Why Structural Change Can Only Work With Empathetic Leadership

At Porsche, digital innovations and technological progress are important drivers for the future of the company. Digital transformation is changing not only our cars, but all areas of our organization and the way we work. As change never succeeds alone, but only together, we asked experts outside of Porsche how they perceive the upcoming challenges and changes. Lunia Hara, Director Project Management at diconium, says empathy is crucial for the automotive industry because people develop products for people.

The automotive industry is crisis-tested. In recent years, digitization, technological and ecological developments have posed major challenges for all involved. Social and cultural changes also require rethinking at all levels. For example, we are eating more consciously and sustainably. We think about the impact of our behavior on the environment because we want our children and grandchildren to grow up in a livable world, too. We don’t want to exclude anyone but be inclusive and adapt our language.

What happens in the automotive sector — one of the most important industries in the world — has an impact on millions of employees. While structural change, which includes digitization, technological and environmental developments, is influenced and brought about by decisions from the boardroom, cultural change within the industry and each company are often left to its own devices.

Significant change is not possible without changing one’s attitude or mindset.

And this is not because the decision-makers do not have or set goals in this regard. In most cases, there is a vision and a goal for change. Nor is it just the sheer size of corporations that are holding up implementation. Rather, it is the people themselves who are challenged not only to let go of old structures and tried-and-tested practices but also to change personally and develop further. Keeping up with the times and learning new technologies and tools is one thing. But who takes care of the personal (value) development of the employees, so that they can withstand the demands of our time? This is part of the core of a cultural change and yet it is very much neglected. Significant change is not possible without changing one’s attitude or mindset. Here, much more is demanded of each individual and, above all, of managers.

One’s own attitude influences the following important leadership topics:

- How are mistakes handled across hierarchies? The higher up you are, the more far-reaching the consequences of an error. Nevertheless, how these errors are dealt with has an impact on the error culture in the company right down to the lowest level.

- Are leaders willing to give up power and not use the reach of their decisions? If gaining power was part of the career goal, then sharing power when the new culture requires it can become a problem.

- How do I shift the focus to look not only at my own career, but also at the potential of my employees? Only if the manager has a close connection to them, knows their personal goals and strengths, can they promote and use them.

For cultural change to succeed, leaders must be held accountable as a matter of priority to take a serious look at their attitudes. Self-awareness through self-reflection is an important pillar of empathic leadership. It is about recognizing one’s own strengths, weaknesses, and areas for development. If we are not aware of these, we can knowingly or unknowingly torpedo the change we want or are expected to support.

Those who are not prepared to make a personal development will only allow this cultural change to reach their office door. With the consequence that there is a gap to the change that is intended.

People develop products for people

What does this mean for the automotive industry? Organizations need to become more empathetic: not just managers, but all employees. People develop products for people. That’s why they have to know and be able to anticipate the needs of customers and users. Customers, dealers, service providers, and consumers, who have acted separately in the past, will have to move even closer together in the future to develop better services and products across the entire service life. In addition, forced by technologization, further players from outside the industry will be integrated into the development process, whose expertise will be needed. This exchange requires everyone to change because the boundaries between the individual participants are blurring, which poses an enormous challenge to communication. There is no “big versus small,” no “big player versus mini-player,” but a “we.” Empathy is required to master these interpersonal challenges.

All people in a company must support this change, from management to marketing, the legal department, production, and purchasing. The specialist departments alone cannot bring about a cultural change if the service departments around them do not adapt to the requirements of the specialist department. Empathy is the basis for trust across all corporate divisions and levels.

At the same time, this creates the conditions for creativity and innovation, which are becoming increasingly important, especially in the automotive industry, because people are increasingly demanding not only high-quality and modern solutions but also sustainable ones. However, trust also includes giving time and freedom for personal development, as well as for the development of innovations.

It’s not a matter of turning over every single stone and throwing everything that is tried and tested on the garbage heap. But those who don’t want to break away from old patterns and hierarchies have a particularly hard time.

Management must exemplify the cultural change

Empathy is not an additional challenge or task imposed in the course of structural and cultural change. Rather, it is a contribution to solving the problems that arise in the increasingly complex world of work. We are all endowed with good and sufficient empathy — but the system in which we find ourselves does not allow us to show it. Learned through education and socialization, this causes a fixed pattern of restraint. Therefore, it is important that leaders lead the way and open up. This requires the will and the ability for personal development of the company and the individual.

Of course, that doesn’t happen overnight. It demands a lot from each individual — especially on a personal level.

Culture change is a long and continuous process. But if we are honestly and sincerely willing to learn, listen and act empathically, then a very important step has already been taken.

Learn more about all facets of Porsche’s digital transformation and beyond in the other episodes of our guest article series. In the next guest article, Osman Dumbuya explains why the window to digital transformation is more open than ever. Recently, Wolfgang Gründer shared his view on an emerging mobility revolution and learnings from the history.

Lunia Hara, Director Project Management at diconium

About this publication: Where innovation meets tradition. There’s more to Porsche than sports cars — we are developing new digital products and services — always with our customers in focus. On our Medium blog, we tell these stories. It’s about our #nextvisions, emerging technologies, and the people that drive our digital journey. If you want to know more, follow us on Twitter, Instagram and LinkedIn.

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