The Essence of Leadership: Strengthening the Foundations for Success amid Digital Transformation

Artificial intelligence (AI), big data, automation, and hybrid and remote working arrangements have become part of everyday business reality. Digitalization is no longer merely a trend; it is now business as usual.

Globally, McKinsey (2024) reported that more than 70% of companies worldwide have launched digital transformation initiatives, yet only 31% have fully achieved their business objectives. This highlights that digital transformation is not simply about adopting technology; it is a long-term journey that requires resilient leadership.

In Indonesia, digital transformation can be seen in the use of cloud computing to accelerate data access, communication applications such as Zoom and Slack to strengthen team collaboration, and data analytics as a basis for decision-making.

However, digital transformation is not only about technology. According to the Deloitte Global Human Capital Trends survey (2021), 72% of executives identified a workforce capable of adapting and reskilling as essential to organizational continuity in an era of disruption. Changes in ways of working, the acquisition of new skills, and job designs aligned with the transformation agenda have therefore become critical.

In this context, leadership plays a pivotal role—not only in setting direction, but also in serving as a role model who inspires the team.

The digital era creates significant opportunities, but it also presents unique challenges that can only be addressed through adaptive leadership. Leaders can no longer rely solely on traditional approaches; they must be able to navigate new and continuously evolving complexities.

Leaders who rely only on strategic thinking, decision-making, and people management will struggle to adapt. A McKinsey study (2023) found that 87% of global executives reported digital skill gaps within their organizations, hindering business transformation.

Digital fluency has now become a core requirement: it is not merely the ability to use technology, but the ability to turn it into a strategic advantage. Without this capability, leaders will fall behind in making rapid, data-driven decisions.

In general, approximately 70% of digital transformation efforts fail. However, recent studies show that the main obstacle is not technology, but organizational culture.

For leaders, building a new mindset is a crucial first step. Without openness to innovation, organizations will struggle to move beyond bureaucratic patterns, remain trapped in silos, and respond slowly to disruption. Conversely, when leaders cultivate a culture of learning, collaboration, and openness, technology adoption can progress more smoothly and generate tangible business value.

Millennials and Gen Z, who are digital natives, now dominate the workforce. They expect leadership that is transparent, inclusive, and flexible. Gallup (2022) found that 60% of Gen Z employees prefer leaders who act as coaches rather than merely as supervisors. Without adaptive leadership, organizations face risks such as higher turnover among young talent, difficulty attracting digital talent, and cross-generational conflict that slows organizational transformation.

Although digital skills are becoming increasingly important, the essence of leadership has not changed. Core values such as strategic vision, decision-making, people management, communication, execution, and financial understanding remain relevant. However, to navigate digital disruption effectively, these foundations must be strengthened in new ways.

Leaders must continue to set a clear direction, but they are now also expected to anticipate rapid change using market data and technology trends.

📌 Real-world example: DBS Bank in Singapore transformed its vision into “Make Banking Joyful” through a digital-first strategy, helping it become one of the world’s leading digital banks.

Intuition and experience remain important, but they must now be supported by analytics and AI to accelerate decisions and improve their quality.

📌 Real-world example: Unilever uses data analytics to understand consumer behavior in e-commerce, enabling more targeted product decisions.

The foundations of trust, respect, and fairness are now expanded through the leader’s role as a coach and facilitator of collaboration.

📌 Real-world example: Through Project Oxygen, Google found that its best managers focus on coaching rather than micromanagement, thereby improving team retention and performance.

Leaders remain ultimately accountable, but execution now requires agility and the use of agile working methods, such as scrum, to respond quickly to market changes.

📌 Real-world example: Gojek adopted agile squad principles to accelerate digital product execution without compromising business accountability.

The ability to communicate clearly and build influence through strong stakeholder relationships remains central to leadership. In the digital era, however, communication must use multiple platforms, become more transparent, and create space for two-way interaction.

📌 Real-world example: Grab regularly conducts cross-country digital town halls that allow the CEO and executives to communicate strategy while opening real-time question-and-answer sessions with thousands of employees. This approach strengthens transparency, broadens influence, and improves engagement across the organization.

Financial reporting, cost management, and profitability remain fundamental, but leaders must also understand digital value creation, including data monetization and cloud efficiency.

📌 Real-world example: Netflix combines financial analysis with content recommendation algorithms to ensure that its content strategy is not only creative, but also financially profitable.

If leadership foundations are the roots that keep an organization firmly grounded, digital capabilities are the branches and leaves that enable it to continue growing in a new era. Leaders who rely only on traditional foundations risk falling behind, while those who add digital capabilities can take their organizations further.

Digital fluency is not simply the ability to use digital tools; it is the bridge between business vision and the application of new technologies. Digitally fluent leaders can select the right tools, encourage innovation, and lead technology transformation strategically.

When addressing issues such as data privacy, AI bias, and cybersecurity, digital leaders must apply ethical principles by prioritizing transparency, fairness, and security as foundations of modern leadership.

A culture of continuous learning is not merely important; it is critical for ensuring that organizations remain resilient and adaptive amid digital disruption. The LinkedIn Workplace Learning Report 2024 found that 89% of L&D professionals agree that proactively building capabilities through upskilling is important for the future of work.

Leadership in the digital era means combining data-driven intelligence with empathy, agility, and ethical responsibility. Successful leaders are not only skilled at using technology, but are also able to inspire their teams to grow and transform together.

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