Six changes in leadership in the digital era

VNPT Meeting application for working remotely is one of many solutions done by businesses amid COVID-19 pandemic.

Asurvey conducted in mid-2020 by the School of Management, Massachusset University of Technology (MIT) and Cognizant Company for 4,296 global business leaders over 20 different sectors, showed: 88% said that the future success of businesses would depend on the digital savvy of its leaders. However, only 12% of business leaders have the right mindset about the digital economy. While many businesses have digital aspirations, very few leaders are committed to developing digital talents.

In the book “Leading in the Digital World” published in 2020, Amit Mukherjee, Assoc.Prof. in leadership and strategy at Hult International Business School, argued: since digital technologies are changing everything else, how could they not change leadership ideologies and styles?

Leadership gap

The MIT study shows a number of key leadership gaps in the digital age. On the one hand, the high-end digital workforce has been pressuring leaders to improve their digital skills for better communication and measuring their employees’ performance. On the other hand, it expects leaders to care about the effective desires and values they bring to the job.

These leadership gaps are exacerbated by the digital dissolution of boundaries between the work and home, between personal and organizational obligations, and between shareholders and community priorities. For example, March 2020 until now, the UK has gone through two social lockdowns, forcing me to work home. Work, community and personal activities hardly offered any family vaccion even though I was with them in the same roof. Many times I wonder: Am I working home or am I living at work? Or when I took part in community projects in Vietnam, my organization in the UK benefited international reputation when I served an international community. This dissolution of boundaries is call “context collapse” by the MIT research team.

The context collapse poses a default for leaders as well as workers: everything might always be exposed, and accessible to everyone. The digital business environment can become a “space battle,” capable of weaponizing the way leaders interact with their employees, communicate with outsiders, and is transparent with the community. Leaders may be forced to react, formally or informally, if someone suddenly finds out controversial tweets, or “messy” photos, as some examples. The transparency is the new default for leaders whether they want it or not. For example, the minutes of a shareholders’ meeting could get outside while the meeting is in progress. The CEOs of the 21st century must proactively scope with the reputation risks resulting contextual collapsing messages spreading on Instagram, YouTube, TikTok and/or Twitter.

COVID-19 pandemic is a final touch to blur boundaries on context. It is the contextual collapse that makes leaders in the digital age more transparent and conspicuous, but at the same time more vulnerable. This is a big change for leaders, because they don't have as much power as they used to be. This forces them to change. How do they need to change? Here is what I learned "standing on the giants’ shoulders".

How do leaders need to change?

First, the leaders of businesses and organizations need to make purpose a principle. Simon Sinek, the author of the book “Infinite Game” (2019), outlines three important responsibilities of a business. They are (1) advance a purpose: to give everyone a sense of belonging to where they work, and that their life and work have value beyond their physical work; (2) protect people: to operate the organization in a way that protects those who work for itself, as well as those who use its services/products and the environment in which we live and work; (3) generate resources: money and other resources are seen as fuel for an organization to maintain existence so as to promote the first two priorities. It means profits are placed after a purpose and people; they are not a prerequisite.

Second, leaders should pay attention to how their employees and other key stakeholders digitally experience as they do, and how customers and clients digitally experience enterprise offerings; Developing KPIs to lead affective digital transformation becomes as important as determining which KPIs drive effective digital transformation; Leaders are expected to share their feelings about why they choose to lead. They should learn to lead in a what that is both affective and effective. They need to consider to what extent does alignment around purpose uplift morale? How important is high morale to net promoter score and customer experience? Does the purpose of the business increase customer loyalty? ... These questions are the assumptions to be tested around the future value creation.

Third, leaders in the 21st century must be data-driven, including in the expansion of their networks. The leadership networks are human connections where true power lies. It is a privilege a few influential positions. Network visualization invite more precise analytics around diversity, opportunity and performance; Digital transformation makes leadership networks more transparent, while creating data- enriched opportunities to maximize human resources.

Fourth, the leadership aims at increasing creativity rather than productivity. In the digital age, capital resource is no longer a prerequisite. The capital in this era is cultural and creative resource. A successful business is the one with the ability to raise creativity, not to increase productivity, because creativity can increase productivity with less resources. To achieve it, leaders need empathy; immediately stop looking for consensus/agreement, often challenging your beliefs; should be the last speaker to let employees speak first, to avoid imposing thoughts on employees.

Fifth, leaders should appreciate diversity and differences. Sex, ethnicity, religion, and culture distinctions in the last century could gradually be erased in the digital age, because such difference can be special and can be seen as the source of creativity. For example, the poor cowboy in Binh Dinh province, So Y Tiet, singing numbers in English on TikTok has become a global phenomenon, promoted by world stars and even Manchester United football club. His global reputation is made possible in the digital social media, otherwise, he would still be a poor orphan, not such an influencer on social media. Similar with businesses and organizations, creativity may not only come certain origin, gender or background. Finally, leaders in the digital era should have a broad wingspan not a long narrow tail. For leaders, narrow expertise painstakingly developed over decades has rapidly diminishing value. They need to develop the ability to navigate the in-between places that experts avoid. They must be willing to read all the literature and learn rapidly.