HR: The “Transformer” for Digital Transformation

Microsoft Philippines HR Director Sheel Majumdar argues that Digital Transformation is more than just about technology.

I have been spending a lot of time with customers lately, conversing about their journey embracing Digital Transformation. To set the context straight, I am an HR professional who has in the past spent some time speaking about “How Microsoft leverages technology to do HR”. However, as we strode into 2016-17, with the intention of owning and leading the customer digital transformation, this conversation changed dramatically. In parts, we are still conversing on “how’s” and “what’s” of our journey, but the lion share of the time is spent on two critical themes:

1. The strategic need for digital transformation
2. To that end, what will it take to make the journey strategically successful – a transformation blueprint from a systemic lens

Traditionally (in most cases), technology investments are a CIO/CTO-led decision and is driven by the vision to bring in modern technology into the company. There is a strategic linkage but predominantly it’s the modernization of infrastructure and business application that drive the investments. Once the technology is brought in, there is an elaborate delivery and deployment phase to tailor them to the application and user needs of the organization.

Over time, some of these investments are successful, and some aren’t, leading to the technology custodians to seek newer options and alternatives. Loosely, that’s the cycle. A great success story is when a certain technology adoption helps an organization to secure a key business disruption or critical customer win or a significant innovation breakthrough. These tend to become case studies for both the organization and the technology selling company.

Digital Transformation (DT) changes everything. This isn’t just another set of technology investments to alter a few activity systems or processes. It’s a complete overhaul of our business strategy to align with the changing market paradigm and the new era. It’s the transformation journey to be more relevant and valuable to the new customer world of today and to compete in a global market place. DT isn’t a “good to have” state, it’s a strategic imperative. Hence, the conversation expands from being CIO/CTO-centric to be a center stage agenda item for the CEO and her executive leadership team.

Let’s take a step back and understand: What is Digital Transformation?

“Digital transformation is the profound and accelerating transformation of business activities, processes, competencies, and models to fully leverage the changes and opportunities of digital technologies and their impact across society in a strategic and prioritized way.”

When we reflect on the above definition we get a bit more clarity:

What it is:

1. Holistic transformation of the organization to stay relevant and valuable in the new era
2. The ability of an organization to embrace the power of new capabilities, to enhance their business proposition, potential, and impact
3. Strategic investment to grow systemically

What it is not:

1. Converting existing non-digital systems to digital
2. Just a set of technology investments
3. Purchase decisions without a deeper strategic transformation blueprint

In my customer conversations, I find a creative tension to change on both sides of the table:

1. On one side (seller side), there is a positive turbulence to shift to a more listening mode to understand the strategic intent of the change: Where is the organization heading and how do they intent to leverage the digital evolution to gain in relevance and growth?
2. And on the customer side, I am witnessing a growing positive discomfort around articulating and architecting the Strategic Intent and the relative Transformation Blueprint.

Furthermore, if we do deconstruct the transformation journey from a systemic lens, it gets interesting:

1. Environment: DT is being called as the 4th Industrial Revolution. Hence, it will be immensely critical for CEOs/CXOs to do a thorough scan of the environment and the future to ascertain the magnitude of the shifts taking place from external (customer, competition, market, economic, geopolitical etc.) and internal (employees, stakeholders, innovation, etc.) perspective.

2. Strategy: Closely intertwined with the environmental scan is the strategy reset to build a corporation of tomorrow that capitalizes on the opportunities of the new era and emerges a strong value player for the customer and market.

3. Transformation Blueprint

• Organization Systems & Processes: Any transformation of this magnitude cannot just be a tactical shift of a few processes. It needs to be a systemic overhaul of every business moment of truth, that will enable a true adoption of the transformation – systems to engage with customers better, systems to empower the employees more (performance, communication, collaboration, etc.), system to make operations more effective and systems that helps to innovate and revolutionize the business model and product line.
• Leadership: What will be the role of organization leadership in this transformation? What will be the narrative they will speak? How will they spearhead and role model the intent, intensity, and urgency of this transformation?
• People/Talent: What additional capabilities would be needed in the new digital world? What behaviors would need to change from the present? What capabilities need to be built in the existing people?
• Culture & Climate: What will be the aspire to culture? What mindsets or beliefs need to change for the transformed world to take shape? What do we need to let go? How do we embrace and drive the new culture?

4. Indicators of success:

• Leading indicators of success – business, growth, customer impact, market sentiment.
• Leading indicators of cultural transformation – symbols, rituals, voices
• Leading indicators of people transformation

Reality today:

In my observation, there is a significant amount of work and thinking happening in #1, #2 and partly in #4. What remains severely undercooked and untouched is #3. And the more we converse, I sense a deeper thirst for the same. Customers do realize this is critical and they need to spend more time architecting the blueprint and then align the execution to this.

HR has the key:

HR has the standing opportunity to be the most valuable player on the strategy table to enable DT. This is a classic OD opportunity begging to be grabbed by the horns and tamed. HR has the wherewithal, the knowledge, the competence, and the tools. It’s a good time to bring it all together. The significant portions they can own are:

• Architecting the new culture – This will be CEO-led, and HR needs to be the chief architect and facilitator for the same. A culture that strengthens and drives the strategy forward. In the process, identify and remove barriers, facilitate the shift from old to new mindsets.
• Blueprint and lead key people systems – performance, communication, collaboration, talent management, knowledge management, learning, modern workplace, etc.
• Key facilitator (OD expertise) for the DT Transformation Blueprint and the mammoth change management thereof.

As I see (and more and more surveys tend to indicate this), Digital Transformation is less about technology and more about people and culture. As has been said for many years now:

"Culture eats strategy for breakfast!"

Technology is and will be an enabler to bring it all alive. Yet at the foundation, it’s the shift of mindset and deeply ingrained beliefs and values, that will empower organizations to change for the new. HR is firmly in a player seat to lead and drive this. It’s upon us to go out there and make it our own!