Brightman’s Romy Hughes examines how digital transformation will affect certain managers and how they can prepare for the future.
Let’s face it, 99 times out of 100, when a new technology enters the workplace it merely digitises an existing process to make it more efficient.
While most new technologies may be marketed as revolutionary, they rarely live up to the title. Most of the time, a new technology merely iterates the status quo here and there as opposed to fundamentally revolutionising it.
This is where digital transformation distinguishes itself from other technology implementations. When implemented correctly, digital transformation provides an opportunity for organisations to fundamentally change how they operate.
It is this transformation aspect which distinguishes it from a more typical technology implementation. The problem is that most people aren’t ready to change how they work, let alone be transformed.
Those in management roles in particular, who have been operating in largely the same way since the industrial revolution, are certainly in for a shock when the effects of digital transformation really take hold. But how will digital transformation affect them, and is there anything they can do about it?
The digital transformation promise
Digital transformation has the capacity to fundamentally change how a business operates, from opening up new revenue opportunities and introducing new data on which to make more informed decisions, to challenging the relevance of certain job roles. Most of these consequences are intentional and expected, yet some of them may be entirely unexpected.
One such unintended consequence of digital transformation is its impact on management culture. It has the potential to fundamentally change how management decisions are made, potentially reaching a point where executives could rely less and less on their gut feelings and more on the insights and recommendations of AI algorithms.
Those same executives that are currently overseeing their organisation’s digital transformation may not appreciate how much of their own decision-making may become automated in the future.
Could automated decision making be a change for the better?
Through digital transformation, AI and big data, businesses are gaining access to a wealth of management data and insights never previously thought possible. With every customer interaction, supply chain step and marketing response able to be recorded and analysed at scale and in real time, the sheer amount of information that can now be analysed is staggering.
Correlations between datasets that could never have been predicted can now be discovered and acted upon, with AI engines continually tweaking their algorithms to better predict outcomes.
Once an organisation reaches this point, it will have the opportunity to delegate even the biggest decisions over to AI. Where should the company invest its profits this year? What is a good price to pay for X? What is the most profitable product to promote in the next two quarters? Which region is at risk of political unrest in the next five years and how can this be mitigated?
These are all very big questions with far too many variables for only a handful of individuals to make informed decisions on, yet these are how boardrooms operate every day. You could say that almost every strategic management decision is made by nothing more than a gut feeling because no single individual is able to analyse all of the facts themselves to make a genuinely informed decision, or they simply don’t have access to all the facts to do so.
AI brings the possibility of genuinely fact-based decision making closer to reality. If an organisation is willing to give up control and take some calculated risks to test and build confidence in their algorithms, they have the opportunity to be run by facts, not feelings.
Managers are not immune to this change
Whenever a change is proposed in the workplace – be it a new technology, a merger or an acquisition, most of the fears tend to be around how it will impact frontline workers, particularly with regards to the risk of redundancy. Do you need as many checkout operators with self-service tills, for example? In this scenario, the answer, of course, is no.
But technology innovations have always made, and will continue to make, certain production roles redundant. Yet, despite numerous technology revolutions, the human race hasn’t found itself redundant just yet. We may have fewer coal miners, switchboard operators and chimney sweeps, for example, but people have found fulfilling work in other, new, often technology-enabled industries.
The difference this time around is that the change introduced by digital transformation is not confined to the productive labour force, but to their managers too. And given that the manager’s fundamental role has been largely insulated from all of the changes to the workforce underneath them until now, managers could be in for a big surprise.
This is because most managers are task-based managers; they set tasks and check that these tasks are being completed. This is then reported up to their manager, who then reports up in turn until it eventually reaches the board.
Management is therefore, more often than not, a reporting line to those further up the chain. But as the reporting of tasks becomes more automated through digital transformation, or the tasks themselves become automated, what role is left for the task-based manager? If they can no longer report the completion of tasks, what is their role?
Returning management to its roots
Managers need to recognise this change now and adapt along with it, just as their staff have had to do for generations. Organisations can help by shifting away from task-based reporting lines to objectives based on values and outcomes.
Managers will still have an important role to play in the digitally transformed enterprise, but it will be far more forward-looking and strategic. Instead of compiling reports and looking backwards at what has or hasn’t been done, they should become more focused on the future.
Managers will be reading reports instead of writing them and making more strategic decisions based on the abundance of data before them. This is a long way away from the tactical, task-based manager that dominates our organisations today. It will require a very different skillset and mindset, which some of today’s managers may struggle to adopt.
While this change requires us to re-evaluate the role of the manager in modern organisations, in reality, digital transformation is returning management to its roots. Management was never meant to be an aggregation point for reporting. Management is about generating value by getting the best from people through encouragement, inspiration and the enablement of teams.
The impact of digital transformation on managers will ultimately be a positive one for them, those they manage and their organisations, but only if they embrace it and are willing to transform themselves along the way.
By Romy Hughes
Romy Hughes is director at Brightman, a business change specialist company with expertise in service integration and management.
