As we find ourselves in the age of 5G, AI and IoT, we realize that the Fourth Industrial Revolution is in full swing. Digital transformation is widespread and ever-growing, with even the smallest of companies realizing that to survive in this century and beyond, they need to upgrade their businesses with state-of-the-art tech.
Still, while it can certainly be easy to get carried away with all the talk about the tech, it is easy for us to forget about the human element that lies at the heart of digital transformation or any other form of technological advancement. In all the chatter about saved costs, lean workforces and improved margins, businesses often forget that humans – the employees at the heart of any business – are still the binding that ties everything together.
Ultimately, human resources (HR) departments are best suited to ensure this.
Now, a new study by global enterprise applications company IFS is shedding more light on this.
Call it what you want, digital transformation is still fundamentally human
According to the report, a quarter (27%) of companies acknowledge that despite being key, people are often overlooked when planning and executing transformative projects.
This is such a major issue that another study by Forbes Insights, cited by DevOps.com, found that 75% of executives say they’re still waiting to reap tangible benefits from disruptive technology. The reason: “Technology alone does not solve digital transformation. It doesn’t address some of the most fundamental issues that inhibit or enable transformational success nor the most critical dependency, which is people.”
“To truly transform, organizations must go beyond just technology to embrace the human elements of this evolution,” DevOps continued.
The IFS study findings show similar reasoning, identifying poor change management as one of the key reasons digital transformation projects fail. When implementing new digital transformation projects, businesses are focused on implementing the key technology and solutions but aren’t considering the importance of staff buy-in and acceptance of the project, which is intrinsically linked to its overall success.
When asked about the reasons for failure in past projects, businesses surveyed in the study also cited lack of employee engagement among the top four reasons. In addition, respondents named past experiences of low employee buy-in as one of the top two reasons for hesitating to launch new digital transformation projects. This can potentially have a great impact on the overall development of a business, as in times of downturn many believe innovation is the key to business resilience.
So, how do business make sure both the human and tech elements mesh well together?
HR has a major role to play
To ensure the best and most holistic implementation of digital transformation practices, the human resources (HR) department has to work hand in hand with the IT department. While it may be surprising that an HR department has such a large role to play when it comes to digitalization and digitization, many companies have had to learn this truth the hard way.
One third of the respondents in IFS’ study identified involving the HR department from the beginning to ensure employee awareness as key to digital transformation success. However, one quarter of companies admitted that they have been guilty of not doing so in the past. Furthermore, 21% of companies expressed that employee engagement is more of a “tick-box” exercise, as opposed to being critical for success, revealing an obvious mismatch between recognition and actual execution.
From an HR perspective, there is ample proof that digital transformation makes good business sense. 29 percent of respondents stated that employee retention would be higher if the business could offer more exciting technology to its people, indicating that technology does have employee retention possibilities. Furthermore, 39% said that technology provides the ideal opportunity to retrain and upskill existing staff, thereby bridging the skills gap that is a major pain point in many industries.
“Through continuous dialog with our customers as well as first-hand experiences from our own digital transformation, we have always known that people can act as both an enabler and a barrier in transformation projects,” IFS Chief Human Resources Officer Jane Keith said.
“This report drives home the point that if digital transformation is kept human centric and if change management is handled effectively and employees are aware and inspired to support the transformation, the business is much more likely to reap success,” she continued. “Staff involvement should not be seen as a just a tick-box exercise but as the secret sauce that will ultimately determine the outcome.”