The big difference is that the leadership exercise isn’t only top-down, but also at level and bottom-up
We’re in the middle of transition, from the mostly predictable and evolutionary world we knew, to a significantly unpredictable and transformational one.
A fading business cycle is making increases in revenue and income harder for CEOs to deliver. As they hunt for ways to sustain growth, new and diversified digital revenue streams have a significant role to play.
Gartner’s 2019 CEO survey found that 82 per cent of CEOs have a digital optimisation or transformation initiative underway, up from 62 per cent in 2018.
Organisations have high expectations regarding the outcomes of their digital transformation programmes, but achieving this isn’t simple.
Each organisation and its leaders are charting unknown territory. New digital opportunities must be explored and, in parallel, organisation-wide culture change undertaken.
While new digital streams begin to generate the expected outcomes and revenue, the organisation must continue to run business as usual. In addition, the transformation programme demands that leaders are capable of harnessing the efforts of everyone, continually aligning them with the journey’s objective and driving them toward that objective.
Despite CIO’s efforts to increase the readiness for change in the IT organisation, traditional corporate culture still supports command-and-control leadership practices of the industrial era.
Many times, traditional approaches to IT-based programmes yield disappointing results because of the very different characteristics of the current business environment.
Collaboration is like doing a trapeze act without a safety net. It’s doing everything with all the care and attention, maybe with some fear, but without mistrust
Change must happen. Gartner expects that in the next few years, 80 per cent of medium to large organisations will change their culture as a way to accelerate their digital transformation.
Information and technology play a prominent role in this journey, and the CIO is the linchpin to make it all happen.
New environment and leadership
IT borrowed industrial engineering models that were successful for decades, driving IT to high levels of quality, efficiency and reliability. The new digital business environment is different. It’s uncertain, changes rapidly and is characterised by very different attributes.
The “old” business leadership in the industrial era was granted through a mandate, associated with an organisational position and a title. Procedure manuals indicated how to develop the work. Leaders would check controls to ensure compliance with prescribed processes.
In the digital era, uncertainty and change prevent the creation of stable procedure manuals and prescribed roles along business processes. Instead, a common, shared collaborative language must be developed to flesh out digital business ambition and new models.
This language is very different from the prescriptive authoritative “order issuing” language used by industrial era leaders. It’s a dialogue where the digital leader communicates a “what to do” and elicit the best approach to “how to do it” from the team.
When you know what you want to achieve, then you select a formal methodology to address it, draw a plan, check intermediate results, measure deviations, correct the track and advance until the anticipated end.
This approach can’t be used when there are inevitable uncertainties in the business environment – what the market precisely wants, what other players are doing, how conditions will change along the way and other key variables.
Solutions evolve through iterations, using prototypes and pilots in successive approximations until you’re happy with the outcome. You can’t create a formal process, describe and prescribe it. Nor can you push advances through command and control.
Instead, change your leadership style to one that will progressively define the details of “what” to achieve, while developing the “how” to achieve it along the way. Relationships become critical to reach out to the appropriate resources, mobilise them and demobilise them – fast and precisely.
Path to the new leadership
New leadership styles require you to put people first, under the perspective that digital transformation focuses primarily on people’s mindset and organisational culture. Instead of issuing orders, exchanges begin by asking for the other side’s perspective. Scenarios are developed collaboratively.
Develop trust and collaboration to support new, flexible, unscripted work patterns. There are dozens of organisational development tools to do that. Choose those that resonate well with your organisational culture Collaboration is key to new work patterns in this new business environment. You need to create a formal programme to address it.
A CIO of a major retail chain I spoke with told me that collaboration is a lot more than working together. It’s doing a trapeze act without a safety net. It’s doing everything with all the care and attention, maybe with some fear, but without mistrust.
In a collaborative environment, leadership is dynamically passed to the specific expert at each juncture. Managing that dynamic is a new leadership social skill.
Develop the right relationships
When we think of leadership in the industrial era, our mental image conjures up the image of somebody ordering someone to do something and the ordered person carrying out the order.
Situational leadership is different. When conducting an organisational programme, each situation will call for a different leader, depending on the knowledge, capabilities or skills required at that point.
The big difference is that the leadership exercise isn’t only top-down, but also at level and bottom-up. The new leadership is not based on a formal mandate, but on the authority granted by knowledge domain expertise. That’s the basis for establishing the right relationships, as well as attracting and garnering the hands-on participation of the right people in the digital programmes.
Cassio Dreyfuss is a VP analyst at Gartner in the CIO research team. His research focuses on the business value of IT, new collaborative work patterns and IT organisation models.
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