What will be your organization’s greatest asset in the future of work? Most commentators and consultants would repeat the usual adage, ‘people’. But in a survey of 800 global business leaders, Korn Ferry discovered CEOs intend to place their bets elsewhere. 67% believe technology will create greater value for their organizations than people over the next five years.
A major shift in attitudes, but perhaps not a surprising one. Entire industries have been overwhelmed by the digital revolution. Moreover, the tempo of change has accelerated exponentially. Just look at the shift in the average tenure of Fortune 500 companies: In 1966 the average lifespan was 75 years, today it is only 15. In the scramble to stay relevant, firms are pinning their hopes on what looks like a clear winner: technology.
But technology doesn’t drive change, people do. Without the acceptance and adoption of their tech-enabled propositions by their hosts and drivers – as well as their customers – digital darlings Airbnb and Uber would have no operating models. Although these tech unicorns are extreme examples, they show what value can be created when people are empowered by technology. They depend on what Korn Ferry calls ‘the tech-people partnership’.
Firms will fail if they neglect the workforce aspect of the tech-people partnership. For organizations to fully benefit from the opportunities that technology offers they need to focus, first and foremost, on developing and enabling their people to succeed. That also includes enhancing their employees’ capabilities by integrating technology as part of their work processes. Digitization has become a necessity.
Sustainable success depends on continuous transformation.
This will require traditional organizations to transform. The way in which most organizations work today will not inspire nor enable people to deliver in the new economy.
The digital world also evolves too fast for transformation to be a one-time intervention. To lead the market rather than react, leaders must embed the ability to constantly adapt into their organization’s DNA. So instead firms should aspire to digital sustainability: the ability to change in a continuously changing digital world.
Organizations that want to remain digitally sustainable should:
- Renew their organization model
Place more focus on empowering all capabilities including partnering with external parties.
- Select the right talent
Have more innovative, risk-taking and resilient talent will allow organizations to compete more effectively in the marketplace.
- Change leadership styles
Adopting the right leadership styles will accelerate the organization’s transformation. Leaders should be able to create a compelling vision for the organization, drive changes and create a great organizational culture.
Weaving the ability to continuously transform into a firm’s processes, practices, ethics, values and culture is a huge challenge. It requires moving from traditional hierarchies and top down power models to network organizations where people across the company are empowered to make decisions, and shifting from driving behavior through rules and bureaucracy to inspiring people with purpose and principles.
As such for a start, organizations should check the readiness for the change. Other than preparing to embrace technology through investment, organizations should also help their people adjust and encourage the usage and implementation of technology in business applications.
Perhaps most importantly firms must shed a risk-averse culture, still so prevalent in traditional organizations today, and evolve to a culture where innovation and experimentation are encouraged. This culture of empowerment and agility underpins all digitally sustainable organizations.
The right talent is critical. The people who successfully drive technological transformation have a rare mix of both digital and change management skills, research from Korn Ferry found in 2016. But to realize the value of these high potentials, firms must foster an environment that allows these high potentials the freedom to generate ideas, test them and execute on at speed.
Furthermore, leaders must take their existing workforce with them and engage them around a compelling vision for the new digital business. Otherwise the change won’t become part of the organization’s DNA.
Starting the journey is the hardest part. Transformation for any reason is a leap of faith into the unknown. At some point, both feet will need to leave the ground.
To help leaders navigate the huge challenge of becoming digitally sustainable, Korn Ferry has identified how firms can move from where they are to where they want to be. Read our latest thought paper Rebuilt to last: the journey to digital sustainability to discover the organizational capabilities firms need—and how to embed them into the company’s DNA.
The task ahead for leaders is undoubtedly an enormous challenge. But the cost of doing nothing is even greater. And the reward for all the hard work? Not just a growing, profitable and digitally sustainable business, but the opportunity to move from reacting to, to shaping the future digital world.