Lost in Transformation

Digital transformation unfolds an intensified dynamic inside a company which, together with the external dynamic, becomes increasingly powerful. The acronym VUCA (volatility, uncertainty, complexity, ambiguity), which originated from the military vocabulary of the 1990s, resonates with the experience of many in times of digitalization. The effects on our social, professional and also private life are extremely complex and interdependent, and the extent and speed of change are hard (if not impossible) to predict. People feel overwhelmed.

This poses considerable challenges for employees and managers in particular. More than ever, they are challenged not only to counter this dynamic and to resolve it, but at best to anticipate in it so as to avoid potential problems or conflicts. What is clear, however, is that when digitalization is implemented correctly and as desired, the corporate result is "more time", "more relief from routines" and "more room for personal communication and development". This replaces "more strain", "constant excessive demands" as well as a de facto "decrease in personal exchange" and in "free development opportunities".

For this to happen, however, many managers must first change their own behavior patterns and mental models. Many of them are currently still quite "lost in transformation", although they of course do not appear to be at all.

Change your understanding of leadership? Lead differently? Don't managers already do that? Hasn't management been undergoing a change for quite some time now?If you believe the management press, then the reinvention of management has long since taken place. "Break what breaks you", was the title of a recent Harvard Business Manager article, which explains how you can master the balancing act between speed and day-to-day business with more "agility". Similarly, Manager Magazine has  three DAX-30 board members on the cover, namely Timotheus Höttges, Johannes Teyssen and Dieter Zetsche and appoints them "Kings of Cool". This is because they not only dedicated their companies to a consistent digitization course, but they also changed their management style.

Midlife crisis

So is everything cool in “manager land”? Or does the "digital" management style bear more ressemblence to a collective midlife crisis?

After a long period of minimal change in the leadership of German companies, which has seen sluggish implementation of changes against great resistance, communication between managers and their teams falling increasingly victim to the escalating reporting culture, and during which no movement seemed possible, suddenly everything has been turned upside down.

As with some men in their prime, who storm into the fitness center on a daily basis, swap family limousines for sports cars, wear three-day beards, sloppy jeans and sneakers, and suddenly fall for a young mistress and feel like a completely new person, seemingly revolutionary changes are suddenly the be-all and end-all for companies. So the question arises: How much is at stake in the new leadership culture? Is it indeed all that it is cracked up to be? And if not, how does leadership have to change to meet the demands of digtalization?

Fact check

If one takes a closer look at current managerial language, buzzwords such as "agility", "disruption", "radical innovation" and "team orientation" are currently used by almost every manager. It has become part of a modern manager’s self-image to be friendly, employee-oriented, willing to delegate, agile and on an eye level with employees. At the very least, this image is promoted to the outside world.

However, the situation is far from the same in all companies: Despite many aesthetic improvements, dissatisfaction with the culture in many companies is still considerable. For example, according to Manpower Group's "Job Satisfaction 2016" study, every second German is dissatisfied with his job. As the main reasons for this dissatisfaction, the bad culture in the company and the direct superior are often cited.

Ulrich Schäfer recently called for this in his column "Das deutsche Valley" in the Süddeutsche Zeitung: Be humble! "In fact, one often encounters the opposite: arrogance, overconfidence and detachment. Anyone who talks to executives from Silicon Valley often meets people who are driven by an exaggerated thirst for world improvement and think they know what the future holds. And those who talk to executives from established companies often meet people who decide from above in the belief that they are the smartest and best...". In his column he quotes Prof. Michael Wade, head of the Global Center for Digital Business Transformation: "Managers should be aware that at a time when technology (and thus the business of many companies) is changing more rapidly than ever, they can no longer know everything. They should accept that other people usually have much more know-how – and therefore be open to their advice, opinions and feedback."

New clothes, old thinking

So the core problem of the new beautiful leadership world is that with jeans and sneakers you may suddenly come across quite differently. Yet, despite all the self-evocations, the same managers remain inside. But they often find it difficult to put aside their old ways of thinking and behaving. And in those companies where the walls are full of progressive self-descriptions, leadership principles and pictures, all evoking team spirit and a culture of innovation, the reality is usually quite different. This is not only apparent in phenomena such as mobbing, internal dismissal, high sickness rates, politics and a bad atmosphere, which still exists in many enterprises or is even becoming more widespread. But also in the frequently sluggish conversion rate and the high resistance, with which companies have to fight in order to implement change.

Managers often have the habit of meeting the "more" (more events, more data, more information, more challenges, more opportunities) with a strategy of "even more". In concrete terms, this means that more and more information, specifications, plans, goals, analyses, presentations and projects are fed into the "company" system. This is particularly true in digital environments: a new app, a start-up in Berlin, a "Let’s just buy a digital agency or immediately establish a "Creative Lab" in California". The blessings of the digital world are also becoming a curse here: the number of e-mails, conference calls, mobile phone calls (often on weekends) with which managers overwhelm (and mistreat) their employees, , has risen significantly. Does all this lead to more success? Not really.

In more and more companies you will find managers who are finding it increasingly difficult to focus. They try to meet the challenges of more dynamism and intensity with a potentiation of dynamism and intensity instead of doing exactly the opposite. These days, a calm conversation, a concentrated meeting, a "staying with the point" is hard to come by. Managers who constantly check their smartphones during meetings, process e-mails and no longer listen properly are now the rule rather than the exception. It is interesting to note that this applies not only to established companies, but also to the digital benchmark companies themselves. Yet they have actually set out to revolutionize the world of work. Facebook dropout Antonio Martinez recently reported that not only using Facebook, but also working there was like “legal crack”.

In fact, such actions generate "quick wins" which, in the short term, can simulate the feeling of effectiveness, success, being useful, an increase in one's own feelings of significance and lead to the release of dopamine. The body’s own pharmacy generously dispenses drugs, even if the hangover follows just as reliably. Much worse it that it is not the results that provide the basis for decisions and actions, but the desire for the next self-confirmation trip. Instead of a really courageous step, surgery is more superficial: a small app, a small website relaunch, a nice new little big data tool, without a well-thought-through plan. This is also confirmed by Thomas Helbing, CEO of Ray Sono AG, who comes to the conclusion in an interview with us:

"Our customers have been working on the topic of digitalization for many years, but in the last two years they have been intensifying their efforts and becoming much more comprehensive. Digital marketing is becoming digital product and service design. However, new customer enquiries also clearly show that there is a high degree of uncertainty, especially in large companies, where project ideas are launched and a lot of money is invested; ideas often fail due to internal barriers and therefore serve more as 'corporate entertainment' than as anything with concrete benefits. There is a downright gold-rush atmosphere: orders worth millions of euros, which fail due to cultural, organizational and technical barriers within the company, are currently not uncommon in our industry. That's why we first start out in an advisory position and then only implement projects that offer the company real added value."

Thomas Helbing's statement clearly shows that the core challenge of digitalization is not the creation of "more", but rather the mastery of this "more" through the right interpretation, selection and focus on the essential, both in terms of content and humanity. Only then will employees be really on board, instead of rolling their eyes over the fuss at the top.