In an era of increasing digitalisation and decentralisation, digital leadership is crucial to business success. But what exactly does the term “digital leadership” mean and which leadership skills are important to digital success?
Digital leadership in focus
- What is digital leadership?
- Why is digital leadership so important today?
- How does leadership have to change in times of digital transformation?
- What are digital leadership skills?
- Digital Leadership and Transformational Leadership
- Why leadership needs feedback
What is digital leadership?
Digital leadership describes how leaders behave and act in an increasingly digitalised world. A good definition of digital leadership is therefore a leadership style that has developed and adapted due to advancing digitalisation. It provides a way of leading people and teams in the digital age that enables leaders to meet the new challenges posed by digital transformation in the world of work. Digital leadership is an agile form of leadership that harnesses the advantages of digital shift to benefit the business and its people.
Employees are at the heart of this new digital leadership concept, with their managers and leaders providing them with greater freedom and opportunities. Equally important, however, are managers themselves, who have to embrace new leadership models and extend their roles in new directions. Essentially digital leadership changes the role of the leader and splits it into two main areas.
- The manager as a specialist: Firstly, managers need to become specialists with the right skills to master digital tools and new models such as hybrid working.
- The manager as a driver of change: Secondly, and equally importantly, the manager acts as a digital transformation leader, using their change management capabilities to drive and control change within the company. As part of this they need to react positively to change, demonstrating openness, an innovative spirit and courage to enable company-wide transformation.
Why is digital leadership so important today?
Embracing the digital leadership style is crucial for successful leadership during digital transformation. Digital leaders help companies to recognise and communicate the benefits and opportunities of digital technologies to their teams, and actively use and encourage adoption of these tools in their workflows. They are the link connecting technology and employees, bridging the gap between the digital space and employees of all generations, helping them work successfully with digital tools.
Digital leadership is vital to successful digitalisation. According to the Boston Consulting Group, 70% of digital transformations fail to meet their objectives. Those that do deliver value are characterised by six key success factors, including a strong digital leadership commitment, and having the right digital leadership skills in place. Digital transformation and leadership are closely linked.
How does leadership have to change in times of digital transformation?
Digitalisation has fundamentally changed the skills required from leaders. Leadership in the digital age has transformed. Managers now serve as role models for employees, who are not only managed, but challenged and encouraged. Leaders set a positive example and decentralise control, giving employees greater freedom, independence, and the opportunity to take risks. Transparent and open communication at all levels is crucial for this change to happen successfully.
Digital Leadership as the New Normal
The COVID pandemic, new ways of working and increasing digitalisation make decentralisation and digital leadership more than a temporary trend. It is the new normal for many managers and employees.
However, many employees do not feel ready or equipped for a digital future. Research from the Salesforce Global Digital Skills Index found that nearly three out of four respondents worldwide say they don’t have the digital skills they need to succeed in the current and future workforce. This could derail digitalisation and its benefits. Employees need to be supported to cope with change on an ongoing, continuous basis. This makes it imperative that organisations look ahead at all times, keep a close eye on the future of work, and proactively address upcoming uncertainties.
Digital Leadership in an Uncertain World of Work
In his book “Leaders Make the Future: Ten New Leadership Skills for an Uncertain World”, Bob Johansen of Silicon Valley think-tank, the Institute for the Future (IFTF), paints a picture of an unstable future. He speaks of the VUCA (Volatility, Uncertainty, Complexity, and Ambiguity) World. Essentially this is characterised by impermanence, uncertainty, complexity, and ambiguity. Johansen emphasises that digital leaders cannot afford to simply passively accept this uncertain future but must actively shape it. Instead of being overwhelmed by the VUCA World, leaders need to act constructively and build new competencies and skills. It is their job to proactively engage with the future and actively shape change.
What are digital leadership skills?
Digital leadership requires leaders to acquire new skills and learn and develop new competencies. A popular way of defining and selecting these skills is set out in the VOPA+ model, created by economist Willms Buhse. This model defines the areas where managers should be active during the digitalisation process. VOPA+ covers:
- Networking (V): The ability to build and maintain networks, both within the organisation and externally with customers, partners, and other stakeholders. The use of social media and platforms can play an important role here.
- Openness (O): Openness to new ideas, technologies, and change. Managers should actively engage with new developments and promote a culture of willingness to innovate.
