A New Role for New Mandates
It is now cliché to note that “digital is changing everything.” The phrase, though tired, is unequivocally accurate. Across sectors, established companies are directly confronting the threats posed by digital:
A leading agricultural company enables farmers to optimize crop yield by leveraging real-time data from sensors and mobile devices.
A top technology company recently announced a multibillion dollar investment into a new Internet of Things unit dedicated to building a platform that will pull in data from billions of connected devices (everything from jet engines to refrigerators).
Various traditional media companies have announced the launch of premium video content streaming services available to consumers without cable subscriptions.
A prominent retailer tripled revenue after the implementation of a digital-centric strategy that integrated enhanced digital efforts with brick and mortar strategies.
As the pace of digital disruption accelerates, many incumbent firms have recognized that digital task forces and volunteer armies will not provide a sufficient defense. Increasingly, these firms are building their strategies for the future around the insights of a new class of executives: digital transformation leaders.
These leaders are tasked with catalyzing meaningful change in organizations and transforming existing businesses in ways that either revitalize a company’s core or extend it in productive new ways. “Chief digital officers used to be on the outside looking in,” notes Kevin Yapp, former Chief Strategy and Marketing Officer at Premier Farnell, who we recently interviewed as part of our first comprehensive study on digital transformation leaders. “Now that companies see the value of what we do, the challenge is to make meaningful change from the inside that makes everyone feel included.”
The issue isn’t whether a forward-looking company needs a senior executive in a digital transformation role— more and more organizations are confirming that this is the case. Instead, the key questions companies face are: What differentiates the most successful people in that role? What traits define the digital executives most likely to succeed in driving digital transformation within an established firm? And, how are they different from senior executives in more traditional roles?
What Differentiates the Top Digital Executives? The Emergence of Productive Disruptors
Answers are emerging regarding the traits that differentiate executives who are uniquely capable of developing and delivering a digital transformation agenda. Our psychometric assessments and qualitative interviews with 28 of the world’s top digital executives demonstrate that these executives are meaningfully different from other senior executives. Our analysis uncovered 21 attributes (across five categories) that make digital transformation leaders unique (see the chart below). Indeed, we have never seen a cohort of top executives so different from other groups.
Most critically, our research reveals that digital transformation leaders are defined by their ability to serve as productive disruptors: leaders who transform companies not by simply generating bold strategies but also by engaging people in the hard work of transformation. As illustrated in the chart below, digital leaders are (unsurprisingly) more disruptive and innovative than other executives. But, equally important, they are more socially adept than other executives—as well as bolder and more determined in translating ideas into action. They recognize that ideas without execution are hallucinations—and they understand that execution hinges on an ability to marshal the energies of the broader organization.
These leaders don’t simply aim to disrupt—they leverage their interpersonal skills to productively disrupt. They not only see the future and understand how to get there, they energize their colleagues to take the journey with them. “It’s not what I know—it’s how I lead,” says John Williamson, Senior Vice President and General Manager of Comcast.com. “You can’t execute without trust.”
Beyond productive disruption, a number of differences between digital transformation leaders and other successful executives emerged as particularly notable:
Productive disruptors are 56 percent more likely to cut through bureaucracy than the broader population of senior leaders. They are successful at making change, in part, because they have little appetite for antiquated processes that stand in the way of change.
- Productive disruptors score 52 percent higher in thinking “outside the box.” Even those with a history at their organization are able to get past the precedent and groupthink that commonly cloud strategic decisions. They are creative and contrarian thinkers who produce non-obvious solutions to the challenges of digital disruption.
- Productive disruptors score 49 percent higher in their willingness to challenge traditional approaches. They are successful at persuading their C-suite colleagues to break with precedent as business conditions change. They have no patience for “the way we’ve always done things here.”
In category after category—from having an entrepreneurial spirit to testing limits—this new generation of digital executives consistently scores higher across five broad areas: innovative, disruptive, social adeptness, bold leadership, and determination.
