Digital Transformation Needs an Integrated Model for Knowledge Management and Transformational Leadership

An integrated framework combining knowledge management and learning and transformational leadership is presented in Figure 11.7 as proposed by Nissinen and Laukkanen (2018). The ontological dimensions in the framework are individual, team/process, organizational, and inter-organizational levels where both knowledge management and transformational leadership processes take place normally. Four learning loops are the integrating mechanisms of knowledge management and transformational leadership in these levels. From a strategy perspective, the key challenge is to effectively integrate and synchronize all these four learning loops for knowledge transfer, organizational development, and change. At the individual level, the focus is on knowledge, skills, and competencies which can be developed with personal feedback tools, competence profiles/maps, competence assessments, and HRD tools

Ramp-up and reconfiguration of competencies and capabilities in management of transient advantage. (Adapted from McGrawth, 2013.)

Figure 11.6 Ramp-up and reconfiguration of competencies and capabilities in management of transient advantage. (Adapted from McGrawth, 2013.)

Conceptual framework for knowledge management and transformational, deep leadership. (Adapted from Nissinen and Laukkanen, 2018.)

Figure 11.7 Conceptual framework for knowledge management and transformational, deep leadership. (Adapted from Nissinen and Laukkanen, 2018.)

(e.g., 70:20:10 model). Transformational leadership aims for the full commitment of

the cornerstones of leadership seen like shared practical values. The focus on learning is to confirm single loop learning which can be a challenge in complex and dynamic work environments having a focus on troubleshooting and firefighting. The presence of the idea and practices of deep learning is vital. At the team level, the focus is on the development of cross-functional team and process capabilities which are often dynamic capabilities (Teece et al., 1997). The learning process is based on double loop learning where the best practices of processes are systematically identified and improved. Transformational leadership is based on a team level learning process. Understanding and using the unique personalities, personal skills, and knowledge are the source of creative and motivating team processes.

At the organizational level, the focus of development is on organizational capital including human resources, organizational structures, and networks. The learning process is organizational learning where strategic capabilities are identified and developed based on strategic targets. Transformational leadership focuses on continuous improvement of the leadership system and the development of the culture.

At the inter-organizational level, the development of capabilities focuses on business ecosystems or supplier network capabilities which often are complementing capabilities. The learning process is inter-organizational, combining benchmarking and learning from the best partners. Deep leadership focuses on creating open interaction and accelerating open or semi-open innovation in a supplier network type of organizational structure.

Systematic organizational development and change are the key areas when analyzing, planning, and executing transformation programs. A typical challenge is that the focus of the programs covers mainly individual competences and team, organizational, and inter-organizational aspects are neglected. Beyond this, the synchronization of these levels and the respective learning loops is mostly forgotten. Detailed theoretical background of this model can be found in Nissinen and Laukkanen (2018).

Case Study of the ABB Takeoff Program: Innovation, Talent, and Competence Development for Industry 4.0

Background for the Digital Transformation at ABB

ABB is one of the global leaders in power, automation, and digital technologies— having business operations in around 100 countries. ABB is dedicated to helping its clients use electrical power efficiently and lowering their environmental impact. As a technology leader, both leadership and knowledge management are key success factors for ABB, in order to drive innovation, to attract and retain talent, and to act responsibly (ABB, 2019a).

The latest update in corporate strategy involves a strong emphasis in digitalization with the corporate vision “Technology Leader in Digital Industries.”

ABB has been a strong player in robotics, automation, and control system technologies for decades, but in 2017, a common cloud-based platform called ABB Ability for digital customer solutions was introduced. Digital services within ABB are integrated into the ABB Ability platform, and in 2019, there were more than 210 solutions for different industries (ABB, 2019b). This customer value and solution-based approach is illustrated in Figure 11.8.

The Value Framework for IIoT and Digital Solutions

The industrial solution framework is a complex mesh of different IIoT technologies, from simple sensors developed for monitoring to machine learning applications that turn sensor data into predictive maintenance actions. Customer solutions can be classified in five different hierarchy levels as illustrated in Figure 11.9 and Table 11.2.

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