Creating the right working environment and empowering employees are critical requirements for future enterprises to achieve their digital transformation (DX) goals.
Some of the key barriers stifling DX success today is not technology-related; it is rather a lack of digital mindset, collaborative culture and change management challenges. Organisations face several friction points as the changing demographics, particularly the influx of newer generations at work, and new business models are challenging the long-established status-quo in terms of both business models and how work is done.
In 2018, IDC found that most organisations in their digital journey can be classified in two groups. The smaller cohort who are leading the charge and thriving in the digital era are defined as “Digitally Determined” organisations. They often have an enterprise-wide DX strategy which aims to transform markets and customers by creating new business models, and products/service.
On the other hand, “Digitally Distraught” organisations have DX initiatives which are tactical; although the initiatives are tied to the enterprise strategy, they are very short-term focused.
With only 40% of organisations across Asia/Pacific excluding Japan (APEJ) being “Digitally Determined” and on the path to realising their transformation goals, a lot more needs to be done to shift the needle on DX. In particular, the “Digitally Distraught” majority must work faster to close the gap with the more aggressive startups or face being reduced to oblivion.
Based on a study of digitally distraught organisations, IDC has been able to identify several key areas where the “Digitally Determined” are establishing new behaviours that need to be considered “normal” within a transformed environment.
To start, this transformation is all about “putting experience at the core of everything” and it does not just mean a focus on just customer experience. It also includes employee and partner experience in a world of digital ecosystems that is helping organisations source employees, resources and sometimes even core products.
Take for instance Airbnb; it crowdsources the properties it offers for accommodation on its platform, which is their core product or service. Such aggregation platforms and ecosystem-based business models are emerging in almost every sector, such as peer-to-peer lending platforms in finance, ride-hailing services, co-working spaces for offices, food-delivery service providers, etc.
Therefore, success today depends much on elevating customer experience, as well as enabling employees and partners with the right tools and technologies to deliver great experiences.
Driving this experience-centricity is innovation-at-pace across products, services, processes and the systems that support and underpin many aspects of all organisations in this data-driven, digital economy we now live. But to achieve this, it requires a fresh approach to risk-taking, new tools for experience monitoring and measurement, and a desire to continuously learn and adapt.
In March 2019, IDC published its Future of Work Maturityscape model, which describes the organisational characteristics of five levels of future of work maturity, from a completely ad hoc approach with limited awareness to one in which a future of work strategy is woven into the organisation’s culture at every level.
The model is meant to help organisations evaluate current workplace transformation initiatives and identify the steps they need to take to advance to the next stage of maturity. Key stakeholders of workplace transformation initiatives include executives, IT leadership, line-of-business managers, employees, partners, and suppliers.
Organisations across sectors can leverage this IDC maturity model to assess their current state of maturity for the future of work and plan next actions at each stage across the three pillars of workforce, workspace and workculture.
Each of these contributes to creating the right environment for innovation and transformation to thrive, thereby resulting in a more well-tuned organisation that is able, with the right talent and partnerships, to excel in today’s business environment.
In IDC’s Future of Work FutureScapes 2019, IDC predicts, “By 2023, 30% of G2000 companies will generate at least 20% of their revenue outside their core industries, using crowdsourcing and agile aggregation models to source talent and business capabilities”.
In short, organisations must begin reinventing their core and invest in digital platforms, aggregation and crowdsourcing models to source new capabilities, and create new revenue streams, outside their core sector of operations.
However, one of the key barriers in this journey is the lack of digital skills and the traditional mindset that often resists to change. Creating the right culture that fosters innovation and collaboration, employee empowerment with the latest tools, and even workspace policies around mobility, talent development and retentions are more critical than ever for the overall success of the organisation.
This issue is exacerbated by the significant uptake of new technologies such as artificial intelligence (AI), microservice architectures, augmented and virtual reality technologies (AR/VR) and multi-cloud adoption where the numbers of trained professionals in these skills is quite low.
Work culture becomes a starting point to attract the required talent. This is about having an engaged and empowered workforce aligned to new digital skills, which in turn support the strategies of customer-centric data monetisation.
Workforce is about the collaboration of humans and technology, not about how AI will replace people, but how AI can augment skills by offloading more mundane and repetitive operations, allowing the human workforce to move to more value-judgment roles that machines cannot necessarily manage as well.
Workspace talks about the environment in which the workforce operates, a connected, secure work environment that is independent of time and space. The “work-from-anywhere at any time”, concept that is indicative of start-ups and born in the cloud organisations globally.
Clearly the last element requires a seismic shift in culture, especially that of management culture. But as we move to a world where the workforce is getting younger, with unique demands that need to be addressed in an environment where they are perhaps going to be spoiled for choices with regards to where they work, this programme attempts to guide, with examples of success, organisations to becoming digitally determined, and ultimately transform into digitally native enterprises.
IDC is looking closely at developments around the topic on “Digital Determination” and “Future of Work”, examining the business cases and monetisation models in Asia/Pacific.
These topics were presented in more detail at IDC’s recent CIO Summit event series held last May 07, 2019 at the Marina Bay Sands Expo and Convention Centre, Singapore.
To know the schedule of the next IDC CIO Summit events, please visit HERE.
Avinav Trigunait is the Research Director for Future of Work Practice at IDC Asia/Pacific.