Digital innovations like machine learning, artificial intelligence and big data analysis are creating opportunities, and firms in every industry need to use technological advances to stay competitive and to survive. This increases the demand for digital skills and competencies. However, global surveys have consistently shown that many managers struggle to embrace digitalization and only a small number of companies feel they have strong digital leaders in place. The main reason is that managers often lack competencies to understand digital issues. Furthermore, HR managers are increasingly concerned about the kinds of skills needed for work 2021 forward. The existing body of research on competencies suggests that charisma, political skills or cognitive abilities are necessary for managers to lead effectively. Such approaches, however, have failed to address the importance of digital competencies that seem to be more relevant today. Nowadays, the focus of managers must be on developing competencies related to digitalization that will allow them to become digital leaders. This research will shed light on what are digitalization-related competencies. In particular, it aims to answer the following research question:

What are the competencies required for middle managers in a digital era?

To answer this research question, a qualitative approach, consisting of two steps, will be adopted. In the first step, a secondary data analysis is being conducted in the form of a systematic literature review. A range of leading management journals, including Academy of Management Journal, Journal of Management and Leadership Quarterly will be scanned for key words such as “competencies”, “industry 4.0”, “digitalization” and “middle managers”. This step will provide a focused assessment of the current state of the art as regards the main research question that is paralleled by the development of the theoretical framework of the study. The theoretical framework will present the development of management theories, the basics of competence models and the relevance and effects of digitalization and digital transformation. In the second step, primary data in the form of semi-structured interviews will be collected. The interviewees include middle managers from selected companies in Finland. The potential case companies operate in innovative industries such as electronics and consulting and are digital front-runners. Two case companies are targeted at present. Approximately 50 managers from the selected companies in Finland will be asked about new skills and competencies for middle managers as well as elements of successful digital transformation strategies.

It is expected that this study will help organizations, especially Finnish firms who participate in the study to identify their basic managerial competencies and provide guidance on restructuring their managerial develop- ment and training programs. Additionally, the identification of digital competencies can greatly help business managers to improve their own skills and thus better cope with digitalization.