Enterprises that are harnessing the power of Business 4.0 to accelerate their digital transformation journeys are succeeding in driving growth and profitability, according to a new study.
With the rapidly evolving business landscape and increasingly sophisticated customer expectations, organisations are facing constant challenges to quickly adapt and stay ahead.
The research, commissioned by Tata Consultancy Services (TCS), has found that six out of 10 companies globally – which have adopted the full range of business behaviours needed to thrive in a Business 4.0 world – expect double digit growth over the next three years.
TCS’ global study, Winning in a Business 4.0 World, surveyed 1,231 senior executives from more than 1,200 large enterprises spanning 11 industries and 18 countries.
A risk-averse and non-collaborative, command-and-control style leader could fight against some of the business behaviours that are proven to be vital for organisations to gain competitive edge
The study benchmarks large companies in their Business 4.0 growth and transformation journeys, by mapping their adoption of four critical business behaviours: driving mass personalisation; creating exponential value; leveraging ecosystems; and embracing risk.
The study showed that:
- One in 10 survey participants or ‘leaders’ (9 per cent) have adopted all four behaviours
- Four-fifths of companies or ‘early adopters’ (82 per cent) have embraced one- to three of the behaviours, with mass personalisation being the most prevalent (78 per cent)
- European businesses accounted for the greatest number of leaders, followed by Asia Pacific and North America
- Leaders are three times more likely than ‘followers’ – 9 per cent of participants that have not yet adopted any of the Business 4.0 behaviours – to have embraced artificial intelligence (AI), blockchain and IoT technologies, and twice as likely to have embraced automation.
“The study reveals a strong link between Business 4.0 maturity and technology adoption. Leaders are more likely than other participating companies to have driven digital growth and realised double digit revenue gains,” said K Ananth Krishnan, chief technology officer, TCS.
“Agile methodologies, cloud, automation, and AI are examples of tech pillars that enable leaders to change course and adapt to shifting market dynamics much better than companies with inflexible ‘idea to execution’ timelines of months or years.”
Commenting on the findings, Richard Chiumento, director of Rialto Consultancy, stressed this was a call to action for leaders who haven’t considered whether their organisations’ behaviours are suitably aligned to the demands of today’s business environment. But he cautioned that they shouldn’t overlook the inherent personal challenge that may exist in such an assessment.
“The behaviours required to lead organisations today have changed radically,” he continued. “For example, a risk-averse and non-collaborative, command-and-control style leader could fight against some of the business behaviours that are proven to be vital for organisations to gain competitive edge.”
The transition to a hybrid “human-AI” workforce will be the biggest strategic challenge facing UK business leaders over the next five years, new research warns.
And, as the adoption of new technologies such as artificial intelligence (AI) and automation accelerate across industries, two thirds of business leaders (67 per cent) fear their organisations will become irrelevant if they fail to move towards a hybrid workforce.
According to Capita People Solutions research, nearly three-quarters of business leaders (72 per cent) see the “human-to-hybrid” transition as their most important priority, while 93 per cent acknowledge that they need to start proactively managing the shift to a hybrid workforce this year.
The study defines Human to Hybrid as “the new dynamic where humans will work in a fully digitised and technologically-optimised environment, and increasingly work alongside robots and AI, over the next 10 years”.
Interviews with 500 leaders of medium- and large-sized businesses showed that the role of HR will need to radically change. More than 90 per cent of leaders feel that improving a whole organisation’s ability to learn and change is important or extremely important, while 88 per cent said upskilling their staff was a priority, including in entirely new job categories.
Meanwhile, the survey of 2,000 company staff also shows that they cannot afford to fail – with half of UK employees (51 per cent) reporting that they will choose to leave their organisation if it doesn’t manage the transition to a hybrid workforce well and continue to offer opportunities to progress.
