We are living in a digital age, when technologies are transforming how we live, socialize and work. Areas like artificial intelligence, the Internet of Things and big data are changing everything – from how we access information to how we connect.
What does it take for organizations and leaders to thrive in this rapidly changing digital landscape? Leadership in a digital age is about more than just embracing new technologies. As organizations navigate the road to digital transformation, how they operate and deliver value to customers is fundamentally different. The unprecedented pace and scope of digital change call for leaders who think and act differently.
Through solid digital leadership, companies can maintain competitiveness, keep up with ever-escalating customer expectations and embrace new business opportunities. Read on to learn more about digital leadership and why it matters, then find out what four digital leadership skills effective leaders possess.
What is digital leadership?
While many definitions of digital leadership exist, the term typically refers to a company or individual’s strategic use of technology to create value and achieve goals.
Digital leadership can be undertaken at both an individual and organizational level. For a company, technology propels the business. It’s a central part of business operations and work culture. Organizations that value digital leadership proactively explore new ways technology can drive innovation and improve performance.
At an individual level, a digital leader may be in a defined role at a larger company. For example, chief digital officers, chief information officers and chief technology officers are all faces of executive tech focused on exploring digital initiatives and integrating technology solutions. In smaller organizations, existing leaders may take on these responsibilities.
Digital leaders are key to an organization’s digital transformation, which refers to integrating technology into all aspects of a company. Keep in mind, technology is an increasingly expansive term. It encompasses everything from simply going paperless or creating a website, to areas such as big data and analytics, artificial intelligence, the Internet of Things, digital security, machine learning and cloud infrastructure.
Why is effective digital leadership important?
Companies with digital leaders don’t just do better — they lap the competition. That’s according to a 2022 technology leadership survey from KPMG in Canada. “Digital leaders are two times better at gaining customer trust, three times better at creating positive customer and employee experiences and increasing their stock price, 3.5 times better at boosting revenues and profits, four times better at improving operational efficiency and five times faster to launch new products or services,” wrote KPMG’s Stephanie Terrill and Sanjay Pathak in the Toronto Star. Their research showed just four in 10 leaders in Canada are digital leaders, leading to a deepening chasm between digital leaders and everyone else.
Everyone — employees, managers and executives — can cultivate digital leadership skills. Technology is already a fixture of workplaces, affecting all aspects of doing business today, from the way you hire (think effective virtual interviews) to how you enhance customer experiences. Business schools are recognizing this and increasingly incorporating digital transformation into their curriculum.
Focus on these four characteristics of digital leaders
- Effective digital leaders embrace innovation. When leaders have a level of fluency with technology, they can be more effective persuaders. Put another way, a top characteristic to cultivate is neophilia, a tendency to like anything new. That’s according to Apoorva Chhabra, a principal analyst at management consulting company Gartner. When leaders are all in on digital, they’re better positioned to help their people learn and experiment, fostering a workplace environment where adapting to new technologies is exciting, not intimidating.
- Effective digital leaders have a clear vision. They understand the digital world is not only about new technologies; at its core, it’s still about people. These leaders embrace innovation but maintain focus and communicate their vision to their people with purpose and clarity. That way, everyone understands what the team is trying to achieve — and why. Such clarity on the desired outcomes can be an important anchor for teams, as they will likely face uncertainty.
- Effective digital leaders manage with agility. That’s because the digital age is full of change, and the speed at which things are done can be the difference between success and failure. Leadership in this new era requires a great handling of stress and the ability to make decisions fairly quickly. When leaders lead by example with these qualities, they create an environment for employees to be more nimble. Considering the growing skills gap employers face, it’s beneficial when employees are eager to learn continuously and are open to upskilling and reskilling.
- Effective digital leaders build a strong workplace culture. Without a purposefully-built culture, organizations can quickly lose their way. Industry analyst Josh Bersin shares similar views. “As we’ve studied digital leadership over the last few years, we find something else important: Culture is key,” Josh Bersin writes in Harvard Business Review. In the digital age, Bersin says a successful workplace culture is collective, transparent and deeply shared, so people share information with each other, partner, and continuously educate themselves.
The digital age we are living in calls for leaders who think and act differently. While the unprecedented pace and scope of digital change can be overwhelming, the opportunities it brings are also immense. Digital leaders who embrace innovation, have a clear vision, manage with agility and build a strong workplace culture help their organizations and people thrive in a digital age.
