It’s not just about technology: The people side of digitization

Abstract

Anything that can be digitized will be digitized! The process of digitization affects almost everything in today’s organizations and puts huge pressure on these to change. Therefore, it is crucial for leaders to understand the implications of digitization on their organization and employees. Digitization not only changes the way of working, it also accelerates the speed of change that companies are facing. Both implications lead to three major requirements that have to be tackled to be successful: New skills and competencies, new forms of leadership, and new organizational capabilities. Depending on the degree to which organizations fulfill these requirements they will also evolve their culture towards a ‘digital mindset’. But digital transformation initiatives are facing huge challenges to realize the expected business benefits. Current studies clearly show the importance of managing people and organizational issues in digital transformations. Organizational change management is considered to be a critical success factor for any digital transformation program and embraces four major areas: Aligning leadership (e.g., digital vision, role modeling), mobilizing the organization (e.g., communication), building capabilities (e.g., digital skills), and ensuring sustainability (e.g., adapting KPI and incentive systems). Furthermore, it will be discussed how change management has to be adapted to meet the requirements in a digital world.