the last 10 years, we’ve seen these trends play out in the field of digital transformation (DT). According to marketing intelligence firm IDC, 40 percent of all technology spending is currently going towards digital transformation, with companies investing more than $2 trillion into the process. But Forbes estimates that 70 per cent of DT initiatives will fail, leaving a $900 billion hole in enterprise strategy. The reason for this gap is simple: digital transformation requires a growth mindset to be successful, and many companies invest in technology before investing in people.
Forbes estimates that 70 per cent of DT initiatives will fail, leaving a $900 billion hole in enterprise strategy. The reason for this gap is simple: digital transformation requires a growth mindset to be successful, and many companies invest in technology before investing in people.
So how can we foster a growth mindset?
Well, experts have identified a few ways:
- The first is setting personal goals that align with the company’s growth strategy. If your business wants to automate and use machine learning, for example, encourage employees to upskill into those fields. Create personal development goals and make them tangible: they need to have timelines, management oversight and criteria for measuring success. (Think of developmental goals as New Year’s resolutions: the more specific, the better.)
- The next is to provide training and educational resources, and encourage staff to use them. This might take the form of an annual training budget, an internal upskilling program, or access to online learning modules and networking opportunities. Harvard Business Review encourages businesses to analyse their employee experience with the same care and attention they give their customer experience: you need to identify strengths, weaknesses and talent gaps, and then align those gaps with your business objectives. This isn’t just good for growth mindsets, it’s good for business: a Gallup study found that engaged employees outperform their colleagues by 147 per cent.
- The final step is to create a culture that rewards curiosity, innovation, risk-taking and experimentation. These are the qualities that inform the growth mindset. Employees need to feel comfortable speaking up, and reassured that there really is no such thing as a bad idea. Everything is a learning experience. Google’s famous 20-Percent Rule is a great example of this: employees are encouraged, not just permitted, to spend 20 per cent of their work time on personal projects they think will benefit Google (the 20 Percent Rule is credited with all sorts of innovations, including the invention of Gmail). Amazon is another company that nailed this digital, blue sky, anything-goes mindset.
"You need to identify strengths, weaknesses and talent gaps, and then align those gaps with your business objectives. This isn’t just good for growth mindsets, it’s good for business"
“Yes, Amazon started as an online book seller, and then they learned about supply chain logistics to become the dominant retailer in the US; they learned how to leverage their technical infrastructure to become the dominant player in web services; they learned how to put 60-70 million Alexa devices in U.S. households,” writes Edwin Schmierer. “They have the experience, culture, patience and people to figure it out.”
That’s a pretty good summary of the key ingredients necessary to achieve a digital growth mindset: experience, culture, people and patience. Notice that technology doesn’t make the list. Digital transformation doesn’t cause a growth mindset; it’s a symptom of a growth mindset. When you decide that every individual can learn and master anything, when you really lean into that idea, you’re no longer limited by your own imagination. Your business can become basically anything.
That’s the beauty of the growth mindset: the perfect team is the one in front of you. They just don’t know it yet.