"We've seen two years of digital transformation in two months." These are the words of Satya Nadella, CEO of Microsoft at the beginning of the Covid-19 pandemic. A study conducted by Twilio points out that Covid-19 has accelerated the digital transformation of societies by an average of 6 years.
It is clear that digital transformation is not only a passing trend but can represent a competitive advantage for organizations. However, statistics show that the success of these initiatives is not particularly encouraging. According to a study conducted by Spencer Stuart, one of the reasons why digital transformation is often not successful is the lack of digital skills at the leadership level. Digital transformation is not only linked to technological innovation: it is a process also linked to the people who adopt the initiative for change.
When we talk about C-suite, knowledge in the field of financial matters is taken for granted, while digital and technological knowledge are still often considered a 'nice to have'. The recent pandemic has significantly accelerated digital transformation and demonstrated the need to adopt unconventional strategies regarding culture, business organization and leadership.
In his analysis Spencer Stuart considered the specifics of the most sought-after leadership roles between 2016 and 2020 and noted a 59% growth in searches that included the terms technology and digital experience. When we talk about technology, we refer to technological techniques, skills, systems, processes, hardware and software, while for digital we refer to a subset of technology referring to intangible assets.
While the majority of the roles for Chief Information Officer, Chief Marketing Officer and Chief Technology Officer made a reference to digital and technological skills, less than a third of the specifications related to Chief Human Resources Officer and Chief Accounting Officer mentioned these skills. The percentage of CEO, board directors and chief financial officers who mentioned digital and technological skills stood at between 40 and 60%.
This analysis shows that many companies have not yet aligned their strategy related to the acquisition of talent to what are the needs imposed by an increasingly pressing digital transformation, in order to be able to successfully implement the digital transformation requires a change in skills and responsibilities in leadership roles.
Featured Download: Manager/Supervisor's Role in Change Management
Spencer Stuart gives us an overview of how the main roles of the C-Suite have evolved:
Chief Technology Officer: while in the past THE ETPs were mainly the experts in the opportunities and limitations of new technologies, today they are called to be the leaders of digital transformation, formulating new strategies and playing a central role in motivating and bringing impacted employees on board these digitalization initiatives. They are the champions in creating and promoting digital culture in the company.
Chief Marketing Officer: traditionally the CMO was in charge of developing and implementing the company's marketing strategy with activities ranging from market research, pricing policies, advertising strategies and PR. Today the CMO is called to know how to track KPIs, automate reports and make decisions that are related to data that reflect the needs of an increasingly sophisticated customer. At the same time, the CMO must be constantly updated on new digital platforms, knowing how to create a cohesive message and manage immediate social media feedback.
Chief Executive Officer: the figure of the CEO is linked to decisions on the strategy of the company, to determine the vision and culture of the organization. Today the CEO is called to carry out these activities in a context characterized by an increasingly pressing change. The ability to articulate the business case for change initiatives, communicate a cutting-edge strategy and be a role model of the company culture aligned with the transformation it wants to achieve is required.
Board of Directors: usually the board of directors was called upon to carry out financial statements, provide opinions on the company's strategy, appoint the CEO and determine his remuneration, and appoint directors. Now the board is also called upon to make assessments on the choices related to large investments in long-term innovation, and not only on medium-term financial performance. For this reason, it is necessary that the members of the Board of Directors are individuals who have digital skills and who are able to understand the opportunities offered by new technologies, but also the risks.
Chief Financial Officer: Traditionally the CFO deals with financial forecasting, budgeting and reporting. It is essential that the CFO is able to leverage new technologies aimed at automating the processes and analysis of financial reporting. It must be able to assess the costs and benefits of technology investments and identify areas that offer growth potential for the company.
Chief HR Officer: the CHO has always been concerned with how to align people's agenda with the company's strategy. Today more than ever it plays a primary role in defining the future of work and strategies for the acquisition of talent. One of the most important elements will be the ability to attract and do retention of talent with digital and technological skills and manage the internal talent pipeline in line with the progress of technologies. In addition, the CHO will play a key role as a partner in change initiatives and cultural transformation to drive innovation and agility.
We can see how digital transformation involves a change in the role of the C-Suite and the ability to manage technological and cultural change.
How can I learn more?
Our FREE webinars offer an insight into the forefront of change management thinking, delivered by CMC Change Management Practitioners. Whether you're new to change management, or are seasoned in the people side of change, there is a topic for you. Attend a live session, or see what we've got available on-demand.
CMC Global also offers private, single-company on-site training and advisory support worldwide. For more information on our virtual and remote options, get in touch!