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Agile Leadership in an Age of
IMD Faculty Digital Disruption
Mike Wade environments, but the emphasis has changed.
Professor of Innovation and In our study, we focused on the competencies
Strategy, Director of the that appeared more pronounced in disrupted
Global Center for Digital environments and labeled leaders successful
Business Transformation, in such circumstances as agile leaders.
an IMD and Cisco Initiative
The must-have competencies
Guest Speaker of agile leaders
Dr Rainer Neubauer According to the results of the research, agile
Managing Director, leaders are Humble, Adaptable, Visionary and
Metaberatung GmbH Engaged. These must-have competencies
inform their business-focused actions.
Research & Humble
Development The individuals who drive In an age of rapid change,
Remy El Assir digital transformation knowing what you don’t know
Andrew Tarling can be as valuable as knowing
Digital disruption is changing the business what you do. Agile leaders must
landscape as we know it. The rise of new be open, willing to learn, and seek input from
technologies like blockchain, machine both inside and outside their organizations.
learning, analytics, virtual reality, cloud, They also need to trust others who know
mobile and connected devices has led to more than they do.
the creation of a new digital ecosystem. In Being humble in one’s approach to
Over 90 executives this ecosystem, non-traditional competitors leadership may sound inconsistent with the
attended a recent IMD have emerged to create new troves of requirement to project an image of confidence
Discovery Event to learn customer value that threaten to break down and authority. However, we do not regard
about the leadership traditional industry barriers that once stood humility as an abdication of the need to
knowledge, skills and tall. Incumbent organizations have found it provide a strong vision and positive direction,
behaviors required to increasingly difficult to protect market share but as an acknowledgement that the current
succeed in a digitally and sustain a differentiated competitive speed of change outstrips any leader’s
disruptive environment. advantage within the ”Digital Vortex.” personal store of knowledge or experience.
New research from the Up until now, very little research has been Accepting that a single person cannot know
Global Center for Digital done on the individuals who drive these everything needed to make a decision is a
Business Transformation, transformations within organizations, and the critical component of agile leadership.
an IMD and Cisco personal qualities they need to succeed. A
Initiative, revealed why new study from the Global Center for Digital Adaptable
leaders need to adapt their Business Transformation, an IMD and Cisco We regard being adaptable as
approach, and how they Initiative, identified key competencies and an acceptance that change is
can go about it. behaviors required to lead organizations constant and that changing one’s
in environments characterized by digital mind based on new information is
Discovery Events are exclusively disruption. a strength rather than a weakness. Focused
available to members of IMD’s The research showed that effective leaders adaptability based on new information
Corporate Learning Network. To find out in disruptive environments share many of is a distinct competency, unlike random
more, go to www.imd.org/cln the characteristics of leaders in more stable vacillation. Agile leaders adapt their behavior
© 2017 IMD – International Institute for Management Development. No part of this publication may be reproduced, stored in a retrieval system
or transmitted in any form or by any means without the permission of IMD.
“In our industry, we are
at the epicenter of a
change. We are being
dragged from analogue
to digital as we speak.
It’s happening now, and
it’s fascinating.”
Russell Quirk, CEO eMoov
Figure 1: Actions of Agile Leaders
in the short term based on their ability to long-term aims and objectives. For
make evidence-based decisions. example, General Electric’s vision is to
Being adaptable is the key to success become the dominant player within the
“Adaptable leaders are for both the organization and the agile “Industrial Internet,” a term it coined, which
not afraid to change leader. Rapid technology changes and the is a major departure from the company’s
their mind in front of appearance of new digital competitors drive traditional manufacturing roots.
their teams.” adaptability in leaders. We found that agile
Discovery Event leaders are adept at dealing with complexity Engaged
Participant and less reluctant to change their minds in Agile leaders display a
the face of new information. They are not willingness to listen, interact
afraid to commit to a new course of action and communicate with internal
when the situation warrants it. and external stakeholders and
a strong interest and curiosity in emerging
Visionary trends. In other words they are engaged.