The top digital transformation leaders are steeped in innovation. As Tanya Cordrey, Chief Digital Officer of Guardian News and Media, says, “My primary role when I’m meeting with my fellow C-level executives is to be looking toward the future. They expect me to have answers, of course, but even more than that, I think I’m there to ask the right questions. But you should not make the future feel like science fiction. You want to be innovative. You achieve this by painting a picture of an ambitious, bold future that feels possible. That’s a crucial set of capabilities for digital transformation leaders: the ability to think in innovative ways, ask questions that help move the company forward, and then be able to collaborate and develop solutions based on what has been learned. But you have to be realistic. You have to be innovative within the bounds of what is possible.”
Leading digital executives excel at communicating their insights about innovation. Jason Seiken, recently departed Chief Content Officer and Editor-in-Chief of Telegraph Media Group, says, “I often find myself having to use conceptual tools to make practical things happen. Innovation happens in the real world—but sometimes you can bring new ideas into the real world by introducing them in abstract ways, through metaphor.” Top digital transformation leaders also highlight the importance of relentlessly linking innovation to clear business outcomes. They recognize that their capability to sell untested ideas hinges on the ability to establish a clear line of sight to revenue growth or cost reduction goals.
By definition, digital transformation leaders are uncomfortable in roles that emphasize steady-state management. According to Yapp, who successfully helped two incumbent companies reimagine themselves as digital businesses: “I’m not there just to steer the ship. I’m less interested in companies that have their digital act together than I am in companies that need to change now.” Digital transformation leaders bring an entrepreneurial spirit to their work, have little tolerance for the way things always have been done in a company, and are exceedingly comfortable managing ambiguity and uncertainty.
In this category, the most dramatic difference between digital transformation leaders and other senior executives is the inclination to cut through bureaucracy. “That’s exactly our role,” says Seiken. “We’re there to argue that, for example, the 99 levels of approval before changing a font size on a website might be a bit much.” Large companies need some bureaucracy to manage risk and reap the benefits of scale, but top digital transformation leaders are extremely adept at cutting through the clutter of unnecessary processes and turning decisions into action.
Digital transformation leaders may be more comfortable with ambiguity and uncertainty than their peers, but that doesn’t stop them from being more decisive as well. Indeed, interviews reveal it is that comfort with ambiguity that allows transformation leaders to set direction without fear. Cordrey says, “There is sometimes a gap between other executives and game changers. It often seems that other executives around the table expect me to demonstrate several behaviors: One of them is being able to take the conversation to a slightly more extreme place and to push us harder on getting the organization fit for the future.” Indeed, digital transformation leaders are 29 percent more likely than other executives to take initiative and test limits.
When digital transformation leaders take initiative, they do so publicly. Our assessment data show that these leaders are 21 percent more likely to lead from the front than the broader population of senior executives. Says one respondent, “It is a very public role. People in our position are clearly identified as change agents; you can’t be a change agent if you whisper. To succeed in this role, to be seen as succeeding in this role, you have to speak up early and often. No one else will if you don’t, I can assure you of that.”
Innovative and disruptive strategies will not matter much if the people with game-changing ideas are not able to communicate them—with confidence—in a way that their diverse constituencies will embrace. And communication goes both ways: Digital transformation leaders listen hard, too. Says Ralph Rivera, Director of BBC Digital, “The key to being ultra savvy at the C-level is to read between the lines. You have to zero in on what people mean or what they’re trying to say, as well as what they actually say.”
Digital transformation leaders are 21 percent more likely to seek to understand people than other executives. They also are 21 percent more likely to adapt to different audiences, which is critical at large corporations with long histories and multiple divisions that sometimes seem to speak different languages. As Yapp notes, “Chief digital executives are a lot like therapists. They can’t be truly helpful unless they really, really listen.”
Digital transformation leaders recognize that their bold ideas will be cast aside if they attempt to implement those ideas in spite of their organization. Digital transformation leaders leverage their social abilities to achieve the buy-in required to effect disruptive change.
Digital transformation leaders, at their best, help others become transformational, too. According to Cordrey, “A big part of my job is to help make sure that whatever bravery I have on my team spreads into other parts of the organization.” By focusing on achievement, insisting on action and moving forward with an optimistic attitude, digital transformation leaders exude a determination that can be infectious.
