4 Leadership Shifts to Survive in the Digital Economy

Are you a leader contemplating the change your organization needs to keep pace with the digital economy? If so, turn your focus inward, because that change starts with you.

In his 2016 address, “The Fourth Industrial Revolution” at the World Economic Forum, Klaus Schwab, Founder, and Executive Chairman acknowledges that the convergence of artificial intelligence, big data, and digitization is unprecedented in scale and scope of opportunity and disruptive impact.

While he optimistically adds, “Neither technology nor the disruption that comes with it is an exogenous force over which humans have no control. It all comes down to people and values; we need to shape a future that works for all…by putting people first and empowering them”, he warns about today’s leadership gap: “Today’s decision-makers are too often trapped in traditional, linear thinking, or too absorbed by the multiple crises demanding their attention, to think strategically about the forces of disruption and innovation shaping our future.”

His call to action to CEOs is clear: they need to move forward from a top-down, tactical leadership style to one where they lead the engagement and empowerment of their broader organization to think critically about the big picture.

Moving forward doesn’t require moving a mountain

The most impactful action a CEO can take to position their organization for tomorrow is to invest in becoming a better strategic leader today. To that end, here are 4 practical shifts a CEO can make:

#1: Shift perception of strategic leadership from “Person” to “Process”

Strategic Leadership is often described by a set of traits, with strategic leaders often described as ‘very strategic thinkers’. But paradoxically, the best strategic leaders aren’t that focused on their own ‘strategic thinking’. Their focus is on championing strategic planning as a process to systematically engage and support their teams’ strategic thinking to navigate the future and keep their company in sync with the changing world.

When a CEO sees strategic planning as a tool to develop a system of people with a shared strategic focus, collaboration expands, accountability increases, critical thinking elevates, and strategic leadership proliferates across the company. Once strategic leadership is entrenched in your company, the collective drive to transform and adapt will become a foundational part of running your business.

#2: Shift from the small picture to the big picture

Many organizations conduct strategic planning locked within the current niches of their market segments, business units, and financial reporting frameworks. But to focus on the future, the strategic planning process should start at the Enterprise level with a macro POV through the lens of long-term industry trends and your current positioning within industry segmentation. What forces define your industry? What does this say about where your industry is heading? How are they shaping your industry segments? Where are you presently positioned? Where do you want to be positioned? Who is at the intersection between best customer experience and application of new technology - is it you or your competition?

Yes, we live in a dynamic and complex world, especially so when viewed through a confined, short-term, internal focus. By taking the time to zoom out and to challenge your leaders to see beyond your present organizational frameworks to clarify long term trends, you’ll help your team see the playing field of possibility (and not just the same old play) to foster invaluable “breakthrough” perspectives to re-define your company and industry.

#3: Shift Focus from Profits to Purpose

People don’t believe in your profits; they believe in your Purpose. That’s not just an idealistic saying. According to Sisodia, Sheth and Wolfe’s bestseller Firms of Endearment, “Purpose-driven companies outperform profit-driven companies on the S&P 500 by 14:1.”

So why is Purpose – your Mission, Vision and Values – so important?

First, Purpose is the foundation of your Brand, and therefore, the basis upon which people – from customers to your employees – build an emotional connection to your organization. Always remember that organizations are the result of human imaginations, and that, as tangible as they seem, only exist because people believe in them and cease to exist when that belief fades.

Second, Purpose is what unites your team in a common focus and shared values; so that you can empower them - to strategically plan, innovate, and work together across silos.

By focusing your strategic planning process through the lens of Purpose, your Vision will be delivered on all levels, from your people’s hearts and minds straight through to the customer experience. Profits then become a measure of how well you’re empowering your team to deliver your Purpose in your market.

#4: Shift from the ‘Hows’ to the ‘Whats’

As a CEO, your job is not to dive deep into the ‘Hows’ (i.e. Strategy). That’s your senior team’s job. Your job is to set and maintain focus on the ‘Whats’ (i.e.: Strategic objectives and priorities).

To help you accomplish this, your Strategic Planning Framework should include two levels of planning: An Enterprise-Wide level (where ‘Whats’ are established) and a Business Unit level (where ‘Hows’ are developed). Here’s an optimal breakdown of how to engage the two levels:

Enterprise-Wide Level “Whats”:

CEOs should work with their senior teams to establish Purpose (Vision, Values) and prioritize enterprise-wide Strategic Objectives that bridge the gap between existing market position(s) and desired market position(s) and within the context of your long-term financial plan.

Pitfall to avoid: Instead of drilling down, CEOs should take a breather from the strategic planning exercise, to reflect and align Executive roles to champion Strategic Objectives, and position the effective development of Business Unit Strategies with their senior managers and teams.

Business Unit Level “Hows”:

Once your senior management structure is strategically focused, strategy (the “hows’) can then become a tool for how the organization will innovate, and where it can apply disruptive technology across the value chain.

As a CEO or a C-Suite Leader, you can remain highly involved in strategy development at this level, but keeping your organization’s Whats and Hows sorted out will support you to empower your team to become a future-focused, agile, adaptive organization.

4 Shifts, countless benefits

Together, these four shifts combine to engage and empower your people in charting your business for today’s realities, and to sustain your firm through tomorrow’s changes.

It starts with the CEO letting go of the traditional, linear, tactical approach to strategic planning and embedding their Strategic Leadership as a foundation throughout their company.

Once we recognize that the more things change, the more we need to change – the humans of the digital economy can win after all.

For more information, or to discuss how you can ensure that your next Strategic Plan keeps pace with the future, contact joanne@strategypluspeople.com.