Leadership in the digital transformation

A lot is currently changing in companies - and not just because of the digital transformation of the economy and society. However, one thing is hardly changing at all: employees. They still want stability and orientation - and all the more so the more unstable their working and living environment becomes.

But who is supposed to convey this feeling to employees in their day-to-day work when almost everything in the company is under scrutiny? Ultimately, this can only be the managers. This is why leadership is becoming increasingly important in the digital age.

Leadership must change

At the same time, however, leadership must change - partly because the services relevant to the company's success are increasingly being provided by cross-divisional and often even cross-company teams, which are often hybrid or virtual in nature. As a result, managers rarely have unrestricted access to their employees and their actions. Instead, they have to lead them on a long leash and trust in their loyalty, integrity and competence. They also have to cooperate more closely with other managers and coordinate the work of their employees with them.

In addition, the solutions provided for customers require more and more specialist knowledge that managers do not have themselves. They are therefore more dependent on the skills and self-motivation of their employees to achieve the desired performance - also because their departments are increasingly faced with challenges for which they do not yet have a solution. As a result, managers are less able to say to their employees "Do this and we'll succeed". Instead, they have to launch trial balloons with them to see what the right solution could be and then determine what is effective in the process.

Becoming a relationship and network manager

How is successful leadership possible in such an environment? The only possible solution is for managers to see themselves as relationship managers whose core task is to shape relationships in the company's social system in such a way that employees can work together effectively; they must also see themselves as emotional leaders whose task is to inspire their employees so that they voluntarily commit themselves to achieving the goals.

Many managers have already done this in the past, but only in relation to the employees reporting to them. In modern high-performance organizations, however, the company divisions are closely interwoven; they also generally cooperate with many external partners who perform important sub-tasks. As a result, managers have to manage an increasingly complex network, not least because companies' workforces are becoming ever more heterogeneous - and this in an environment characterized by permanent change, in which ultimately no one knows what the future holds.

Managers need new skills

Three areas of competence can be distinguished in the development of management skills:

1. Personality intelligence - This area of competence primarily encompasses the level of self-perception. For "digital leaders", i.e. the managers that companies need in the digital age, this is characterized by the fact that they see themselves as learners. They regularly question their behavior and its impact and continue to develop as a person. Closely linked to this are characteristics such as curiosity and a willingness to change.
2. Relationship intelligence - This area of competence encompasses the skills required to build and expand sustainable relationships. Empathy - i.e. the ability to empathize with other people and constellations - and an appreciative approach to the (personal) interests and needs of network partners are of central importance here.
3. Digital intelligence - A central element of this area of expertise is what is known as looking to the future. In addition to a vision of where the common path should lead, this includes the awareness that technological progress (not only in the field of AI) enables new solutions to problems and that the resulting opportunities must be exploited. In addition to interdisciplinary thinking, this requires a "solid" digital competence.

This competence is not demonstrated by the fact that a manager is, for example, the best programmer or user of AI tools. Rather, it is demonstrated by the fact that the person in question, alone or with expert support, can form a well-founded judgment about the opportunities and risks arising from technological progress - for example in the field of artificial intelligence - and is therefore capable of making decisions and taking action.

Managers who possess the skills and characteristics mentioned above can become the emotional leaders that people long for in an environment characterized by instability and change. They can become personality brands that their employees and network partners are happy to follow because they trust them.

Managers need active support.

Managers not only need active support in this development into such a personality brand or digital leader, they also want it. In fact, however, management development is currently largely on hold in many (large) companies, as although they know that their managers will need a different skills and personality profile in the future, they are still unclear as to which one. This is why many companies have "temporarily" discontinued the management and leadership development programs of which they used to be so proud in recent years.

One consequence of this is that a growing number of managers feel left alone "in difficult times", which is why frustration builds up in them. They also often feel overwhelmed. Their employees also notice this. This was shown, among other things, in a Online survey of junior managers aged up to 35 in companies with more than 100 employees, conducted by the IFIDZ. In the survey:

• three quarters of the survey participants stated that the "established managers" in their company were not actively shaping the process of digital transformation and the establishment of a new culture of collaboration, and
• More than two thirds were convinced that they were only tackling these two issues half-heartedly.

This means that the up-and-coming young managers, who are already digital natives and belong to generations X, Y and Z, often perceive their older management colleagues as a "paralysis layer".

Admittedly, this online survey was not representative. Nevertheless, there seems to be a latent generational conflict in many companies between the young, upwardly and forwardly striving managers who want more dynamism in change on the one hand, and the established managers on the other, who - perhaps even rightly - put the brakes on the enthusiasm of the "newcomers" because they know they have to manage day-to-day business: Despite the justified desire for change, day-to-day business still has to be managed.

An iterative approach to management development

Finding the right course in this difficult and complex environment is obviously often difficult for both young and experienced managers. This is why systematic management development is particularly important now - even if companies do not yet know exactly what skills and characteristics their managers will need in the future.

In the case of other topics such as "technical innovation", companies do not throw up their hands in their laps because of such uncertainties. Instead, they propagate an iterative approach when the solution is still unknown: in other words, first try a (solution) experiment, then reflect on the experience gained and then readjust or readjust the measures. Companies should also practice such an approach in management development so that their managers do not increasingly have the feeling that they are being left out in the cold: They are leaving us out in the cold.

About the author: Barbara Liebermeister is head of the Institute for Leadership Culture in the Digital Age (IFIDZ), Wiesbaden. She is the author of the book "The manager as influencer: How to win employees as followers".

Source: www.die-profilberater.de / www.ifidz.de