Mastering the art of digital transformation.
CHALLENGE 3: LACK OF EXPERTISE
Following our last insight on mastering the art of digital transformation (challenge 2: rapid technological change), we continue our series with challenge 3: lack of expertise.
With digital transformation hitting organizational structures holistically, companies are faced with skill and people related challenges across all hierarchy levels. The issue in general is that the workforce is not able to follow up with technology and finding new staff that can is challenging. This leads to frustration, fluctuation, resistance, and inefficiencies.
In this article we point out specific solutions to this challenge.
12.03.2024 - 7 min. reading time
AUTHOR
Dr. Lorenz Lucaj
CHALLENGE 3: LACK OF EXPERTISE
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As businesses seek to adapt to rapidly evolving digital technologies, they face various hurdles in developing, acquiring, and maintaining the necessary expertise. The effect this has on the workforce should not be underestimated. Not only will this leave people frustrated, because they lack skills, transparence, and the possibilities to grow. In the long run this can lead to more fluctuation and cultural resistance towards digital transformation as well as inefficiencies that spread across the organization.
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SOLUTION: IDENTIFY GAPS AND DEVELOP STUFF/HIRE EXPERTISE
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To prevent the organization from the issues arising from a lack of expertise, corporates first need to understand the underlying cause and effect. Thus, it is of utmost importance to identify the gaps and develop according to needs. Not only on individual/people level but also on process, organizational and technological level.
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CONDUCT A DIGITAL IMPACT ANALYSIS
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Following the technological changes and the overall digital transformation journey, corporates first need to understand what the impact of such changes are. Understanding that gaps can be due to a variety of factors, including legacy systems, outdated processes, and a workforce that may not have been initially hired for digital competencies, is crucial. Also, not all areas of the business have the same impact.
Some main questions to ask are:
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What does our digital agenda/strategy look like?
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How are new, digital topics changing the way we work?
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What areas of expertise and target groups are there (as-is)?
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What impact does digitalization have on skills profiles (to-be)?
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Once this is understood on all levels across the organization, the company is ready to assess the individual demands for all relevant groups.
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ASSESS DEMAND AND CREATE A FIT-GAP VIEW
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Skill development is always tailored to the specific needs and characteristics of the target audience/specific roles within the organization. It is crucial to precisely identify areas for development, both in terms of their scope and depth. This can be achieved, for example, through a fit-gap analysis.
First, the relevant target groups and levels within need to be identified. Second, the criteria need to be determined, individually and based on the company’s digital transformation approach and current technological setup.
In a third step the status quo needs to be evaluated. This can be done via top-down and/or bottom-up interviews, systematic question-naires or even using tools that support with e-learning/testing etc. Once this is done, the organization can set targets for individual roles in multiple terms, e.g., tool-based, soft skills and other relevant types and categories needed.
ESTABLISH A TRAINING CURRICULUM, PLAN, AND EXECUTE ACROSS THE ORGANIZATION
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A training curriculum is needed. Based on the fit-gap results, companies must develop an overarching plan that covers the relevant skills. Depending on the size of the organization and the depth of the skills needed, the trainings should be conducted systematically. The approach should consider scope, order, frequency, competency depth, medium (e.g., via e-Learning) and other individually relevant criteria.
As skills mostly will not come from within and the high volume and demand cannot be covered internally, companies need to work in close collaboration with training providers. On top of that, it is notable that people development in specific areas can be treated with state-sponsored financial support. This should be individually assessed and applied for before conducting the trainings.
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AMEND HIRING DEMANDS AND CRITERIA​
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Looking at the existing workforce is one thing. However, to hire for the future requires a shift in hiring demand and criteria. Whilst new roles and responsibilities occur all over the corporate landscape, existing roles change and must be equipped accordingly in the event of replacement. Thus, companies must add and search for new roles and set of skills as well as changing existing role descriptions and job postings (internal and external).
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AMEND HR PROCESSES AND ORGANIZATION ACCORDINGLY​
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Changes in hiring demands and criteria will automatically have an impact on existing processes in HR and the company’s organizational structure in general.
Recruiting processes will be faced with new technological skills and challenges that only few people within the organization understand and are able to evaluate properly. Transparency and quality of applicants in these cases will be hard to determine and hiring failure rates and durations are up. The higher the technical requirements, the more likely it is that specialized recruiting firms are hired, with the effect of rising cost. Alternatively, hiring platforms with focus on tech talents are on the rise and will partly be able to support.
Once new or newly specialized roles have been developed or hired, they will have an impact on the organizational structure of the company. Most impact can be seen in IT departments. However, organizational changes most likely occur where specialized roles are needed. And to further promote this positive change, internal structures will be needed to help the company to develop these skills intrinsically and establish a learning organization.
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SUMMARY
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In the quest to master digital transformation, we highlight the critical need for businesses to evolve their workforce capabilities in tandem with fast-paced digital advancements. This involves a deep-dive analysis to identify skill gaps, a tailored approach to skills development, and a revamp of training programs to build the necessary competencies. Additionally, a transformation in hiring practices to anticipate future needs and a reconfiguration of HR processes to support these changes is needed. All of this finally aimed at fostering a resilient, learning-centric organizational culture.
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Part 3 of 4 – Mastering the art of digital transformation: 4 challenges and the solution