The Traits That Define Great Leaders In The Digital Age

It can be tempting to go big, but successful digital transformation rarely, if ever, results from a massive organizational overhaul.

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It may be an uncomfortable truth, but crisis often sparks innovation. Two years into the Covid-19 pandemic, companies have made concrete gains in driving their digital initiatives forward. In just one measure of success, a recent survey by IBM found that 59% of companies accelerated their digital transformations, while 66% were able to complete projects that were stalled before the pandemic started.

And yet, despite these achievements, some hard facts remain. Only 13% of leaders believe their companies are truly ready to compete in the digital age, and 70% of digital transformation projects still fail. In the early stages of the pandemic, rapid technology adoption was the reason many businesses were able to survive. The speed and success of the transition was “nothing short of a miracle,” as one market research firm put it. 

Today, ever-shifting demands and growing complexity threaten to make digital transformation success hard to come by. Clearly, companies understand they need to do something to make themselves ready to compete in the digital economy, but where should they start? The answer is their own employees.

People are the solution to digital transformation, not the problem.

In surveys that detail digital transformation challenges, most of the blame often goes to company culture. Capgemini, for example, found that 60% of employees across seniority levels believed that their corporate culture was the number one obstacle to successful digital change.

It is true that a static or risk-averse company culture can stop any change initiative in its tracks. But culture is made up of people, and people are actually the key to unlocking the incredible power of digital transformation. At my company, we’ve seen firsthand how individuals are often the driving force behind implementing new technologies and digital strategies.

But we wanted to know more about what exactly makes someone a successful digital leader. To find out, we co-developed a report with Dr. Gerald C. Kane, professor of information systems in the Carroll School of Management at Boston College. For his research, Kane conducted a qualitative analysis of 35 interviews with leaders across a range of companies, including Google, Square, the Royal Bank of Canada and Microsoft.

Digital heroes are made, not born – here’s how.

When a company becomes a digital “innovation factory,” the benefits can be huge, including 1.8 times higher earnings growth and 2.4 times higher enterprise value. Does that mean organizations need to go out and search for digital leaders to help them transform? Thankfully, no – Kane’s report shows that digital leadership is not inherent to certain employees but can be cultivated in anyone who is willing to try. Here are four steps detailed in the report to help businesses get started:

1. Commit to using Covid-19 as an opportunity to move forward.

“Never let a crisis go to waste” is a familiar saying in politics, but it also applies to business. Organizations should ask themselves what they learned since the beginning of the pandemic. They should also ask what new capabilities competitors have developed. The answers will serve as the outline for concrete steps that leaders can take to help ensure they use the gains they’ve made in a focused way to compete more effectively in a post-pandemic world.

2. Find digital heroes and start with a coalition of the willing.

To find digital leaders, look inward first and search lower down in the company organization chart. As Kane explains, employees with less seniority “often have a very different – more realistic – view of how the organization functions and provide important insights into which transformations might have the most significant short-term impact.” Executives should also ask themselves what they can say or do to encourage those individuals to step forward.

3. Protect the digital heroes from your organization.

No, that’s not a typo; companies can be an unsafe place for innovative ideas. As Square co-founder Jim McKelvey observes in the report, “Big organizations are designed to kill new ideas unless they actively try to counteract it.”

To build their defenses, companies should ask what resources – time, money, technology, staff – they would feel comfortable providing to help their digital heroes experiment with new strategies. 

4. Start small and share quick wins to build momentum.

It can be tempting to go big, but successful digital transformation rarely, if ever, results from a massive organizational overhaul. Instead, making incremental changes and sharing wins is a much more effective approach. As Laela Sturdy, managing partner at CapitalG, explains in the report, “No one can refute when those quick wins deliver business value. That helps those leaders gain even more credibility and rope internally to then make bigger bets.”

To start, companies should determine two or three small projects that can be completed in 6 to 8 weeks. They also need a methodology to evaluate the results of these initiatives, as well as a plan to learn from them and share these lessons internally.

Kane predicts that the next few years will be “among the more exciting and disruptive periods of innovation that many of us will experience in our lifetimes.” Organizations should prioritize finding the digital heroes in their ranks today so that they can be ready for the immense digital changes that are just over the horizon for tomorrow. 

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