Importance of digital transformation for HR and Organization

Worldwide spending on the technologies and services that enable digital transformation is forecast to reach $2.3 trillion (£1.8 trillion) in 2023, with the period from 2019 to 2023 seeing a steady expansion of digital spending to reach this figure. This shows that increasingly the digital transformation process is being viewed as a long-term investment, with initiatives set to take over a 50% share of worldwide technology investment by 2023, reflecting the global commitment to enterprise- wide digital transformation.

But why should organisations undertake digital transformation?

Everyone expects on-demand

Today's customer, internal or external, expects the same kind of experience in a professional environment that they have with technology in their personal lives. But for a business, this can be challenging to achieve. There have never been more choices, both in terms of how and where to deliver applications from, and who to partner with in the delivery of services.

Businesses increasingly demand more agile networking capability, and getting the user experience right is a critical part of business transformation. This goes beyond just the usability of applications for employees or external customers, and includes the experience of working with the IT team and tools.

For today's IT leaders, the need to maintain the operational discipline around security and performance will remain a priority.

Helping employees be more effective

Workforce engagement is a hot topic. Employers are looking for new ways to create productivity improvements, with digital technology playing a pivotal role in helping employees to become more effective in their primary roles.

Digital transformation provides a valuable opportunity for core business functions, such as finance and HR, to move away from manual processes and automate key areas like payroll, enabling leaders to focus on wider business opportunities.

The network's role in supporting innovation – by enabling remote working and providing access to technology and services on demand - is critical to delivering an environment that enables employees to achieve.

But the pressure to deliver consumer-level experience, great performance and enterprise-grade security can mean that on-demand services run the risk of becoming a millstone round the necks of IT and HR departments.

Security is a top business priority

It is essential that progressive businesses implement a security strategy consistently across all networks, applications and data, whatever services or service providers are being used.

To allow the effects of digital transformation to be truly transformative, CIOs should surround themselves with both business and technology partners that understand the broader business objectives and can operate honestly and transparently to achieve these goals.

Strengthen business partnerships

Demands from customers are increasing, and competition within industries is fierce. Firms are becoming increasingly reliant on each other, working with suppliers and distributors, sub-contractors and specialised consultants, with the aim of producing a diverse range of products and services that interest customers.

Managing these partners often requires document-based communication, a process traditionally viewed as an exhausting obstacle to efficiency. But technology is now available that can redesign this process. Utilising an eSignature system can enable a streamlined workflow that is more transparent, timely and accurate. This can even bridge the gap to mobile technology, helping employees be more effective and productive day-to-day.

More visible business priorities can often take precedence when compared with internal improvements within enterprises, especially as IT departments are increasingly stretched and budgets can be tight. But this is a mistake.

Through building a digital process at an early stage and integrating the wider organisation with technology, businesses stay ahead of the curve and make themselves more available to future partners. Internal processes can become more efficient and flexible, with the ability to scale as the business grows. Over time, digital transformation produces the tools to generate time and resource gains, strengthening business partnerships.

Make better decisions, faster

Placing data and analytics at the center of a digital transformation strategy will allow businesses to take advantage of big data.

Enterprises today have access to greater volumes of data than ever before, in no small part due to the Internet of Things (IoT). With the right set of analytical tools, this data can be converted into valuable business insights that can be used to make more informed, quicker decisions. The deeper analytical tools are embedded into business operations, the greater the integration and effect they can have.

Leveraging AI-based technologies can be the key to tapping into the potential of big data. Innovations across data and analytics are constantly rising to the surface, and many harbour advanced AI capabilities which both modernise existing applications and sift through data at a faster and more reliable rate, all supporting leaders in their endeavors to make the better, faster decisions that result in progression.

But what’s the need of HR Digital Transformation?

The Why of HR Transformation

First things first. As a rule of thumb, any HR transformation, whether it is a digital one or not, has to take place with a clear objective in mind. It has to make business sense.

Too often still, companies seem to give in to peer pressure; their competitors all ‘do digital’ so they feel like they have to do something too. But digitalizing certain HR processes just for the sake of it is never a good idea. It leads to the implementation of (expensive) technology that doesn’t meet the actual needs of the business. Needless to say, this totally defies the purpose of a transformation.

Importance of undertaking digital transformation in HR?

The goal of digital transformation in HR may be multi fold:

• To automate processes and reduce the time spent on repetitive tasks.
• To maximize the employee experience.
• To use the freed-up time to strategize and ultimately benefit the business bottom line.

HR digital transformation is the transformation in the way HR functions, using data to guide all areas of HR: payroll, benefits, performance management, learning and development, rewards and recognition, and hiring.

The role of HR teams in digital transformation is twofold:

• It is responsible for its own transformation – using automation and digital, data-led processes.
• In collaboration with the IT department, HR is now being asked to lead organizations towards digital transformation and support its continual digital evolution. This involves empowering employees with a digital mindset to improve workforce processes and enhance productivity

HR’s Role in Business-Wide Digital Transformation

As HR takes responsibility for its own digital transformation, it is also expected to take the lead in enabling the transformation of the rest of the organization. While IT takes care of the digital aspect, HR’s role is more oriented to the human aspect – helping change the mindset and helping create the culture. Simply put, as the custodian of the human experience in the workplace, HR is at the center of enabling digital transformation.

Employees love consumer-grade experiences in their personal lives, like chatting with a chatbot to complain about the late delivery of their food order. But in the workplace, they may fear the same chatbot for a variety of reasons. For example, they may fear that the information they share with these chatbots may be used against them, that this automated tool will take their job from them, or simply believe that this trend might not last.

Behavior change is a critical aspect when implementing new technology. In the end, it’s the people that make a business successful.

He then recommends unique ways to get employees on board when implementing a digital transformation project. HR can help to provide learning experiences of different kinds for employees to make learning fun, engaging and effective.

For example, in getting employees to use AI-powered tools, you can tell them that it is AI that auto-generates a playlist for them to listen to on Spotify based on their preferences. This can open up their mind to the positive features of AI, and they are more likely to embrace it as a useful tool.

Some of the other benefits you can highlight are:

• Quickness: How easily a digital solution will improve the speed at which employees work.
• Simplicity: How easy it is to use the solution.
• Freedom from repetitive tasks: How it frees up time to do more creative tasks.
• Anonymity: How, while data collection is the norm, in some areas (such as in engagement surveys), the data is collected anonymously to help identify an organization-wide trend only.

In addition, By providing learning both on-demand and through multiple channels in everyday activities, your employees can learn efficiently in real time and actual context. It’s also essential to make learning highly immersive, interactive and self-paced, so employees can practice tasks specific to their daily activities in the context of their jobs and at the rate of change they are comfortable with.

Closing Thoughts

Digital transformation aims to create an agile organization that is ready to change as technology keeps advancing. Technology will always be ahead of the curve as organizations try to catch up. The absence of this agility can be one of the reasons why digital transformation strategies fail.

What you as an HR professional can do is prepare your organization and your team to remain engaged in this process, and adopt technology at its peak, optimally. For that, you need to be prepared yourself. Stay aware, stay current, and ensure that you know what your competitors are doing in the same area. Keep an eye on the pulse of the organization and what it is saying/doing. This will allow you to initiate, complete, and keep moving forward with your vital digital transformation project.