Digital transformation efforts yet to translate into greater productivity at many firms

British and Irish firms are increasing their investment in digital transformation, according to Docusign’s Digital Maturity Report 2024, but this hasn’t yet translated into improved productivity or digital maturity. The poll of 600 decision makers in the UK and Ireland, now in its second year, reveals what it claims is a ‘stark productivity and efficiency paradox’ for employers, as well as a Catch-22 for workers.

Technology investment is increasing, but workers are ‘wasting more time on manual processes’ than this time last year – and more are considering leaving their roles due to a desire to abandon what the report refers to as ‘legacy ways of working’. Furthermore, the disparity between worker and organisation digital maturity is widening: fewer than half of organisations (47 percent) see themselves as digitally mature vs 84 percent of workers.

The report claims that workers are wasting nearly two working days every week (12.6 hours) on low or no-value tasks – an increase since 2023 – despite businesses having increased digital investments in an effort to find efficiencies. This disproportionate amount of time spent on manual, low-value tasks could not only cost UK businesses £271,574m in lost productivity per year, but also presents a major threat to employee satisfaction and talent retention.

The burden of repetitive tasks and a desire to abandon ‘legacy’ ways of working is a major factor causing 41 percent (up from 33 percent in 2023) of UK respondents to consider leaving their companies.

Positively, improving efficiencies in day-to-day work is a top priority for companies, expected to have the biggest impact on company performance and productivity in the next 12 months.

72 percent of business decision-makers report having a skills gap when it comes to digital transformation – up from 69 percent in 2023. Skills gaps around AI (63 percent), data analytics (62 percent) and security (61 percent) are the most common issues.

Of those that have skills gaps in their organisation, 53 percent say that talent shortages are materially impacting their business and claim they are not able to deliver against operational imperatives because of a lack of talent. A greater impact than in 2023. This affects delivery against strategic plans for 55 percent and stops 54 percent of respondents from experimenting with innovative technologies.

To address these issues, companies are increasingly focusing on ‘quiet hiring’ and AI technology, finding ways to address the skills gap without increasing headcount or replacing people. 44 percent are allowing staff to upskill and 34 percent are offering workers the chance to retrain.

There’s also been a large 42 percent increase in the number of businesses focusing on using tools such as Chat GPT to increase efficiencies in order to close skills gaps (34 percent of those who have skills gaps in 2024, up from 24 percent in 2023).

Here comes the AI bit

In the next twelve months, 35 percent of companies plan to invest more in AI and machine learning. But while organisations recognise the potential for AI to improve cost efficiencies (33 percent) and employee productivity (29 percent), only 43 percent of organisations actually feel a high level of AI readiness. Only 11 percent have appointed a specific individual responsible for AI; in many cases, responsibility lies with CTOs/CIOs (32 percent) or CEOs (29 percent). Many companies are more concerned about AI-related risks, such as security (35 percent) and data protection concerns (34 percent), than the opportunities.

Furthermore, only 19 percent report ‘constantly’ experimenting with new disruptive technology innovations such as generative AI tools despite 46 percent of respondents stating they want to dedicate more time to training on and experimenting with digital transformation. Companies in the UK and Ireland are in a paradoxical situation: they expect AI to provide relief but are still plagued by inefficient manual processes and lack sufficient resources to build expertise.