Digital Disruption’s Impact on Leadership

Mar 26, 2018

Digital Disruption’s Impact on Leadership

What elements create the effective leadership skills that are critical to managing digital disruption? Research from IMD suggests that certain leaders are equipped to thrive amidst today’s digital transformations. They possess certain skill sets and sensitivity to their team’s and customers’ needs and exhibit behaviors that exemplify the nature of Agile leadership: From IMD: “The research revealed that leadership effectiveness in disruptive environments shared many of the same characteristics as leadership in more stable environments, but with a few notable differences. We were able to identify a number of key competencies and business behaviors of Agile Leaders who thrive in this type of environment.”

Today’s disruptive and transforming networked economy is forcing changes in how leaders and those destined for leadership manage their path to the top.

The End of the Silo

New research from The Economist also explores the impact of digital transformation on leaders and how traditional silos are being dismantled. From the Economist Intelligence Unit:

“Digital transformation isn’t only disrupting established business models. It’s disrupting time-honoured career paths. Once, an ambitious professional could take a straightforward path to build their experience and reputation in an area of business. The road from the cubicle to the corner office, and beyond, was mapped out for them. However, traditional corporate silos, and the career paths to the top of them, are changing as emerging technologies become central to every aspect of doing business.”

New Paths From Cubicle to Corner Office

The research is based on a survey of 800 business executives, based in France, Germany, the Netherlands and the UK. Other findings of this research include:

  • 70% report that their role is merging with other roles in the organization. The need for digital innovation forces greater collaboration and removes organizational barriers across functions.
  • 48% of executives report that the “blurring of departmental boundaries makes it harder for them to plan their professional progression. Only 38% say it is clear where to focus their skills and training.”
  • 65% say internal networking will be more important in the near future. The leadership skill that most respondents believe will grow in importance is motivating employees.
  • 62% of respondents say it is likely that they will expand their current role to include responsibility for other departments.

The overlap and the new speed of innovation create pressure on individuals to emerge as a new type of leader. Skills have to change and collaboration is critical. At graduate business school INSEAD, Professor Charles Galunic found three types of characters that he believes companies with cross-functional teams working on digital projects need in order to survive in the digital age.

“The first type, he calls ”the quants”—those who understand data analytics, advanced statistics and coding. The second are “digital natives”—people adept at using digital and social media tools and who know how to reach others using those tools. The third, he refers to as ”the suits”—expert project managers and business-minded people, who can put together a business plan and help execute it.”

He says the big challenge is having all of these different people collaborating and working together because it is just too rare to find a person that can do it all. From a technology standpoint professional services firms especially, because they are people powered and sell knowledge, will need to devise a new “operating system of record” that lets the team see the entire project life cycle (see last blog on collaboration) from start to finish.

A New Learning Curve
The following survey response indicates how executives can sense the shift in skill sets and relative importance.

Professor Michael R. Wade, Andrew Tarling and Rainer Neubauer in an article for IMD surveyed over 1000 executives on the subject of Redefining Leadership for the Digital Age and focused on the skills of the “Agile” leader and identified four characteristics that distinguish agile from non-agile leaders. Agile leaders are:

  1. Humble: They are able to accept feedback and acknowledge that others know more than they do.
  2. Adaptable: They accept that change is constant and that changing their minds based on new information is strength rather than a weakness.
  3. Visionary: They have a clear sense of long-term direction, even in the face of short-term uncertainty.
  4. Engaged: They have a willingness to listen, interact, and communicate with internal and external stakeholders combined with a strong sense of interest and curiosity in emerging trends.

Change or Fail

There is still more to learn and uncover on the nature of disruption as we all find ourselves in the midst of technological upheaval and incredible opportunities to transform our organizations and the individuals that make them go into greater more agile leaders that build new teams that can work outside of the traditional silo and thrive. It is clear than without some transformative program both technologically and new learning is necessary. There aren’t too many other options.

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