This is another facet of digital transformation and one that needs to be led from the very top
The report also underscores the need for organisations to approach the Human to Hybrid shift in a “considered and structured way”, with leadership from the very top. It shows that 88 per cent of business leaders agree that that in order to drive a successful transition to more automated working they must invest in a three-pronged approach of developing:
- the skills and capabilities of their people
- their use of digital technology
- their use of data gathering and analysis.
“The shape and make-up of workforces across all industries will change dramatically over the next few years and business leaders have to get on the front foot to manage this transition,” said Erika Bannerman, executive officer at Capita People Solutions.
“Investing in AI and automation is not enough to build a sustainable or productive hybrid workforce; organisations also need to ensure they have the skills, cultures and processes in place to work alongside this technology. It has to be a people-first approach, where innovative technology is used to support, enable and empower a highly-skilled, motivated and agile human workforce to deliver higher value work.”
Richard Chiumento, director of Rialto Consultancy, underlined that it will be leadership not technology that helps organisations to gain competitive edge with the hybrid human-AI workforce.
“This is another facet of digital transformation and one that needs to be led from the very top,” he said. “The research findings show that the stakes are extremely high with organisations at risk of losing swathes of talent if they aren’t able to manage the transition to the new human-AI workforce successfully. And it won’t just be the company that becomes irrelevant but themselves as leaders, too.”
More than half of the roles that government IT workers will perform by 2023 do not exist in government IT today, according to a new study.
Gartner Predicts 2019: Establish the Foundations for Next-Generation Digital Government Success report shows that the transition to digital government is gaining momentum.
The analyst found that 53 per cent of digital initiatives in government organisations have moved from the design stage to early stages of delivering digitally driven outcomes. This is up from 40 per cent last year.
“The move to digital business means that the IT organisation needs to adapt to new skills requirements,” said Cathleen Blanton, research vice president at Gartner.
“In many governments, roles of chief data officers and cloud architects are already present. However, it is worth noting that 38 per cent of government respondents did not introduce any new roles in 2018 due to insufficient resources, skills and cultural issues.”
To adapt to new skill requirements, CIOs need to initiate a transformation process that results in new or changed roles. For example, as cloud services become more prevalent, the number of data centre management roles will decline, the report states.
Furthermore, the emergence of digital product management is changing how governments think about their services, and this will lead to the emergence of digital teams internally to design and deliver products, the analyst suggests.
This isn’t just a call to action for leaders working in government but across every sector. All leaders must drill down and examine the impact technologies such as AI will have on their organisations and predict which skills and capabilities will be required and which new roles need to be created
In the future, government IT will also accomplish more diversified tasks than today. Public sector agencies will rely on government IT services to address inclusion, citizen experience and digital ethics. Those fields will require new types of skillsets, like researchers, designers and social scientists.
At the same time, government IT will need to assign new roles to support their digital transformation and introduce emerging technologies in diverse businesses and mission areas.
As artificial intelligence (AI) and Internet of Things (IoT) technologies advance, machine trainers, conversational specialists and automation experts will slowly but certainly replace experts in legacy technologies, Gartner cautions.
Commenting on the findings, Richard Chiumento, director of Rialto Consultancy, added: “This isn’t just a call to action for leaders working in government but across every sector. All leaders must drill down and examine the impact technologies such as AI will have on their organisations and predict which skills and capabilities will be required and which new roles need to be created. And this is at all levels of the organisation, including senior leadership.”
Almost every enterprise (95 per cent) is strategically planning how they will take advantage of 5G wireless connectivity to power core business initiatives from new services, to Internet of Things (IoT) and smart ecosystems, a new study finds.
Furthermore, four fifths of companies expect to deploy basic connectivity solutions by 2021 as they look towards the “tremendous” positive impact 5G technology can have on their ability to serve customers and the bottom line.
Oracle Communications report, 5G Smart Ecosystems Are Transforming the Enterprise: Are You Ready? surveyed 265 enterprise IT and business decision makers at medium- and large enterprises globally to discover how businesses are thinking about 5G today as well as its potential significance moving forward.
