With the growing awareness of digital transformation in Asia Pacific, there is a need to focus on the factors that influence effective digital leadership. The latest trends and directions of digital transformation are in the fields of Artificial Intelligence (AI) and Machine Learning (ML), Internet of Things (IoT), Analytics and Augmented Reality (AR). The role of leadership is crucial throughout the digital transformation journey of an organization (Larjovuori et al., 2018).
There are also very few studies that describe the effect of digital transformation on management (Cortellazzo et al., 2019).
Organisational Focus Areas for Exploration
Therefore, we hypothesize that organizational strategic priorities, as highlighted above, are positively associated with effective leadership for digital enterprises. Collaborating and engaging with business stakeholders early in the process builds innovation and creates value from procurement. Giving employees the opportunity to generate their own ideas and propose where digitization/digital technologies can and should be applied in the company.
Establishing practices that enable employees to work in new ways, play a key role in amplifying change and keeping pace with the fast-paced business world. Enable and empower employees to thrive in a digital environment by providing them with the tools and capabilities to implement new initiatives. Therefore, we hypothesize that organizational focus areas, as highlighted above, are positively associated with effective leadership for digital enterprises.
Furthermore, we also theorize that strategic priorities are positively related to areas of organizational focus for exploration. The conflict between exploitation and exploration can be addressed by adopting a portfolio approach and setting strategic priorities. Therefore, we hypothesize that strategic priorities are positively related to areas of organizational focus for exploration for digital enterprises.
Digital Governance Practices for Exploitation
For this study, the digital management practices for exploitation shown in Table 4 were important to achieve successful digital transformation. Must ensure security around organizational data assets and personal privacy, to protect them all from theft or external attacks. Ethical data handling • Recognizing risks of unethical data practices and illegal use of insights and mitigating these threats is critical to a digital enterprise.
Determine how the Corporate brand is represented in social media such as Facebook, Twitter or YouTube or in Expose employees to different ways of thinking and engaging, foster employee collaboration and allow them to embrace the digital culture. Therefore, we hypothesize that exploitative digital management practices, as highlighted above, are positively associated with effective leadership for digital enterprises.
4 Research Method, Data, and Analysis
- Survey Instrument
- Sampling Process and Data collection
- Data Analysis
- Reliability
- Validity Convergent Validity
- Structured Equation Modelling / Path Analysis
- Hypothesis Testing
In the first stage, reliability and three types of validity study; content validity, convergent validity and discriminant validity, were performed to assess the robustness of the measurement model. Jöreskog's rho evaluates composite reliability to appreciate model integrity and homogeneity (Werts, 1978). This confirms the statistical significance of the model and shows strong evidence of internal consistency reliability (Hair, Hult, Ringle, & Sarstedt, 2016).
As recommended by Fornell and Larcker (1981), the discriminant validity of the independent variables was examined by finding the square root of the AVE. The square root measures of AVE seen on the diagonal of Table 7 are all greater than the inter-construct correlations, thus confirming discriminant validity (Sarstedt, Wilczynski, & Melewar, 2013). Path modeling is a special case of structural equation modeling (SEM), in which single indicators are used in the model for each variable and the strength of each path is calculated as the product of the path coefficient along that path.
Correlation is the equation of the sum of the contributions of all the paths through which the variables are related. The strength of each path is calculated as the product of the path coefficient along that path. In our research, the analysis results in Figure 2 show that the model with an R2 value of 0.590 was acceptable and all 5 hypotheses were supported (Hooper, Coughlan, & Mullen, 2008).
5 Discussion
Summary of Findings
Various past studies examining leadership traits and qualities suggest that digital leaders must be able to pursue a clear and meaningful digital vision, inspire employees, and have the ability to execute strategies to actualize the digitization process of enterprise (Swift & Lange, 2018; Larjovuori et al., 2018). The leadership competencies that organizations must develop in their leaders include digital vision, digital knowledge, empowerment and managing diverse teams (Imran et al., 2020). Leaders would also be open to new opportunities, new markets, new customers and new innovations by taking risks (Larjovuori et al., 2018).
