Authors: Linda A. Hill, Ann Le Cam, Sunand Menon, and Emily Tedards
Harvard Business School

 

The April edition of “The Hub” featuring a collection of three research articles from Harvard Business School sharing insights on digital transformation in the shifting business landscape.

 

Part A. Where Can Digital Transformation Take You? Insights from 1,700 Leaders
 

The respondents in the research emphasis on using words “leadership in the digital age” instead of “digital leadership” and highlighted three major shifts in the global economy-

1. New customer expectations
2. New employee expectations
3. New societal expectations

 

SIX QUALITIES OF DIGITALLY MATURE ORGANIZATIONS

 

Rather than waste time resisting, digitally mature organizations embrace and adapt to these key shifts in the business landscape-
 

1. An Intimate and Dynamic Understanding of the Customer
   Rather than expecting customers to buy whatever a company sells, the most successful companies proactively anticipate and discover customers’ problems and desires and innovate accordingly.
    
2. Culture that’s Data-informed, Not Data-driven
   Digitally mature organizations embrace data and use it to make better, faster decisions. However, data informs, not determines, their decisions. Analytics are important, but judgment and critical thinking ultimately set the roadmap.
    
3. A Challenger Mindset and Willingness to Disrupt
   Encourage employees to challenge the status quo—even if this means fundamentally rethinking the core business. Curiosity and creativity are vital resources for a digitally mature company.
    
4. Distributed Decision-making and Co-creation
   Leaders of digitally mature organizations see beyond functional silos and organizational levels to bring together individuals with varied skill sets to frame and solve problems and view employees more as “collaborators” than “followers,” in part because data and technology enable more employees to have input in decisions.
    
5. Continuous Experimentation and Learning
   Digitally mature organizations leverage design thinking, lean start-up, and agile methodologies to power innovation. In a world where speed matters, digitally mature organizations act even when the appropriate move is ambiguous.
    
6. Ethical Decision-making and Proactive Governance
   Leaders of digitally mature organizations align their employees around a shared purpose that puts ethical decision-making on behalf of stakeholders at the center. Proactive partnership with policymakers to develop regulations and practices that encourage competition, protect customers, and meet the needs of society.

 

Part B. Digital Transformation: A New Roadmap for Success

 

Seven guiding principles for digital transformations at any stage—nascent, progressing, or stalled:
 

1. Recognize the Emotional Side of Digital Transformation
   Digital transformation can be bewildering and exhausting for leaders and employees alike. 
    
2. Align Around a Customer-Centric Narrative
   Leaders must develop a narrative—a human-centric story—for how digital transformation will improve the lives or livelihoods of their customers and other stakeholders.
    
3. Build a Data-informed Culture by Upskilling Talent
   Today, digital transformation requires upskilling all employees so they can harness digital tools and data.
    
4. Manage the Power Dynamics that Come with Data
   Data shouldn’t be touted as a replacement for expertise or experience. It’s important to remember that data, like all information, is power, and not everyone will embrace this transition readily.
    
5. Design for Inclusive and Agile Problem-solving
   As leaders develop and iterate their strategy for where they are going and how they will get there, they need to surround themselves with people who have their fingers on the pulse of the organization.
    
6. Encourage an Outside-in and Collaborative Ecosystem Perspective
   Digital transformation requires continuous individual and collective learning. An outside-in perspective can infuse the creativity and curiosity that digital transformation requires. 
    
7. Safeguard Ethics and Take a Proactive Approach to Governance and Compliance
   In the digital world, leaders must stay informed of nascent and fast-changing compliance standards—globally and locally—as they make investment decisions and must articulate the values and principles that should guide how employees resolve inevitable ethical questions and create processes and habits that reinforce desired actions.

 

Part C. Curiosity, Not Coding: 6 Skills Leaders Need in the Digital Age

 

To transform their organizations, leaders must first transform themselves. For recalibration, the leaders may focus on the following-
 

1. Be a Catalyst, Not a Planner
   In the digital era, companies face a more dynamic competitive environment. The speed and complexity of technological change require digital transformations to be more iterative than other forms of corporate change. Leaders need to catalyze change rather than plan for it. That means creating the initial conditions for the organization to achieve its ambitions and guiding their company through a process of continual learning, pivoting all along the way.
    
2. Trust and Let Go
   Inviting employees to share in decision-making and creating a culture that makes people feel safe enough to take risks and act on behalf of organizational interests.
    
3. Be an Explorer
   With so much changing around them, leaders must be explorers. Leaders must balance this curiosity with intentionality as they figure out when to be open-minded and broad and when to be focused and dig deep.
    
4. Be Courageous
   Leaders need to learn to experiment, iterate, and pivot themselves if their organizations are going to be able to thrive. In order to get comfortable with the inevitable missteps and unconfirmed hypotheses of experimentation, leaders need a new attitude toward risk.
    
5. Be Present
   The best leaders stay present and emotionally engaged, communicating openly and authentically.
    
6. Live Values with Conviction
   Many employees will resist changing their mindsets, behaviors, and skills unless they appreciate the value of doing so; leaders need to be clear about not just what they’re doing, but why they’re doing it. Leaders must share how corporate purpose and values shaped their decisions, and the principles and guardrails they relied on when weighing tradeoffs.

 

(IICA acknowledge the authorship/ownership of the research articles and republishing the same only for education purpose only.)