Digital Leadership: Rethinking the link between leadership, organisational culture and change
Technology pervades organisations across all industries, yet the organisational structure has – to date – transformed very little as a result. Organisational culture, leadership and the employees’ experience remain comparatively unchanged.
With technological advances, however, come new responsibilities, especially as the relationship between humans and machines is evolving faster than ever before.
The world of work isn’t changing- why isn’t it leading to progress?
Technological innovation and digital transformation are supposed to lead to net positive outcomes, higher productivity, more focused employees and so on. Yet, it’s often not the case. Why not?
With most of us spending the bulk of our waking hours at work – approximately one hundred thousand hours of our lifetime – this question concerns us all.
One of the reasons is we’re too often looking at technology in isolation, thinking about digital transformation in siloed and inflexible ways.
What does ‘digital transformation’ even mean?
Some define it as improving and changing their business to a platform-driven business model. Others describe it as automating their processes. Others still, define it as creating a digital customer experience. All tend to focus more on the application of new and emerging technologies.
Far less, if any, strategic thought is given to how the organizational culture will inevitably also change as the company undergoes a digital transformation. Too often we sweep these aside as unintended consequences.
It ‘just so happens’ that perhaps people feel less recognised than they used to. It ‘just so happens’ that people are more overwhelmed than before. Should, it, ‘just so happen’ though? The working world needs to start understanding that every time we opt to introduce and help technological change take place in our organisations, we are also making cultural changes and perhaps influencing the organisational structure, too.
To manage these effects, organisations need a new type of leader: the digital leader. Leaders who are equally well-versed in leading technological change as they are in leading organisational change.
Digital transformation is change. Period.
We are fast approaching the corporate singularity, where the once discrete domains of technology and business are forever converged, as Paul Michelman recently wrote in Tales from the Digital Frontier published by the MIT Sloan Management Review.
Regardless of how a company chooses to embrace digital transformation (from new digitised processes to new digital client experiences to new digital business models), it ultimately means that the organisation needs to embrace change. Why? Because digital technologies have fundamentally changed the framework conditions for business success in two aspects: speed and scarcity.
We are accelerating from a business world defined in linear speed to one that operates at exponential speed – attracting, and also losing clients, occurs faster than ever before. Take the airline industry: it took 64 years to hit 50 million customers. Television took some 22 years, mobile phones 12, Facebook just four years and Pokemon Go a mere 19 days to hit that same landmark number.
These factors often lead – in popular media and management literature – to the image that digital transformation is best understood as a tornado, a hurricane or a tsunami. It’s an unfortunate choice of an image and narrative: digital change may be as far-reaching, impactful and irreversible as a natural catastrophe, but it is better understood and more aptly described as a human-driven change process.
We need to stop obsessing over technology and shift our focus towards people.
Deciding on a new technology is at best only 50% of that change process. The other half is about the people. Are they willing to go the extra mile and engage with the new technology until it has a positive effect on the customer, or the process efficiency, or the business model, or whatever it is that you want to achieve for your organisation by upgrading your technology? Ultimately, digital change depends on employee engagement.
‘Engaged Employees’, as defined by Gallup, are those people in an organisation who go above and beyond what is in their job description. Disengagement, conversely, is people who do just enough not to get fired – the bare minimum of the job description but not more.
In times of digital transformation, we need people who go (and want to go) the ‘extra mile’ – it’s often the critical factor for whether digital change becomes a success story.
An example from my own professional life was a project my consulting company Inspire 925 undertook with Swissôtel, which is part of FRHI Hotels and Resorts. Back in 2013 I worked with their leadership team as they wanted to use technology to improve the sense of belonging and engagement for hotel employees scattered across multiple locations – some of whom didn’t even have an email address at the organisation because of the nature of their roles. The idea was to introduce an app, giving everyone real-time visibility of what was happening across locations – what special guests were arriving on a particular day, for example.
Given what I’ve said about the negative media portrayal of tech, there is always a danger that staff could display cynicism towards such new ways of working. The traditional way of daily communication at the hotels in question was for the general manager to come in and brief everyone in the morning and then the staff would go about their assigned tasks.
So, to ensure everyone would be on board with the introduction of the app and a new way of working, the leadership team first toured every location – from Zurich to Basel to Geneva – to share the story, showcase the tech and explain the strategy. The result was indeed an increased sense of belonging, while the reduced number of meetings across locations brought efficiencies for the business.
The success of this project came down to the head of human resources going over and above to win over many key managers to support the roll-out process, and then, in turn, enabling these managers with Inspire 925’s support to drive engagement among his workforce.
More change in less time requires more people who are engaged and go the extra mile, more people doing whatever is necessary to make the change become successful, tinkering, experimenting, adapting, until it produces positive results.
What drives engagement, in turn, is a strong organisational culture and leadership by example. Thus, for digital change to be truly transformative, organizations need leaders who are willing to embrace the responsibility of shaping not only the technological future of the company, but also the cultural and organisational structures.