Transformation is a phenomenon, and digital transformation is a big thing these days – but it’s hard to put your finger on just how to explain it.  It’s not just a matter of digitizing business processes – in best cases it’s about building a digital-first business model.  What does that mean? And what do people mean when they say it’s not just about technology – it’s also about cultural change? That’s often the biggest obstacle, in fact, to successful digital transformation: leadership stuck in old cultural ways.

Here’s what I think could be a good way to explain the change going on in the economy and world.

“In the dynamic between mind and machine, product and platform, core and crowd – the latter of each has grown so much stronger that the relationship between each of these pairs must be re-examined…The business world is always changing but in transitions as profound as this one, things are even more unsettled than usual.”

That’s from the book Machine, Platform, Crowd: Harnessing Our Digital Future, by Andrew McAfee and Erik Brynjolfsson.  It’s a good book.

I think this also offers a good model for self-examination.  How much are you relying on your own mind – and how much are you leveraging the power of the machines you have access to?  I know I think of a lot of ideas, but observing the output of technologies offers a whole new level of insight into what I’m working on.   I get pretty excited about the product of my labor, but the true power is increasingly from the networks, the platforms, and if I’m not keeping my eye there, on the opportunities and the consequences, then I may be missing the lion’s share of what’s available.  For example, I work a lot with Twitter data on a product, but I’ve got to mind the value emerging out on the network of Twitter users and conversations.  The products I use help me gather that value.  And of course the core of any company these days is remiss if it doesn’t pay attention to, and tap into, the crowd it aims to do business in.

I’m going to try using this historic shift toward the power of machine, platform, and crowd as a way to talk about digital transformation.