Visionary in the context of agile Whatever their hierarchical position,
leadership means having a agile leaders are always engaged, be it
clear sense of the long-term with customers, partners, suppliers, team
“Humility is what most direction, even in the face of members, staff or the broader societal
leaders should aspire to.’’ short-term uncertainty. In times of rapid and industrial ecosystems. This desire
Discovery Event technology and business model disruption, to explore, discover, learn and discuss is
Participant with opportunities opening up everywhere, as much a mindset as a definable set of
a clear vision is even more critical. Agile business-focused activities.
leaders have a well-defined idea of where
their organizations need to go, even if they Essential behaviors for
do not know exactly how to get there. agile leadership
Being visionary is not restricted to
digital disruptors; it is equally important Combining the must-have competencies
for legacy organizations, where leaders with agile behaviors provides a powerful
need to define and clearly articulate amplifying effect for agile leaders, making
Page 2 www.imd.org insights@IMD
them significantly better equipped to deal with organization is not able to act with speed.
today’s disruptive business environments. Ultimately, agile leaders will only be “Humble was the key
The research identified three key behaviors effective if they are able to quickly execute insight.”
that differentiated agile from non-agile an informed decision. There are many Discovery Event
leaders: hyperawareness, informed decision barriers, be they organizational, fiscal, Participant
making and fast execution. structural or cultural. One executive from
a large incumbent told us, “You need to
Hyperawareness kill and hide bureaucracy … fast decision
Hyperaware agile leaders are focused on making means fewer signatures.” That’s
spotting emerging digital opportunities or adaptability in action. Size matters in
competitive threats. They are engaged, execution terms, but agile leaders at every
seek new insights and adapt in response, level in large incumbents identified fast
but they are also aware of the need to execution as critical.
provide guidance through a strong vision,
as the potential for change threatens Agile leadership in Saas-Fee
to overwhelm a linear strategy. Good
leaders are constantly scanning their Agile leadership, with its must-have
environments, both inside and outside competencies and behaviors, is not “You have to be sure that
their organizational boundaries. With restricted to large incumbents or disruptive you are able to correct
technology-driven change accelerating technology players. The small Swiss wrong decisions or weak
across industries, the need for leaders alpine ski resort of Saas-Fee, famed decisions. You have to
to look outward, and not just at their for the James Bond ski chases, is an be able to say, okay,
competitors, is evident. interesting example. yesterday I said left and
In 2009 a local private investor and a today, based on this, we
Informed decision making group of residents took back ownership are going right. It has to
For agile leaders, informed decision of Saas-Fee’s cableway company from not be a weakness for
making fundamentally entails using a large foreign corporation in an attempt you. It is a necessity of the
available data to make evidence-based to strengthen the local economy. The environment of today.”
decisions. To do this, leaders need to company operates the ski lifts, manages Lothar Raif, Head
engage; they must recognize and utilize ticketing, maintains the slopes, takes care of Banking Support,
the best data sources, apply appropriate of skier safety, and leases restaurants on Credit Suisse
analytics, and then make a decision. Faced the slopes to various restaurateurs.
with insufficient or even contradictory data, As the new owners, the local community
leaders must draw on their experience and became fully accountable for the resort’s
intuition to move forward. success or failure. Local stakeholders
Informed decision making underpins felt a fresh start was needed to steer the
a leader’s ability to adapt and support newly acquired operations to success
their long-term vision. Agile leaders who and in 2010 appointed Rainer Flaig as
understand the value of using digital CEO based on his extensive industry
technologies to gather and analyze data are experience. However, the early 2010s
always on the lookout for new data sources were difficult for the resort. A combination
to support informed decision making. A of aging equipment, high fixed costs and
number of survey respondents noted the stiff competition led to a significant revenue “I think you have to
growing availability of public data along decline. By 2015 Saas-Fee counted 35% be bolder as a leader
with social, mobile and other sources. fewer skier days than in 2007, and overnight because by definition
stays were down by one-third. Competing disruption is bolder, you
Fast execution Swiss ski resorts also suffered, but less have to have the courage
Fast execution entails willingness on acutely, with an average 26% decline in of your convictions...
the part of a leader to move quickly, skier days. The strong Swiss franc coupled You have to wear your
often valuing speed over perfection. with the emergence of trendier and less- vision on your sleeve.”
