Small and midsize companies are on the brink of a massive change. As digitally enhanced business models, connected products, and automated processes become the norm, employees are demanding a shakeup in every aspect of the workplace as they try to keep up. Meanwhile, large organizations watch how smaller businesses are impacted first by the digital wave to determine the most-innovative ways to make their workforce more agile.
This desire for internal change is not entirely unwarranted. The workforce mindset, knowledge, and culture can actually get in the way of a successful digital strategy, according to the IDC interactive guide, “HR Transformation and the Digital Journey: How Small and Medium-Sized Businesses Can Deliver Strategic HR.” When ignored, these three factors can bring a business to a downward spiral of mass employee disengagement, new talent indifference, and revenue-sapping inefficiency and complexity at even a faster pace, given their size.
I experienced this firsthand when I left a business-to-business start up for SAP. During the interview process, I was asked a series of questions about HR and business priorities being considered for the next 12 months. I was so nervous when I accepted the job, thinking that my experience at a startup would not meet the demands of a big player like SAP. But to my surprise, we had already tackled these topics 6–12 months prior in the startup. I soon realized that my experience during the dot.com explosion – which gave me expertise in running an agile organization and a keen understanding of HR technology – allowed me to contribute quickly to these issues that the SAP HR team needed to confront head-on.
So why are HR leaders not taking on these challenges directly? The reason is quite simple: They are less likely to be invited to the table to help lead digital transformation.
Why digital strategies should be focused on people
A digital transformation that delivers a competitive advantage requires an engaged and educated workforce. However, this cannot be done without the support of HR leaders who can address the three critical principles of successful digital initiatives that most CIOs, CTOs, and CEOs do not typically consider.
1. Align the workplace culture and business strategy with analytics
When it comes to acquiring and developing the right talent, it is important to align strategies and goals for talent management and development, business growth, and digital transformation.
This can be facilitated with intelligent analytics – such as predictive analytics, machine learning, and automation – that can help HR leaders shape the workplace culture and business strategy in parallel. The insights generated by these tools can inform business leaders about emerging operational imperatives that should be included in the digital strategy to meet the expectations of internal and external stakeholders, employees, suppliers, partners, and customers even before they happen.
2. Acknowledge and support workforce diversity
The more diverse and inclusive the workplace culture becomes, the more necessary it is to view the digital strategy through the lens of various segments of the workforce. Social experiences and generational and ethnic values can overshadow widespread technology adoption by coloring how people communicate and make decisions around hiring, developing, and managing talent.
For example, knowledge from retiring employees needs to be efficiently exchanged to empower a new generation of workers to succeed. The culture of newly acquired companies should be integrated into the overall business deliberately and respectfully. And the preordained biases (both conscious and unconscious) we all carry need to be removed from our decision-making processes.
3. Build a more engaged, productive workforce with technology
As HR leaders know, digital transformation can change how people – from employees to potential recruits – view the employer brand. It’s an opportunity to redesign processes, offer new transactional and administrative services, and shape new mindsets that will enable employees to deliver their best selves every day.
By tapping the HR function as a true partner, business leaders gain the expertise they need to keep employees engaged, empowered, and invested in a culture of innovation. Intelligent services and artificial intelligence, for instance, eliminate the frustration of manual routine tasks. A center of HR excellence drives one-to-many services such as onboarding, recruiting, succession management, and compensation planning. Plus, collaboration tools can bring the entire business together to provide feedback on organizational experiences and mentor employees who are ready to be developed for new roles.
HR expertise maps a clear path to digital success
From facilitating administrative services to creating a vision for the future of work, HR leaders certainly have their hands full. But no responsibility is more important than helping every employee embrace the changes required to move the business forward competitively. Fortunately, HR leaders are uniquely qualified – and prepared – to understand the workforce’s readiness for such change and to earn the support and commitment of every business leader and employee.
Find out the key trends and actions that make HR organizations uniquely qualified to address the challenges of digital transformation in small and midsize businesses. Read the IDC interactive report, “HR Transformation and the Digital Journey: How Small and Medium-Sized Businesses Can Deliver Strategic HR,” sponsored by SAP SuccessFactors.