Point of View

Put people first to succeed with digital transformation

August 19, 2021

Digital transformation fails for three key reasons—culture, talent, and process debt.

Forget the rate of digital adoption. That’s a non-starter if your change management is nothing more than a bolted-on afterthought. We have to get serious about putting people first and get focused on the changing behaviors at scale.

That was the message from HFS President, Research & Operations, Saurabh Gupta at the HFS OneOffice™ Digital Symposium, as he hosted a panel on Embracing People and Business Change (see Exhibit 1).

With him to discuss the “X-factors” in realizing our digital ambitions were panelists

  • Eva Sage-Gavin, Senior MD, Talent & Organization Human Potential Practice, Accenture
  • Gareth Morgan, VP Global Finance Transformation, Walgreens Boots Alliance
  • Jay Desai, VP & Head–Global Business Services, Japan Tobacco International
  • Kaushal Mody, Chief Strategy Officer, Accenture Operations
  • Melissa O’Brien,Research VP, HFS
  • Paul Papas, Global Managing Partner, Business Transformation, IBM
  • Rajashree R, Chief Marketing Officer, TCS
Exhibit 1: Saurabh Gupta and guests on the Embracing People and Business Change panel

Source: HFS Digital Symposium, June 8, 2021

There was broad agreement that ambitions are focused on finding ways to empower employees to respond to shifting markets and anticipate changing customer needs—supporting people to become digitally fluent in the data science and emerging technologies that are becoming increasingly common in employees’ daily lives. That need is only heightened by the rapid scaling of emerging technology in the enterprise identified in the June 2021 HFS Pulse data survey—presented by HFS CEO and Chief Analyst Phil Fersht in his earlier keynote. (Exhibit 2)

Exhibit 2: Enterprises are deploying emerging tech at scale; digital fluency, less so

Sample: 801 of the Global 2000
Source: HFS Pulse, June 2021

While we may be facing transformation fatigue, we must tackle legacy processes now that they have revealed themselves as costly process debt. And we must overcome the cultural drag that is slowing efforts to reconfigure how—and by whom or what—work gets done. Change management needs to be built-in, said Saurabh.

And that change must start with the people.

Eva Sage-Gavin (Accenture) said her research across 12 geographies and industries found that while most people are learning about digital, she categorizes only 14% as digitally fluent.

She categorized capabilities at four levels: remote collaborators, disciplined achievers, adaptive team players, and digitally fluent.

Digital fluency is essential for the delivery of value from emerging technology

HFS defines digital fluency (an important enabler of OneOffice—see Exhibit 3) as the ability to drive the interplay between business and technology. With it comes the ability to translate the understanding of digital tools to create new ways to serve customers’ needs and drive value, the ability to consider how digital technology will impact every aspect and every functional area of the organization, and the ability to examine the organization’s business model, strategy, and operations in the context of digital technology—all essentials to realize the value of emerging technology.

Exhibit 3: Digital fluency skills are essential for the delivery of value in the OneOffice emerging tech platform

Source: HFS Research 2021

“We have to grow our people if we are to grow our businesses. They must feel safe, included—as well as having the tools,” Eva added while pointing out that almost every human hired on the planet in the last 16 months had been hired remotely and had little human contact with their colleagues since.

Over-investing in change management is the secret to digital onboarding

Jay Desai (JTI) illustrated the truth of the remote hiring phenomenon in his own experience in setting up a multiple function GBS just as the pandemic hit.

“We said we can either step back or adapt. We went for ruthless adaptation. We changed everything, adapting to the reality that every day brought. We were told we could never bring in the culture—voilà 1,100 people digitally onboarded! The secret sauce has been over-investing in change management.”

Paul Papas (IBM) said the rate of change businesses had been forced to face over the last 16 months had given people, process, and change its seat at the table.

He pointed to restated IBM principles encouraging leading with empathy and mindful leadership. There was a new focus on the need to look at people as their whole selves and tend to their mental and physical health.

Being tethered to webcams is the most exhausting thing we’ve experienced

“Being tethered to the web camera has proved more exhausting than anything we have experienced in our careers. So, we crafted a work-from-home pledge to support each other. Put family first. Be flexible for personal needs, and support NOT camera-ready time,” said Paul.

IBM has also appointed a senior vice president (SVP) of culture reporting directly to the CEO—separate from the HR function. The purpose is to continue to transform into a culture of inclusivity.

The result has been that net promoter scores (NPS) went up during the pandemic, as did employee satisfaction.

Empathy is proving an essential skill for enterprise leaders. Gareth Morgan (Walgreen Boots) identified it as the key factor when bringing together IT and business partners in transformation. He said leaders had to appreciate that when they ask teams to take on the new, they are already managing heavy day-job workloads alongside providing the bandwidth for the future.

Tech fosters an engineering mindset, but change needs softer skills

Rajashree R (TCS), whose current primary focus is driving vaccination roll-out in India, identified an additional challenge facing the tech industry; it fosters an engineering mindset and the things we were describing were soft skills. She said it was important to systematically connect the human in all of us, rather than leave individual teams to make their own best efforts.

And Kaushal Mody (Accenture Operations) noted how hard numbers had become matched by human concerns in business planning. When it comes to adopting the transformational emerging technologies arriving in the enterprise, he said firms should remember the three Rs: reward, reskill, redeploy. Embracing them meant people could embrace change rather than fear it.

The way we reward must change—diverting away from the number of people you manage and toward the number of ideas you create and the productivity you manage. We need to invest in reskilling, making the teams we have the experts we need, he said, and he concluded that we must look at redeployment more broadly since providing skills can open a huge range of new roles for the individual.

The Bottom Line: Put people’s needs and skills first, or your digital investments will flounder

It is clear from HFS Research data and the experience of our expert panel that the need to reskill people must be a priority. Ignore this, and the investments in emerging technology made by most enterprises will never deliver to their fullest. If 86% of employees have yet to achieve digital fluency, there is huge headroom in capability waiting to be delivered. We advise you to start today.

Watch the Embracing People and Business Change panel

You can read other POVs and a comprehensive ebook about the Symposium, plus watch video highlights of the two-day event, here.

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