The CEO's Role in Digital Transformation

June 20, 2018 | Tom Bernot
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What is the CEO's role in digital transformation strategy? How involved should he or she be, and how much should be delegated down? A look at the day-to-day involvement in moving digital initiatives forward.

Role playing, role juggling, role analysis, and role adjustment—all are regular aspects of a CEO’s life as he or she seeks evaluative, proactive, responsible balance as a company head in an age of digital transformation.

The world is now digital. This is not the description of a passing trend, but the acknowledgement of what every CEO now recognizes as a permanent corporate shift. But while leadership may admit that digital transformation demands attention, a CEO may be experiencing incredible and legitimate struggles with his or her role in “the big disruptive change.”

How will we ever catch up or completely transition, let alone progress as a digital front runner?

 

Keeping up with the constancy of digital change feels impossible from my seat.

 

I’ve led for years as a traditional business executive. And we’ve been fine.

 

Someone else can do this job.

Actually, the CEO is the one.

Denial, frustration, confusion, and complacency cannot rule the day on this one. Boston Consulting Group says, by nature of “the magnitude of change, the degree of disruption, and the power of inertia,” a CEO has to be involved. No one else is as perfectly suited to head up an organizational makeover. The CEO who chooses to delegate digital change leadership—letting one department attempt to make piecemeal, incremental changes—will quickly feel out of the loop.

Instead, an effective CEO can demonstrate leadership by making what professionals are calling a “priority shift”—changing from past emphases on projects, sales, and assets, to modern solutions, daily experiences, tech-centric outcomes. Model the transformation. Invest personally. Embark on this mission. You’re at the top—you’re the “engine of change.”

Find Your Reason and Hold on Tight

Why embrace digital? This question is top-of-mind for CEOs considering full-on digital transformation. Having a convincing, compelling argument for changing from traditional to digital business will keep a CEO on track when the disruption overwhelms. Maribel Lopez of Forbes posits that “digital transformation requires a catalyst because change for change’s sake is too hard.”

Kick off the digital transformation campaign with definite purpose—a real, well-stated, core reason (or several) why digital business is right for your company. Peter Dahlström, Driek Desmet, and Marc Singer describe the type of purpose-driven objectives that are spurring successful digital change: “Almost every notable digital innovation we’ve seen has been based on using connectivity and data to transform the customer experience or to reshape products and services by allowing customers to interact with them in new ways.” Intentionality has never been as important as now. Fast or slow, digital change based on a solid foundation of “why” is critical.

The Beauty of Complexity

Growing the business and advancing company structure digitally—these objectives go hand in hand, two sides of the same issue. Wise CEOs recognize the wisdom of using digital strategy in order to grow as a company. An over-simple focus on growth to the exclusion of online and mobile-friendly business is corporate suicide.

But in reality, we’re not just talking digital and goals. This migration is considerably more complicated than just tacking on a bit more tech to make a change. “Digital transformation touches several aspects beyond technology: strategy, organization, culture, change management,” Domenico De Luca, CEO of Axpo Trading AG, explains. Is it an IT job? A marketing issue? A sales strategy? Yes. All that and more.

Whole-Scale Change

Transforming a company digitally really means transforming a company culturally. And on this point, a CEO may have to take a step back and re-group with the board, advisors, or reflective, critical friends: What has our company culture been to date—our personality and style as a company? How do we define our onliness, our values, our vision? An IT overhaul needs to align with (as much as possible) but also further—not stall, confuse, or derail—the existent culture of the enterprise.

CEOs should carefully study how they can broadly apply new ways of working, new levels of customer service, and new technology platforms to their own organization. . . . At the same time, companies should not abandon their core strengths and culture. An organization that has been around for 50 or 100 years or more has enduring and proven qualities that do not just vanish in the digital age. Boston Consulting Group

Consider the digital change, not as its own agenda, but as perhaps the most significant element of affecting the progress and advancement of the entire company experience to become technologically relevant. We’re talking deep change and new ways of working.

The Flip Side: Reliance on People

Digital transformation—IT-based as it is—still necessitates human leadership, individuals driving the company’s change. The enormous task of transitioning a business from storefront or catalog to become a technology-driven corporation demands initiative, strategy, decisiveness, and direction in order for the dream of online connection to be fully enacted.

CEOs are strong and visionary world-changers, perfect for this job. But no one can do it all for long. So, a good CEO will recognize the need—due to this complexity of a whole-scale digital change—for everyone to be on board. First, his or her willingness to step up, learn more, and get in front will state to the rest of the firm—This is our direction. Follow me. And that’s when the  trickle-down effect will begin: Strong leadership begets a trail.

Many CEOs find themselves unfortunately surrounded by various levels of technological illiteracy—employees who are less interested in and less able to make this transition with them. Gartner, Inc.—an American technology research leader—found that CEOs state “lack of talent and workforce capability is the biggest inhibitor of digital business progress.” So, at this point it’s time to link arms with the CIO and tackle this together. CEOs have upper-level management team members for a reason—so that no one has to climb this mountain alone.

According to Bill Ruh of GE Digital, CEOs should tackle personnel deficiencies head on: “A company needs to bolster internal innovation by growing digital talent within the company, hiring where available, and acquiring where necessary.” Collaboration between the experienced and upper-tier management, the new hire and the IT leaders, the sales managers and the finance stars—team alignment is key. An effective leader involves those nearby, listens to good ideas, and adapts as applicable.

Embrace the Happy

CEO attitude flavors the entire corporation. And in the midst of a comprehensive shift to digital business, positivity must reign. Say it loud and clear: We want this. This is best for business. It’s not just necessary—it’s awesome. Yes, it’s work, but it’ll bring growth. Let’s do this thing. And then go for it—with full, out-front, fierce leadership that advocates for digital advancement. Innovation powers digital transformation, but an affirmative, confident CEO can navigate change in a way that brings every individual along for the ride.

The Bottom Line: Yes, You’re the Leader.

With commitment to convert an enterprise into a forward-thinking digital business, the CEO’s role will necessarily expand. The encouragement from global professionals is to embrace it. Put this huge item at the top of the agenda and leave it there for a long while.

Consider the issues mentioned—the complexity, the need to involve all individuals, the long-term view which is crucial to implementation of a digital business strategy—this is not a time for passing the buck. The CEO may have to put on a different hat than he or she has always worn, but steering a non-digital corporation into new, deep technological waters is vital for survival in years to come. Develop a digital competence that inspires those around to join in.

Topics: Digital Leadership CEO

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