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Leading the way through a digital transformation

Key takeaways

  • Organisations need to embrace a digital-first mentality to compete in the modern business world.
  • No longer a fixed-length technology project, digital transformation must be holistic and continuously deliver value.
  • Leaders play a crucial role in a successful transformation, enabling innovation, empowering employees and providing critical direction on the journey.

Leadership. It can make or break your digital transformation faster than any legacy technology.

The underlying technology is important, as is the data you feed it and how you keep it safe, (evidenced in our Where next for digitalisation and data reliance? report). But leadership is the element without which  the rest of your transformation efforts will be rendered meaningless. 

There are three areas in particular where the top needs to lead the way. 

Unearthing ideas and people

  • Leave ego at the door — Years of coveting the corner office and a hard-won fight to the top can get in the way of a leader’s ability to effect change. While all CEOs will likely have their ‘legacy’ in the back of the mind, it’s important to be realistic. With a busy schedule and the weight of responsibility on your shoulders, simply finding the time that’s required to sit and think up innovative ideas is a big ask. Embracing ideas from employees, on the other hand, harnesses the power of the collective mind and comes with many benefits.
  • Invert the pyramid — More than just removing hierarchy, leaders should actively encourage ideas incepted at lower levels in the organisation to bubble up. Bottom-up innovation is invaluable to a business as your employees on the frontline and in the trenches will have unique perspectives honed by the reality of what works and what doesn’t and they’re likely to more intimately understand customer pain points and opportunities for change.
  • Include diverse perspectives — In its broadest sense, inclusion is about recognising amazing ideas from people with a variety of backgrounds and experiences. Amid a transformation, it will take real effort to create an environment where everyone feels empowered to speak up, can contribute openly, and feels like no idea is a stupid one, but doing so will increase the diversity of thinking and provide the best ideas to work with. 
  • Unlock your digital natives — Leaders need to identify and surface the digital natives in their business. These employees will often be the most passionate and innovative, and have the potential to push your organisation to think differently (digital-first!) and take risks that place digital at its core. Finding them could be as simple as asking for ideas. But once you uncover these employee gems, make sure you listen to them — nothing will frustrate them faster than false interest.

Uplifting skills, behaviours and mindsets

  • Remove hierarchy — Whether you embrace an Agile, BXT or ‘test and learn’ mentality, a reorganisation of the way the business works must be part of a transformation to get value from it. This doesn’t necessarily mean a restructure, just a rethink. Teams should be multidisciplinary in nature so that all the tools for success are found within their members, un-siloed to remove business unit blockages and territoriality, and empowered to get from idea to value in the quickest way possible.
  • Model the behaviour you want  — As a leader it’s necessary to role-model the behaviours that you want your employees to engender, but equally, you can’t assume that a collaborative and inclusive culture will ‘just happen.’ In the initial stages, you will have to engineer the mechanisms that allow these behaviours to take hold. It has to be a little bit staged as it’s a lot to expect people to speak up and take the reins just because you’ve said they can.
  • Embrace an agile mindset — A leader must learn to think differently about what they prioritise in a digital transformation, as it requires a different mindset around how value is delivered. To do this, define what the value is that you’re trying to unlock, prioritise it at the start, and deliver it early and often. Transformation is no longer a massive project that goes on for years delivering value only at the end. 
  • Understand people’s needs — For an organisation to ingrain digital into its DNA, leaders need to understand the new skills that will be required to drive transformation and growth. This could include an uplift in mindsets, different behaviours, or new skill and capabilities. Assess your workforce and invest in upskilling people in the areas they — and you — will need for the future.

Providing direction

  • Digital-first — What is it that you’re trying to transform: your customer experience, the products you provide, tech you use or even your business model? The answer should be all of the above, because if all you’re doing is putting a ‘digital veneer’ on top of your old business, you’re not really transforming. Digital bells and whistles are temptingly easy to decorate with, however, especially if siloed departments are looking to deliver on the vision but only control a small part. It’s up to leadership to ensure digital goes deeper.
  • Define delivery — Failed transformation efforts are often due to leaders being unclear about what is being delivered (or when, or how). Digitalisation is not a three-year project — change has to be holistic, continuous and strategic. Leaders must understand exactly what this means, and what it doesn’t, so that they can bring their people along on the journey.
  • Outside-in, not inside-out — Too often, organisations still form an inside-out view of innovation, assuming what customers want instead of knowing it. Value needs to be defined from outside the business, and so requires engagement with your customers (citizens, business partners etc.) to determine what value looks like for them. An outside-in view of the world will ensure that service design and digital enablers are driving the right kind of value.
  • Nix the IT strategy — Your organisation should not have an IT/ITC strategy that sits alone. Instead IT (or more accurately, tech) needs to be a fundamental component of your overall organisational strategy. Technology, all the more important in contemporary transformations because it must pervade the entire organisation, must be infused, not imposed. Leaders must bring tech and the business together to deliver the internal capability and plot out the transformation together.

Leadership today is not about being the figurehead of the company (at least, not solely). It’s about creating an environment that empowers your teams and encourages them to innovate. This is all the more true when it comes to transforming your business to a digital future. Without your employees on board, your transformation simply won’t happen, and that is entirely dependent on the culture, behaviours and direction provided from the top.

For information on how the right approach to digital can enable your business to thrive, download PwC’s Australia Rebooted report, Where next for accelerated digitalisation and data reliance? or visit PwC Australia’s site on Digital Transformation.


Matthew Benwell

Matt is a partner who leads the Technology Advisory practice in Consulting, PwC Australia