Today, almost in the last quarter of the dramatic 2020 year, many organizations are not only at risk financially, but are at risk of losing their relevance, of becoming the dinosaurs of our modern world. COVID-19 has launched Digital and Technology with an amazing speed in the top 3 on the priority list of the CEO's. The speed of development of Digitization and Technological progression (DigiTech) is accelerating. It not only changes the Tech side of organizations. It also impacts leadership and people systems. In this article I will guide you through Five Imperatives of DigiTech Leadership I have identified.
We can talk all we want about needed change, but unless we have DigiTech leaders who are willing to think in new ways and venture into new territories, our organizations are likely to stay stuck in the status quo. So, what makes a leader exceptional in today’s DigiTech Organizational environment? Following are five practices for progressive leadership, each one key to moving organizations forward effectively to be ready for 2021.
Article by: Neil C.W. Webers
1. Drive a culture or Agile Innovation. Accelerate. Go faster!
Speed is crucial today. When you design-it-all-to-detail a competitor might catch up. You must strive for perfection, but you need to build it into your operation system in order to improve along the way. The story of Tesla is famous: They just hedged standard parts (not meant to use in cars…) on the market, while their competitors spent years with their suppliers designing the right part-by-part for their cars. Result? The first Tesla’s latterly loosed parts while driving. Did it mind? Yes? Tesla had to improve faster and faster. Did it hurt? Well, just check Tesla’s value compared to competitors today. They are the most valuable car producer in the world. Do they sell the most cars? No, but they fuel the complete expansion of their global footprint by the stock increase without having to borrow money from banks or the market.
Driving a culture does not mean spreading the word. It means aligning the right systems, structures and processes in both management and operating systems of the organization in order to evoke the right results and the right results on time regarding new products, new services, upgraded packaging, updated recipes and more.
Design a value chain which includes suppliers as part of the organizations supply chain. End-to-End. Involve suppliers in the design from the start. By integrating suppliers in the early design process you will reduce risks and it will enable to prototype fast. Manufacturing is not a necessary (conversion) cost of your product. It is an integrated part of the design and a distinctive competitive advantage from your competitor. It creates responsiveness in your demand pipe so you can ‘breath’ in the same pace with the faster changing demands of the different channels.
2. Challenging the imperative part is part of daily practice in order to create a responsive strategic process
Exceptional leaders aren’t recognized for how well they maintain the status quo, they’re celebrated for how well they are able to anticipate and respond on changes in market and demand.
Today, DigiTech leaders have access to tons of data and loads of analysis which enables them to continually scan the environment to discover what others are doing and find ways to stay ahead of the curve. In short, they take the initiative to make change. ‘Operationalizing’ data, analysis and management information on strategic level = Making the numbers work in function of the strategic process. If most of your management information arrives monthly, 12 days in the new month…. Can you then expect any agile strategy revision process on a weekly level? No. The strategic information flow has to be in ‘real time sync’ with the desired strategic process. Today, DigiTech is ready for it, but many strategic processes and management process in organizations still have the slow, long term pace. Design a world-class-excellence-strategic-process listening to your customers, vendors, colleagues. To top-floor and specifically to the shop-floor in your organization. These are the people who know what products, services and programs your customers need and want. Additionally, look outside your organization and into other industries for ideas. You can also maintain an “Organization of the Future” committee 24/7, rather than only tasking your team to vision the future during scheduled strategic planning periods.
3. Flip the Pyramid: Create a culture of Ownership and Responsibility instead of a culture of ‘Check-and-Control’
You may be the dedicated leader, but leadership is not a one-person show. Leaders in the DigiTech era create a trusting environment based on collaboration and accountability so that those around them feel safe sticking their necks out. In enabling others to act, creating a culture of ownership on shop and top floor, you are facilitating a process of trust, providing people information, skills and the tools they need to rise to the occasion and produce unexpected results. Information = power. Yeah, right. That was 30 years ago. Today, everybody can challenge their doctor by Googling diagnosis and treatments. Everybody knows the CEO’s remuneration. Everybody has (mobile) access to price and product information of competitors. Today the power of information is finally equally shared in between shop floor and top floor. That's huge progression, but if leaders do not leverage on it, they will not gain the full potential. Creating a culture of joint collaboration, utilizing the collective brain to accelerate results is key to create this culture of ownership and responsibility.
