If you’ve spent time in the technology world over the past decade, you already know the pace of change is increasing exponentially. And there’s no sign of a slow down.
Any organization with hopes of growing (or even doing business) in the future must adopt new tools, platforms and processes to thrive in the ever-changing world of technology. Digital transformation is happening in every industry, at every level of government and in academia far faster than most experts predicted.
The companies best positioned to thrive in this changing environment foster an innovative culture and aren’t afraid to disrupt their own businesses with new products, services and delivery models. This playbook breaks down:
1. The challenges that stand in the way of speed
2. How leaders can build a motivated workforce intent on building new skills
3. Why skill development is essential
4. How they can realize the ROI of successful transformation
Why you can't move faster
How to build a motivated workforce
Skills: the fuel behind transformation
The ROI of adaptability
1: Why you can't move faster
There’s no other way to put it: Digital transformation comes with some major challenges. Most significantly, leaders face difficulty managing all the moving parts in their organizations:
How does the change in digital business models impact technology and people?
How do we adjust the marketing plan to support the transformation (and vice versa)?
How does it impact the brand and existing customers?
Are we hiring the right talent to support our growth, or will our current employees hold us back?
Technology leadership gap
Until recently, organizations dealt with these challenges by adding chief digital officers to drive the transition to digital strategies and tools. Ultimately, this tactic isn’t enough. As analog operations are converted into higher-performing digital businesses through the adoption of new technologies, the role of the chief digital officer is giving way to other C-level leaders with digital skills.
CEOs must see technology strategy as business strategy. CIOs and CTOs must hire and lead teams that are agile enough to support emerging business models and are dedicated to building the skills they need to thrive. CMOs must now be proficient in supporting a digital customer experience. Even human resource leaders must more efficiently attract and hire people who don’t simply support existing architectures, but can also innovate with newly developed tools and practices. The days of business leaders leaving digital strategy to the CDO are over.
It’s human nature to avoid change, especially disruptions that are painful for those unable to adapt. Some business leaders see that their current analog businesses are still growing and argue, “Why fix something that’s not broken?” They’d rather wait until real problems develop before investing in new tools and processes.
Other organizations may object to moving forward with digital transformation due to the cost. A real transformation can require a significant investment in everything from new customer interfaces to back-end systems that support functions such as finance or sales. So they hold back, allowing competitors to take advantage of the opportunities, hoping (perhaps in vain) that they can catch up when the technology is more affordable.
Another challenge arises from inflexible organizational cultures that depend on outdated technologies. These companies are handcuffed by old systems and policies that keep employees from doing their best.
In time, these tech laggards will see both customers and employees opt for better opportunities to interact with fast-moving competitors. Forward-looking companies should be constantly on the lookout for new ways to update and disrupt their own systems. Eventually someone will do it—why not make sure that person is in your organization when they create the next big thing.
And finally, lack of skills
It’s not just technology that holds teams back. Organizations require both tools and the skills to grow. The skills powering your transformation are as critical as the strategies and technology that make it possible. And while many organizations invest in training for their staff, the rate of change is accelerating so quickly that much of the instruction is obsolete as soon as it’s delivered. Effective digital transformations require continual investment in new skills that, until recently, only a few organizations could afford.
2. How to build a motivated workforce
One of the most valuable assets for companies that thrive in an era of digital disruption is a workforce of star team members who are invested in their jobs. The world’s best engineers can be up to 10 times more productive than their average peers. That means that the right employees have the potential to accelerate digital transformation by 20-30 percent.
The most valuable employees are those who resist complacency, take risks and drive the business forward. According to a Gallup study, employees considered talented, experienced and engaged outperform average employees by 18 percent and pass on their enthusiasm and knowledge throughout the organization. That can be the difference in millions of dollars of increased revenue—up to $12 million per 1,000 workers for highly skilled professions.
So, how do you develop and retain a motivated workforce with adaptability at its core?
Allow autonomy to flourish
Give your employees a voice in the types of skills and projects they’re working on. It pushes them to explore and create new ways of reaching goals. Challenging conventional wisdom from the inside gives your company a competitive edge. Your star performers are your unique strategic advantage to seizing new opportunities in a business environment that’s changing faster than ever.
Don’t typecast roles
As your teams become interdisciplinary, they’ll have a better understanding of how other technologies work, and roles that are unique to your business will emerge. You’ll find that recruiting becomes easier as you look to your current workforce to fill critical, custom roles on your teams. On the other hand, employees who feel boxed into their role will look to your competitors for growth.
Provide ongoing enablement
The full power of technology can’t be realized if leaders take a passive approach to supporting their workforce while introducing new tools, processes and business models. It’s only when employees fully understand the capabilities of technology that they’re able to leverage it to achieve desired business outcomes. This understanding must come from more than informal knowledge sharing, so consider investing in robust documentation, strategic certifications and a technology skills strategy.
