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The shift from the industrial revolution to the information revolution has altered existing paradigms. The only difference between the two is that we don’t yet fully understand and comprehend the extent of the information revolution, and it is a work in progress.The information revolution has given way to digital revolution that is impacting every aspect of businesses. From business strategy to the workforce, the digital revolution is truly ubiquitous and is impacting everyone.
The extent of digital transformation is vast and, in some ways, carries within itself parts of digitization as well as digitalization, two terms that are often used interchangeably but have contrasting meanings. The need to address the uncertainty of the digital revolution has never been so imminent at the organizational as well as at the individual level, failing which organizations could head towards becoming entirely obsolete.
In layman terms, “digitization is the process of converting information from a physical format into a digital one.” – David Burkett, Digitisation and Digitalisation: What Means What?
Closely associated with both digitization and digital transformation, digitalization is the way in which the process of digitization is used to strengthen business processes.
The term ‘digital transformation’ refers to:
“The profound and accelerating transformation of business activities, processes, competencies, and models to fully leverage the changes and opportunities of digital technologies and their impact across society in a strategic and prioritized way, with present and future shifts in mind.”
How to Approach Digital Transformation in your Organization – A CIO’s Guide to the Changing Digital Landscape, Innovation Value Institute.
The past decade has witnessed monumental digital transformation with social media, smart devices, 4G internet, advanced analytics, cloud, artificial intelligence, among others, seeping into the very fabric of how organizations conduct their business. Businesses that have undertaken modernization amid digital transformation, displaying agility in adapting to the digital ways, are already in pole position, enjoying an advantage over their competitors.
From apartment condominiums to the healthcare industry, everybody is taking the digital route for better customer experience. Many apartment condominiums in Delhi-NCR have gone digital with an app for entry approval, bill payments, and maintenance requests, for the ease of use for residents as well as administrators. The healthcare industry, too, is witnessing transformation by digitally facilitating appointments, tracking reports, and maintaining the record of a patient’s health indices. Every business today is trying to add value for its users and customers, and this is where digital technologies play an essential role.
Businesses have often seen a digital transformation as being limited to an upgrade in their IT infrastructure and through the internet of things (IoT). However, for businesses to champion the future of work, every aspect of a business, right from processes, strategy, to its building blocks and its workforce should be ready to embrace this transformation.
Digital transformation is not about technology—it is about strategy and new ways of thinking.
– David L. Rogers, The Digital Transformation Playbook
It can be defined as the level of readiness in the employees of an organization that is undergoing a technology transformation or going digital.
“Digital readiness is simply the ease with which employees and organisations can transition to digitized workflows, using software and other technology. The eventual goal is to streamline the way business is done and customers are served.” – Damien Martin, Shufti Pro
Employees are the building blocks of any business, and it is essential for organizations to proactively train them to undertake the digital transformation, for their personal as well as professional growth. For an organization to completely transform every facet of its business to be in sync with digital technology, its employees have to onboard the digital readiness train.
The digital transformation strategy of every organization needs to be well prepared to accommodate varied aspects of digitalization. It needs to have a defined objective, an all-encompassing business plan, as well as a workforce ready to take on the challenges that come in the way of achieving the digital goal.
There are two facets to the digital transformation – a cultural change, starting at an organizational level and trickling down to an individual level, and an actual shift in technology, with an infrastructural update using new technologies in processes and operations. However, the real power of digital transformation lies at the human level, with people who execute it.
When an organization decides to start its journey towards digital transformation, its employees across all levels, from CXOs to the administrative staff, need to be digitally ready to be active contributors. For a business to truly embrace technology, organizations will have to jump many hurdles that obstruct the path to digital transformation.
“One challenge organizations face in achieving a digital-ready workforce is that some workers may have a mindset block or simply not be willing to learn what they need to in order to achieve digital readiness. I’ve personally worked with people who will preface any digital training or digital skill acquisition challenge with saying no they are unable to learn new digital skills or they simply would rather not. Overcoming the mindset block and being willing and able to learn new digital skills is a huge challenge for many companies who want their workforce to be digitally ready.” – Stacy Caprio, Founder, Growth Marketing.
