Digital leadership

What is leadership and what is special about it in the digital age?

Andy Weeger

Neu-Ulm University of Applied Sciences

February 14, 2024

Introduction

Digital leader empower people with vision, understanding, clarity and agility. Waltraud Glaeser, Leadership Coach

Definitions

From leadership
to the digital age
to digital leadership

Dicussion

What is leadership?

Quote

A leader. . .is like a shepherd. He stays behind the flock, letting the most nimble go out ahead, whereupon the others follow, not realizing that all along they are being directed from behind. Nelson Mandela

Leadership

A leader is “is one or more people who selects, equips, trains, and influences one or more follower(s) who have diverse gifts, abilities, and skills and focuses the follower(s) to the organization’s mission and objectives causing the follower(s) to willingly and enthusiastically expend spiritual, emotional, and physical energy in a concerted coordinated effort to achieve the organizational mission and objectives.” (Winston and Patterson 2006, 8).

Management is about coping with complexity, leadership is about coping with change (Kotter 2017)

Management brings order and predictability to a situation. But that’s no longer enough—to succeed, companies must be able to adapt to change. Leadership then, is about learning ho to cope with rapid change (Kotter 2017).

• Management involves planning and budgeting. Leadership involves setting direction.
• Management involves organizing and staffing. Leadership involves aligning people.
• Management provides control and solves problems. Leadership provides motivation.

Dicussion

What is the digital age?

Context of leadership

The digital age is coined by digital technologies (e.g., social media, mobile computing, analytics/big data, cloud computing — SMAC) that are inherently disruptive and that cause major changes (Karimi and Walter 2015).

Verhoef et al. (2021) identifies three phases of digital transformation:
digitization, digitalization, and digital transformation.

• Digitization is the “the process of converting analog signals into a digital form, and ultimately into binary digits (bits)” (Tilson, Lyytinen, and Sørensen 2010, 749).
• Digitalization is “a sociotechnical process of applying digitizing techniques to broader social and institutional contexts” (Tilson, Lyytinen, and Sørensen 2010, 749).
• Digital transformation is “a process that aims to improve an entity by triggering significant changes to its properties through combinations of information, computing, communication, and connectivity technologies” (Vial 2019, 118).

Dicussion

What are specifics of the digital age that require distinct leadership skills?

In a small group, take 10 minutes and find 2 characteristics of the digital age and a related leadership skill.

Disruptive potential

Digital technologies do not develop linearly, but exponentially, which is leading to significant changes in peoples behavior, attitudes, and expectations.

Digital technologies do not develop linearly, but exponentially (Schreckling and Steiger 2017):

• Hardware becomes ever more powerful, small, and thus ubiquitous (Moore’s Law¹).
• As every consumer and every machine (‘Things’) is able to be connected, established (rules of) individual and organizational behavior are disrupted (i.e., hyper connectivity)
• Network effects lead to a superlinear increase in value by connecting systems, processes, and users (Metcalfe’s law²).
• Comparatively low barriers to entry

This fuels and is fueled by changes in peoples behavior, attitudes, and expectations, e.g.,

• The speed with which people adopt new technologies
• The urge to use connected devices to take action on whatever we need or want right now

We’re not going online, we’re living online. Jerry Dischler, VP of AdWords Product Management at Google

Acceleration of VUCA

Volatility
Uncertainty
Complexity
& Ambiguity

The term VUCA was introduced by the US Army War College to describe a volatile, uncertain, complex and ambiguous environment. It was first used by the Pentagon to describe the terrorist attacks of 11 September 2001. A few years later it was used by strategic business leaders to describe the chaotic, turbulent and rapidly changing business environment that has become the ‘new reality’ (“VUCA: The New Reality,” n.d.).

Characteristic of a VUCA environment is not so much the disruptive upheavals caused by (digital) technology, but rather the speed and scale of disruption specific to the digital age.

