Focusing on digital transformation technology and outcomes without taking the human factor into account is a recipe for disaster.
This no-nonsense warning was the key message from PwC’s Kevin Kroen, principal, automation and upskilling leader, and Lauren O’Brien, senior manager, in their recent HR Tech Virtual conference core session entitled, “Let’s build it together: How empowering your workforce can help scale your digital transformation journey.”
PwC defines digital transformation as a rethinking of how an organization uses technology, people and processes in pursuit of new business models and new revenue streams.
Digital transformation projects tend to be “big, ugly and expensive” initiatives that have a high risk of not reaching goals and outright failure, Kroen said. And when looking at the results of these projects three years out, they are usually disappointing. “The biggest reason is you haven’t really moved the needle from a people perspective,” he said.
In changing business processes, for example, the people angle is often the most underinvested aspect of the transformation program.
To avoid these project flameouts, HR and IT leaders must offer incentives like the opportunity to learn new skills for the future and the chance to collaborate on projects, O’Brien said. Both will help get employees on board with the transformation overhaul, she said.
Why? Because transformation is heading toward nearly every business in the coming decade. PwC research predicts 97 million new digitally oriented jobs will emerge and 85 million jobs will be disrupted by new technology.
According to PwC, workers are eager to learn new skills for the upcoming changes in the ways business is done.
Half of workers will need upskilling in the next five years and 77% say they are ready to learn new skills or completely retrain. More than 30% said they will be willing to sacrifice salary in exchange for skill-building opportunities, according to PwC research.
And employers are onboard as well. PwC research found that 94% of employers stated they expect employees to pick up new skills on the job, which is up from 65% in 2018. An estimated 66% of employers expect to achieve ROI for upskilling and reskilling within one year of launching these programs.
HR leaders have a clear role to play in focusing on the people aspect of most digital transformation projects, which PwC calls “citizen-led innovation.” This means focusing on learning and development and upskilling efforts that allow employees to effectively develop skills for a job in the future.
“If you train someone on robotics automation tools, for example, they can innovate and create ideas that will transform business solutions,” said Kroen, who suggested that this could produce immediate benefits. “This can provide ideas for bigger transformation effort, for example,” he said.
Not providing these new skills could snuff out an organization’s employee experience. More than one-quarter of employees—26%—say they began the pandemic without adequate digital skills and 21% are getting no opportunities at all from their employees to develop their digital skills outside the normal duties.
“You need to meet people where they are starting from and what skills they need,” said Kroen. He added that this can help HR leaders to design the right applied learning strategy and choose the right L&D application for teaching those skills.
Meanwhile, employers need to rethink how they view ROI when choosing an L&D platform. Instead of expecting an immediate boost in revenue or profits, employers should focus on employee happiness and sense of purpose. “How am I helping them develop new capabilities that will deliver more value to the business?” asked Kroen.
Ultimately, employees are looking for more job satisfaction, new skills for their future and the chance to work at a place that delivers a long-term purpose. This is the business case behind the digital transformation, according to Kroen.
“When you add employees in this piece,” he says, “this builds the long-term employee experience.”
Registered attendees can view all HR Tech Virtual presentations through April 4 here.