Three quarters of respondents (73 per cent) agree the IoT will be revolutionised by 5G networks and more than two thirds (68 per cent) feel it will be transformative to their customers while in terms of experiences and efficiencies a further 84 per cent reckon that 5G networks will have a lasting impact on the way their companies do business.
According to Oracle, “born in the cloud” 5G will have the ability to enable enterprises to provision or “slice” core pieces of their networks to power mission-critical new offerings and smart ecosystems.
Those business leaders who are not yet alert to the potential of 5G in terms of improved productivity, reduced costs and increased agility, are running out of time if they want to steal a march on their rivals
This can range from anything to providing the highest speed connections for life-saving first responder services, to enabling autonomous vehicles to communicate with one other quickly; and ensuring IoT devices in smart factories are providing real-time information on the health of machines and assets.
“Enterprises clearly want to capitalise on the promise of 5G, however, to be successful, IT and business leaders must avoid thinking of 5G as just another ‘G’, and should instead consider it as an enabler to the smart ecosystem we have long talked about,” said Doug Suriano, senior vice president and general manager, Oracle Communications.
“This means asking the right questions at the outset, and considering how 5G can help enable upcoming solutions, what timeframe should be considered and how will they will procure and use 5G capabilities as part of their business evolution.”
Outside specific initiatives, respondents believe 5G will have a wide-spread impact across their business, including increasing employee productivity (86 per cent), reducing costs (84 per cent), enhancing customer experience (83 per cent), and improving agility (83 per cent).
Business decision-makers are most focused on quality of experience the technology will bring, while IT is concerned with network speed and resiliency.
Commenting on the findings, Richard Chiumento, director of Rialto Consultancy, cautioned that business leaders who have yet to recognise the potential business opportunities of 5G should see the survey findings as a wake-up call.
“I was pleased to see Oracle’s Doug Suriano address ‘business leaders’ as well as IT leaders in his call to action,” he said. “And the survey findings prove that those business leaders who are not yet alert to the potential of 5G in terms of improved productivity, reduced costs and increased agility, are running out of time if they want to steal a march on their rivals.”
The relatively short tenures of UK chief information officers (CIO) is putting digital transformation strategies at risk, a new study warns.
These rapid and constant job changes are resulting in a so-called “CIO cycle” where organisations lack the continuity of leadership needed to see through large-scale transformation projects.
Only 42% CIOs “fulfilled their vision” in most recent role
One in six CIOs reckon they will last less than three years in their current post
The findings are in a whitepaper from Citrix, Nowhere to hide: UK CIOs and the age of digital change, which revealed half of the CIOs (51 per cent) surveyed spent less than five years in their last role. Meanwhile, 48 per cent expect to spend less than five years in their current post with one in six (16 per cent) reckoning they won’t last three years.
Some 400 CIOs were quizzed for the report to learn about the challenges they faced and where their organisations sit on the transformation journey.
The report also highlighted a pronounced lack of confidence and positivity about the role with only two-fifths of respondents managing to “fulfil their vision” and a further 53 per cent believing they achieved just “some” of their goals.
Furthermore, CIOs are being held back from achieving their objectives by having to operate in politically charged environments. One quarter claim that internal politics and “sacred cows” – or ideas or ways of working are “immune to criticism” as well as budget constraints. More than one fifth of senior directors also wanted to see an immediate return on investment.
To justify the right IT investment to the board, over half (52 per cent) of CIOs wanted leaders to refocus return on investment (ROI) in terms of what more can be done, not how much can be saved. A similar number (45 per cent) also called for the board to foster a bigger appetite for risk.
CIOs need patience, backing and autonomy
“Moving forward CIOs need patience, backing, and autonomy from the board so that they feel motivated to remain in their role for longer and turn their vision into a reality,” said Darren Fields, regional director for sales UK and Ireland at Citrix, writing in a blog post on the report.
“Given the importance of technology and IT in digital transformation, I feel certain the CIO role will become ever more critical in 2019, and it is important we understand and support it properly.”
