How Effective Leaders Drive Digital Change

No leader wants his or her team to fail. But, in many digital transformation efforts, creating the conditions in which failure is an acceptable outcome might be key to success. As with Pixar Animation Studios, a subsidiary of The Walt Disney Co., which credits its blockbuster successes to all the storyboards that don’t actually make it onto film, effective digital initiatives often depend on a mix of experimentation, prototyping, and failure.

Creating a culture in which risk-taking is acceptable and giving employees a wide berth to learn from failure (and success) can be difficult challenges for leaders managing change. If the following behaviors aren’t part of your leadership repertoire, you may not be ready to lead a digital transformation.

The importance of these leadership behaviors appeared in a year-long study of a 450-person financial services function within Deloitte Services LP that was implementing a large-scale technology project to streamline reporting, budgeting, and analysis for the entire organization. If successful, many employees in the function would have more time to become trusted advisers to the business, rather than simply focusing on compiling and reporting numbers. The financial services function, however, was risk averse: The entire group was accustomed to complying with fairly stringent regulations and policies but was unaccustomed to voicing their opinions. Becoming advisers by effectively communicating a new way to do business would be a hurdle for much of the staff.

At the end of one year, the research had identified several distinctive characteristics of executives who were most effective at implementing the project: They fostered a culture tolerant of failure and embraced the following four behaviors.

1. Be clear about priorities. Leaders who were clear on shifting priorities and how success would be measured seemed to have much more engaged employees throughout the transition. Goal-setting was an important factor that enabled employees to track their progress and growth. Leaders also frequently reassessed goals and ensured that employees were well aware when priorities and needs shifted. Balancing clear communication of priorities with a willingness to adapt goals when circumstances dictated was important to engaging the workforce during a time of digital transformation.

Before launching the project, executives traveled to local offices to express their vision for the future and set the overarching mission for the finance function.