Don’t let Trump’s tariffs push your digital transformation off course

Digital transformation in the age of tariffs and turmoil

 In turbulent times, change is more important than ever.

Given the economic concerns surrounding the business world, it takes a brave soul to launch a modernisation programme. With parts of Europe suffering stagnant economic growth, two international conflicts raging and now a trade war sparked by the tariffs announced by President Donald Trump, few have the appetite for a cost and resource-intensive digital transformation. Despite this, some would argue that these are the very reasons to modernise. 

Tariff wars and digital transformation: Overview

• Trump's tariffs prompt business uncertainty
• Transformation slowed down by decision-making
• New leadership required for transformational change
• Becoming truly customer-centric
• Key takeaways

Trump’s tariffs prompt business uncertainty

Planning ahead feels impossible at present. In his second term as U.S. President Trump has imposed a series of global tariffs, prompting something of a chain reaction across the world; China responded with tariffs of its own, and the EU warned it would not stay idle…and then, for all of that, the US tariffs were rolled back. Last week, the US went further still - dropping China’s tariffs from 145 percent to 30 percent, while a similar relaxation of terms has been agreed with India.

Financial markets are depicted as a rollercoaster ride as they surge upwards and plunge back down. 

Beyond the politics of a trade war, artificial intelligence (AI) has also sent global markets into a tail spin, with organisations fearful they may be being left behind by their competitors. Given this market fragility, business leaders can be forgiven for not having the appetite to trigger digital transformation initiatives when so much uncertainty hangs in the air. 

Yet this unpredictability is the very reason why organisations and leaders need to be investing time and energy into modernisation programmes. 

No matter the actions of politicians, markets or drum-beating AI investors, the existing ways of working, and the current range of products and services, are all going to have to change. 

“If you don’t, your competitors will,” said Jeremy Schwartz, a successful CEO and now keynote speaker and advocate for change. 

“If we are to win in this environment of Trump, then we have to innovate the way we work,” Schwartz told business leaders at the launch of PerfectRebel, a firm specialising in change. 

Transformation slowed down by decision-making

The pace of disruption from billionaire politicians and technology firms has increased markedly in the last two years. Yet the pace of decision-making in the modern enterprise, especially in change-based decision-making, has remained notoriously slow. 

Looking back on his career, which has included leadership roles at global consumer goods firm Coca-Cola, UK retail giant Sainbury’s, cosmetics companies Body Shop and L’Oreal and jewellery business Pandora, Schwartz said decision-making was often slowing organisations down. 

“Work is like battling through syrup…Getting teams to collaborate– sometimes it feels too hard,” Schwartz said, adding that leaders and their teams are spending excessive levels of time (his research indicates 60 percent) in meetings which are unproductive. 

Dr Christoph Burtscher, a strategic advisor to PerfectRebel and a transformation leader, said business leaders must regularly ask teams and fellow leaders what the business objective is in terms of its mission or the outcome customers expect. If they don’t, these can be lost and this will impact any efforts at digital transformation. 

New leadership required for transformational change

For organisations to modernise, they need a new leadership style, one which can adapt and cope with the disruptive nature of today’s economic and technological uncertainty. 

Central to that is a leadership style which empowers managers and teams so that decision-making is not applying the brake on progress. To empower teams, leaders need to make it clear they personally do not have all the answers; in fact, quite the opposite, successful leaders are those who simply ask the right questions.

This taps into the answers actually residing with team members, and by asking them to reveal that knowledge, they should feel empowered to act on their knowledge. Leaders will still have a personal point of view and need to galvanise team members to follow them on a course of action. Alongside their point of view, good leaders ask for, accept and rely on the skills and knowledge of team members around them. “Ask first, tell later,” said Schwartz. 

Giles Lindsay, change management author of ‘Clearly Agile’, recommends building change advisory boards featuring a breadth of levels and skills.

“You get empathy with some people in the business, and before long, you are knocking on an open door.” 

Lindsay adds that detractors can be really helpful in this scenario: “Detractors are not wrong. I value their information and feedback, which I take and share as it shows what the underlying problems are.” 

Becoming truly customer-centric

In all of today’s chaos, it can be easy to lose sight of the customer, but as Schwartz points out, this economic and technological shift is “atomising” markets, making it more important than ever to bring the customer in closer. 

As Transformation CEO for Pandora, Schwartz said spending time in the stores and on Instagram gave his team an insight into the customers. This then enabled a rapid turnaround of the Danish firm’s fortunes.

“Bring the consumer into the room; the one person you cannot argue with is the consumer,” he said. 

That consumer insight enabled Pandora to set what it described as an “unrealistic deadline” that led to a turn-around in just eight weeks. Reflecting on this story, I remembered the pace at which Nightingale Wards were built, emergency airlifts, aid programmes and a host of times when organisations responded to dramatic events. It may sound extreme to think of today’s economic chaos and far right actions as an emergency, but it may be the best way for your organisation to survive the slings and arrows of outrageous fortunes. 

Lindsay added: “I always make sure that the change is contextually right for that organisation,” which sums up the conundrum of modern technology leadership, being both reactionary but with the right level of caution. This balance ensures protection and ambition in equal measure. 

Key takeaways

• Transform now - don’t be afraid of the current market turbulence; it is in fact, the reason to push ahead with modernisation
• Change is security - your talent and customers are expecting you to change
• You don’t have all the answers - modern leaders of change cannot have all the answers, so be comfortable with that
• Ask the right questions - ask the right questions to showcase the answers your team members have
• Empower managers to make decisions and end the bottleneck
• Bring the customer into the room - they cannot be argued with