You’ll often hear that digital transformation is all about technology but at the heart of it, it’s really about involving your people and company processes, ensuring you’ll receive truly valuable benefits from transformation.
It’s often argued the only certainty in business right now is uncertainty. For companies unable to respond to volatility, it’s very real. For example, research finds that the average length of tenure on the S&P 500 index was a stable 60 years in 1958. However, at the present rate of churn, a shocking 75% of today’s S&P 500 will not be there by as early as 2027.
The blame for this has been placed solely at the presence of digital disruption – and the speed (or in most cases, slowness), with which organisations have been able to enact a strategy of digital transformation (think of once-great companies that couldn’t adapt such as Blockbuster or Kodak, who were once household names). As the latest C-Suite Challenge 2019 survey reveals, one of CEOs’ greatest internal anxieties is now how to create new business models that deal with disruptive technology.
However, technology can be such a powerful force it can cause all sorts of incorrect decision-making, high spend on technology, but without a coherent strategy for how it’s meant to benefit the business. But while digital might well be the main reason more than half of Fortune 500 companies have disappeared since 2000, digital alone is not the answer.
It’s all about culture too
What’s integral in any digital transformation process is the notion of how to actually begin to create the greatest impact – and it invariably starts with looking at how to involve your managers and employees.
Digital transformation is really just a shorthand for creating new ways that allow staff to collaborate, innovate, share, and foster greater productivity. And none of these things are islands. When firms like CISCO, IBM and Unilever were undergoing their own digital transformation, they started with what their employees’ needs were first – whether it was new ways of digitizing recruitment to hire people faster (and with greater levels of employee engagement too) or ditching the annual performance review for a more valuable continuous feedback approach, such as Objectives and Key Results, enabling managers to take control of how their team are developing against company goals.
Integral to any digital change is transforming digital HR process – ones that are based on taking a people driven approach and creating agile infrastructures; that replace process-centric approaches and outcome-based mindsets. In short, outdated legacy systems perpetuate outdated process, and practices, and maintain old ways of thinking. These need replacing because transformation is not about implementing IT for ITs sake, but because it has a greater role to play in creating a new type of agile working, and an agile thinking culture.
Implementing the HR backbone that facilitates agility
When we talk about digital transformation in HR, what we’re really talking about is the implementation of an ‘HR backbone’ for the business – one that lets employees and managers contribute to their teams with as little impediment as possible. HR technology plays its part, but only in the sense that it makes the job of truly being a part of a company even better. No manager or employee wants to be held back, and have their time wasted by outdated onboarding systems, inadequate employee self-service or performance tracking and workflow dashboards that hinder rather than help.
Cutting edge HR software doesn’t make IT the focus of attention in digital transformation. Technology – as is often remarked, but often forgotten – should only ever be the enabler. Far more important is what having data (such as performance and goal-tracking information), can do for companies and HR departments. With great technology, suddenly CEO’s can see who their top performers are, how integral each employee is to the company, and what ROI it is yielding. This is real digital transformation – using digital tools to see what makes the biggest impact to employees – translated to increased performance. With better business performance (such as reduced time to market or innovation) – surely comes improved longevity too.
Find out about how Appogee HR could be the first step to your digital transformation. Try us free for 14 days.