“Digital leadership is a scientific approach to defining the tasks and tools of leadership in times of digitalization in general and in phases of transformation into digitization in particular.” This definition can currently be found on Wikipedia.
In the course of my research, I have studied the term with more than 60 executives. For me (Lindner 2019), the term is defined as follows: “Digital leadership is a cross-sectional competence as well as a collective concept for various methods, theories and tools that describe leadership and in particular leadership competence in the digital age”
But what is exactly different about this leadership in the digital world? The Crisp research project already found the following:
A number of high expectations are projected on the new generation of executives. In addition to a variety of desired characteristics, the Digital Leader primarily maintains a constructive and continuous exchange with its own IT department, actively informs itself about IT innovations and thinks disruptively with regard to new processes and business models.
Challenges of Digital Leadership
Leadership has always dealt with the scope of executives facing social and entrepreneurial challenges. A new challenge is the so-called digital age or digitalization. But the leadership challenges are complex and numerous and can quickly overwhelm.
To shed more light on this, I discussed the challenges of digitalization in a roundtable with 7 executives. The result can be seen in the following figure. The source can be found under Lindner and Greff (2019).
On the one hand, agile teams and methods are increasing, especially in IT. More and more executives are confronted with agile teams and are considering what a new kind of leadership might look like.
On the other hand, current leaders expect a clash of generations. For example, the digitally restrained Generation X already meets the digitally shaped Generation Y. In addition, both will meet the fully digital generation Z. Not every one of these generations can be guided with the same methods, so a balancing act is needed for the digital leader.
Furthermore, remote work and virtual teams are increasing, which entails a guided tour at a distance with virtual software tools. It is not clear how this can be implemented in a targeted manner by executives at the moment.
The final challenge is the change of traditional business models and the associated change management, which must be essentially managed by executives.
Challenge 1: Agile Leadership / Agile Teams
“Agility is defined as the ability of an individual or object to respond flexibly to requirements and adapt to its environment” (Lindner and Leyh 2018). It can therefore be assumed that leadership in an agile context is flexibly tailored to the employee or the working environment (Lindner and Greff 2018).
An agile value cape
Agile leadership is a mindset and a personal attitude of the manager. To help you understand these, I have had over 60 executives create a value image based on sliding rules. You can see in the illustration what an agile mindset should look like according to the executives. This can be considered a guideline for you in everyday life.
Leadership methods and agility
Leadership has been around for a long time and there are numerous concepts around agile leadership, digital leadership and classic leadership in the sense of Taylorism (Command and Control). I would like to give you a little more specific information about the various methods.
The challenge is to use all leadership methods wisely at the right time.
In my research, I came across 9 leadership styles that should cover 90% of a leader’s possible behavior. I distinguish the styles roughly between the type of eye-level and the autonomy for the employee.
Reading tip: Learn more about the management methods here
In an agile context, a manager should therefore repeatedly use targeted management methods to suit each employee. The idea of agile leadership is simple but difficult to implement: you have to respond to the needs of the individual employees and adapt the management styles.
For example, the new employee needs a more detailed briefing, as he is not yet familiar with his or her duties. On the other hand, a colleague who already has the necessary experience would be given more responsibility. Depending on the need for autonomy or eye level, apply different leadership styles per task.
Challenge 2: Maturity-oriented leadership of generations
A significant difference between generations lies in a differentiated average digital affinity. Ciesielski and Schutz (2016) continue these considerations and examine the differences between generations in attitudes towards the world of work. The following table shows the intergenerational characteristics.
Reading tip: Generation management
In literature as well as in the roundtable, digital maturity was closely linked to the generations (Lindner and Greff 2018). Of course, it can be ruled out that this is always true in practice, but this blog article is intended to maintain this due to simplification. The picture is from my study (Lindner and Greff 2018).
Until a few years ago, the world of work was largely adapted to the needs of Generation X (e.g.: strict separation of work and private life). It is therefore necessary to evaluate which working models could guarantee a high level of satisfaction and thus a high motivation in the execution of work (Lindner and Greff 2018).
Creating workspaces for generations
Not every employee wants to work completely digitally and agilely. It is therefore necessary to create different analogue and digital workspaces that the generations can use for themselves. There are two options:
- Teams with mixed generations promote innovation and creativity
- Teams with only one generation promote efficiency and collaboration
We have had the more than 60 managers evaluate some working methods and have them assigned to a scale on the basis of the generations. You can see how you can create such workspaces from the illustration.
Challenge 3: Virtual leadership
The manager is a key player in organizations whose task is not only to perform at different levels, but also to motivate employees to perform through specific behavior and to create optimal framework conditions for performance creation in organizations (Zeichhardt 2016).
In order to create the right framework conditions for virtual teams, it is also up to the manager to introduce the appropriate software tools such as video conference, project management software, chat systems and much more and to coach the employees with them.
