Leadership At All Levels - Leading TMT Organisations Into The Digital Future

Foreword

Digital is revolutionising the technology, media and telecoms (TMT) sector, acting as a catalyst to change business models and putting increased focus on Leadership to guide organisations through the change. In developing this paper, Deloitte LLP and Spencer Stuart have combined perspectives from interviews with a number of leaders from TMT clients with their own expertise and experience of developing leadership at all levels in organisations.

This paper is the second in the 'Digital Leadership' series,which explores how TMT organisations can develop the agility to successfully navigate the digital transformation whilst developing the new skills and capabilities required for the digital economy. The first paper in the series, called 'New Shapes and Sizes', explores organisation design and can be downloaded at: www.deloitte.co.uk and www.spencerstuart.co.uk

Executive summary

"We don't need someone who just breaks eggs; we need someone with a ferocious intellect who can set out a clear and compelling vision and align people and their behaviours to it."

Rona Fairhead, Chief Executive Officer, Financial Times Group.

Digital has been a double-edged sword for Technology, Media and Telecoms (TMT) organisations. On the plus side it has created many new avenues for growth amongst a connected and technology-savvy consumer base. On the flip side, it has suddenly and drastically reduced the effectiveness of business models that have sustained the industry for decades. The recent downturn has added to the pressures resulting from these structural shifts by draining balance sheets of cash and organisations of the resources to effect change.

Never has the call for leadership been stronger. Now more than ever, organisations need leaders with the ability to galvanise a group of people to work together on tough problems, many of which have no known solution. We define leadership as a set of actions or activities, rather than as a position or the unique character of a visionary. As such, we argue that leadership is needed across TMT organisations as they tackle the multifaceted challenges of the digital transformation; leadership is needed at all levels.

Traditional players need to overcome significant cultural barriers as they look to change working practices that have thrived for many years. Leadership is about helping people to transition past these existing ways of working and seeing the world, it is about adapting organisations for the new environment they are facing.

TMT leaders have been, and continue to be, challenged to demonstrate a set of skills and insights that are new to almost all of the current leaders across the industry. They need to navigate their organisations through incomparably tough market conditions whilst also repositioning and transforming them.

"You can put all the checks, balances and controls in place but unless you change the culture it will be meaningless. Unless there is real leadership that stands up and talks about digital, that lauds it, that boycotts award ceremonies unless they have online awards, that sponsors online awards, it won't become a digital culture."

Malcolm Wall, former Chief Executive for Content, Virgin Media.

Many leaders are still struggling to make complex choices about the future of their business, to articulate a convincing narrative of what digital means for them. TMT organisations need to develop leadership at all levels so that the right people can take key decisions around business model and product innovation. Traditional organisations need to develop agility to manage the transition to a new market place which is defined by consumers whose consumption habits and demands are ever-changing.

"I've been in this business 12 years and for the first 8 years we were ahead of our customers, delivering multi-channel, PVRs, high def, etc. As an industry we are now behind our customers' expectations and demands – devices have changed everything."

Mike Darcey, Chief Operating Officer, BSkyB.

This is the central challenge for chief executives and their management teams. What mix of approaches will enable them to successfully navigate the road out of recession and to transform their organisations to keep pace with their consumers? This is a question that can only be answered by the executive team. We believe that it can be broken into three broad topics:

  1. Reshaping organisations, rather than uniform cost reduction approaches or the closing down of legacy businesses.1

  2. Increasing innovation (both product and business model), at all levels of the organisation.2

  3. Building leadership at all levels – the subject of this paper.

    The UK TMT industry demonstrates enduring strengths in creativity, quality, and dynamism. The UK creative sector consistently punches above its weight in the international market. A third of all television format sales around the world are created in British Production companies. The sector is a major part of the domestic economy contributing 6.4% of GVA. Furthermore it continues to be a leading export success for the UK. In order to maintain this position, senior leaders will need to demonstrate leadership in four dimensions – developing the insights necessary for successful change within complex systems, building the cognitive skills to manage effectively in demanding environments, and encouraging the emotional intelligence to motivate their people.

    By bringing these three dimensions together...

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