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What Digital Leaders Most Need to Overcome Modern Challenges Developing well-rounded digital leaders is a pressing issue for the future of all industries. Here's how to cultivate the best ones.

By David Zhao Edited by Kara McIntyre

Opinions expressed by Entrepreneur contributors are their own.

Today's business leaders have a lot on their plate. Their companies expect them to manage digital change, lead digital initiatives and motivate employees in both in-person and virtual environments. This presents enormous challenges that digital leaders need to overcome. Hence, developing digital leaders is a pressing issue for the future of all industries.

To be sure, the payoff is huge. Prior research has shown that digital leadership skills can improve well-being, lead to greater corporate productivity and increase profitability. In contrast, lack of leadership is a top challenge for digital transformation.

However, many companies still struggle with how to develop digital leadership skills. Many place technologists in leadership roles, while others assign complex digital programs to traditional leaders. Both approaches can be a recipe for disaster.

Instead, digital leaders need a mix of digital literacy and traditional leadership roles. They also need new skills to manage remote workers in a virtual environment. In particular, they need to learn:

  • How to cope with the challenges of digital change
  • Where digital leadership differs from traditional leadership
  • How to adapt to post-pandemic norms for remote work

Fortunately, all three skills can be learned and developed.

Related: To Succeed In A Virtual Workforce Era, Effective Digital Leadership Skills Are A Must

How to cope with the challenges of digital change

For digital leaders, one of the top goals is to lead the company through digital transformation. However, executives themselves must first learn to cope with digital change. While technology can be a business accelerator, it can also add distractions and stress to employees' daily lives. Moreover, technology for the sake of technology can be detrimental to a company's operations.

Thus, the modern digital leader's skills to cope with digital change are indispensable. In one study, researchers found that the top skills to cope with the challenges of digital change are:

  • Ability to think and act entrepreneurially
  • Self-organization and IT skills
  • Profound ability to motivate others
  • High degree of flexibility, commitment and creativity

Thinking entrepreneurially can help with information overload when multitasking, while self-organization skills are critical for managing the issue of being permanently available. In addition, training programs can teach skills such as IT competency and the ability to motivate others.

Lastly, flexibility, commitment and creativity are all necessary for leaders to encourage collaboration within their teams, especially when working remotely. Teams are more likely to deliver creative solutions with flexible, committed and creative leaders.

Related: The Keys to Succeed in the Digital Transformation Industry Today

Where digital leadership differs from traditional leadership

Imagine two senior leaders. One is a likable and charismatic founder who inspires employees but dreads keeping up with digital trends. The other is a brilliant technical genius, who routinely berates employees for asking questions and becomes impatient when subordinates do not meet expectations. Which one is best equipped to lead a company's digital transformation?

The answer, of course, is neither. The first leader lacks digital literacy, while the second lacks core leadership capabilities. Without both, leaders may fail to deliver the promises of digital transformation.

Thus, we should examine where digital leadership differs from traditional leadership and where it shares common ground. One five-year study has examined the difference between digital leadership and traditional leadership.

Laying out where digital leadership differs from traditional leadership, the authors found that the top three capabilities that are unique to digital leadership are:

  • Providing a transformative vision and forward-looking perspective
  • Understanding digital literacy through a generalist lens
  • Staying open-minded, adaptable and innovative, in case the technology and the business landscape evolve in unanticipated ways

Related: Rethinking Leadership For The Digital Era

In addition, the authors found that the top capabilities that digital leadership shares with traditional leadership include:

  • Explaining why the company needs to change, and then making the proper time, energy and money to foster success
  • Owning the transformation, rather than delegating digital transformation to technology specialists
  • Equipping employees to succeed by empowering them to execute critical initiatives and by providing adequate training

Thus, it seems that the two previous executives could learn a bit from each other. The charismatic executive should develop the digital literacy necessary to articulate a transformative vision. The technical genius could use training on motivating others and on helping employees help themselves.

How to adapt to post-pandemic norms for remote work

While remote work existed long before the pandemic, Covid-19 produced a seismic shift in how employees collaborate. As business leaders continue to debate the relative merits of return to the office, permanent remote work or a hybrid model, it is clear that digital leaders will need to accommodate a variety of working styles and preferences in the future.

So, how has the pandemic affected our expectations of digital leaders? A systematic review of the Covid-19 pandemic's impact on digital leadership found that personality traits for digital leaders are largely consistent with traditional leaders.

However, among the differences, they found that for digital leaders managing remote workers:

  • The skills most distinctive for digital leadership are trust-building, coaching and change management
  • Adaptability and risk-taking are more important
  • Cultural, social and emotional intelligence is also more important
  • Extraversion and charisma become less important

Thus, compared to traditional leadership, social intelligence becomes more important, while general intelligence is relatively less important. Given the increased difficulty of team-building and addressing individual concerns in virtual settings, trust-building and coaching skills are at a premium. In contrast, extraversion and charisma have less impact in virtual settings. There are fewer social cues.

Lastly, digital leaders still need to learn the necessary technical skills to develop digital literacy. However, change management is more important than deep technical expertise when it comes to motivating employees toward achieving a shared goal.

Related: Four Benefits Of Digital Leadership For Your Business

Takeaways on what digital leaders most need

In conclusion, the skills that digital leaders today draw extensively from traditional leadership skills. Leaders still need to take ownership, motivate employees, and manage change. However, there are still important differences for what digital leaders need.

For technologists, one surprising takeaway is that traditional leadership skills are still more important than technical skills for managing digital change. On the other hand, traditional leaders pivoting to digital roles need to develop core digital literacy, an entrepreneurial ability to provide a transformative vision and greater cultural, social and emotional intelligence.

In the end, both technology experts and traditional leaders can develop the skills to overcome modern challenges.

David Zhao

Managing Director of Coda Strategy

David Zhao is managing director of Coda Strategy, a management consulting firm that works with digital leaders to execute business strategy through analytics and automation. He has guided numerous organizations through the design and implementation of complex digital transformation programs.

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