Together with the more than 60 executives, we evaluated the factors of virtual leadership. It turns out that there are essentially two fields of tension. Thus, on the one hand, it is a question of the balance between autonomy and trust and, on the other hand, between the digital and analogue worlds.
Reading tip: Virtual tour
Use leadership software
Since the handling in the analogue has already been extensively researched, we want to deal with virtual management with software in this case. We have evaluated the satisfaction, the procedure (controlling to delegate and the task size using various software tools with over 60 executives).
You can see in the table various tools and in the first column how satisfied the managers are with this in virtual teamwork. You will notice that the email in particular tends to drop in satisfaction for virtual teams and are likely to be replaced by chat systems.
In the second column, you can see how the executives are doing. Is the medium used more to control or delegate tasks quickly? For example, in Jira, executives stop tasks and assume that they will be completed, while e-mail is more likely to query a status.
The last column shows the task size. Are they more likely to be assigned large or small tasks? While software such as Jira tends to assign small tasks, executives discuss larger and medium-sized tasks via videoconference or telephone.
Challenge 4: digital business models
Another approach is not only digital leadership but also the role of a digital leader in the transformation of business models. In the study of 102 companies, the consulting firm Deloitte examined the role of executives in the transformation of business models. The result was as follows:
- Leadership creates a clear vision for business model
- The task is to break up existing silos and optimize value creation holistically
- The digitization of business models requires a major organizational and personal challenge, and therefore also requires an outstanding leader, which is not easy to find
Reading tip: What does a CDO do?
But how does a company decide which digital business model it wants to use in the first place? In order to answer this question, companies should analyse three aspects in particular in detail.
- Offer (How can the product be offered using technology?)
- Customer benefit (How can the customer benefit even more from the offer through the use of technology?)
- Value chain (What options are possible for technology to change the value chain?)
Reading tip: Digital business models
Transformation of business models
We also evaluated tips on the transformation of business models with more than 60 executives. The important tips are:
- Conversion to a software company: Open up new business areas in your company and increasingly transform from a product to a software company
- Think in new patterns: Don’t just digitize old, suboptimal processes. Instead, you should integrate new concepts and approaches, rethinking processes and services.
- Digitize with strategy: Think about a sensible route for transforming your business model instead of starting out without a plan. Start digitizing where you can get the fastest results and follow this pattern as a continuous iteration.
- Be open to new things: The transformation of a business model often has a lot of potential, but at the same time brings with it many new processes. Therefore, remain open to technology, but also to the content, and to analyse whether your existing partners and alliances continue to fit the transformed business model.
- Stay close to the customer: Digitalized business models clearly focus on the end customer. In order to best meet its needs, your entire projects and processes should therefore be designed for customer benefit. To do this, you should always stay in close contact with your customers and place an intense emphasis on user experience, customer journey and interaction design.
Conclusion: Old wine in new hoses
The quotation goes back to the turn in the Bible after Matthew 9:17. Digitalization brings with it a new challenge, but leadership has long been shaped by dealing with new challenges. You will successfully master as well as digitalization!
The already known management styles, for example, are still preserved and executives should only use them specifically at the right time in the sense of a digital world. The creation of workspaces for different generations is also an issue that currently concerns leadership, as well as the management of virtual teams and the transformation of business models.
In the end, I would like to give some recommendations for action for you as a Digital Leader, which I also derived from my practical experience:
- You are the advocate of digitization. So take the helm and actively shape change as a role model!
- They must be flexible. Always react appropriately to changing conditions and show understanding for errors.
- Try using new media and tools like Twitter, Snapchat and Instagram as well as Trello and Slack. Be a digital pioneer!
- As a digital leader, you don’thave to know everything, but you have to bring the right people into the team who bring the necessary know-how.
- Have understanding especially in the communication of diversity for men/women, cultures and generations.
- Read a lot about organizations and management: Don’t make the same mistakes that are in every management book and organize your team as you did 20 years ago!
- Often listen to your intuition and sensitivity! Such a radical change is not a sprint, takes a long breath and often cannot be planned directly.
Lindner, D. (2019). SMEs in digital transformation: results of empirical studies. Wiesbaden: Springer Gabler.
Lindner, D., & Greff, T. (2019). Leadership in the age of digitalization – what do executives say? HMD – Practice of Business Informatics, 7(1), 20.
Lindner, D., & Leyh, C. (2018). Organizations in Transformation: Agility as Consequence or Prerequisite of Digitization? BT – Business Information Systems. In W. Abramowicz & A. Paschke (Eds.) (pp. 86-101). Cham: Springer International Publishing.
Zeichhardt, R. (2016). E-Leadership: Leadership and performance enhancement in digital contexts. In performance management (pp. 125-140). Wiesbaden: Springer Gabler.Gender note: I have used the male form for easier reading. If no explicit distinction is made, women, miscellaneous and men as well as people of any origin and nation are always meant. Read more.
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