Many businesses and their movers and shakers are still thinking too much along conventional lines to address digitalisation and master it properly. The required transformation is disruptive and needs a new type of leadership. And this goes for HR as well.
From APO activist to Daimler, to Lufthansa, to Continental and finally to Deutsche Telekom as Head of HR, he has a varied life behind him and likes to speak his mind: the Bavarian FDP MP Thomas Sattelberger, who did not join the party until 2015.
According to him, HR is a “living corpse”, and has been so for the last ten years. HR departments should actually be driving digitalisation, yet are “lagging hopelessly behind”. Sattelberger believes that many people in positions of authority know too little about the technological and social forces shaping the world of work. “They react insufficiently – and act even less. We need HR people who can think conceptually and above all who are keen to do so. Many lack verve and inspiration. Maybe they were never inspired themselves – how then can they inspire young talent?” And: “Many managers have worked their way up in the same company and place loyalty before truth,” believes Sattelberger, champion of diversity management, decentralisation and empowerment, while also stating that many studies question the added value HR can provide and that DAX companies are abolishing the role of board member for HR altogether.
Digitalisation and the associated disruption will hit most businesses sooner or later. In a study entitled “Digital Leadership”, Deloitte Digital has drawn up a disruption map by sector, which describes a different length fuse (timing) and a different size bang (impact or effect). Businesses in the retail, telecommunications and media sectors as well as banks and insurance companies are finding themselves in a “short fuse, big bang” situation, while manufacturing, the healthcare sector and logistics are in a “long fuse, big bang” scenario.
To illustrate how new technology can have a disruptive impact and overthrow entire value chains, the authors of the study chose the example of 3D printing. Wholesale, sales and retail will hardly play a role any more in future if goods can go from the raw material to the 3D printer – possibly while being transported according to the blue-sky thinking of DHL and UPS – and then on directly to the end customer.
Three big questions
CEOs must address three fundamental questions:
“Digital is the new normal,” is how the study puts it. According to the authors, the digital transformation will also require culture change, which will need to be initiated from the top, ideally driven by the CEO himself or herself. What is required in the situation is a “Digital Leader”, who does not necessarily need to be enthroned as Chief Digital Officer (CDO), but who needs to have the appropriate skills and competences and combine leadership talent with charisma. He or she is the “connecting piece between all C-level executives”, who connects with the organisation as a whole and the workforce at the same time. The CDO must also have thorough knowledge in all important areas, including ecommerce, marketing, social media and big data, while understanding the traditional value chains as well. That, plus the necessary assertiveness, is quite a big ask for anybody taking on the role of CDO or of “Digital Leader” under whatever title.
“This is precisely where HR needs to come in and do the necessary work. Who should take charge of digitalisation: the board members/management, the IT department, or the shareholders? Is it not wonderfully convenient to always palm the job off onto someone else?” asks Florian Walzer, Head of Sales & Marketing at rexx systems.
According to Sattelberger’s visionary concept of decentralisation and empowerment, Digital Leadership must also be provided by the individual departments and, above all, in HR. This will above all require culture change, as the former “Avanti” presenter and business consultant Christiane Brandes-Visbeck states in an article about Digital Leaders in SME companies on the UPLOAD Magazin website. “The digital transformation is all about the survival and growth of businesses,” she writes in her article. That requires “new thinking” and radical action. “Digitalisation requires courage” – from those who have not yet confronted the issue. Those people are precisely the ones who will be replaced by robots and AI. The world is undergoing change and spinning every faster. Those who shy away from this change, who do not develop and who keep on doing things the way they always have are indeed at risk of their jobs being replaced by some app that is more efficient than they are. It requires courage to embrace change, courage to go with the times, courage to start with yourself.
Digital Leaders do not need to “become automation experts or be able to set up a Scrum process”; instead it is about the appropriate mindset and an attitude in tune with the digital times. Brandes-Visbeck reminds us that beside the digital natives there are also digital immigrants who were born into Generation X or the earlier baby boomer generation, but embrace digitalisation as much as their younger colleagues. In her conclusion, the communication expert repeats the question she posed to begin with: namely, whether you need to create a profile in a social network as a Digital Leader and express yourself in tweets, for example. The simple answer is Yes. Because networking is a career booster and provides you with the digital calling card that is par for the course these days.
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The digital transformation is all about the survival and growth of businesses. It is incumbent on HR departments in particular to address topics relevant to the future in order not to be left behind where “Digital Leadership” is concerned.