Organizations are often unable to explain to its employees the wide scope of the digital movement and how deeply it affects every facet of their business. While technology continues to transform everything it comes in contact with, companies often overlook the microscopic changes required to attune to its pace. The skill gap is already becoming the reality of most businesses, something that not many organizations have been able to come to terms with.
Employees often don’t understand why their organization needs to change in the first place, which can be a significant bottleneck. They are unable to comprehend the importance of digitalization in terms of avenues for new growth and opportunities to expand. Organizations need to start a dialogue on the vastness of digital transformation and keep employees at the centerstage of this exercise.
While the first thoughts around digital transformation are that of technology implementations, rise in budgets, and infrastructural updates, etc., the most significant challenge is often the one that dictates all of these – the business strategy that needs to put humans at the forefront of the digital revolution. Business strategies often overlook the skill gap prevalent in the industry due to the multi-generational workforce and the fast pace of technological change.
While organizations often take an outside-in approach to digital transformation and are tempted to transform their customer-facing side of the business, the best path is an inside-out one, where your employees are the first in your digital readiness checklist.
An inside-out approach ensures that your employees are in line with the larger vision of the organization and can be contributing members to the process of digital transformation.
Upgradation to new technology needs to be accompanied by training and reskilling efforts to get employees at par with the pace of business that you envision for your organization. Digital readiness assessment for employees can be the first step towards evaluating their stance on digital technologies and coming up with a strategy accounting for their learning agility. The digital transformation strategy needs to have a human-centric approach for it to bring about the maximum impact.
Technology is making processes more efficient and streamlined. At the same time, technology is altering the roles of employees. Employees are no longer working in silos and constantly collaborating for knowledge sharing.
Digital transformation is challenging business frameworks and touching every aspect of our personal and professional lives. With the changing technology, the workplace culture is also recasting itself. However, human beings are naturally averse to significant changes, which is a challenge.
The newness of digital transformation needs a space where organizations, as well as employees, can take risks and embrace failure as a stepping stone to success. This culture of experimentation, of giving a safe space to take risks, is all part of the sea change. Organizations need to proactively instill a digital culture by starting in a small but significant way. Everyday tools that employees and organizations use to operate should be added to the digital readiness checklist as a first step to introduce technology as part of everyday work.
The right change can only be brought by the right people who lead the way. Digital-savvy leaders are catalysts for an organization in its digital transformation journey. Digital leaders don’t need to possess all the tricks of the digital trade, but in fact, need to be the voice of reason and promote digital readiness and agility for the overall growth of the business and its employees.
Digital-savvy leaders are an added advantage to the digital transformation. They can aid the pace of digital transformation by setting a positive example.
The purpose of this assessment is to test the cognitive skills and behaviors that underpin employee’s preparedness and level of readiness to adapt to the digital culture of the organization. It evaluates whether the employees possess the ability and the will to adapt and manage the digital transformation process.
Digitally skilled employees are a prerequisite for organizations in today’s exponentially growing digital world. Many organizations are rooting for new and young talent to take their digital onus. However, what organizations need to understand is the perennially changing quality of technology. No generation of a workforce can keep itself digitally updated without the help of organizational intervention.
Organizations don’t need new talent but reskilled employees who can continually learn and unlearn competencies required to perform well in the future of work. The employees of the digital world have the following competencies:
The two most important aspects of a digital readiness assessment are the evaluation of behavioral and cognitive competencies. An employee needs to have the ability and the will to learn to excel in the age of digital transformation. Not only do employees need to be resilient to transforming technologies, but they also need to possess mental agility, an openness to learning and manage change, a collaborative and inclusive outlook, and an innovation-focused approach to truly imbibe the digital way.
The digital readiness assessment for employees is important in today’s milieu. It ensures that your employees are actively contributing to the growth of the business. We are no longer at a point where we can say that digitalization is in the future.The digital era has already dawned on us and its power can’t be underestimated. It is imperative for businesses to align their workforce with the future of work. Poor people’s decisions and bad hires can lower the pace of your digital transformation strategy. Organizations need to start assessing their employees and help them come aboard the digitalization bandwagon.
To ensure a high ROI, it is imminent to make scientific decisions based on validated analytics. It is also important to be able to identify the true potential of your employees to take the necessary recourse for their training and skilling.
