Business leaders agree that organisations must be digitised to compete

Over two thirds (67 percent) of business leaders agree their company must become significantly digitalised by 2020 to remain competitive, and they are looking for HR leaders to lead the transformation. This is according to Gartner, Inc whose latest research suggests that CEOs are sharing their focus on digitalisation with their investors; with mentions of “digital” on earnings calls increasing by 20 percent year-over-year since 2010. CEOs are seeking ways to keep costs down while achieving gains in efficiency and productivity, and the HR function is expected to lead digital transformation efforts across their organisations. Gartner analysts are discussing how HR leaders can drive innovation and digitalisation efforts across their organisation in front of more than 1,450 attendees at the Gartner Reimagine HR conference, which has been taking place in Orlando this week.

To lead this digital change Gartner has identified five macro strategies to lead this transformation:

1. Attracting more digital candidates
2. Gaining better insights about employees
3. Coaching managers to develop the digital capabilities of their teams
4. Improving technology to drive employee self-service at work
5. Evolving performance management

Realising the expectations of the employees is critical given the state of the labour market, which includes decreased employee effort amid some of the lowest unemployment numbers in recent history. According to Gartner research, the number of employees who are willing to go above and beyond the call of duty in the workplace has declined significantly, both globally and in North America. In the second quarter of this year only 17 percent of North American employees reported high levels of discretionary effort, down from 26 percent in 2013. Globally, a mere 14 percent of employees reported high levels of discretionary effort in 2Q18, five percentage points lower than in 2013.

“As more organisations become increasingly digital across their operations, HR departments are facing a tall order: not only do they have to lead the digital transformation of their company and satisfy the desires of the CEO, but they must also meet employee demands that digitalisation efforts provide improved experience for them,” said Brian Kropp, group vice president of Gartner’s HR practice.

“The U.S. unemployment rate was 3.8 percent in the third quarter of 2018 and the U.K.’s wasn’t much higher at four percent, indicating labour markets that are the tightest they’ve been for some time,” said Mr. Kropp.

“For most organisations, talent is the single biggest overhead expense, and the biggest competitive advantage. As such, heads of HR are under extreme pressure to deliver on the promise of what digitalisation has to offer, both in terms of the business and employee experience.”