Transformation is about People rather than Technology

(This article originally appeared in Global Focus, EFMD’s Business Magazine, and has been republished on this website with the permission of EFMD.)

Digital transformation challenges traditional ways of organising work, of defining careers and work identity, of understanding competition within clearly defined boundaries, and of experiencing products and services. It requires organisations to somehow reinvent themselves and, thereby, to recognise that transformation is more about people than technology.

Corporate learning has a dual role to play here: on the one hand, to transform itself and digitise the learning experience and, on the other, to enable the transformation of the enterprise.

This article would like to shed light on the second aspect: corporate learning as an accelerator of digital transformation.

To perform this role effectively, learning and development (L&D) has to evolve from the identity of a service provider (we deliver flawlessly what the business asks us to) and being a strategy enabler (together with the business we agree the best way to build the capabilities required to execute strategy and deliver accordingly) to become a transformation agent, challenging the business and the status quo. At this stage, corporate learning must lead, not lag. This is not a small request. As a transformation agent, corporate learning must seek answers to questions such as:

• How to activate leadership and mobilise the entire workforce for a different future?
• How to allow everyone to recognise their digital skills gap and how to close it?
• How to take innovation outside R&D and make it everyone’s job?
• How to promote agile ways of working?
• How to rethink work as human augmented intelligence?

Digital transformation asks for a different way to lead. Today’s leaders increasingly recognise that in order to credibly transform their organisations, they must transform themselves and their teams. This time, leadership development must start at the very top and not one or two levels down. And it must entail a process of deep reflection about the changes ahead and the capabilities required for continued success. This might include a review of the current leadership model.

In a comprehensive study, MIT – in collaboration with Cognizant – found an emergence of new and an erosion of traditional leadership competencies in addition to a set of enduring competencies that stand the test of times of digital transformation.

Empowerment and inspiration will replace command and control as leadership imperatives. It takes courage and insight to imagine a leadership model that pulls toward a digital future yet is simple and memorable and to then embed it in relevant people processes and engage leaders at all levels to embrace it and overcome cultural inertia. The engagement must be at scale and both top down as well as bottom up.

In addition to engaging an organisation’s leadership, the entire workforce must be mobilised and prepared for a decade of reskilling and upskilling. All jobs, clearly some more than others, will be impacted by automation and artificial intelligence (AI). For some, it will be a matter of incremental learning. For others, it will mean changing professional identity and starting another career.

It will be a major effort to motivate associates to take stock and ownership of their future employability. Concepts such as life-long learning and adaptive personalised learning have to be turned from idea into reality. Corporate learning must orchestrate an ecosystem of internal and external learning partners and resources to cope with such a singular challenge and it requires top management commitment and sponsorship.

Increasingly, companies set aside a dedicated fund of significant size to finance the forthcoming reskilling wave, as this would surpass the means of normal learning budgets that get allocated at business unit level.

These funds are held at enterprise level and facilitate internal mobility in line with the shifting demand for new skills. For example, Shell just announced a large-scale deal with the online learning provider Udacity to provide online education on AI for 2,000 employees.

Novartis offers its employees a free online masters degree programme in data science via Coursera, another provider of online education. And Siemens launched a Fund for the Future that facilitates a bottom-up approach to creating new qualification projects.

In the past few years, companies have been defining skills required in the context of their digital transformation. Based on this digital skills model, many provide a self-assessment tool for experts and for everyone else. This can happen in the form of an app to understand the level of digital literacy or mastery and to identify respective gaps and how to fill them. Competency models are updated and amended accordingly.

Digital academies are launched to bundle learning offerings for digital skills. The academy scope can be broad to include communities of practice for areas of expertise such as data analytics and data science. Reverse mentoring programmes allow, for example, digital natives to teach senior management how to develop a social media footprint.

Digital transformation requires an organisation to experiment and innovate at scale across businesses and functions. Along with the business model canvas, design thinking has become the method of choice for the development of products and solutions in the digital age.

Corporate learning supports the penetration of design thinking through tutorials and workshops and embeds the underlying principles in its learning architecture through customer journey mapping; frictions in the customer experience are eliminated and the overall experience improved; customer segments are described by personas and there is a continuous interaction between the design team and targeted user groups; solutions aim at combining technical feasibility, economic viability and human desirability; and new ideas are evaluated differently, to enable experimentation and learning from failure.

L&D is often the co-owner of innovation labs and incubators that allow for the promotion and testing of internal and external ideas, collaboration with start-ups and for the engagement with critical stakeholder groups. Some organisations launch digital accelerators to develop a digital customer experience next to their existing business and task corporate learning with developing appropriate capabilities.

The agile movement has brought about new ways of working that rely on the principles of trust and empowerment, self-organisation, cross-functional collaboration, user experience and customer value, experimentation and speed. A wealth of new work hacks and agile methods are spreading through organisations, to provide transparency about work priorities and about what everyone is working on, and that define work as a team effort, such as daily stand-ups, Kanban boards, objectives, and key results or retrospectives.

Corporate learning provides plenty of assets to learn about and experiment with new methods. It might even consider the launch of an agile academy to develop agile coaches and accelerate the diffusion of new work practices and to facilitate the sharing of experience and best practice.

Advances in AI and automation will reduce the demand, first for isolated and repetitive then for more advanced physical and cognitive skills. Therefore, machines have often been regarded as a threat to employment. However, organisations must cultivate those capabilities that will enable humans to add value where machines fall short: in problem solving and critical thinking; in managing ambiguity; in creativity and imagination; in empathy, communication and collaboration.

Only a positive attitude toward smart machines and AI and its use to augment human intelligence will allow companies to unearth new and formidable sources of productivity and competitive advantage. It is not a question of either machine or human, but of a symbiotic integration of both.

This integration will become a new and seminal arena for corporate learning. It means nothing less than proving those wrong who predict the fourth industrial revolution to lead to mass unemployment, and instead, unlocking new opportunities for humans to learn, grow and excel.

Original article written by Martin Moehrle; Management Consultant and Director of Corporate Services and of CLIP at EFMD

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