The Role of Leadership in a Digitalized World

The studies on digitalization and leadership that adopt a macro-perspective of analysis can be classified in four different categories, according to whether they focus on: (1) The relationship between e-leaders and organizations; (2) How leaders adopt technology to solve complex organizational problems; (3) The impact of digital technologies on ethical leadership; or (4) The leader's use of digital technologies to influence social movements.

The Relationship Between E-Leaders and Organizations

The studies within our sample that take a macro or organizational-level approach are considerably less than those which investigate the micro dynamics occurring within organizations. A summary is shown in Table 2. This imbalance is probably due to the relatively greater urgency and challenge to understand the role of leaders and leadership in guiding and implementing the digitalization process within organizations, rather than what new forms of organizations are emerging as a result of the digital transformation. As observed by a recent Harvard Business Review Analytic Services report, leaders have increasingly become the key players in driving positive results from the investments on digital tools and technologies.

In the last few years, scholars have begun to adopt the construct of e-leader in order to specifically refer to those leaders who have initiated a massive process of digitalization in their organizations. Despite the call to understand how organizations and e-leaders are intertwined, few studies provide an empirical explanation of the new organizational configurations emerging from the interaction between technology and the human/social system. Berman and Korsten are one among the few. By surveying a large sample of CEOs, running companies of different sizes and across 64 countries and 18 industries, the authors showed that outperforming organizations had leaders that created open, connected and highly collaborative organizational cultures. The authors suggest future leaders should base their organizations on three pillars: (1) Assuring a highly connected and open working environment at any hierarchical levels and units in organizations; (2) Engaging customers by gathering knowledge about the whole person; and (3) Establishing more integrated and networked relationships with partners and competitors. They posit these three pillars transform the organizations at all levels. This implies organizations are becoming boundaryless, at both the internal and external levels. Further, the organizational structure is no longer a static feature, but an ongoing process. While a shift toward an ecological perspective ­– one where organizations' boundaries are loose and permeable ­– requires higher coordination, collaboration and individual responsibility, it also enhances innovative capabilities. According to Kodama, managers at any level can foster innovation if they go beyond the formal organization, to create real or virtual networks among internal and/or external communities of practice. These communities of practice enable a more agile response to change, promoting the free-flow of information and breaking down information silos, thereby empowering both managers and employees to integrate, transform and stimulate knowledge that fosters innovation. This way, information and communication technology enables the creation of shared information pools wherein diverse staff across the organization contribute to a collaborative and dynamic process of idea generation. Moreover, such co-generation of ideas and knowledge cultivates stronger relationships between disparate organizational units, further facilitating open innovation processes.

In sum, by breaking the organizational boundaries within and between internal and external stakeholders, the traditional leader-centered information and decision-making process is giving way to novel processes that democratize access to information and share decision power among all parties involved.

Digital Tools and Organizations: How Technology Enhances the Optimization of Complex Organizational Environments

Although most papers adopting a macro perspective reflect on the novel structures of organizations, they tend to underestimate the effect of digital transformation on organizational processes. That is, however, not the case with Weiner, who discusses how the effective achievement of operational goals relies on the fit between strategic planning and information technology, particularly in operationally complex organizations, such as hospitals. Their empirical study shows that digital tools could highly contribute in the planning and monitoring of internal processes, increasing the transparency and accountability across all levels of management, and engaging customers' trust. For instance, the intelligent use of data through sophisticated digital tools, allowed hospitals administrators to lead improvements in decision-making processes and service quality by enhancing the usage of traditional management tools, such as key performance indicators (KPIs), and storage of critical data, namely on infections and diseases. Notably, this study offers empirical evidence on the need to adopt digital technology to develop efficient internal organizational processes and guarantee high quality service to customers. In another empirical study conducted in a hospital, the authors confirmed that the use of digital tools helped leaders solve complex issues related to personnel and operational costs. Similarly to the previous study aforementioned, data were used to re-design the entire organization with the aim of optimizing the efficiency in the use of both facilities and processes.

Leaders are responsible for verifying the suitability of technological tools being adopted or implemented in relation to the organizational needs and objectives. Moreover, while we acknowledge that digital technologies hold the potential for improving the efficiency of organizational processes, we contend that they need to be internalized and integrated within employees' routine tasks in order for organizations to minimize attritions from their adoption and fully capture its benefits.

