C-suite beware: Employees do not believe in your digital strategy

Capgemini research highlights stark divide between employees and leaders over digital culture

This is a contributed piece by Jerome Buvat, Global Head of Research at Capgemini

In a world that is increasingly concerned about the gap between the ‘elites’ and the rest, a worrying new divide has opened up between employees and their leaders. In an economy where technology investments and the rapid digitisation of organisations is a competitive essential, the extent to which businesses have a culture that is conducive to digital transformation becomes critical.

However, our latest research [PDF] has found that leaders and their people do not see eye-to-eye on whether they do in fact possess a ‘digital culture’. By that we mean a culture where a range of attributes – from data-driven decision-making to the readiness to take risks and innovate – are prized.

Overall, 40 percent of senior leaders feel their organisation has a digital culture, but only 27 percent of employees feel the same. In France, as our chart shows, 42 percentage points separate the executive suite from the rest.


‘Them and us’

Our analysis highlights a number of reasons for the divide between “them” and “us”:

Employees don’t feel digital visions are pragmatic enough. We found that 64% of employees and middle managers don’t feel that their organisation’s digital vision and strategy are concrete enough to be translated into projects and initiatives. 

Middle managers are disengaged. Middle managers are vital agents of change, but they’re sceptical about the company’s digital ambition. Over half – 51% – do not even feel that their organisation has a digital strategy, and only 22% agree that their company has a digital culture.

Leadership is failing to walk the talk. Employees do not believe that leaders display openness to change and are themselves adopting the new behaviours required of a digital culture. In Germany, Italy and the Netherlands, no employee felt leaders walked the talk; however, a majority of leaders (50% or more) in those three countries felt they did.

Leaders underestimate the impact of bureaucracy and silos on employees. In Germany, for example, around a third of employees (32%) believe that their organisation has a bureaucratic culture which does not support creativity and innovation. This is a worrying sign for a country on a path to Industry 4.0, but it’s also a global problem. We found that 55% of employees believe that hierarchy matters more than the value of ideas.

Employees do not feel empowered. Only 17% of employees say that they are empowered to experiment and then get that idea into deployment quickly. And many employees we talked to do not feel that their ideas are valued. As one pharma employee told us: “Leadership thinks that innovation needs to come from startups. But we also need to build innovation capabilities from within.”

Younger generations are not convinced. Younger employees are more sceptical. For example, while 41% of 31 to 40-year-olds believe that their leadership acts as role models in adopting new behaviours, this drops to 25% in the 18 to 21 age group.


Building bridges

So what should you do to start gaining the confidence of your employees?

The critical issue is to create an environment where people can speak their mind and feel empowered. As part of that, leaders need to be more visible and approachable. At Google, for example, the company holds an all-hands meeting every week, where employees can engage directly with the digital giant’s leaders. This also reflects the need for leaders to walk the talk. If you don’t display the behaviours you want to instil, employees won’t believe those behaviours have value. Finally, you need to invest in employees’ capabilities, showing that you’re serious about arming them with the skills and capabilities they need in a digital world.

Digital transformation requires new ways of working and behaving. In short, a different culture to the norms of the past 20 years. While differences between leaders and employees are not new, this culture gap has the potential to derail the digital strategies and tech investments of many firms.