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Cisco says technology isn't enough to build the best workforce for the Digital Age

AvantiKumar | June 16, 2016
Companies are neglecting the needs of their workforce, which will impact the returns on their digital transformation efforts, said Cisco Malaysia's Albert Chai.

Albert Chai Managing Director for Cisco in Malaysia 

Photo - Albert Chai, Managing Director, Cisco Malaysia


Companies may be limiting their returns on investment from digital transformation efforts if they do not include plans to build the right workforce for the Digital Age, according to new studies.

Networking solutions provider Cisco Malaysia's managing director Albert Chai said companies in Malaysia are neglecting the needs of their workforce, which will impact the ROIs (returns on investments) on their digital transformation efforts.

Chai said the Global Centre for Digital Business Transformation (DBT Centre), which was formed by Cisco together with Swiss business school IMD as a global hub for applied research where executives engage to solve the real-world challenges, found hat "that only one in 10 workforces are fully empowered."

According to the DBT Centre's Digital Vortex report four in 10 industry incumbents will be displaced by digital disruption over the next five year, he said. Many companies have put the stress in their business transformation efforts on IT and business processes.

Chai said the DBT Centre studied the business models of more than 75 disruptive workforce startups and conducted in-depth interviews with many of the founders and/or CEOs of these companies to understand their value propositions and how they believe digitisation can transform the workforce. In addition, the DBT Centre surveyed 941 executives globally to assess the current state of their digital transformations and their workforces.

 Three key capabilities

He said the study showed that - in the area of people - "fewer than 10 percent of companies have achieved a level of excellence in three key capabilities of digital business agility: hyperawareness, informed decision-making, and fast execution." As described in the study, these are three foundational capabilities that organisations must build in their workforces in order to compete successfully in the Digital Vortex.

Chai said Cisco projected that by 2020, 50 billion objects will be connected to the Internet and able to generate massive streams of data. In such a climate, organisations must ensure that people are ready for these new forms of communication and the insights and opportunities that follow.

"We speak to companies every day that are trying to understand the role technology plays in their business strategy," said Kevin Bandy, chief digital officer, Cisco.  "Many of their most pressing questions focus on how they can empower their employees through digitization to help them improve decision-making, accelerate innovation, and be more productive."

In addition, DBT Centre's research pointed out that technology solutions alone were not the only answer to transforming the workforce.  Bandy said that these efforts must align to the business process changes that occur across organisations as they reinvent their operating models to compete effectively in a digital era. 

Workforce transformation required sustained commitment from leadership. "Transformation is more than a summation of digital solutions, he said.  "Digital transformation is rewriting the rules of business and will require a workforce that is appropriately equipped to work with the speed and agility that this requires."

 Reimagining the Malaysian workforce

Cisco Malaysia's Chai said, "Malaysians today are demanding more from service providers, as ownership of mobile devices moves into the billions and 4G connectivity becomes the norm. Banking customers demand quicker service and response times, commuters want real-time updates on traffic conditions and eCommerce customers continuously expect shorter delivery times for their orders."

"These changing customer expectations require digital business agility, a perspective that most companies are beginning to grasp," he said, citing a recent IDC report, which noted the majority of Malaysian organisations (63.2 percent) were now in an opportunistic stage of digital transformation, and attempting to bring about digitally enabled competencies.

"Unfortunately, these companies focus their transformation efforts on IT and business processes, too often neglecting the most critical element - its people," said Chai.

"By neglecting the workforce as part of digital transformation, companies are failing to build the capacity to understand and react to threats and opportunities in an era of digital disruption. This is concerning -  the 'Workforce Transformation in the Digital Vortex'  report shows that in today's turbulent climate, digital disruptors will displace 4 in 10 incumbent companies over the next five years," he said.

How then can organisations build a workforce that is highly agile, innovative and engaged? "As the report shows, technology solutions alone are not the only answer to transforming the workforce. These efforts must align to the business process changes that occur across organisations as they reinvent their operating models to compete effectively in a digital era."

Chai said, "As an organisation chooses its approach to reimagining a digital workforce, it should use the following three drivers of agility to build the capacity of internal talent:
- Hyperawareness -  ability to sense what is going on throughout the enterprise, among its competitors, and in the marketplace;
- Informed decision-making -using data and analytics to empower the workforce, resulting in better decisions at every level of the organisation;
- Fast execution - responding rapidly once they have made a decision."

"As more companies embrace digitisation the same way they navigate today's markets, leadership will continue to play a key role in sustaining the transformation of today's workforce. With the right tools married with agile processes, Malaysian businesses can look forward to attaining a competitive edge, coming out at the winning end when future-ready organisations collide with stagnant incumbents in the digital vortex," he said.


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