Managing the Human Side of Digital Disruption

Leaders really can minimize the pain of transitions while maximizing worker engagement

By Paula Klein

Worker resignations. Digital disruption. Change at hyper-speed. These are some of the realities organizations and their leaders face every day as they also confront the overarching challenges of the pandemic, global politics, and climate change.

It may surprise some leaders that more emphasis on humans, not just new technology, can actually reduce the pain.

At a recent MIT IDE seminar, Hal Gregersen, MIT Senior Lecturer in Leadership and Innovation, said that not only is “the human side of digital disruption” relevant, it’s a critical success factor in an age of exponential transformation and transitions.

So-called soft skills — like interpersonal communications and empathy — have had a rocky relationship with businesses over the years. These leadership traits were either ignored or downplayed with programs that lacked teeth or meaningful support.

In the current environment of digital and social upheaval, however, efficiency-focused, status quo leadership tactics may be a business liability.

“We know we have to more effectively manage and navigate the human side of business” in order to push forward and flourish, Gregersen said.

After decades studying some the largest and most innovative companies in the world –including work with Clayton Christensen, and research on the innovation skills of MIT Sloan alumni — Gregersen concluded that, “challenge-driven, problem-led leaders” are the gold standard: they are resilient and able to withstand disruption because they engage directly with employees. These traits let them seek out and creatively solve challenges at every level of an organization.

Gregersen cited executives at Pfizer, Unilever, Dell, Salesforce, AMD, and others as outstanding because they faced huge challenges, such as COVID-19 and digital disruption, in collaboration with employees. Case in point: Nicole (Nicky) Sparshott, was named CEO at Unilever Australia/New Zealand five days before the March 2020 national shutdown, Gregersen said. As someone new in the position and used to an action-oriented leadership style, Sparshott was uncertain of how to take charge amid the turmoil. But Sparshott quickly sought advice, listened to employees on Zoom calls, shared her own experiences, and created teams to work well remotely. She got to know her people and their most significant concerns from the outset, and used that opportunity to tackle problems longer term.

A Framework for Change

Gregersen offers a framework for navigating and leading transitions. The idea is to help leaders and their workers let go of former roles while taking on new ones — whether they’re in the midst of a crisis or not. For most executives — especially those in high tech — paying systematic attention to the human side of digitally driven change is not intuitive, Gregersen said. That’s why he’s launching an executive education course at MIT this spring, Managing the Human Side of Digital Disruption (mit.edu), where executives can develop the capacity to lead transitions in professional and personal contexts.

The transition-curve framework, which charts how people adjust their roles, shift capabilities, and manage psychological responses to change, “recognizes the human element of transitions, particularly as they play out in organizations undergoing extensive digital transformations. We ask: What will workers gain as they give up former roles, tasks, and responsibilities? How can they be motivated to seek out these changes instead of fearfully avoiding them?” (See figure 1).

Figure 1: The three core elements of business and personal transitions are adjusting roles, shifting capabilities, and managing the emotional energy of individuals and teams in an organization. Each element is dynamically changing, and the interplay must be managed well to make progress.

While the pandemic requires urgent, immediate attention, Gregersen believes that the most successful organizations under pressure were predisposed, or already had in place, a challenge-driven culture.

In these organizations, everyone tries to figure out the next problem to solve and has the autonomy and competence to do something productive about it.

Before the pandemic, for instance, studies by LinkedIn and the World Economic Forum found that creativity and technical acumen were the most crucial skills needed for the future. Leading-edge companies, like Salesforce, had already prioritized innovation as a core cultural value and practice across the organization, Gregersen said. When a crisis hit, it had an easier time pivoting and helping employees cope with disruption. At Dell, executives like Jen Felch, Chief Digital Officer and CIO, spoke honestly with employees about the company’s transition away from mainframes and how to upskill and retrain the workforce to meet new requirements.

Forward Thinking

Not every manager has a passion for “hard, edgy problems” and may not rise to the occasion. Most are taught to maintain the status quo; to act quickly, take on additional tasks, and rely on convenient, well-honed capabilities. These things matter, Gregersen said, “but you also need to step back and look at the broader context. What’s coming? What do we need to learn? How do we manage the emotional energy [of the firm] and use it to an advantage?”

It’s a cliché based on some truth that leaders with tech backgrounds often have the most difficult time with interpersonal skills. One tech CEO, for example, wasn’t prepared to engage with colleagues on a personal level — asking about families, interests, and non-work related topics — but she soon learned the importance of those capabilities and incorporated them into her role. This “affect-centered approach,” as Gregersen calls it, proved crucial in the midst of an upcoming turnaround taking place across the organization.

Gregersen also offered diagnostic tools and methods to help executives identify and solve problems. One of the tools he shared from his book, Questions are the Answer: A Breakthrough Approach to Your Most Vexing Problems at Work and in Life, was the Question Burst methodology. It’s built on the assumption that when stuck or moving backward during a transition, we’re likely asking the wrong questions. By changing the questions, the direction can change as well, according to Gregersen.

He described the question burst process as a deceptively simple strategy where individuals or teams take two-to-four minutes to generate as many questions as possible about a challenge. They strictly follow two rules in the process: No answers to any questions, and no explanations about why they’re asking the questions. Based on data from tens of thousands of leaders across the world, Gregersen found that 85% of those who leverage this questioning method to reframe their challenge gain positive emotional energy, and acquire at least one new idea to move the challenge forward.

Creating Safe Spaces

Will techniques like these be enough to reverse the trend of discontented workers and ‘toxic workplaces?’ Gregersen said it’s an important first step. He cites what Amy Edmondson, author and Professor at Harvard Business School, describes as a psychologically safe, and ultimately “fearless, organization,” as the goal.

Gregersen understands that businesses need to “create safe spaces to acknowledge what [workers] are feeling… (because) arguably, at least half of all organizations aren’t psychologically safe.”

If leaders are focused on squeezing out efficiencies, not paying people well, and not listening to workers, they’re creating toxic environments that elevate existing problems and make transitions more difficult. But if they can point to the benefits of innovation, offer new problem solving skills, and encourage creativity, everyone can become less fearful and more receptive to the inevitable changes taking place.

Gregersen has discovered that engaging others in a question burst process actually builds more psychological safety and lessens fear. Conversely, when strong psychological safety is in place, individuals and teams are more willing to ask fearless, progress-making questions. In short, these are self-reinforcing dynamics. Based on companies that he’s worked with, such as Chanel and Fidelity Investments, people who learn how to ask better questions and safeguard psychological safety can navigate transitions more effectively; they’re more likely to acquire new skills, gain fresh ideas, and adopt a more positive outlook about their challenges.

“Most managers know what change is. They know skills have to change; but only about 20% think about how roles are shifting, capabilities are changing, and how the emotional impact of digital transformation is evolving.”

It may seem obvious, he said, but it takes time to systematically attend to all three levels of change and to alter very basic behaviors. When leaders do take this tripartite approach, however, that’s when success really sets in.

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Watch the MIT IDE seminar here.

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MIT IDE Paula Klein, Editor

MIT IDE Paula Klein, Editor

Addressing one of the most critical issues of our time: the impact of digital technology on businesses, the economy, and society.