3. The fuel behind transformation: skills
To maintain speed, leaders are rethinking how their teams develop new skills.
In the past, managers determined which skills employees needed to acquire, then either sent those employees to training off-site or paid top dollar to bring experts in-house. This top-down model of outlining what teams learn doesn’t work for fast-moving organizations. Too often the skills being taught aren’t relevant to what teams need to know. Perhaps just as importantly, providing this kind of training has become increasingly expensive—it just doesn’t scale.
LMS systems designed to “push” learning activities to employees have given way to new self-paced formats that allow employees to find the skills and learning paths they need, when they need them. Teams shouldn’t wait weeks or months for conferences or pre-scheduled professional development opportunities between projects. Instead, leaders must encourage personal responsibility for acquiring new skills during a project, so effort is maximized and projects are delivered faster.
To do this, technologists need an easy way to access expert, vetted content. Without it, they’ll waste hours searching for the information they need or turn to their coworkers for help, impacting the productivity of the entire team.
Pluralsight has solved this problem with our channels feature. Channels allow organizations to curate relevant courses and other content based on key initiatives or business needs, for instance switching technologies or onboarding new hires. Learners receive course recommendations based on their interests and can build their own channels that align to the skills they want to acquire.
Turn skills into speed
While employee-driven skill initiatives are the trend, often teams need help identifying the most important technologies, tools and roles. Today’s top technology skills platforms must include accurate measurement capabilities, so leaders can understand where their workforce stands. In addition to leader analytics, learners should be guided to the right skills at the right time, and be able to understand how their skills have progressed over time.
With Pluralsight, learners take short assessments that benchmark their abilities against their peers and tell them where to start learning. Knowing what they know—or don’t know—gives them an efficient path forward.
The same is true with our Role IQ experience. At many organizations, technology roles aren’t clearly defined or there’s ambiguity around career growth, which creates disengaged employees. With Role IQ, technologists can identify which skills are required for success in their roles, see where they stand and take on opportunities to improve.
Meanwhile, leaders using Pluralsight gain access to one-of-a-kind analytics that catalog role proficiencies across the organization, so they can put the right people on the right projects and successfully execute their tech strategy.
Strategic skills change the way your organization goes from idea to market. The right skills speed up innovation, reducing design cycles and development time. Without an investment in them, your transformation efforts will fail.
4. The ROI of adaptability
The investment is in your workforce is a big one. By the end of 2019, companies around the world will spend $1.7 trillion on digital transformation—42% more than they spent in 2017. These costs can be hard to justify if stakeholders see transformation as a one-time bet on rebuilding existing businesses, rather than a process for developing new products and strategies that allow an organization to thrive in the future.
How to measure the payback
Most investments are measured using some combination of payback period, internal rate of return (IRR), or break-even analysis. Accountants project the gain from investment and divide that by the cost of the investment. By these measures, change in your organization might appear to be a bad investment.
For example, investing one million dollars to digitize an aging inventory management technology may have a significantly lower short-term return on investment than spending the same million dollars on a new marketing campaign to drive an immediate increase in sales. But relying on aging systems to support the business activities of the future is a losing strategy. Eventually the lack of digital investment will catch up with (and possibly destroy) your organization.
Adaptability translates to savings
The reality is an investment in the future will actually save your company money. Even if traditional ROI projections don’t look stellar.
Once an organization’s processes have been digitized, the transformation and cost savings continue as teams work together to improve processes and technology—removing inefficiencies and automating steps in the process that require expensive and time consuming analog inputs from employees and suppliers. Capital expenses are often reduced and move to the operating budget as organizations move more data and services to the cloud.
Feedback loops across the organization provide access to new data sets like chats, video, social media, online discussions, point-of-sale transactions that can be mined for insights. An adaptable organization can act on feedback to improve products and processes. This allows employees to identify revenue opportunities and new ways to do tasks more efficiently.
These are all very real potential gains that are difficult to capture in traditional measurements of ROI.
The wrong skills are the greatest risk to your investment
The irony of transformation is that the implementation of platforms, software and systems is relatively easy compared to finding talent with the right skills to manage it all. You can no longer get away with easily hiring the right person when the need arises—a process that can take months and cost thousands of dollars. Imagine the cost and hassle if you need to bring on a whole team of experts.
In addition to new business strategies, adaptability requires a shift in technology skills strategy as well. Rather than hiring exclusively for needed skills, leaders should hire people with an aptitude for growth, so as technology needs change, skills can be quickly updated to support new software and platforms. The ability to learn new skills on the fly is becoming far more important than a command of any one set of technical skills.
Our technology skills platform enables teams to learn the right skills at the right time—providing leaders with an agile workforce that can tackle market changes as they come.
So, what’s the ROI of adaptability? If these changes allow your organization to develop competitive products and services that customers will buy in the future, the return on investment just might be priceless.