• Volatility can be defined as the nature, speed, volume and magnitude of change that does not follow a predictable pattern (Sullivan 2012). This is turbulence; a phenomenon that is occurring more frequently and more rapidly than in the past. Typically, market demand in many businesses was already increasingly volatile and unpredictable before the Corona virus crisis, and will be even more so after the containment.
• Uncertainty can be seen as the lack of predictability of issues and events (Sullivan 2012). Past issues and events cannot be used to predict future outcomes due to volatility. As a result, forecasting becomes extremely difficult and decision making very challenging for most executives.
• Complexity is the difficulty in understanding the causes and mitigating factors (both inside and outside the organisation) involved in a problem (Sullivan 2012). The layer of complexity, added to the turbulence of change and the absence of past predictors, adds to the difficulty of decision making and leads to confusion.
• Ambiguity is the result of the confusion mentioned above. The lack of clarity about the meaning of the change slows down the decision making process to the point of freezing the status quo (Sullivan 2012)..

Digital leadership

Digital technology has changed and is changing organizations’ structure, work environment, processes and culture, in an irreversible way, creating new challenges that leaders have to face.

Organizational leaders must work to ensure that their organizations is capable of responding to the disruptions associated with the use of digital technologies and of responding to the changes (Vial 2019), e.g., by

• dissolving inertia and resistance to change,
• leading employees to assume roles that were traditionally outside of their functions,
• acting as boundary spanners that foster close collaboration between business and IT functions,
• depending on analytical skills to solve increasingly complex business problems,
• ensuring that digital technologies are properly leveraged (i.e., used).

Digital leaders empower people with vision, understanding, clarity and agility.

Q&A

Homework

Read Judge et al. (2002) and answer following questions:

• What are the most salient aspects of personality as proposed by the five-factor model of personality (i.e., Big Five traits)?
• How are these traits found to relate to leadership?
• What surprised you most?

Literature

Judge, Timothy A, Joyce E Bono, Remus Ilies, and Megan W Gerhardt. 2002. “Personality and Leadership: A Qualitative and Quantitative Review.” Journal of Applied Psychology 87 (4): 765.

Karimi, Jahangir, and Zhiping Walter. 2015. “The Role of Dynamic Capabilities in Responding to Digital Disruption: A Factor-Based Study of the Newspaper Industry.” Journal of Management Information Systems 32 (1): 39–81.

Kotter, John P. 2017. “What Leaders Really Do.” In Leadership Perspectives, 7–15. Routledge.

Schreckling, Edward, and Christoph Steiger. 2017. “Digitalize or Drown.” Shaping the Digital Enterprise: Trends and Use Cases in Digital Innovation and Transformation, 3–27.

Sullivan, John. 2012. “VUCA: The New Normal for Talent Management and Workforce Planning.” Ere. Net 16.

Tilson, David, Kalle Lyytinen, and Carsten Sørensen. 2010. “Research Commentary—Digital Infrastructures: The Missing IS Research Agenda.” Information Systems Research 21 (4): 748–59.

Verhoef, Peter C, Thijs Broekhuizen, Yakov Bart, Abhi Bhattacharya, John Qi Dong, Nicolai Fabian, and Michael Haenlein. 2021. “Digital Transformation: A Multidisciplinary Reflection and Research Agenda.” Journal of Business Research 122: 889–901.

Vial, Gregory. 2019. “Understanding Digital Transformation: A Review and a Research Agenda.” The Journal of Strategic Information Systems 28 (2): 118–44.

“VUCA: The New Reality.” n.d. QRM Institute. https://qrminstitute.org/vuca-the-new-reality.

Winston, Bruce E, and Kathleen Patterson. 2006. “An Integrative Definition of Leadership.” International Journal of Leadership Studies 1 (2): 6–66.

Footnotes

1. Moore’s law is the observation that the number of transistors in a dense integrated circuit doubles approximately every two years

2. Metcalfe’s law states that the value of a telecommunications network is proportional to the square of the number of connected users of the system