Another study mentioned the need for managers to collaborate and build partnerships with key stakeholders for new digital business opportunities (Larjovuori et al., 2018). Based on previous studies, managers are expected to seek high-level priorities for the organization and create new business models and adapt to changing business trends (Tardieu et al., 2020; Popadiuk et al., 2018). To sustain and compete in the dynamic competitive environment, managers will need to reassess strategies, competitive strengths and review assets that provide potential competitive advantages (Tardieu et al., 2020; Hyek & Nendick, 2014).
In addition, managers must make deliberate decisions about the use of technologies for innovation in the company (Donahue, 2020; Popadiuk et al., 2018). This is consistent with previous similar studies that stated that an effective digital leader to compete in a rapidly changing digital environment will need to focus on diversifying the organization's business model by establishing strategic partnerships (Della Corte et al., 2019; Fenwick & Schadler). . , 2018). In order for employees to adopt a digital culture, managers must engage and create opportunities for employees to participate in the digitalization change process (Larjovuori et al., 2018; Kane et al., 2017).
Benefits of Effective Leadership
This is in line with relevant findings (Wrede, Velamuri, . & Dauth, 2020) that state that strategic prioritization affects focus areas for exploration as the overall corporate strategy has digitalization integrated and there is clear communication about digitalization goals. Another study stated the need for executives to be aware of the growing cybersecurity risks and unethical data practices and implement security controls to ensure privacy and compliance with data protection laws and practices (Butler & O' Brien, 2019; Bongiorno et al., 2018, Accenture, 2016). Moreover, with the widespread use of social media, managers must constantly pay attention to the organization's online reputation (Steele, Allen, & Watkins, 2019).
Zhang et al., 2011) study states that transformational leadership improves team coordination, resulting in high team performance. (Morales et al., 2012) study suggests that transformational leadership through organizational learning and innovation is necessary to improve organizational performance in the current changing business environment. Chen et al., 2012) further states that transformational leadership plays an important role in driving innovation and is effective at the strategic business unit (SBU) level.
From the research results, it shows that the transformational leadership style is more suitable to be adopted by digital leaders of companies, as factors such as having a digital vision, fostering innovation, agility, natural collaborator, building digital talent are consistent with transformational leadership theory (Bass & Riggio, 2006). Holistically, the results highlight the importance of the considered factors and validate the implications of effective leadership for digital transformation. Therefore, these factors must be taken into account by the business leaders of organizations that have embarked on the digital transformation journey in order to remain competitive in the digital economy.
6 Implications
Implications for Research
This implies that clear digital vision, greater focus on innovation and growth and skill in aligning business and IT strategy (Heneghan, Snyder, & Symons, 2017) have the strongest impact on effective leadership, along with the talent to execute digital lead and deliver. strategy (Tong, 2017) with a path coefficient of approximately 0.8. Aggressive investment in agile and disruptive technologies, building on stable and secure infrastructure and building strategic partnerships have a moderate effect on effective leadership. This includes connecting the follower's sense of identity to the mission;. inspire them; challenge followers to take greater responsibility and understand their strengths and weaknesses in order to assign responsibilities accordingly.
However, future research can be conducted that incorporates additional factors to improve the accuracy and dynamics of the proposed model. The model in this study (Figure 2) can be used to guide future research into understanding the antecedents of effective corporate leadership. Finally, the study results can be further validated with other regions by examining leadership characteristics, strategic priorities, and organizational and digital governance practices.
Implications for Practice
There is a need for governments to introduce and update cybersecurity regulations and policies and promote digital governance practices, especially across small and medium-sized businesses.
7 Limitations of the Study and Future Scope
8 Conclusion
Acknowledgements
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Appendix
Top managers in the digital age: Exploring the role and practices of senior managers in the digital transformation of firms.