If your management style is still ‘Command and Direct’, you will never utilize the brainpower of your shop floor. You will never see the results on the top floor. You will create a culture of ‘Check and Control’. Personal power, commitment, collaboration and connection are what make leaders successful in modern times. Asking the right questions instead of giving the right answers. Proving the right support and continual challenging the status quo will create a culture of ownership and excellence. The servant leader, facilitating the customer or client on top of the pyramid.
4. Lead by Purpose. Start with the Why -> How -> What instead of the other way around
Until now, organizational life in many industries was relatively constant. Today, though, we are asking a lot of our employees in creating continual change. If you want your people to be engaged and moving forward, you must encourage their hearts by personally showing them you care. Taking time for acknowledgement, recognition and celebration of successes is key, and the most inexpensive, personal gestures make the biggest difference. Leaders sometimes forget that leadership is about the relationship between those who lead and those who follow – and the quality of the relationship matters. If you want to get extraordinary things done through people within your organization, connect heart to heart. There is nothing more inherently motivating to employees than knowing they matter to the person leading them into unfamiliar territory. As leaders in 2020, we have a mandate to make real change. Whether this has been verbalized within our organizations or not, the risk of the status quo is simply too great to ignore. But if we’re not continually growing ourselves beyond our own status quo, we can’t expect our organizations to thrive in the current, often turbulent, environment.
Ramon Laguarta, PepsiCo’s CEO and Chairman, is leading with Purpose to make PepsiCo Faster, Stronger, Better. This is not just a cultural upgrade but a real “systemic approach” to insight that positions it as a driving force within the business and enables it to continually learn and grow each year. The way fast business insight is positioned within organizations needs to be reinvented to keep up with the rapidly changing consumer landscape, which PepsiCo is looking to achieve by being faster, stronger and better, according to Tim Warner, vice-president of insights and analytics for PepsiCo ESSA. “Insight – and I mean that in its broadest sense; the capabilities, the process, the talent, the organization, everything – needs to be reinvented,” he said, talking at a public event held by the Market Research Society in Kantar.
The Golden Circle explains to us why companies like PepsiCo and Apple are so successful. They go inside out, starting from the ‘Why they do’ via ‘How they do it’ ending with ‘What they do’. Most companies tell us first ‘What they do’ and then ‘How they do it’.
Source: Simon Sinek
With the deeper ‘Why’, these successful companies also connect in a better way to our brain. The oldest part of our brain is the limbic brain. That is where ‘Trust’ is centred. The purpose of successful companies connects directly with this ‘Trust centre in our limbic brain. That’s why Apple has ‘Fans’ and Dell has ‘Customers’.
5. Model the Way and Lead by example
“Do as you say, not as you do.” DigiTech Leaders walk their talk. Why? Because there is nothing to hide any more. Data is open, information flow freely. And we need everybody’s brain to contribute. So we’re all in this together… People execute in their daily lives their deeds and actions with their personal values and, in the workplace, they align their actions with organizational values automatically. A new employee has adapted within 3 weeks 70% of the organizations habits. This means that the leadership practice of modelling the way starts with clarifying organizational values and communicating them to all staff and stakeholders. Once organizational values are clarified and communicated, it’s up to you as a progressive leader to be steadfast to your commitment to them, as well as being alert to discrepancies. This is how leaders earn the right and respect to lead – by embodying what they request.
About the author:
Neil C.W. Webers is Executive Vice President Americas and member of the group executive board for EFESO Management Consultants . Neil is author of several management publications and founder and author of Performance Behavior.