Notes Yapp, “When you are brought in to make change at a mature organization, there’s a good chance that you’re not the first person they’ve brought in to take a shot at it. The person before you hasn’t succeeded— that’s why you’re there—and part of the reason they didn’t succeed is that they didn’t or couldn’t stick around to see things through. They didn’t seem determined. A digital transformation leader is guiding people into the future rather than simply painting a picture of what that future might look like.”
Productive Disruption in Practice
Each of these five areas: Innovative, Disruptive, Social Adeptness, Bold Leadership, Determined—represents a robust set of individual capabilities. Each digital transformation leader may have a different level of strength in these five categories, but it is in balancing those areas that the top leaders emerge as productive disruptors—leaders who can constructively shake up an organization to change and enlist leadership teams in the hard work of driving transformation. Those with high innovative and disruptive traits are unlikely to succeed if they do not have the social ability and determination to inspire change. But determination alone does not accomplish much unless it is in the service of strong ideas and vision. As Erik Huggers, former President of Intel Media and newly announced President and Chief Executive Officer of Vevo, says, “It often seems, more than anything else, that my job is to give people something to believe in. That doesn’t appear to exist very much, I’ve found.”
The stories that productive disruptors tell of driving meaningful change frequently start with setting expectations. “I’m trying to embed innovation at a place where there is not a natural culture of innovation,” says Jeff Moriarty, Chief Digital and Product Officer at Johnston Press. “Innovation doesn’t happen with the snap of a finger, and I’m in an industry needing to focus on the bottom line as it transitions to new platforms. It can’t be just about the next flashy thing. As a digital executive, I rightly feel pressure to contribute to the bottom line, and I do. But there’s always a tension between what I can do for the organization long term and also delivering fast and meaningful contributions to the business.”
Similarly, Nick Franklin, former Executive Vice President of Next Generation Experience at Walt Disney Parks and Resorts, notes: “If digital leaders want to have an impact, if they want to succeed at all, they have to bring in people who ‘get it’ about digital transformation together with those who don’t see it yet. Early on in my tenure, I spent an enormous amount of time showing, not telling, how even though digital was a huge threat, it was an even bigger opportunity for us. Taking the time to let people imagine the upside made it possible for us to go from redesigning products—which is just tactical—to redesigning strategies.
“There are three ways to gain trust for game-changing digital initiatives. And they’re all about doing what seems like contradictory things simultaneously,” Franklin continues. “You’ve got to be able to challenge traditional approaches without alienating the people who are wedded to those approaches. You’ve got to make sure you adjust your style so that people feel you’re talking directly to them—without changing your story. And you’ve got to find ways to be as transparent as possible so that when people from different groups talk together—as they will—you can be sure they all have received the same message.”
POSITIONING DIGITAL TRANSFORMATION LEADERS TO SUCCEED
Even the most talented digital transformation leaders are unlikely to succeed if they parachute into an organization that is not prepared to foster the same values. Talent is extremely important, but it is not enough. Chief executive officers, in particular, must serve as a vocal champion of digital transformation and create the conditions in which digital transformation leaders can succeed. Digital transformation leaders must take responsibility for catalyzing large-scale change and transformation. But this exceptionally challenging mandate is far more likely to take flight in organizations that truly are committed to addressing the threats and opportunities posed by digital disruption.
Appendix: A Diagnostic for Assessing Aspiring Digital Transformation Leaders
The diagnostic below provides a portion of Russell Reynolds Associates’ proprietary framework for assessing an individual’s potential to succeed as a digital transformation leader. By evaluating aspiring digital transformation leaders against the readiness levels presented here, organizations can begin to determine if an individual holds the potential to serve as a productive disruptor. That said, this (highly simplified) assessment should be viewed only as a starting point for the assessment of potential candidates, and it always should be used in combination with a more comprehensive evaluation of an individual’s competencies, experiences and achievements, as well as culture fit with a given organization. For more information about the Russell Reynolds Digital Transformation Leadership Evaluation, or to see the full assessment framework, contact a Russell Reynolds consultant or send a request to Digital.Transformation@russellreynolds.com.