Organizations and Ethics

Ethics in leadership roles has been an issue of concern to scholars especially since the emergence of the transformational leadership paradigm. In general, ethical leadership is defined as "the demonstration of normatively appropriate conduct through personal actions and interpersonal relationships, and the promotion of such conduct to followers through two-way communication, reinforcement, and decision-making". With the advent of digital transformation and the massive use of data, scholars have begun to call into question the integrity of leaders. Indeed, the use of data and technologies exposes leaders to new dilemmas, which nature is intertwined with ethical concerns. For instance, the use of sensitive data is driving leaders' increased concerns about privacy protection and controlling mechanisms in the workplace. Electronic surveillance (ES) is a way to collect data about employees and their behavior, so as to improve productivity and monitor behaviors in the workplace. ES rules vary across countries and cultures. For instance, the US Supreme Court of Justice obliged employers to adopt ES to monitor employees in order to prevent sexual harassment. Notwithstanding, Europe has been more concerned with individual privacy. Notably, in 1986, the Organization for Economic Cooperation and Development (OECD) approved a declaration on social aspects of technological change, whereby member states "were concerned that employers and unions ensure that workers' privacy be protected when technological change occurs". Perhaps the boldest manifestation of this concern is the recently adopted EU General Data Protection Regulation (GDPR), which has just come into force the past May 25th, 2019.

In this scenario, leaders are required to set clear guidelines and practices that lie within national and international data security policies. In particular, they need to monitor the use of personal sensitive data, if not for the ethical concern per se, because if otherwise caught in unlawful data practices, their organizations' reputation, trustworthiness, and brand image could suffer irreparable damage (e.g., the recent scandal of Cambridge Analytica about an inappropriate use of personal data, has affected the reputation of all organizations involved). Leaders also need to set clear expectations for employees and act as role models for all members of the organization in order to clarify what ethical behavior regarding personal sensitive data looks like. This is especially true for organizations that strongly rely on virtual communications, as these tend to stimulate more aggressive and unethical behavior, due to their lack of face-to-face interactions. Leaders, therefore, have a pivotal role in weeding out potential unethical behaviors from their organizations.

Finally, an emerging topic in leadership concerns the unlawful appropriation of technology from private and public organizations. Specifically, it refers to situations wherein technology is used for purposes other than those it had originally been intended. For instance, improper use of technology may result in unauthorized access to data and lead to cyber security breaches.

Despite the interdisciplinary relevance of ethics, the debate of ethical concerns within e-leadership seems to be currently confined to the literature on governance and information technology. Yet, there is room for more theoretical and empirical discussion about how ethics is affecting power relations, surveillance, safety perceptions in the workplace, and human resource processes.

Leadership and Digital Tools: Insights From Social Movement Studies

A complementary perspective of leadership and digitalization is provided by several recent studies that analyze social and political events, in particular grassroots movements such as the Occupy and Tea Party, the Umbrella Movement in China and the political tensions in Russia. These contributions share the notion of a leader as someone who directs collective action and creates collective identities. These studies, mainly rooted in communication and political sciences, are certainly relevant to our review as they shed light on the social nature of leadership in the new digital era.

These studies focus on how social media and digital tools are disrupting traditional forms of leadership, altering the structure, norms and hierarchy of organizations, and creating new practices to manage and sustain consensus. New forms of leadership are for instance defined as horizontal and leaderless. The horizontality defines movements and groups in which authority is dismissed, whereas leaderless points to the lack of power stratification among the participants.

In a similar vein, recent studies looking at the use of digital tools by participants in social movements, observe how power struggles were changed by new information and communication technologies (ICTs): "ICTs have transformed the power dynamics of social movement politics by challenging traditional forms of [social] organizations".

The single case study of the ultra-orthodox community illustrates for instance how authoritarian leadership can be broken down by digital tools and social media. When the leadership of a closed and conservative religious community is questioned in social media, that creates a new space to renegotiate the community's boundaries and modify its power dynamics: "the fluidity and temporality of digital media have advanced to become an influential, independent factor shaping community opinion". As such, the identity of a closed and inaccessible community and its leadership are challenged by both internal and external actors through the use of digital media.

The study of different digital tools is also considered a relevant subject matter to gain understanding about what tools are more efficient in organizing and mobilizing resources. Technology and digital tools are not value-neutral nor value-free, because they influence how people organize, coordinate, and communicate with others. For instance, the study on the Russian activists shows how the long-term success of the movement was a result of a centralized, formalized and stable network, wherein its leading representatives and other members were bonded together by a new digital tool. The use of digital instruments enabled the transformation of an organization that was initially chaotic into a more structured one, as they facilitated the discussion and coordination between the leader and its followers. This resulted in a more efficient and effective way to achieve consensus.

Taken together, these studies show how technology is far from being a neutral instrument. Rather, digital tools influence power dynamics in any type of organization (e.g., flat, bureaucratic or networked), and at any level. If on one hand, digital tools can lead to the de-structuring of extant hierarchies and challenge organizational boundaries and rules, on the other hand, they can be used as communication and coordination mechanisms that allow leaders to build structured networks from scratch and, through them, reinforce their power.

In sum, these studies stress that, despite the participatory dynamics that characterize social movements, power struggles and hierarchies are still the underlying forces that bond heterogeneous groups of people together. Leaders are then the key actors in identifying objectives, orienting followers, and providing a clear identity to organizations, by means of a shared vision.