Leadership insight: leading digital innovation

Posted by Cranfield School of Management on 02-Nov-2015 11:17:02

Many organisations are struggling to keep up with digital technology, with those that have a legacy of traditional priorities, processes and systems being particularly disadvantaged. It's therefore no surprise that Deloitte recently found only 43% of employees are satisfied with their organisation’s current reaction to digital trends. 

To stay abreast of the evolving marketplace, organisations need to put digital at the heart of their strategy. But according to this study, there's often a lack of engagement and buy-in from senior management when it comes to digital transformation. If executives want to move their organisation towards digital maturity, it's crucial for leaders to strategically invest when it comes to IT and digital transformation. 

The rise of the CDO

Organisations are progressively recognising the need for somebody who is responsible for spearheading and overseeing digital proceedings. That's why the role of Chief Digital Officer (CDO) is increasingly being created, and evolving with the times. The level of accountability within this role has also expanded to the point that large scale business transformation often lies fully within the remit of this position or its equivalent.

An article by McKinsey cites two main reasons that a company requires a CDO. First is that underlying problems need to be meticulously pulled apart in order to move forward digitally. Secondly, when the CEO sees that the way the organisation works needs to be radically transformed to stay competitive, a CDO can focus on securing benefits. 

In order for an organisation to fully embrace digital, the CDO – or the person with the most digital clout – needs to get these five things right:

  1. Recognise that digital strategy isn’t enough

The person spearheading the digital initiatives in the organisation needs to realise that digital strategy is rapidly becoming something of the past. Digital needs to be tightly woven into every aspect of the business from process to operating models and of course company culture. Research shows that 90% of companies with the highest Digital Quotient have digital systems fully integrated and digital initiatives firmly ingrained within their strategic planning. The position of CDO comes with a great deal of responsibility for innovation; she or he needs to work closely with other high level leaders to ensure ambitious objectives and initiatives are pushed forward.

  1.   Adopt a customer-centric mindset

There's a huge difference between an organisation knowing their customer and putting them at the heart of all strategic business decisions. Using technology in the most effective way to gain data-driven insights is essential to success, while carefully mapped customer journeys will make sure everyone is working towards the same goals. Customer journey mapping is particularly effective at establishing and visually communicating the pain points that a customer comes up against. As digital capabilities usually have such a profound influence on the customer experience, it is the responsibility of the CDO to ensure everyone in the organisation adopts a customer-centric mindset.

  1. Become more nimble

To a great extent the person spearheading digital is responsible for changing organisational perspectives, in order to adopt more agile ways of working and response times. Open and regular communication about strategic leadership issues with relevant personnel is key to getting everyone on the same page. Holding weekly or biweekly meetings to convey information in a timely way and allows ideas to be circulated, while creating a space for the CDO to encourage a more agile mindset into the company culture. Digital instigators need to be brave and decisive, setting ambitious goals, scrapping projects which are not proving promising, and having the authority to inject budget into those which are.

  1. Think outside the box

A great CDO will also be an effective networker, staying ahead of current trends and identifying key players for potential collaboration or acquisition. Staying open to external industry perspectives is essential in a business landscape of disruptive technologies and agile start ups; building a good network of partner organisations is a key part of the CDO role, in order to utilise external capabilities when necessary and allow for agility.

  1.   Develop political skills

In order to achieve results, often a CDO needs to be a masterful negotiator. This is key to many aspects of their role, but is perhaps most pertinent when it comes to the reassignment of budget. Often people can be resistant to change and if this involves moving investment away from their area, tensions can arise. The CDO needs the skill to handle this with diplomacy and invite confidence in their ability to lead this kind of change. As well as finely attuned political skills, the CDO must have the ability to head up different teams, overcome barriers to transformation, guide projects and deliver integrated change. On top of all these things, a solid conviction in their objectives, married with a willingness to listen, will help ensure success. 

How we can help

Within Cranfield School of Management we believe that leadership is a skill that needs to be honed, developed and nurtured. The Centre for General Management Development (CGMD) offers general management programmes that help managers at key career stages develop into leaders who influence the strategic course of their organisations. The management development courses, which cover the subject of knowledge sharing, are:

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