Digital business needs Level 5 leaders


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To meet the challenges wrought by digital transformation, the business world needs Level 5 leaders, according to Eastman Chemical CIO Keith Sturgill.

The term Level 5 leadership, in case you’re not familiar with it, was coined by researcher and author Jim Collins, of Good to Great fame.

During the course of his research into the factors that turned a good company into a great company, Collins found that an essential component was a Level 5 leader. Not only did they possess individual capability, team skills, managerial competence, and leadership skills as traditionally conceived. But the truly stellar leaders, who had the ability to take their companies to the next level, had what Collins described as an “extra dimension” – a seemingly paradoxical blend of personal humility and professional will. Though they lacked the ego to seek greatness purely for their own gain, they had absolute ambition to make their companies great, and were willing to do whatever it took to get there.

And it is this type of leadership that businesses are in need of now, says Keith Sturgill, CIO of Eastman Chemical.

Sturgill will be presenting the opening keynote at the Mastering SAP event in Melbourne in October, on how organisations can embrace change and seize the opportunity of digital transformation, as well as a session on leadership.

He is a man who knows a bit about leadership himself, having worked his way through the ranks at Eastman from his role as the company’s first SAP Basis person to his current role as CIO. Sturgill also serves as chairman of the Americas SAP User Group (ASUG) Board of Directors.

The science of leadership has been a fascination for Sturgill since he first began managing teams back in 2000. Then he immersed himself in leadership books, and though he admits that much of his experience has come through the “school of hard knocks”, Good to Great remains his favourite business book of all time.

There is no doubt that with the ubiquity of digital now forcing paradigm shifts in all industries, solid leadership is required. And Sturgill argues it is time for technology leaders to step up.

“We as technology leaders have got to be the thought leaders during this transformative time; as a group we are thinking about the implications of digital transformation more so than our peers. So my challenge [is] it’s time for us to take the lead, and to set the vision, to put plans in place to move our companies to that digital future aggressively, with a sense of urgency,” he said.

In the trenches

Eastman Chemical, a chemical manufacturer with annual revenues of around US$10 billion, originally grew out of Eastman Kodak in 1994, and since then, the two entities have gone their separate ways. Digital transformation is not necessarily coming easily to Eastman, and Sturgill admits the company is still grappling with what it will mean for what is a very traditional industry.

“I live within an industry that hasn’t changed frequently. The chemical industry builds assets that last for decades. So the change that most of our leaders are accustomed to is nothing like what we’re going to see in the digital era,” he said, adding that the implications could be huge.

“We manufacture materials; we invent new molecules, we improve the quality of life through the materials we create and we are starting to think about how does this whole idea of digital business impact our industry.”

Eastman first implemented SAP as part of a globalisation strategy back in 1991, replacing homegrown siloed systems that were proving a barrier to the company’s growth. While in the future, HANA will function as Eastman’s digital core, Sturgill believes what comes after the technology will be the game-changer.

“It’s going to be about fundamentally rethinking how our businesses operate. At its core, it’s really about how we make decisions at every level of the corporation,” he said. “We are clearly putting technology in the key enabling category where frankly it belongs.”

Rolling out HANA quickly and just overlaying the technology with existing processes and organisational structures might be a quick fix that would ultimately disappoint.

“Maybe it would run faster, but we will not really get the benefit that we could get. So we’re taking a slower approach because we do believe that to get the value from HANA, we really have to rethink how the business operates today, how decisions get made at each level, what are the decisions that we’re trying to make at each level – then how does the process and the technology enable that decision. So we’re beginning with the decision; not the process, not the technology.”

Other emerging drivers such as big data and data science, and the transfer of consumer-grade expectations to the B2B world, are all having an impact much faster than perhaps businesses realise.

And according to Sturgill, that’s where Level 5 leadership will really come into its own, for those who are up for the challenge.

Keith Sturgill will be presenting two sessions at the Mastering SAP event on 23-26 October, which celebrates its 20th year in 2016: the opening keynote, ‘The Only Thing to Fear is Fear Itself: Embracing Change and Seizing the Opportunity of the Digital Transformation’, and ‘Dealing in Hope: Great Leadership for Great Results’. This year, at the Crown Promenade, Melbourne, four communities will come together under one roof – Business Analytics, Customer Engagement, Supply Chain and Enterprise Asset Management. To find out more and to register, visit http://masteringsapconference.com/aus/spring/.

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