Effect of Digital Transformation on Organisational Structures and Leaders

1366 words (5 pages) Business Assignment

27th Apr 2020 Business Assignment Reference this

Tags: Business AssignmentsBusinessLeadership

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Introduction:

Today’s businesses are always more interconnected via various networks and platforms as society in general is experiencing a Digital Transformation, this digitalisation exposes businesses to new opportunities but also new threats. As the way business is conducted changes, the figure of leaders that lead organisations through the business ecosystems need to change obtaining a range of skills, abilities and behaviour in order to be successful as Digital Leaders. This is what I will try to explain in this paper with the support of the literature and studies on the subject.

The figure of Digital leader:

So a question arises: Who is a digital leader? Digital leaders can be found across the organisation in the various levels, from operational levels as operational managers, division level as divisional or line managers, executive level as executives such as CEOs, CIOs, or Board levels. Digital leaders are the new leaders that guide, empower and inspire employees throughout all the organisation in order to successfully achieve the planned objectives. This are the same old leadership trait but this are executed in a background of a volatile, uncertain, complex and ambiguous (VUCA) business environment throughout which digital leaders set their organisations to lead with Social, Mobile, Analytics, Cloud and Internet of Things (SMACIT) technologies but also be led by them in order to achieve an organisation success with speed and agility (Stijn Viaene, 2017). This are some of the new digital requirements set by the current digital transformation.

Effect of Digital transformation on organisational structures and Leaders:

Organisations find themselves with the need of an agile and adaptive behaviour in order to align with the fast changing environment and not incur a strategic drift. “Evolve and flex against any set of circumstances”, (David Wheldon). This deep need of change favours organisations with no hierarchy or low hierarchical structure so that leaders need to adapt to new behaviours and styles of leadership, with communication and ideas exchange being favoured against an old autocratic style. Delivering products and digital in an old hierarchical way is fine in the short term but will not be sustainable in the long term with the increase of the exponential rate of innovations and change (Matthew Guest, 2014) as the levels create silos and slow communication and knowledge sharing in the organisation the need of leaders of working in a matrix structure in a cross-sectional way that favours collaboration. Digital needs to be embedded in the organisation culture in order to make a strategic capability out of it, so that the whole organisation can reap the benefits of speed, knowledge and ability to adapt to change it creates. In this new organisational style becomes important that people aren’t forgotten, all the employees need to have some digital knowledge, so that once organisation has a plan to deliver some objectives needs to acquire the necessary skills, develop people’s skills in the same workplace and retain talent internally (Deloitte, 2014). Even offices structure is changing with less old style single desks but spaces that favour ideas exchange and interactions, so that employees can learn from each other or from outside talents that are recruited to cover special needs, and so leave some knowledge helping the internal workforce growth. So how do Digital leaders fit in this change process?

Digital Leaders capabilities:

Leadership is paramount in times of change so Digital Leaders will still have a more than important role during the Digital Transformation and will be expected to lead and guide the workforce through it. With roles and responsibilities which can be thought as the same of old-style leaders but with behaviours and styles that are slightly different as communication and collaboration has become more important. They still need to have the capability of providing a vision and purpose, evaluating the views of the team and explaining what the plan for the coming years is. So they can empower the team in a way that it can have freedom of working as it thinks it is best testing and iterating new methods with no fear of failure which would stifle innovation, but still understanding that they are accountable towards the organisation success. Employees are this way allowed to develop through the organisation with the counselling of leaders that do not dictate the way of how things are done anymore but allow different ways of thinking. It is important that digital leaders keep the workforce focused on the organisation goals so that the outcomes are directed to this success, continuously motivating to achieve.

Skills:

Digital leaders will not need to be digital technicians with a deep knowledge of digital platforms but will need to think digitally and have good understanding of the new opportunities the Digital Transformation brings so that they can acquire the technical skills needed by the team bringing in the right workforce and obtaining what is needed for the organisation purpose. The understanding and knowledge of the opportunities will require Leaders to be smart and mobile, continuously connected on the go through various social network or digital platforms as the young digital savvy workforce like being connected through this networks and leaders can share and obtain real time feedback. (Deloitte, 2014)

Decision making will always be more based on analytics and the digital leader needs to have the ability to take informed decisions. Other skills to develop are the flexibility and adaptability to fast paced and continuous change in the new business environment where things change exponentially. Change will need to be adopted more often and it will be achieved with a collaborative stile always more important. Leaders will need good communicative skills in order to collaborate, understand and make others understand, setting the organisation tone.

Conclusions:

These can be seen as broad skills and capabilities of a good digital leader, this is a wide role as there is different types of organisations and Leaders will adapt to the organisation business models and objectives, as the whole organisation will need to be focused on the outcomes. Important for a leader will be the understanding that technology entails many opportunities as well as many risks and trade-offs and balances of benefits and costs(Kara Kolomitz, Edmund T. Cabellon,)

Digital Leaders will need to understand that in order to succeed Digital will need to be embedded throughout the culture of the organisation as a way of doing things with the availability of necessary training and guidance to the whole team of employees, Leaders themselves will need to accept reverse mentoring if needed so that older leaders can align their knowledge to young tech-savvy employees.

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