Digital technologies are changing the world of work – the internet of things, artificial intelligence, cloud storage, cloud computing, cognitive computing, and robotics are creating new business needs, opportunities, and challenges never before imagined. Such developments are disrupting the enterprise world and transforming employee experiences.
The growing reliance upon ‘everything digital’ has placed massive demands on training and development, with companies competing to get the best digital talent. Lack of education and skills in key technologies is holding back companies that need to grow, and change.
A new research study, the Digital Disruption Index by Deloitte, shows three-quarters of UK executives say they face challenges in recruiting the right digital skills. Only two in ten leaders think there are enough school leavers and graduates with the appropriate digital skills. Forty-five per cent also say that their organisation does not provide them and other leaders with the resources needed, such as training and coaching through a variety of multimedia channels, to develop their own digital skills.
MARGINALIA spoke with Paul Thompson (pictured below), UK digital transformation leader at Deloitte, to explore those findings and discuss what organisations can do to ensure successful business transformation. In this interview, Thompson walks MARGINALIA through the necessary digital skills that companies need, the impact of artificial intelligence on the future of work, and how organisations should move away from traditional linear ways of working when dealing with digital transformation.
Gloria Lombardi: According to Deloitte’s new survey, businesses are struggling to attract and develop digital talent. What types of digital skills are businesses looking for?
Paul Thompson: Businesses are looking for a broad range of digital skills. They are definitely looking for people who have technology and technical engineering skills. So, the sorts of employees that you would classically see be recruited by the technology part of an organisation: individuals who understand digital platforms, the architecture within digital systems, and how to build them.
But, companies are also looking beyond that. They are looking for talent with industry skills. For example, supply chain experts who understand about functional areas, and have functional expertise at all levels within the organisation.
So, it is not only about having the capability to build and implement the technology, but also helping leaders to think about the applications, and how that technology can be used within the company to transform various areas of the business. That is why we talk about a broad range of skills: organisations need deep technologists, but also people with industry and functional expertise who have a fluency in digital and technology.
GL: Your study found that 50 per cent of organisations are not providing the necessary training to support the digital strategy. Why is that happening despite the clear need for digital expertise across the business?
PT: It’s a combination of a couple of factors, at least. First, because companies are not 100 per cent clear in terms of what their digital strategy actually is; sometimes, leaders struggle to understand the type of skills that they need to support the strategy.
Without a clear a strategy that says, for example, that artificial intelligence is going to be a major component of the organisation’s future direction, it becomes difficult for that organisation to actually know what they want their employees to become fluent with.
Secondly, there’s a big shift brought by digital technology, which moves very quickly. An organisation may have employees who have been with the business for ten to fifteen years, and may require quite a lot of up-skilling to stay relevant in their particular area. Those workers may have been focussed on, for example, managing existing legacy systems as opposed to keeping abreast of the impact of new technology.
So, whilst there is a definite need for more digital skills, it’s not just about recruiting new talent; it’s also about up-skilling existing people in the organisation. And that’s quite a challenge for many companies as there can be so many employees to consider; the breadth, depth, and the general scale of the workforce that requires additional skills can sometimes be vast and overwhelming.
GL: Beyond training, what else should organisations do to support their digital strategy, and move forward with their digital transformation?
PT: It starts with setting the direction and the vision. Digital transformation is, in a way, just about business transformation, but in a world where the transformation is fuelled by the use of digital technology.
Digital technology is moving fast, as I said, and the pace of change is quick. But technology also allows organisations to do things relatively speedily. For example, with cloud technology. One of the biggest impacts of cloud is it lets businesses scale and deploy solutions swiftly compared to when they were dealing with an on-premises type world. This speed means enterprises can build and deploy new and better solutions quite quickly. They can test and prototype systems promptly. But speed is also a challenge, as employees need new skills to keep up.
So, for example, an organisation may want to transform its supply chain through the use of analytics, artificial intelligence, and the internet of things in terms of connectivity. What they want to achieve needs to be set out in a vision, and well communicated. It might be that they want to improve speed; they might want to reduce wastage; they might want to improve efficiency, etc. Therefore, what they can do in those situations is prototyping, testing, and building quickly. Through prototyping, iterative improvements, and frequent testing, they can quickly rebuild their systems.
In the past, transformation activities would be characterised by having multi-year roadmaps, which were set in stone. Today, digital gives companies a certain agility, which allows them to test something, see if that works and whether the business case stacks up. Organisations, of course, still need strategic direction to make sure they’re taking the right route.
GL: Another emerging technology explored in detail in your report is artificial intelligence, which is predicted to have the biggest impact on the future of work. What type of impact is Deloitte’s research referring to?
PT: Digital is all about connecting things up: it might be connecting a business to a customer; connecting an employee to an employer; connecting a field service agent to an expert; or a machine to a machine. This connectivity is only made possible by digital technologies such as mobile and cloud. With greater connectivity, we started to have more information and data. Then, the emergence of more mature and sophisticated analytics tools allowed us to make sense of that data. Artificial intelligence is the natural next step; making smart decisions based on analysis, in real time, and in a sort of operational way.
There are lots of stories about how many jobs will get reduced because of the emergence of AI. But that’s not the goal. The real goal is to improve the effectiveness of what organisations are doing. Businesses should not be looking at how they can automate their existing ways of working. AI gives businesses the opportunity to effectively reinvent some of their processes. For example, how the company interacts with its customers, how it interacts with its suppliers, and how it interacts with its mobile workforce.
The real objective of using AI is about creating better experiences, getting a better impact, and therefore driving the business value. It’s about thinking of what the company wants to achieve as opposed to just automating what they currently do.
GL: What types of digital skills are required to succeed and be relevant in the AI age?
PT: Businesses need skilled people to develop the necessary data architecture, so that the right data can be in the right place – it’s back to the connectivity issue again. They also need people who understand that the data transfer layer looks like – individuals who have mastered how to build data warehouses.
Organisations need data scientists too, people who actually apprehend how to optimise artificial intelligence engines, because the AI needs to be trained, rather than only programmed, to do what the company wants.
Organisations benefit from big data and all this connectivity only when it can access both the people with hard technical skills and people who understand how to bring AI capabilities to bear on business needs within the business environment.
To repeat: the organisation needs hard technical skills as there are some specific skills unique to AI. But it also needs the people with the ‘business smarts’ who can envision how AI can be deployed and adopted by the business to the fullest advantage.
Now, if the organisation can find all those skills in the same person, then fantastic, but quite often it can’t. And even when the company has all this range of skills, it still needs to think about how to handle those skills and, most importantly, about the ways of working inside the business. An organisation can have all the required AI skills together, but if it doesn’t challenge traditional ways of working then it will not be able to use those skills to the best effect.
Classically, when business leaders consider transformation, they won’t have data engineers around the table with them. Traditionally, data scientists and architects only get involved after the vision and mandate have been set.
I would argue now, in the AI age, that leaders need those people around them when they start to set out the vision, hence from the beginning. Because those technical individuals can help shape the vision around the art of the possible, focusing on the type of value that could be unlocked through the application of AI.
Our study shows that business leaders see the potential value from digital transformation, nurturing digital talent, and deploying emerging tech like AI. But, as ever, the challenge is in unlocking that potential, which is down to the strategic direction and the quality of the implementation. The UK’s economy is linked to productivity, and so developing our digital skills is crucial to the future of work and the success of the country.