Digital transformation is workforce transformation: Why HR must assume a leadership role
Digital transformation is top of mind in boardroom discussions today for ample reasons: higher quality products and services, employee productivity enhancements, operational efficiencies and cost savings.
In these strategic talks, little mention is given to the need for workplace transformation. But one without the other is a recipe for failure.
The risks of employee disengagement, decreased productivity and turnover can be daunting in a digital transformation, requiring attention to the impact on the workforce. This is especially the case at organisations with disjointed IT applications, systems and processes, resulting in a highly complex integration process.
For digital transformation to succeed, internal processes need to follow customer experience, not the other way around. This often results in such radical changes as the dismantling of processes and functional roles, as well as the demand for new skills and capabilities.
When not handled well, these changes can irretrievably damage employee morale, particularly if senior leaders have not compellingly articulated the reasons for the change throughout the enterprise.
If there is already a culture of fear or mistrust in the organisation, people will be resistant to changes they perceive as employment risks, making it difficult for the business to achieve the far-reaching goals of the transformation.
Different skills are required
Many change programmes fail because the senior team and board of directors lack the necessary transformational management experience to steer the workforce through the process.
There is a profound difference between operational and transformational management. This is especially the case when it comes to making needed changes to the executive team in the early stages of the effort.
Digital transformation cannot be thrust upon an unwilling audience.
Consequently, the people who end up guiding the transformation often have a very different skillset than what is needed to manage the impact of change in the workforce. The emotional side to change is often underestimated in terms of how deeply it can affect employees.
In this void, HR must step forward and take a leadership role, understanding the reasons for the digital transformation to guide the process forward without adversely affecting workforce morale, engagement and productivity.
Done well, employees will embrace the change effort, knowing the organisation will emerge smarter, stronger and more competitive.
In leading the change programme, HR itself may need to change. Processes and systems that impede workforce innovation, flexibility and agility must be abandoned. Building the right workforce is an art form, not a matter of creating rigid processes to assess people.
When HR professionals fail to articulate the ‘why’ and the ‘what’ of the transformation objectives to employees, and don’t regularly take the pulse of the organisation as the changes occur, it may contribute to a negative outcome.
There are numerous ways to mitigate these risks. For one thing, HR should encourage senior leaders to run a talent capability diagnostic before embarking on the digital transformation.
It’s all very well having a brilliant transformation plan in place, but the company must assess its existing ecosystem to perceive possible skills gaps.
The need for HR to assume a leadership role is clear and compelling.
It is also important to hire the right talent at the right stages of the initiative. The talent capable of implementing the design stage may not be able to deploy the programme regionally or globally or even sustain the benefits in the long term. Having the right talent in place and critical junctures of the transformation can mark the difference between success and failure.
Secondly, digital transformation cannot be thrust upon an unwilling audience. HR leaders must ensure organisational-wide buy-in of the change effort as it commences, if not before, leading frank discussions on the reasons for the change programme and the workforce modifications that are likely to result.
If these issues aren’t addressed until the transformation is underway, negative employee attitudes and resistance may already be embedded.
Taking on a consultative role
HR should see its role as that of an internal consultant to senior management and the board on the workforce implications of the digital transformation. In this capacity, HR can assist the hiring of people to manage the digital change effort.
HR can also ensure the design and implementation of a governance structure that permits accelerated decision-making capabilities. It can provide valuable advice on the consistent application of practices, tools and metrics in areas like benefits management. And it can manage those stakeholders who resist technology adoption.
Add it up and the need for HR to assume a leadership role is clear and compelling. Human capital is a company’s most important form of capital. Managing people to achieve their greatest potential is what HR does.
As digital transformation continues to be a key strategy of more and more companies, HR professionals that have already notched this type of experience will be in high demand. Count on it.