- Participation (P): The involvement and participation of employees. Digital leaders should encourage their teams to actively participate in decision-making processes and share their opinions.
- Agility (A): The ability to respond flexibly to change and react quickly to changing market conditions. Agile working methods and adaptability are essential to success in the digital world.
- Plus (+): This additional point stands for the individual competencies and knowledge that may be relevant to specific industries or companies. It stresses the importance of industry-specific knowledge and technical expertise.
Leaders who understand and implement the VOPA+ model are better equipped to successfully lead their teams through digital transformation and make the most of the opportunities that it brings.
Extending Digital Leadership Skills
As well as the skills set out in the VOPA+ model, leaders need to also demonstrate these competencies:
Digital Literacy
Digital abilities clearly have a decisive role to play when it comes to successful digital leadership. Leaders have to combine confidence in using existing digital tools with an understanding of the latest trends in order to always be up to date with technology advances. Additionally, they need to share these digital abilities with their wider team, involving and training them to make smart decisions.
A no-blame culture
Digital leaders need to promote a no-blame culture where all employees work together to learn and improve. Mistakes should be seen as opportunities, rather than negatives, allowing everyone to develop in a dynamic environment. This culture creates a space in which employees dare to try out new ideas and pursue innovative approaches without fear of negative consequences if they don’t deliver positive results.
By encouraging employees to be proactive and take responsibility, digital leaders enable continuous growth by their team, unleashing their full potential. This no-blame culture promotes the personal development of employees, supports the acquisition of new skills, and contributes significantly to company success.
Bringing people together through team building
Bringing employees together and encouraging them to collaborate is crucial to successful digital transformations, especially when they bring knowledge and capabilities from different departments across the company. Through this interdepartmental collaboration, problems can be viewed from different perspectives and solved by applying a variety of approaches. This enables companies to create new ideas and innovations. The diversity of experience and skills within these combined teams significantly contributes to overcoming the challenges of digitalisation and promotes a creative and dynamic work culture.
Empathy and understanding to drive acceptance
Digital leadership and successful change management require effective communication through empathetic leadership. The introduction of new tools and workflows requires understanding of the employee perspective and any potential obstacles to adoption. Clear communication of the vision and demonstrating that you understand and have considered employee needs are crucial for successful change. Open communication and the use of skills such as empathy are essential to promote trust and a positive corporate culture.
Combining Digital Leadership with Transformational Leadership
How digital leaders operate can be very different from traditional models. While there are multiple leadership styles that can be combined with the concept of digital leadership our Future of Work Report has clearly shown that transformational leadership is the best way to lead employees now and in the future. Digital leaders who lead transformationally excite, motivate, and inspire their teams with a strong vision and their charismatic personality. This increases employee commitment and transforms the relationship from being transactional to inspirational.
Leadership needs feedback – especially during digitalisation
How a leader views themselves can differ significantly from how they are perceived by their team, superiors, or customers, with the external and self-image often not matching. That‘s why successful digital leaders learn from real feedback.
In the digital world of work, it is often more difficult to assess what others think and feel, especially when leaders and employees may work remotely from each other and don’t meet on a daily basis. On the other hand, digitisation opens up new opportunities: It has never been easier to collect feedback. Smart team feedback tools enable holistic feedback that helps managers become good leaders.
However, this is not just about getting feedback on the leader’s own behaviour. Intelligent tools also uncover issues in the team or poorly designed processes. Feedback makes it easier for leaders to identify such concerns and problems at an early stage and act before they escalate. This creates sustainable employee engagement and strong employee retention.
In short, feedback is the most valuable tool for leaders, enabling them to take informed decisions and lay the foundations for effective leadership development.
360-degree feedback for successful digital leadership
For leaders, 360-degree feedback is the ideal way to assess their leadership skills. This multi-rater feedback allows for a comprehensive assessment from different angles. Feedback can be collected from a wide range of groups:
- Direct and indirect superiors
- Colleagues
- Team members
- External and internal customers
As part of the 360-degree feedback process the manager also completes a self-assessment. By assessing this range of perspectives, they gain a wider insight, and can see how their views compare with those of others.
This is exactly where Tivian’s Leadership 360 comes in. It gives digital leaders the opportunity to capture feedback digitally and holistically and turn these insights into concrete actions that will drive their development and improvement.
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