In various blog posts and presentations over the last year or so, we have argued that Digital Leaders Are Urgently Required.
While 74% of executives surveyed in Forrester’s State of Digital Business in 2014 Report claimed to have a strategy for dealing with digital disruption, only 15% believed their company had the capability to execute the strategy. Successful digital business transformation, according to Forrester, requires the full support of CEOs to drive investment priorities. However, few CEOs fully understand digital. It is not surprising, therefore, that ‘many executives report that their firms are woefully unprepared to deal with the digital onslaught.’ To correct this, companies need to hire digitally skilled employees.
The ‘digital execution crisis’ identified by Forrester supported earlier research highlighting a major skills shortage in this area. For example, a 2013 report by Capgemini Consulting and the MIT Center for Digital Business entitled The Digital Talent Gap found that missing digital skills were the key hurdle to digital transformation in 77% of the companies surveyed. Similar findings have been reported by IBM, Accenture and others.
Two years down the line, it would appear that digital leaders are even more urgently required. The pace of digital change has accelerated. No industry, no company, no individual is immune from the threat of digital disruption. Yet the shortage of digital leaders remains a major barrier to successful transformation in both the private and public sectors.
In their predictions for 2016, Gartner, IDC and Forrester are all predicting that digital transformation will become the key strategic thrust for most CEOs. Gartner’s research suggests that 125,000 large organizations around the world are starting to launch digital business initiatives; IDC expects the percentage of enterprises implementing advanced digital transformation initiatives to more than double by 2020, from today’s 22% to almost 50%.
Whether the digital leadership skills exist to drive such rapid transformation is questionable.
A November 2015 report by Econsultancy entitled ‘Effective Leadership in the Digital Age’ argued that:
‘‘With the increasing impact of disruptive technologies, rapidly changing competitive environments, and a growing maturity and integration of digital into 'business as usual', organisational leadership itself needs to adapt to a brave new business world…….A new type of leader is required who can bring together a powerful combination of skills to adeptly navigate the rapidly evolving and shifting technological landscape?’’
While the large majority of survey respondents believed that it was 'very important' for leaders to be technology literate in the modern business environment, far fewer believed that the level of digital literacy among their own leadership was strong. Only 28% of those surveyed stated that leadership within their own organisation was ‘very technology literate’.
One of the main conclusions from Forrester’s own updated survey, The State Of Digital Business 2016 to 2020, is that firms need a better digital talent acquisition and retention strategy:
‘‘As the risk to existing revenue streams becomes apparent, companies will begin a panicked effort to attract digital talent. Companies with a strategy to attract and retain top digital talent will have an advantage in the face of a massive talent shortage.’’
A recent report by the National Audit Office concluded that digital leadership and skills shortages were also a major barrier holding back digital transformation programmes in the Government and public service sectors (NAO, The Digital Skills Gap in Government, December 2015).
In Scotland, our recent ‘Digital Disruption’ report, prepared for the Federation of Small Business, argues that there is an urgent need to develop digital leadership skills among Scotland’s small business community and that business support advisers throughout the enterprise network will require additional training to develop digital leadership in Scotland’s firms.
As in most other countries, Scotland faces a severe shortage of digital leaders – executives who can combine high level business knowledge, experience and understanding with the ability to develop digital business transformation strategies fully aligned with and supportive of agreed business goals and objectives. Leaders with the confidence and personal skills to digital led organisational change.
Are you a Future Digital Leader?
Registrations of interest in attending our 2 Day Digital Leaders Bootcamp, in association with the University of Edinburgh Business School, are now open.
We are restricting numbers attending to a maximum of 10 so early registration is recommended to reserve a place.
As always, comments and feedback on this post are very welcome.