Part 2 of The Business Case for Digital Transformation
By: Gary D. Abello
When companies create their roadmaps for their digital transformation journey, what remains as the critical piece of the plan is ironically not some form of technology. Human capital is a cornerstone and is still very much the central resource of any company. After all, the success of a company’s digital transformation sits on the shoulders of people: those that will carry out the transformation and those that will be impacted by it. Within the company that is looking to transform, if the people are not ready, then the organization clearly is not. Remember as well that beyond leadership and employees, clients and other external stakeholders are just as important to engage and get on board as a company weaves its way into the digital age.
Companies that succeed as they go digital take the “people first” paradigm to heart, and typically demonstrate this in the following ways:
Strong executive leadership or sponsorship – This is a given in any transformation roadmap, and will be defined based on a company’s nature of business and level of IT maturity. For many organizations, the Chief Technology Officer or Chief Information Officer is the default senior responsible owner and navigator of the transformation journey, with the full support of the Chief Executive Officer. Some companies will tend to think that they need to hire a Chief Digital Officer (CDO) or outside talent to facilitate the change, but it may not always be the best approach that applies to all businesses. For other companies, the CDO’s skills and competence may overlap with an existing resource, or may be a better fit in a different capacity. Also, complementing the technical competence should be the leader’s ability to articulate and relate what the change will mean to middle managers and employees. The transformation has to have value to all members of the organization, and if the goals are clearly understood and resonate well with employees, then rallying them to achieve the goals will be less difficult.
Thorough skills inventory for the workforce – This starts with mapping the total skills and competency requirement, and identifying the corresponding gaps that need to be addressed. This exercise is essential, and must be done with great diligence even before any company decides to restructure in order to meet its transformation objectives. Further, the skills inventory has to consider not only what employees need, but also what clients and partners will demand. For many companies, transformation may lead to some level of automation, leaving some roles to be redundant. Yet still for a lot of companies, the transformation will require new hot skills in such areas as analytics, security, and digital content strategy. Where the skills are lacking, often investments in training and retooling may be just as beneficial as hiring external talent. If company leadership expects employees to align with the transformation goals and contribute to reaching them, then much attention must be given to show employees that they are getting the professional support they need to embark on that journey with their management. In fact, the top-performing employees that will drive the transformation should welcome the opportunity for new training or knowledge transfer. It is thus important for leadership to recognize not just where skills are lacking, but where enthusiasm and potential are present.
Opportunities for developing resources and identifying good people managers – A transformation journey for companies leads to disrupting the status quo with the rollout of new tools and piloting of new processes that require much time, planning, and effort. When aligned properly and balanced with an employee’s work plan, stretch assignments or side initiatives resulting from the transformation can be a good means to develop and/or enhance skills in project management, client engagement, and other technical or operational skills. The motions of change in the organization can also be a good means for senior management to identify and reward people managers who motivate for the right reasons, keep morale high without making unrealistic promises, recognize good work, and keep communication lines open with their downlines.
Communications and what conversations need to occur – No digital transformation strategy succeeds without a communications plan to employees who will be impacted by the company-wide change. HR plays a key role in ensuring consistent messaging for people managers, and in creating venues for upward feedback, town halls/staff meetings, and even employee-management conversations. Having a sense of employee sentiment is critical, and will serve as a measure of whether they have a clear appreciation of the direction the company is taking. From a client perspective, no one certainly likes last-minute notices so it is also key to define and cascade reasonable lead times for customers to adjust to the transformation changes that will affect them. A strong front line and channels of communication such as hotlines, chat or email support will assist clients in getting up to speed, and also get their feedback on their evolving experience with a company in flux.
Putting people at the center of a company’s digital transformation is as critical as the technology that helps power the transformation. Thus, a clear non-negotiable in the transformation agenda is investing in people and making sure that employees, clients, and other stakeholders are able to adapt as the business landscape becomes more high-tech. And when the boxes are ticked on executive sponsorship, workforce development, communications, and client/stakeholder hand-holding, then a company’s digital transformation investment is likely to yield optimal returns as well.
*** Gary D. Abello is a Practice Director in ZMG Ward Howell, specializing in digital entertainment, media, telecoms, and tech industries.