“Stressful” disruption offers UK business leaders the chance to grow

March 19, 2018
Global
If you can handle the pressure, UK executives say, digital disruption provides opportunities to spread your wings.

The UK is one of Western Europe’s most digital societies. According to the Ecommerce Foundation, the UK e-commerce market is bigger than those of Germany and France combined [1]. And the UK leads the world in the provision of government services online, according to a UN study [2].

Perhaps for this reason, British companies have been less shaken by digital disruption in the past three years than those in France and Germany, according to a new survey by The Economist Intelligence Unit. UK executives included in the survey are less likely to say their organisations have been subject to “significant” or “extreme” disruption in the past three years (53%) compared with their peers in France (56%) or Germany (60%), and they are less likely to expect such disruption in the next three.

Indeed, UK firms are more likely to see disruption’s impact as a positive one: more than half (53%) agree that it has given their company a competitive advantage (see chart one).

This suggests that UK companies are more experienced at managing the changes wrought by digital technology, and that the experience of UK executives may therefore provide an indication of what is in store for other European business leaders.

If that’s the case, it may be a stressful road ahead. When asked what leadership skills will become more important in future as a result of digital disruption, threequarters of UK executives say “managing pressure and stress”—more than in any other country included in the study. This confirms that the organisational impact of disruption has an emotional impact too.

Of course, any change can be stressful—especially if it affects one’s livelihood or those of one’s employees. Just under two-thirds (64%) of UK respondents say digital disruption has removed the need for some roles that previously existed in their organisation—more than among peers in France, Germany and the Netherlands.

But it may be that digital disruption, in particular, requires a degree of personal self-mastery that business leaders may not have developed to date.

People skills

The proliferation of digital technology in business is blurring the dividing lines between the corporate functions, as digital projects require contributions from all functions, working in close collaboration.

Tesco’s Pay+ digital wallet app is a case in point. Developing the app, which allows customers to pay for goods and collect points in the company Clubcard loyalty scheme, is an exercise in cross-functional collaboration.

Mark Loch, who leads Tesco’s digital wallet and group payments strategy, reports to the head of Tesco Bank, the group’s financial services arm, but the product is aimed at Clubcard members. Mr Loch’s team is therefore split between locations: the innovation office sits in London working on product design and customer needs, while the app’s development team sits at the bank’s headquarters in Edinburgh.

“I sit within Tesco Bank but very much cut across both parts of the business. One of the strengths of the wallet is bringing different parts of the group together. The integration element is a highly important factor,” explains Mr Loch.

That integration has required co-operation with, and understanding of, a wide range of other functions. Mr Loch and his team work closely with the group’s customer service centre, marketing and communications, physical and online store operations, the Clubcard loyalty programme and their banking colleagues.

“Customers see the Tesco brand as one business. We need to bring the best of the constituents together,” he says.

Amid digital disruption, then, executives must lead initiatives that straddle functional divisions, and develop knowledge and skills that may once have been associated with other roles. Seven out of ten British respondents say their role is merging with those of leaders in other functions due to digital disruption.

The leadership skills that UK respondents believe to be growing in importance amid this shift suggest that it will test their ability to inspire employees as much as any technical capability. The ability to motivate staff (78%) and empathy (76%), for example, outrank even innovation (75%) and change management (74%).

Mr Loch’s department leads product development, co-opting in colleagues as required. He and his team have worked hard on learning what other divisions can bring to the app—and what it can offer back to them. Empathy and communication skills come to the fore.

“We’ve had a good level of buy-in from the rest of the organisation by doing it right, from the outset. Even in the early days, getting innovation through a business is challenging enough itself,” he admits.

New opportunities

UK respondents are relatively confident in the strength of these newly important skills: 26% are very confident in their empathy, for example, and 30% say the same of their ability to motivate staff, in both cases a higher proportion than among their French, German or Dutch equivalents.

This may reflect the support they get from their employers: despite the fact that 81% of UK respondents agree that the blurring of departmental boundaries makes it harder to plan their professional progression, 85% say their current role provides them with the opportunities to develop the skills required by digital disruption.

This optimism is balanced by some doubt: 39% of UK executives surveyed say they are “concerned” about the impact of digital technology and automation on their career prospects.

But this does not prevent them from seeing the opportunities that arise from disruption, and UK respondents are the most likely to see it as an opportunity to spread their wings. Nearly two-thirds (64%) say interacting with other departments has made them more aware of where their next roles may take them.

Just as many agree that business leaders can no longer expect to have a successful career with experience in just one department, and 74% believe it is likely that they might take a leadership position in another function of their company in the next three years (see chart two).

When it comes to managing one’s career development, the experience of UK executives shows that digital disruption can be stressful, but can also present ample opportunities for growth.

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Footnotes:

 

Pete Swabey
Editor

Pete is the editorial director at The Economist Intelligence Unit's thought leadership division in EMEA; he is also global lead for the tech sector. He specialises in technology and has managed research projects on topics including digital transformation, the hyperconnected economy, the future of work and the evolution of marketing. He has presented this research at a range of conferences and has moderated discussions at a number of The Economist Group's own events.

Before joining The Economist Group in October 2013, Pete was editor of enterprise IT magazine and website Information Age and head of technology research for business-to-business publisher Vitesse Media. He holds a BSc in Experimental Psychology from University College London.

 
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