Commenting on the findings, Rialto director, Richard Chiumento, reckons it is time for the board to truly support the CIO in the organisation’s digital transformation efforts. “This means eradicating all of the barriers to transformation, especially internal politics, entrenched views and unrealistic budgets,” he said.
“These findings also suggest that too many leaders simply don’t understand the depth of change a digital transformation programme entails nor its overall purpose,” he continued.
“Rather than expect an immediate return on investment, these programmes are about ensuring the organisation is fit for the future and will be able to sustain its position in increasingly competitive and complex markets.”
Seven in 10 workplaces will integrate artificial intelligence (AI) in the form of chatbots and virtual personal assistants (VPAs) by 2021 to assist employees’ productivity, a new study finds.
“Digital workplace leaders will proactively implement AI-based technologies such as virtual assistants or other NLP-based conversational agents and robots to support and augment employees’ tasks and productivity,” said Helen Poitevin, senior research director at Gartner.
But the report warned that past incidents have shown that poorly designed assistants cause frustration among employees, sometimes prompting bad behaviour and abusive language toward the VPA.
“This can create a toxic work environment, as the bad habits will eventually leak into interactions with co-workers,” continued Poitevin.
The report points to recent experiments which have shown that people’s abusive behaviour toward AI technologies can translate into how they treat the humans around them.
As a result, Gartner predicts this development will prompt 10 per cent of organisations to add a digital harassment policy to their workplace regulation.
When establishing VPAs in the workplace organisations must also train the assistants to respond appropriately to aggressive language.
“They should also clearly state that AI-enabled conversational agents should be treated with respect and give them a personality to fuel likability and respect,” added Poitevin.
“Finally, digital workplace leaders should allow employees to report observed cases of policy violation.”
According to Richard Chiumento, director of Rialto Consultancy, this clearly demonstrates why leaders cannot not underestimate the major change programme that is required when it comes to embedding and integrating new technologies like AI and robotics into the workforce. “And there must be real depth and commitment to this change,” he said. “Few would forsee the potential side-effect of fuelling bad behaviour elsewhere in the workforce. This demonstrates new processes, methods of working and strategies need to be clearly thought through and even, if it is impossible to predict some outcomes, leaders must be alert to the unexpected.”
Building critical skills and competencies in their workforces has been identified as the number one priority for the vast majority of HR leaders in 2019. This is closely followed by strengthening the current and future leadership bench and improving employee experience according to new research from Gartner.
Some 843 HR leaders were surveyed globally for the study – at the enterprise, business-unit and subfunction levels – which revealed 85 per cent of heads of learning and development reported that developing critical skills and competencies was a priority while 78 per cent of talent management leaders are prioritising building their leadership benches.
Meanwhile, more than half of all HR leaders agree that improving employee experience is a priority.
“The businesses that are successful today and, in the future, will be those that win when it comes to talent,” said Sari Wilde, managing vice president of Gartner’s HR practice. “This means helping employees build critical skills and developing employees into leaders, which is especially critical given that less than two-thirds of managers think their employees are able to keep pace with future skill needs.”
To deliver against these top three initiatives, the analyst firm is calling on heads of HR to develop a strategy that focuses on the following “key levers of improvement”:
Developing “connector managers” Ineffective managers are the single biggest problem in the workplace today with almost half of HR leaders (48 per cent) citing their organisation’s managers as not effectively developing employees. According to Gartner, most organisations yearn for “always on” managers, who commit to constant employee coaching and development. Connector managers are the most likely to improve employee performance by fostering meaningful connections among employees, teams and the organisation to develop an employee’s specific capabilities at the precise moment that employee is primed to learn. Gartner claims connector managers triple the likelihood that their direct reports will be high-performers and furthermore employee engagement will increase by up to 40 per cent.
