Relearning Leadership in the Second Machine Age

Here’s the deal...Cognizant’s Center for the Future of Work believes a new machine for work is emerging, set around data, algorithms, platforms, robots, sensors and connected things. It’s going to unleash waves of economic value for years to come for those companies that build and organize the work people do around them. Moreover, these machines don’t just belong to the usual suspects (Amazon or Google et al); now established companies are working their big company advantages and building these new machines for work (GE, Bosch, DHL...the list goes on). This is a profound shift in the world of work and radically changes how people work together to create value. If you’ve read the Center for the Future of Work’s previous work on the Future of Talent we provide a prescription for the workforce, talent and the organization of the future. Our latest report deals with the hard part: Relearning Leadership in the Second Machine Age.

The current generation of leaders are finding themselves stuck (see my previous post). Stuck with a legacy business model, stuck with excessive cost structures and stuck with a workforce unable or unprepared to deal with the blistering pace of change from the “always on”, data centric age. And our work with many of the top brands worldwide – insights amplified from our recent Work Ahead research series – confirms we are smack bang right in the center of a major economic shift. Business value increasingly accrues at the intersection of the physical and the virtual worlds; at the crosshairs between automation, artificial intelligence and business model innovation. As our economies shift and it becomes clearer how technologies create value and augment work, leaders face huge challenges. Their number one job is to prime their organization for value now and in the future; to leave the organization in a better place than when they found it. But how?

Notions of leadership are getting a lot of attention in business schools, boardrooms and the media right now. Business leaders often talk about being flexible, agile and collaborative among all levels of the organization, and about adopting more connected styles of leadership that move away from rigid, traditional command-and-control structures that can stifle innovation and flexibility. Yet, all too often, they struggle with the reality of such change; many are in fact caught in limbo because it’s all too easy to underestimate culture and the institutional inertia at play. Cultures that have grown up over decades can be large, unwieldy and complex – even, at times, paranoid and complacent (we call them zombie organizations in our new report and they must be fought at every turn). The challenge for leaders is to paint the best picture they can of the future: how employees will work, where they will work, what skills will be needed and how their firms will capture value today and tomorrow. Of course, we think there is more to leadership than vision but it travels a long way. This is why we decided to investigate.

Cognizant’s Center for the Future of Work together with the help of Oxford Economics, investigated leadership at the beginning of 2017. Our ideas laid out in last year’s Future of Talent report, made a strong call on leadership and why it matters. We said a leader needed to take a much more activist approach to leading their people through these exciting, thrilling and frankly, scary times. When there is so much opportunity to play for and so much risk for ignoring it, we felt that leadership behaviors and mores forged in the 20th century needed updating for the 21st. Greater accuracy and context is needed in choosing fewer, bigger, long-term strategic bets to focus the workforce and the energy the organization burns on innovation. Conversely, leaders are challenged to be more flexible when predictions are uncertain. Now, after our investigations into leadership, we think successful leaders today and those from tomorrow must build their mandates around three clear roles.

  • Accelerate the shift to software and adopt a platform mindset. Economic value increasingly flows through data—as it does, the concept of the platform as layers of software that gather and synthesize data to link assets, products and partners together with customer demand are critical. These platforms can take many forms – like a car, a home or even a process. Build one, buy one or join one but driving platform style behaviors into a culture needs strong visionary leadership underpinned by mechanisms that share data, collaborate and integrate work practices.
  • Hyper scale innovation now, tomorrow and always. Compared with more nimble and collaboration-orientated competitors, the metabolism for boosting ideas and innovations must increase for the traditional company to survive. Power and decision-making dynamics found in many companies today simply won’t work in an era that demands speed, agility and innovation. The time has come to disrupt the status quo with a bold reorganization that creates flatter, open and more dynamic team structures and rewires power to improve co-ordination and speed. Tools that help stakeholders align, iterate and innovate are critical.
  • Extend customer value by understanding people. It might sound counterintuitive but technology that helps to understand the customer isn’t enough in today’s digital era: Tools that can uncover the growing empathy with their issues are now hypercritical to informing effective decision makers. Leaders need to pivot their companies around the voice of the customer, using data together with human insights to reveal heightened sensitivity to customer needs, wants and desires. New skills are needed to visualize and explain what a customer sees or narrate what the rich streams of product data mean for a business.

So there you have it: Switch into software and pivot on platforms, accelerate innovation and nail human insight into customer experiences. These are the new roles leaders have to play but there are other challenges they need to get to grips with, from how and where people now like to work, how to lead inter-generational teams and how to enhance and shape a culture without doing the unthinkable and breaking it. The upshot for leaders is to carefully calibrate the speed of change based on a cultural understanding. It might sound light and fluffy but if you tackle the transition too fast, then leaders risk breaking the company and its culture; taking the shift too slow and the organization risks being left behind as customer expectations shift or a competitive threat blindsides. What’s clear is the new machine and what it enables—new business models, new revenue flows, and radical new cost structures—is redrawing industry structures, the talent companies need and the leadership that puts them to work. It’s time to get deadly serious about how your organization’s most important asset—its people—are led. Please read our new report Relearning Leadership in the Second Machine Age.