The
Need for Digital Know-How Starts at the Top
Do you remember the last time you received an
email from a senior leader touting some new transformative technology you’d
soon be expected to use? It was going to revolutionize the way you work, change
your company’s culture, and inject digital acumen into the organization.
How
did that turn out? Most employees probably followed along for a while, then
looked around and saw that the heads of their divisions and other executives
were going about things the same way they always had. So much for that new
culture. In fact, at least 70 percent of transformation efforts will fail to
achieve the desired results in 2018, according to IDC, and a mere 3
percent of CEOs worldwide said that they have
successfully completed enterprise-wide digital transformations in a survey by SAP
and Oxford Economics.
There’s a good reason for this dismal track
record — it just might not be what leaders are paying the most attention to.
For starters, many executives are focused merely on introducing a single
technology, thinking it will be transformative with or without a change in how
people work. But no single technology brings cultural change; it’s just a tool.
More important, senior leaders are hyper-focused on the skills and competencies
of mid- and lower-level employees, fretting about their workforce not being
prepared to take on the digital future.
Such
skills are necessary for employees across an organization, but how many CEOs
have also examined the abilities of their own executive teams? When they do,
they might not like what they see: PwC’s
21st CEO survey found that 70 percent of CEOs say
they’re worried about the digital skills of their senior leadership team. And
the 30 percent who aren’t worried shouldn’t assume that those skills are where
they need to be.
Worse, many CEOs aren’t doing anything
meaningful to improve their own skills, perhaps because they haven’t fully
grasped what it means to be a digital company. For instance, 55 percent of CEOs
say they’re customizing the software they use as a way to hone their digital
skills. That’s admirable, but not nearly enough to lead a company into the
digital future. And just 23 percent say they are interacting regularly with
artificial intelligence-powered tools. Perhaps they never ask questions of
Siri, don’t own an Amazon Echo, or never interact with chatbots. Or could it be
they don’t fully understand what AI is and what it could mean for their
business?
It’s hard to move a ship if the captain and
the main crew aren’t steering in the direction they’ve asked everyone else to
go. For most traditional organizations, change has to start at the top.
Otherwise, you will find that your senior leaders don’t have the skills needed
to be exemplars of the new way of working required in a digital company. And if
that’s the case, it’s likely any transformation is destined to fail or bring
poor results.
The time to act is now; the need for key
skills to lead in the digital future will only be more intense in the years to
come. For most leaders in traditional companies, expertise in a particular area
and an ability to guide decisions through old-school “the boss decides”
management tactics are what got them to the top. But that won’t work in an
agile, digitally focused approach.
Reconciling
the traditional with what it takes to manage a truly digital organization is
the first step. To turn the tide, senior leaders have to admit to the company
as a whole what they, too, have a lot to learn. Once that’s out in the open,
CEOs and senior executives need
to upskill themselves, and be public with their workforce about
that effort. Yes, upskilling is a buzzword — but not without reason. The idea
dominates today’s employment conversations, became a centerpiece of the World
Economic Forum in January 2018, and
is a staple in tomorrow’s jobs narrative.
To understand what type of training is
needed, leadership — the CEO and those around the CEO — needs to determine the
skills required to lead a digital company. Where does the senior team stack up
to these? Does every leader, from product development to HR to finance and
marketing, have a basic knowledge of how to work with and contextualize data?
Do they know what’s going on in other parts of the company? Are they aware of
the uses of the latest emerging technologies in their industry? Do they know
enough to speak intelligently, and apply the concepts to the company? Are they
solving problems together or just in their own departments? Are they applying
design thinking when solving problems?
The answers to these questions — many of
which are likely to fall short of where a company will want to be — will give a
clearer sense of the skill gaps at the highest ranks. Most of these needs
represent a change in thinking and working, and they’re universal, across
industries. Leaders might not need the technical level of skills that some on
the front line will, but everyone should have a base level of knowledge about
the technological onslaught that will change their industry and company. And
executives will need to embrace some new ways to manage teams, modeling
something closer to a startup mentality of management than the traditional
hierarchical methods that have succeeded before.
This
means changing
mind-sets and behaviors to incorporate more
social ways of idea generation so that the best ideas bubble up and aren’t
constrained by hierarchy or silos. Executives need to model new rituals and
habits, such as bringing together people on other teams and divisions to solve
problems, rather than leaving them to one department. They’ll need to practice
speedier decision making, being more agile in order to come to conclusions in
days or weeks, not the traditional months (or longer).
As leaders grow their own digital acumen,
they will gain a level of credibility — and as important, perhaps, a level of
empathy — that will allow them to bring change and continuous learning across
the rest of the workforce. Only then will traditional companies stop playing
catch-up in an environment where change is the only constant and going all in
on digital is the route to survival.
Tom Puthiyamadam
https://www.strategy-business.com/blog/The-Need-for-Digital-Know-How-Starts-at-the-Top?gko=bb0fb&utm_source=itw&utm_medium=20180220&utm_campaign=resp
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