Digital transformation: Leadership imperatives for 2021

For leaders doing digital transformation work in 2021, four issues deserve special attention: Collaboration, culture, data ethics and security, and the role of social media
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The COVID-19 pandemic not only changed our present but also sent out a strong ripple effect on our future. For most organizations, especially the ones that are struggling, technology might be a saving grace - for example, enabling new customer-facing processes, or new virtual collaboration options via tools like Miro or Mural. On a bigger level, some organizations will move to more reliable technology platforms or begin a cloud-native applications approach.

The pandemic continues to influence the future trends of how organizations will do business – and how individuals will lead digital transformation.

C-suite leaders around the globe are navigating difficult decisions including technology deployments to keep pace with the wide and changing needs of customers. Among many organizational needs, e-commerce, digital selling, customer support, employee well-being, and engagement have become top priorities.

The CIO role expands

Big challenges await in terms of leadership style and rethinking of roles, as well. Digital-age CEOs, in a post-COVID world, will need to brace and assume the role of digital change agents and digital enablers themselves. In order for organizations to recognize opportunities offered by new technologies and push for their implementation, the scope of technology leadership roles including CIOs, CDOs, and CTOs will have to be increased, a Deloitte study found. Also, CEOs and CFOs will need to develop a deeper engagement in decisions related to technology implications and decisions. Going forward, leaders will need to learn to manage risk and lead effectively during crises, while shoring up old problems such as fragmented technology platforms.

[ Will your organization thrive in 2021? Learn the four priorities top CIOs are focusing on now. Download the HBR Analytic Services report: IT Leadership in the Next Normal. ]

Consider these key factors that leaders will have to focus on – and related capabilities they’ll need to enhance or develop – as they lead organizations in 2021.

1. Becoming more collaborative digital leaders

Social scientists are busy trying to study and understand the impact of digitization on organizations and society, in conjunction with the role of leadership in shaping organizations. There is a need for a robust digital culture where leaders continue being the key actors and champions. It’s more essential than ever to bring multiple and even often dispersed stakeholders together for enhanced alignment and collaboration. Collaborative processes will have to be skillfully facilitated, at the same time that leaders also address and cope with crucial ethical concerns.

[ Get answers to key digital transformation questions and lessons from top CIOs: Download our digital transformation cheat sheet. ]

2. Designing digital culture

Digital technologies help develop efficient internal organizational processes that assure high-quality outcomes for customers. Leaders will need to demonstrate purpose and intent, constantly educating their employees to the overall mission and vision of the company.

Amplify your organization’s existing support structures such as learning, training, coaching, and mentoring systems – and ask if you need new ones.

Digital tools, used appropriately and effectively, can contribute to planning and monitoring internal processes, increasing transparency and accountability across all levels of management, and building customers’ trust. Digital tools are not only helping leaders solve complex issues related to personnel and minimizing operational costs, but also improving decision making. However, leaders will have to verify the suitability of tech tools being implemented in relation to organizational needs and objectives.

These are not top-down decisions. Leaders promoting open ways of working in their organization could make this a more inclusive and participatory process by adopting and implementing an approach such as the Open Decision-Making Framework.

One key factor to remember: While digital technologies have much potential to improve organizational processes, leaders must take proactive actions and measured steps to help employees internalize and integrate these processes. The easier that leaders make it for employees to adapt to and use new technology in their daily routines, the faster the integration.

The hardest part is often the change management: Leaders need to facilitate this in a way that instills a positive attitude in employees. Amplify your organization’s existing support structures such as learning, training, coaching, and mentoring systems – and ask if you need new ones. This will also mitigate the employee frustration levels that often come with the pressures of technological, process, and behavioral change happening at once.

[ Is your team exhausted? Read our related story: Remote exhaustion: 13 tips to reduce fatigue. ]

3. Prioritizing data ethics and data security

The continued advancement of digital transformation and enormous use of big data and cutting edge technologies such as AI means leaders will be exposed to even more dilemmas interlaced with ethical concerns. For example, leaders must pay careful attention to increased customer concerns about privacy protections related to sensitive data. The EU General Data Protection Regulation (GDPR), implemented in 2019, is a significant expression of this concern. Ensuring clearly set guidelines and practices that take into consideration both national and international data security policies will have to be a priority for leaders.

It is worth re-examining who owns risk for these areas in your organization.

It is worth re-examining who owns risk for these areas in your organization. Any tardiness in dealing with sensitive data practices could cause irrevocable damage to the organizational brand and its reputation. Leaders need to set an example and set clear expectations by defining ethical practices regarding personal sensitive data and spotlighting the related risks.

4. Re-examining the role of social media

Social media continues to influence power dynamics in organizations – affecting norms, values, organizational structures, and rules.

In 2021, social media and digital tools will continue to have a stupendous influence on both social and professional behavior and organizational structure. It’s predicted that the traditional forms of leadership will continue to be disrupted as digital tools and social media continue to influence power dynamics in organizations – affecting norms, values, organizational structures, and rules.

However, pragmatic, proactive, and prepared leaders can use social media to their advantage, and their organizations’ advantage, by riding the wave and leveraging these for improved communication and coordination purposes. For example, IBM President Jim Whitehurst has been sharing ongoing conversations on open leadership practices, via Twitter and LinkedIn, opening dialogue with both teammates and customers.

Social media-shy leaders need to push out of their comfort zone, suspend their preferences and biases, and learn to strategically carve out a social media presence. During the pandemic in 2020, we witnessed all events and conferences shift to a virtual format. Suddenly everyone was forced to work from home. Most leaders worldwide were forced to step up and embrace digital tools to establish connections with their employees, and address both internal and external audiences.

In 2021, leaders have an opportunity to not only maintain a connection with their employees and customers, but also expand their leadership presence and influence by engaging with the audiences on socially and technologically relevant topics.

Which of these imperatives could benefit your organization in 2021? Will you work on your social media presence this year, or would you like to learn new ways to communicate empathy and care to your employees? Perhaps it’s time to take on a much-needed culture change? It’s up to you as leaders to answer these questions honestly - and develop your leadership competencies accordingly.

[ Get exercises and approaches that make disparate teams stronger. Read the digital transformation ebook: Transformation Takes Practice. ]

Shabnoor Shah is the Open Leadership Global Lead and Executive Coach at Red Hat Open Innovation Labs, Transformation Services.