Gerald C. Kane
The book you hold in your hands, TRUST: The Winning Formula for Digital Leaders, brings home a key message. While technology is obviously a factor in digital transformation, perhaps a more important factor is something much more human—trust. The ability of some leaders to engender the trust of their employees allows them to accomplish a digital transformation much faster and at much less cost to the organization.
The book is about (and for) digital leaders, the people in charge of changing the course of their organizations. The authors have studied companies undergoing digital transformation and concluded that character and competency of their leaders differentiates Digitally Mature organizations from Digitally Developing organizations. They bring it all together with interview chapters from fifteen digital leaders on how they build trust.
The authors have the credibility to tackle this task. They have considerable industry experience and have spent years studying the perils, and triumphs, of companies engaged in digital transformation. They have seen these transformations first hand. More importantly, they have engaged directly with the digital leaders they have featured. They know what makes these leaders tick.
I agree with the authors, an organization’s response to digital disruption should focus on people and processes—and not on technology. My own research shows that digital disruption is primarily about people and that effective digital transformation involves changes to organizational dynamics and how work gets done. A focus limited to selecting and implementing the right digital technologies is unlikely to lead to success. The best way to respond to digital disruption is by changing the company culture to be more agile, risk-tolerant, and experimental. Digital disruption won’t end anytime soon; the average worker will probably experience numerous waves of disruption during his or her career. What, then, does digital transformation involve?
It Involves Leadership
Having effective leaders is among the most critical factors associated with effective digital transformation. While it is important that these leaders have strong digital literacy, being forward-looking and change-oriented are far more important characteristics. Interestingly, the majority of even the most Digitally Mature companies report needing more and better leaders to steer their organization into an uncertain digital future. The difference is that these advanced companies are far more likely to be taking active steps to develop those leaders than less advanced ones.
It Involves Talent Development
We have observed a similar trend with respect to digital talent. Almost all companies report needing more and better talent, but the Digitally Mature companies are actually doing something to develop that talent. My research shows that over 90% of respondents indicated that they need to update their skills at least yearly to keep up with digital trends, but fewer than half reported that their companies supported their efforts to keep up.
It Involves Culture
Digitally Mature companies are more likely to demonstrate a number of distinct cultural characteristics. They are more likely to be risk-tolerant, experimental, innovative, and collaborative. These companies more often report spending time, money, and energy on efforts to strengthen these aspects of their culture, suggesting a possibly widening gap between leaders and laggards.
It Involves Organization
Digitally Mature companies are more likely to organize around cross-functional teams, and these teams look different than those at less mature counterparts. They are more likely to have autonomy around how to meet business objectives and are more likely to be evaluated as a unit. These teams are often protected from the bureaucratic policies and procedures of legacy companies to allow them to be more agile.
It Involves Strategy
Perhaps the biggest factor associated with digital maturity is that the organization’s leaders have a clear and coherent digital strategy, and they effectively communicate that strategy to employees. Again, this strategy may or may not involve implementing digital technologies at all but simply carving out a viable response to digital trends. For example, Best Buy has developed an effective strategy in the face of competition from Amazon by focusing on people, showrooms, and relationships—not technology.
This book should not be taken to mean that implementing new digital technologies and platforms are somehow not a vital part of effective digital transformation efforts; they almost certainly will be. The authors and I simply argue that an exclusive focus on the technological aspects of digital transformation overlooks one of the most important aspects—building trust across the organization, which produces the confidence to change their leadership, talent, culture, organization, and strategy—in one big, sometimes disruptive step!
Dr. Gerald C. (Jerry) Kane is a Professor of Information Systems and Faculty Director of the Edmund H. Shea, Jr. Center for Entrepreneurship at Boston College’s Carroll School of Management. He is also a Senior Editor at MIS Quarterly. He teaches companies’ responses to digital disruption to undergraduate, graduate, and executive education students worldwide.
His first book, The Technology Fallacy: How People Are the Real Key to Digital Transformation, published by MIT Press in April 2019, encapsulates five years of research into how companies are responding effectively to digital disruption and transformation. For this book, he surveyed over 20,000 executives worldwide and interviewed over 100 executives and thought leaders to determine the key factors associated with Digitally Mature companies. He concludes that an organization’s response to digital disruption should focus on people and processes and not necessarily on technology. He speaks nationally and internationally to executive audiences on the characteristics of Digitally Mature companies, the steps necessary to become more mature, and how leaders need to adapt their own skills and careers to lead effectively in a digital world. His next book, The Transformation Myth: Leading Your Organization Through an Uncertain World, focuses on how companies adapt to acute disruptions like COVID-19.