Demand-driven succession management Among HR leaders, 47 per cent said their organisation struggles to develop effective leaders and 45 per cent said their succession management processes didn’t yield the right leaders at the right time. Adding to the complexity, most organisations expect more than two fifths of leadership roles to be significantly different within five years. Traditional succession planning assesses current roles and gaps in leadership supply. By switching to demand-driven planning, HR leaders can assess leadership needs that will enable the organisation to achieve strategic goals, not just fill potential future vacancies in current roles, said Gartner.
Employee experience Employees want the ease of their personal life, fuelled by digital technologies that enable seamless, effortless experiences, to be duplicated at work. To start delivering on this requires a change in focus for HR from just asking what employees want (or worse still, assuming what they want) to listening to what they need and determining what they really value, said Gartner. The company claims supporting what employees value increases employee performance by one fifth.
“Gartner highlights some important issues for today’s senior leaders. People will continue to be the differentiator in the world of business so it is encouraging to see that building critical skills and competencies is rightly such a high priority,” said Richard Chiumento, director of Rialto Consultancy.
“Many of these will be digital skills that support the organisation’s digital transformation programme and ensures it is fit for the future. But this must also extend to the senior level. Digital skills are among the least represented on the leadership bench and this situation must change if the alarming digital leadership void that exists in many companies is to be addressed.”
Business leaders are increasingly taking steps to ensure ethical and responsible use of artificial intelligence (AI) within their organisations, a new study finds.
Most AI adopters, which now account for nearly three quarters of organisations globally (72 per cent), conduct ethics training for their technologists (70 per cent) and have ethics committees in place to review the use of AI (63 per cent).
So-called AI leaders – organisations rating their deployment of AI ‘successful’ or ‘highly successful’ – also take the lead on responsible AI efforts: almost all (92 per cent) train their technologists in ethics compared to less than half (48 per cent) of other AI adopters.
The findings are based on a global survey among 305 business leaders, more than half of them chief information officers, chief technology officers, and chief analytics officers.
The study AI Momentum, Maturity and Models for Success was commissioned by SAS, Accenture Applied Intelligence and Intel.
The report states that AI has a real impact on people’s lives which highlights the importance of having a strong ethical framework surrounding its use.
“These are positive steps; however, organisations need to move beyond directional AI ethics codes that are in the spirit of the Hippocratic Oath to ‘do no harm’,” said Rumman Chowdhury, responsible AI lead at Accenture Applied Intelligence.
“[Organisations] need to provide prescriptive, specific and technical guidelines to develop AI systems that are secure, transparent, explainable, and accountable to avoid unintended consequences and compliance challenges that can be harmful to individuals, businesses, and society.”
The fact that companies are taking steps toward ethical AI and ensuring AI oversight, is understandable the report notes, as they know that faulty AI output can cause repercussions.
Of the organisations that have either already deployed AI or are planning to do so, three fifths stated that they are concerned about the impact of AI-driven decisions on customer engagement, for example, that their actions will not show enough empathy or customers will trust them less.
Other key findings from the survey include:
More than half (51 per cent) of AI adopters indicated their deployment of AI has been a real success – citing more accurate forecasting and decision-making, higher success at acquiring customers, and increased organizational productivity as the primary benefits;
Many organisations see an advantage for their workforce by way of elevated roles. Two thirds of respondents (64 per cent) strongly or completely agree they are already seeing the effects, as employees focus on more strategic tasks rather than operative ones, thanks to AI.
Commenting on the findings, Rialto Consultancy director, Richard Chiumento, reckons the focus on ethics shows that artificial intelligence is becoming more embedded in organisations as well as leaders’ thinking. “It is also welcome news that some organisations are realising the espoused benefits of AI enabling individuals to add value to their role by being more strategic,” he said. “This is extremely empowering for employees and has clear benefits for business.”
Speech recognition will reach the “plateau of productivity” (where mainstream adoption starts to take off) within the next two years, while six other technologies are predicted to reach mainstream business adoption within the next two- to five years.
Gartner’s 2018 Hype Cycle research identifies 40 key technologies and describes how they will impact business performance in the digital workplace during the next 10 years.
