Why people are at the heart of digital transformation

In the final article in our series on digital transformation, RSM experts explain why organisations should keep prioritising people as they undergo technological change. If you missed the first two articles, you can find them below: 

• Digital transformation in the middle market: Unleashing butterflies or racing caterpillars? 
• How businesses are turning to the Cloud to accelerate digital transformation 

Despite the increasing use of, and familiarity with, automation and Artificial Intelligence (AI), the robots, it seems, have yet to win us over. Customers’ preference for human interaction is long-standing and persistent, even as AI has improved beyond recognition. 

Even in roles where humans do not always find a welcoming audience, such as telesales, robots see less success. Research suggests that consumers feel less empathy towards AI telesales bots, compared to human callers, and hang up faster. Indeed, some of the most successful technology to emerge in the last two decades owes its rapid growth to meeting our need to connect with other people: “our brain’s lifelong passion”, as another researcher has put it. 

Of course, none of that is likely to halt the profound digital transformation we are seeing across industries and the broad range of technology transforming businesses in the middle market and elsewhere. Even when it comes to sales, resistance to AI interactions is likely to weaken as the technology (and its use) continues to improve. Moreover, a range of technologies, including AI, are already helping to support humans in better serving customers. “Adopting ‘omnichannel technology’ to create seamless customer experiences, has been among the key developments in retail, for example,” according to Lilian Boyer, IT and Risk Advisory manager at RSM France. 

However, it does indicate that humans will remain a core part of operations for the foreseeable future. It is also an indication that, quite apart from the other challenges digital transformation may pose to businesses, tackling the people problem will be critical to the success of projects in this area. 

No pain, no gain: the challenges with digital transformation 

For a start, even where technology and automation are replacing people, the transition will create serious challenges. As IT manager Daniel Hasslund at RSM Sweden explains, the replacement of jobs with technology is not new and has been a feature in many sectors for decades. Think, for example, of automation in manufacturing, allowing factories to run more efficiently and safely with fewer personnel. AI, however, could be a ‘game-changer’. Hasslund says that both expanding that replacement to traditionally white-collar roles and reducing the traditional barriers that required high capital investments. 

Looking to the future, Hasslund suggests, “In the upcoming years, AI could make automation more accessible not just for large corporations but for businesses of all sizes.” 

Undoubtedly, there will be business benefits from this, but responsibilities and challenges, too, in managing such a transformation. Boyer adds, “Replacing jobs with automation necessitates thoughtful workforce planning.” 

Furthermore, implementing digital transformation projects poses its own employee challenges with technology driving the need for ‘upskilling’. Among other challenges, a shortage of digital skills within the workforce is one of the key issues behind the slow uptake of some technologies. 

“The professionals assigned to digital transformation are often very scarce due to the increase and the high demand for technical professionals with experience in digital transformation,” explains Alexander Sobanski, Partner at RSM Ebner Stolz. 

The universal shortage of digital skills will ease with time. Universities, for instance, are beginning to integrate relevant content into their curricula, but the scale of digital transformation projects planned across industries and businesses still dwarfs the available talent. 

“Training programmes for employees are also increasing, but not all employees can be retrained as digital experts,” Sobanski says. 

Even where businesses can find the staff needed to implement projects, they can face skills gaps in managing cyber security, privacy and other risks new technologies can introduce. 

“Audit, IT and risk management play essential roles in evaluating and addressing these risks,” says Boyer. 

Finally, digital transformation also brings a broader workforce challenge: a new way of working. Without it, the impact of any technological investments is likely to be limited. 

RSM’s Simone Segnalini, partner for Digital, Risk & Transformation in Italy also suggests, “Digital transformation often necessitates a cultural shift towards a more technology-driven and data-centric mindset. Companies must foster a culture of continuous learning and innovation to embrace digital advancements.” 

Seizing the opportunity: How digital transformation can support business growth 

For as much as a cultural shift is a challenge, it can also be a highly beneficial opportunity. As Segnalini suggests, digital transformation can drive a shift in ‘workforce dynamics’. That requires businesses to prioritise upskilling, seeking out digital talent, and adapting their organisational cultures. But it also unlocks new ways of working for efficiencies and increased productivity. 

Perhaps most obviously, remote working has become normalised globally as a product of the pandemic, as much as the technology that made it possible. 

“The remote culture has entered everyday life and is changing the modus operandi of many organisations,” says José Pedro Gonçalves, an RSM partner and digital transformation expert in Portugal. “Every aspect of human resources has become digitised”, he adds. 

In part, this actually eases the potential burden of skills gaps resulting from digital transformation. While it has brought a need for new skills and increased competition in the recruitment market, for many roles businesses are now able to look to a much wider potential talent pool than before. 

“Finding qualified personnel is one of the most significant challenges for many companies, and digitalisation has opened doors to a broader talent pool beyond geographical boundaries,” says Hasslund. 

It is not simply about who is working for a business, however, but how they work. The same technologies enabling businesses to recruit globally also enable workers to connect globally. Collaborative tools mean that teams can more easily tap into the expertise and experience across the organisation for cross-border collaborations or for training purposes. 

“Digital transformation is fundamentally changing the way that a business approaches upskilling, training, or recruitment, and even the composition of its workforce,” says Segnalini. 

And finally, digital transformation is changing what people do in their place of work. It can automate repetitive, simple tasks and administration, as well as support and inform decision-making. This can liberate individuals from repetitive tasks, allowing them to spend time on higher-value work and relationship-building activities in which a personal touch is needed – while leaving the rest to the robots. Digital transformation, if done correctly, could, in fact, make work a little more human. 

If you are embarking on digital transformation and would like more information, please contact us.