A beginning point towards achieving digital readiness is to float a digital readiness survey at the inception to gauge a business’s standpoint. Before taking it to the employees, the digital readiness survey helps analyze an organization’s stance and sets a context towards which all future digital initiatives will be steered.
Every business has its own set of competencies that are must-haves in the digital age and another set of competencies that can be considered good-to-have. A good starting point is to take an inside-out approach to empower your employees to achieve the business objectives the organization has laid down in the present and the future.
“It all starts with identifying which processes are to be digitalized and which technology solutions will be integrated to achieve so. Once this is clear, it is important to assess the need for customization. Having all technical specifications reveals the digital skills that are needed to use the new applications, systems, etc. making it easy to organize training at the right time and ensure a digital-ready workforce.” Lilia Stoyanov, CEO, Transformify
Here is a 5-step approach to maximize your ROI on your efforts towards digitizing your workforce:
Before you set your digital transformation journey in motion, have an understanding of the final destination, objective, means, and context of the strategy. It helps organizations have set expectations and a united vision. It also helps in accurate representation and calculation of ROI.
The starting point of a digital transformation strategy should take into account changing job roles and accordingly map the current competency framework to them. The new competency framework needs to be examined through a future point of view. To truly embrace digital trends, employees need to learn, unlearn, and relearn the rights skills and competencies that are needed to perform the jobs of the future. This revised competency framework can be a foundation for all your digital transformation pursuits, like skill gap identification, training, and developmental programs.
Once you’ve zeroed down on your present and future competencies, a digital readiness assessment can be administered to identify skill gaps. The digital readiness assessment enlists the gaps in the behavioral and cognitive skills of an individual that are a deterrent in the way of him/her reaching the digital goal faster.
The digital readiness assessment framework not only helps in skill gap identification but also places every employee on a path of training and development based on their level of digital readiness.
Digital transformation is not a short-term plan. It is a gradual process. Thus, it is essential to create a roadmap with significant milestones for ease of calculating ROI as well as keeping organizations and their employees motivated throughout the process. The journey to digital maturity can be one of uncertainty. It is advisable to have predefined checkpoints and success metrics to be able to track progress and ROI throughout the process and make amends to keep innovating when necessary.
Successful digital transformation has to start at an individual level and needs a human-centric approach. Displacement of jobs is not the solution to the burgeoning demands of the digital revolution. It requires continuous efforts from individuals and organizations to create new avenues where humans can collaborate with technology to initiate a new culture of learning.
The end objectives of your organization’s digital journey might be different, but the path will intersect between human experience and technology.
Mercer Mettl can help your organization create accurate and future-ready competency frameworks for each job role taking into account the skill set required to perform that job in the present and future. Competency frameworks act as the base for assessing employees on their digital readiness, further helping organizations create L&D programs through accurate training needs identification.
Mercer Mettl’s Digital Readiness Assessment for employees is a battery of psychometric tests, which includes the Mettl Personality Profiler (MPP) and the Mettl Test for Abstract Reasoning.
MPP is a global tool that is standardized and normed in various geographies, including India, the US, Europe, South Africa, South East Asia, LATAM & Middle East. The reliability of MPP range from 0.65 – 0.85, and estimate of convergent validity range from 0.4 – 0.75.
Mercer Mettl’s Digital Readiness 9 Box Model helps organizations identify employees on their level of digital readiness, which can be taken as the first step to lay down a developmental plan. The model gives a clear picture of individuals and their understanding vis-a-vis digital readiness.
The digital readiness assessment consists of a battery of tests to measure the digital competencies and sub-competencies mentioned in the table above. The 9-box model further maps the individual to decide the next course of action, ranging from an introductory session on digital readiness to training programs designed for specific digital skills required by the employee to efficiently perform their job. Digital ready employees should be deemed as digital leaders to help the rest of the workforce come up to pace.
Behavioral competencies like mental agility, collaboration, inclusion, openness to change are often the most sought out in employees. Employees high on these competencies usually rank high on readiness needed for successful digital transformation and vice versa.
Originally published February 18 2020, Updated June 16 2020
Bhuvi is a content marketer at Mercer | Mettl. She's helped various brands find their voice through insightful thought pieces and engaging content. When not scandalizing people with her stories, you’ll find her challenging gender norms, dancing to her own tune, and crusading through life, laughing.