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Leadership in the digital transformation

Technology is not the problem. A research project by Prof. Wolfgang Güttel's team at the TU Wien shows that whether organizations benefit from new digital technologies depends on the organizational embedding context and the design of the change process.

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Managers must often act as mediators between the old world and the new digital future in their teams.

By Sebastian Flesch, BA, BA

Managers play a key role in this. But contrary to what is assumed, it is not their technological knowledge that determines whether the digital transformation succeeds. Rather, the decisive factor is the extent to which they are able to communicate the meaning of the innovations to the employees in order to connect the old world with the new digital future and to functionally shape the resulting process of change.

Particularly in the case of medium-sized hidden champions, which were studied in the research project on digital transformation, the role played by executives in digital transformation becomes clear. This is because, in contrast to large companies or digital-born start-ups, core business and digital innovation business are closely juxtaposed there. This is not trivial, because the logic between short-term optimization in the core business and the development of completely new areas of expertise is completely opposite; efficiency meets disruption. In large companies, it is comparatively easy to establish new business units that then provide space for new digital business models. Disruption is separated from the core business. Managers can then specialize in each case, and only at the top of the company is the portfolio of different business areas balanced. Start-ups, in turn, are often founded on the basis of digital business models and are usually disruptive due to their characteristics. Managers, if they exist apart from the founder, exclusively pursue the implementation of innovative digital business models.

In the case of medium-sized hidden champions, core business and innovation business are closely intertwined. Even if creative spaces for the development of new ideas, for example through data science or robotics, are quickly created as independent organizational units, the reintegration of radical ideas becomes a stress test. This is because production or sales take place at the parent company, where conventional research & development is also located, which competes with the new start-up-like think tanks. As a result, managers at the interfaces between creative spaces and core business are particularly challenged: they must act as mediators between the old world and the new digital future in their teams and between the divisions, but also ensure a strategic balance between the two development options. The research results also show that digital technologies must be brought into the company in such a way that they are not perceived as a problem but as a solution for the (digital) future. Know-how on the topics of leadership, technology and change is therefore more in demand than ever in SMEs. Based on this, the Continuing Education Center of TU Wien qualifies executives in six new MBA programs in the field of Management & Technology.

Background:

In a technology-driven world, managers and organizations are faced with special challenges at the interface of management, technology and leadership. The new MBA programs at TU Wien are designed to address these challenges by providing participants with a basic understanding of technology, key business skills, and technological decision-making competencies.

Program start: April 2021

Further information: www.tuwien.at/mba