Digital leaders & the future of performance management: An interview with Ursula Vranken

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“The pathway to the goal starts on the day you take one hundred percent accountability for your actions." This quote of quote of Dante appeals to Ursula Vranken, CEO of IPA Consulting, in particular. She emphasizes that especially for organizations nowadays it is about strengthening personal responsibility and moving from talking to action.

Ursula herself is a woman of action and founded the Cologne-based consulting firm IPA Institute for human resource development and organization of work over 20 years ago. With her team, she advises national and international enterprises with respect to leadership and organizational development. On her page she blogs about topics revolving around digital leadership and new work.

Three years ago you founded the Digital Leadership Summit , what was the reason?

Many leaders first think of Bits & Bytes, when they hear about digital transformation. But that is too short-sighted. The successful coping with digital transformation depends first and foremost on motivated employees and good leadership. Digital change needs digital leaders, which bring together technology and people in a meaningful way. That for instance, we also discuss at the Digital Leadership Summit.

What are the most important trends and challenges of Digital Leadership & People Management for employees and leaders?

It is about a new understanding of leading and working. Ands about communication on equal terms amongst all participants. The digitalization on the one hand changes many business models and processes radically. But on the other hand we also see that Gen Y & Z have completely different ideas of working, leading and work life balance compared to their predecessors. In general employees want - and that is across generations - to be more involved and have a say. We have to better listen to employees and take their ideas and arguments seriously and thereby create a new culture of collaboration. Good people management becomes a key challenge for leaders this way.

“Digital leaders will have to orchestrate networks and not just preach but master the entire digital gamut.”

What should digital leaders be capable of?

Leaders are demanded as coaches and people manager. That means they have to more heavily delegate tasks, and also the decision making processes coming along with them, to self-organizing teams. This requires trust, but also the ability to support employees in the right situations. In the best case, leaders also develop talents.

In general we talk about the so-called ambidexterity of leadership. So, leaders must on the one hand keep track of efficiency and costs but at the same time promote creativity and innovation. Therefore they have to be very close to the teams and abdicate hierarchical command & control attitudes. The added value created by leaders will in the future be measured by their ability to develop teams and promote communication among each other.

Digital leaders will thus be demanded as role models. They will have to orchestrate networks and not just preach but master the entire digital gamut.

What do employees expect from their bosses and their organizations today?

Employees nowadays know that there will be no life-long employment for them anymore. Many also don't want this. Instead they expect a meaningful job and want to contribute and create a real value.

Employers thus need a strategic talent management. Because especially young people will not wait ten years to make a career. Companies therefore have to make attractive offers. To that belongs, next to a competitive pay, a good team, a pleasant working environment with creative freedoms and options for personal development.

“In practice, many firms forego digital education and development though. Not really forward-looking.“

What do organizations expect from employees?

Also employees have to make their contribution to an organization that increasingly builds upon self-organization and showing initiative. More concretely, this means taking responsibility to make balanced decisions and that employees think beyond their field of responsibility within the meaning of customer orientation. And in general, also employees have to keep themselves up to date and develop themselves continuously.

Are the leaders of today and the HR prepared for this?

To be honest, I still see a lot of potential there. That training, exercise, time and investments are necessary for mastering the above-mentioned demands is self-explanatory. In practice, many firms forego digital education and development though and hope it also works out without. Not really forward-looking.

But when and where do digital leaders learn the necessary leadership skills?

Often not at all. They have to take over leadership responsibility without proper preparation and have to “just do” leadership of a team then. Not everyone is a natural talent and frustration at all fronts emerges rapidly. Also in agile working worlds, where there is less hierarchy.

Especially young leaders often complain: „I am lacking the necessary skill set. I´ve read many books and also want to involve everybody in the team, but the discussions are painfully long and motivation not good.“

Seasoned leaders on the other hand often lack the digital skill set. And they have to learn to let go, allow true participation and operate within networks. That is why we from IPA developed dedicated coaching offers for digital leaders that take into account those different concerns.

How do we have to adapt performance management to the tasks of a digital world?

Many performance management systems of today are outdated, bureaucratic and do not foster employees´ motivation. On the contrary. Oftentimes lengthy discussion rounds and haggling over points and bonus payments frustrate all parties involved.

Nobody finds the backwards directed perspectives and cases from half a year ago really interesting. The original idea, that it is about common goals and challenges of a group or department, is often overlooked or forgotten.

“Because it holds: fail fast - succeed faster.”

What has to change in performance management?

We need a radical change of mindset and the shut down of old systems that build upon meticulously evaluation scales and complicated individual bonuses.

From the psychology of learning we know that feedback works best, if used directly and immediately. Yearly or mid yearly performance reviews, in my opinion, do not sufficiently account for this principle.

We need frequent and short feedback rounds that are carried out through communication on equal terms and have the spirit of true esteem.

Especially the work in agile teams is based on intensive communication and cooperation. Feedback from peers, employees, freelancers or customers becomes an indispensable source of knowledge. If you want to learn quickly you need qualified feedback to discover and resolve errors and issues in the system prematurely. And that is exactly why feedback instruments like peer-to-peer, 360 degree feedback or OKRs belong in the toolbox of modern organizations. Because it holds: fail fast - succeed faster.