In an environment characterized by expensive resorts in Austria and France Russell Quirk, CEO eMoov
significant disruption, the effectiveness of made it difficult for Saas-Fee to compete.
hyperawareness and informed decision European tourists, who accounted for
making is significantly reduced if the 70% of Saas-Fee’s visitors, began to take
insights@IMD www.imd.org Page 3
their ski holidays elsewhere. Indeed, the customers, promote new products and
European ski industry as a whole did not services, and gather intelligence about
“Listen and trust. This see a decline during this period. consumer behavior and spending patterns
can’t be a half-hearted Flaig was forced to take drastic measures. at the resort. Skiers became users who
effort.” He initiated a major cost-cutting program, could be communicated with before,
Terry Bennett, reduced the workforce by more than 20% during and after their ski vacations.
Fortium Partners and blew up mountains to widen the ski Although Saas-Fee had struggled for
slopes. He also invested heavily in job years to stay afloat and came close to
enrichment, basic IT education and other declaring bankruptcy under his leadership,
training in an attempt to broaden the staff’s Flaig finally managed to successfully
skillset. Still the downward trend continued transform the business by applying agile
and local hotels began shutting down or leadership principles.
going up for sale. With no hope of support He exhibited humility by engaging and
from the bank, Flaig realized that radical listening to advice from digital marketing
change was required to avoid bankruptcy experts who knew more than he did and
“There needs to be an at the end of the 2016/2017 skiing season. who proposed radical solutions. His
everlasting radar, a high The cultural resistance to innovation of hyperawareness led him to appoint a
speed radar, where you local stakeholders was a major barrier to cutting-edge digital marketing consultant
constantly track the change. The local community had already because when the traditional routes to
situation.” struggled with the cost-cutting initiatives, attract new customers and cut costs
Alexander Dahm, such as partial closure of the slopes and failed, he knew sweeping changes would
VP Head of Space lift installations, which they feared would be needed.
Equipment Ops, Airbus deter even more skiers. A new business Throughout the entire process, Flaig
model would be a difficult sell. remained true to his vision of returning the
Flaig knew he could not save Saas-Fee resort to financial viability, and once he
alone. In early 2016 he mandated Swiss ski- was convinced what action was needed,
marketing consultancy Alturos to revitalize he exhibited fast execution by introducing
the resort’s appeal. In October 2016 a business model that had never before
the resort announced its “Hammerdeal” been applied to a Swiss ski resort. Through
initiative, an online campaign to sell ski his powers of engagement, he brought
“What do you define season passes for CHF 222 instead on board the culturally conservative local
as fast? For me, fast of the usual CHF 1,050. Inspired by stakeholders and convinced them to also
execution means, as crowdfunding models, the deal was initially become more adaptable.
soon as I come to a contingent upon reaching 99,999 signups Flaig channeled his passion to develop
conclusion, then I by November 27, 2016. A week before his vision. His willingness to seek help and
execute.” the deadline, 75,000 people had signed engage with Alturos and his belief in the
Emrah Göztürk, SVP, up and the company decided to go ahead new initiative were critical to the success
GEA Farm Technologies with the deal. By the time the deal closed, of the crowdfunding campaign.
they had over 100,000 clients, and in one
night approximately CHF 16 million was Digital disruption
charged to the subscribers’ credit cards. demands agile leaders
This represented almost a year’s worth of
revenue. The village immediately reaped Today’s volatile and unpredictable
the economic rewards as hotel bookings business landscape, shaped by digital
increased 45% for that winter. The cable car disruption, requires managers to adopt an
company’s mountain restaurants, the local agile leadership approach. Agile leaders
“I would say no data, shops and ski rental services also benefited. exhibit high levels of humility, adaptability,
no decisions. Informed At CHF 222, the season ski pass was vision and engagement. They also
decision making is incredibly cheap by any standard, but practice digital business agility through
becoming critical.” Saas-Fee figured that the long-term value hyperawareness, informed decision
Isabelle Perreault, of this initiative was in the customer data making and fast execution. Combining
Stratford Managers it acquired, such as name, e-mail address, must-have competencies with these agile
age and credit card information. With a behaviors ensures that agile leaders are
digital footprint of 100,000 visitors, Saas- significantly well equipped to deal with
Fee created a new channel to reach its today’s disruptive business environment.
Page 4 www.imd.org insights@IMD
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