“The effects of speech recognition can be seen on a daily basis. Consumers and workers increasingly interact with applications without touching a keyboard,” said Matthew Cain, vice president and analyst at Gartner.
“Speech-to-text applications have proliferated due to the adoption of chatbots and virtual personal assistants (VPAs) by businesses, and consumer adoption of devices with speech interactions including smartphones, gaming consoles and specifically, VPA speakers.
Among the technologies expected to reach business mainstream adoption are:
Chatbots and virtual assistants (VAs) represent a value-added implementation of speech recognition. VAs use artificial intelligence (AI) and machine learning (ML) to assist people or automate tasks. They listen to and observe behaviours, build and maintain data models, and predict and recommend actions.
Two fifths (38 per cent) of organisations are planning to implement or actively experimenting with the technology according to Gartner’s earlier 2018 CIO survey.
Augmented analytics and personal analytics are making analytics available to more employees, allowing everyone the opportunity to become “citizen data scientists”.
Gartner anticipates that citizen data science will rapidly become an important part of the way data science capabilities are enable and scaled throughout the organisation and urges data and analytics leaders to embrace augmented analytics as part of their digital transformation strategies.
Gartner also predicts that, by 2020, more than 40 per cent of data science tasks will be automated, resulting in increased productivity and broader usage by citizen data scientists.
Commenting on the research findings, Richard Chiumento, director of Rialto Consultancy, said: “We are already seeing this technology in use in the workplace but Gartner’s Hype Cycle highlights to us that many of these will be in the mainstream in as little as two years’ time. Some already overlap with the technology employees are using at home and they will expect to find speech recognition, for example, in the workplace.”
He added: “Not only must leaders be aware of the impact they will have on how people perform functions but also how they engage with their work and the organisation. Indeed, the use of such technologies will also contribute to the employer brand in the future and will help to attract the next generation of talent.”
The majority of CEOs in the UK are frustrated by short-termism and the pressure from their boards to deliver results on multi-year digital transformation projects, according to a new study of some of the country’s largest businesses by KPMG.
As a result, tensions are starting to appear between CEOs, boards and management teams with three quarters (72 per cent) citing unreasonable expectations for return on investment related to digital transformation.
Instead leaders want their boards to take a long-term view of tech investments, with the study finding that two thirds (64 per cent) advising the company would only begin to see a return on investment (ROI) in artificial intelligence (AI) in three- to five years after the initial outlay.
Similarly, more than half of the 150 CEOs interviewed for the KPMG study (52 per cent) agreed on the same ROI time scale for process automation technologies like robotics.
Meanwhile, half of CEOs expressed doubt in the skills of their wider management team, confessing they were not confident their immediate team had the right experience to oversee the radical change the organisation needed.
This finding chimes with recent research from Rialto Consultancy which showed two fifths of business leaders (41 per cent) don’t believe that the culture within their organisation is supportive of transformational leadership.
Worse still, the Supercharge your leadership skills for the future report found just 16 per cent of leaders ranked a “digital transformation mindset” as one of the three most important skills required by leaders of the future.
“Digital transformation is no longer a choice, it’s an essential driver of revenue, profit and growth,” said Lisa Heneghan, partner and digital transformation lead at KPMG UK.
“Business leaders need to move away from simply fulfilling client needs, in sometimes laborious ways, to using technology to achieve results with more depth, efficiency, and decrease the probability of error.”
Despite its challenges, the disruption is welcomed by UK CEOs. The vast majority of the CEO cohort (95 per cent) agree that it is more of an opportunity than a threat, but 86 per cent are overwhelmed by the time needed to make progress.
“The reality is that digital transformation isn’t a simple change that can be implemented overnight and deliver results straight away. It requires embracement of innovative breakthrough technologies, investment in digital skills, and retraining the existing workforce,” continued Heneghan.
“This change is needed and for some it is a major turning point, especially for those that have engrained processes, to make the change otherwise there is a real possibility of being left behind by technology first businesses.”
