Beyond Technology – Agile Digital Transformation By Daniel Cham, General Manager, Workday Greater China

From shifting to hybrid virtual workplaces to redefining the role of business as usual, the disruption caused by COVID-19 continues to loom large over organisations across the sectors. The pandemic’s profound impact has left us with no choice but to become more adaptable in today’s challenging business environment.

From transparent corporate cultures to digitised solutions and processes, being able to pivot in the face of crisis requires an organisation to be agile. Agility is also about looking for innovative ways to build business resilience, future proof revenue streams, improve operations, and ensure employees are managed and supported well. Even though the benefits of being agile may seem obvious and lead to the assumption that the majority of companies are in the process of incorporating technology and innovation into their operations, a recent Workday study has demonstrated otherwise.

The Workday Digital Agility Index study, conducted in partnership with global technology market intelligence company IDC, sought the insights of nearly 900 senior business leaders and C-suite executives in nine Asia-Pacific regions, including Hong Kong. The study showed that while 17% of Hong Kong organisations have accelerated their digital transformation efforts since the onset of COVID-19, the reality is that almost half (49%) have slowed down because of the pandemic. Significantly, while 91% of the organisations have used digital technologies to execute their business practices during COVID-19, which seems like a positive statistic, a significant 40% of those surveyed still do not see digital transformation as a business priority. 

Based on Workday’s survey findings, while organisations are able to see the benefits of digital transformation, they lack what it takes – the agility – to attain effective transformation. Beyond deploying technology as an expedient measure to deal with the public health crisis, the majority of companies lack the enterprise wide agile culture necessary to develop interconnected high-performing teams, each with a clear purpose and the skills it needs. The survey illustrates this. It found that the most important areas of focus for Hong Kong employers in their digital transformation plans for the next 12 to 18 months are predominately front-end. These include front-end revenue generating systems (47%), front-end systems for customer touchpoints (46%), and front-end customer service systems (37%). Back-end systems in finance (30%), administration (28%) and HR (19%) were viewed as lesser priorities.

Investing in talent to innovate and thrive

In the new world of work, ensuring digital agility has become more crucial than ever to remain competitive. To achieve this, organisations need to ensure their employees are equipped with the appropriate digital skills. Workday’s study illuminates that owing to a lack of digital agility many employees lack the necessary skill sets needed to thrive during the pandemic. The vast majority (94%) of companies in Hong Kong are not taking an active role in tracking the development of their employees’ skill sets, resulting in a shortage of digital skills.

Adding to the concerns, 74% of Hong Kong organisations revealed that less than half of their employees have been trained with the relevant digital skills and capabilities, with 11% revealing that they have almost no employees with digital experience or skills. Based on the survey data, it should not come as a surprise that this limitation has contributed to the general lack of an enterprise wide culture of agility (76%). The survey data also shows that 84% of the organisations do not view employee experience as an essential consideration in enterprise wide decision making. This is precisely why it is necessary to alter the mindset within Hong Kong companies, i.e., to invest in and nurture talent, and to perceive nurturing talent as a competitive advantage.

Organisations need to build a competitive workforce by sourcing in-demand skills, investing in continuous learning and skill development, and managing and optimising performance. Together, these investments can help ensure those changes remain sustainable. Truly agile organisations are more likely to have plans to upskill their workforce and push specific initiatives to boost employee engagement. Upskilling creates a mutually beneficial relationship. Expanding internal skill sets not only helps employers quickly adapt to change, but also gives employees new areas of expertise they can use to develop their careers.

Furthermore, truly agile organisations also make timely, accurate data accessible to employees who need it. Workforces need to be empowered with the right data and information at the right time to make the best possible decisions for the business. Previous Workday research has shown that a growing share of numerous companies’ revenue was directly linked to digital skills — that did not exist a decade ago. However, the Workday Digital Agility Index findings showed that almost all (98%) of the C-level executives have found it challenging to make adjustments to their financial plans in response to COVID-19, with 70% unable to realign their organisational structures. 

Accelerating digital transformation

So how can the HR function and their organisations effectively drive change in this new era? Artificial intelligence and machine learning can play a crucial role in digitising business processes and systems. Not only does this help streamline operations and save time, the insights and data gathered enable managers and team leaders to make informed business decisions that add greater value to the company. The HR function plays an important part in assisting with the integration by providing staff with the relevant training to leverage these new technologies.

Remote and flexible working arrangements are here to stay. Having a cloud-based platform facilitates business continuity, reduces locationbased obstacles, and allows businesses to recruit top talents from various geographies. Furthermore, changing the way the HR function manages talent and fostering a learning culture are also essential. Artificial intelligence will be able to identify specific skill sets within the workforce and can be a useful tool when developing career optimisation related programmes – this can be extremely beneficial to employees as they progress in their careers. It can also boost morale and employee retention.

Organisations can also adopt systems that harness machine learning and use graph technology to create a “skill ontology” to discover skill gaps, maintain the growing list of skills, as well as map how closely skills are related to one another. This enables companies to determine a more optimal path toward a target result, such as matching employees to content, learning, and mentors; and vice versa, matching learning to employees, and more. This helps equip staff with the necessary skill sets that align with the organisation’s digital transformation.

Collaboration must support digital transformation

While having a team of digitally agile employees is a prerequisite for accelerating digital transformation, it is also critical for the HR function to join forces with the IT team to create new technology tools and platforms for sustaining the digital transformation momentum. This is because such integrated technologies can help foster a more cohesive working environment – bridging the gap among employees working in different departments and geographical locations.

A unified environment allows integrated workforce planning. It also provides HR leaders with the ability to plan the workforce in synchronicity with all other business plans – corporate strategy, financial, operations, departmental budgets and forecasts. This creates a comprehensive and dynamic workforce plan which aligns with strategic corporate goals. Now more than ever, the ability to quickly and easily iterate and develop multiple contingency plans is emerging as a competitive advantage for companies seeking to maximise the potential of their workforces.

Once integrated digital systems have been put in place, and employees have been equipped with the relevant skills, issues such as communication barriers and organisation inefficiencies can be eliminated. Only then can companies become truly digital, with the agility to remain resilient in the future of work.