To prosper in the digital age, companies must undergo two types of digital transformation. Firstly, they need to become digitized. Secondly, they have to become digital.
Though both transformations depend on new technologies, they require different strategies and rules to implement. Digitization requires companies to update their operational backbones. In the past, core operations, such as delivering goods and services, maintaining accounts, and completing back-office processes, were handled by people. These days, however, they can be enabled by software-as-a-service. In addition to digitizing themselves, companies also need to become digital, which means creating a digital platform for the company’s digital offerings. Not only does this facilitate business development and connection with partners and customers, it also allows companies to better target revenue growth.
To conduct both transformations, leaders have to be comfortable using different sets of rules for people overseeing the operational backbone of a company and people working on the company's digital platform. In particular, they need to change their leadership styles according to the group they are working with as well as understand its cultural and operational needs.