The Talent Gap: The Silent Transformation Killer

As the adage goes, actions speak louder than words.

This phrase may not ring any truer than when it comes to digital transformation. Perhaps it’s because as an industry we’ve been talking about it for a while, but the latest fad seems to be organizations congratulating themselves for a digital transformation well done.

If you’ve followed our work here at Intellyx, you’ll know that we think that these proclamations are naive at best — and delusional, at worst. True digital transformation is a capability organizations must build and sustain, not a project that they can complete.

Nevertheless, organizations are rushing to the bully pulpit of the industry press to talk about their successful digital transformation initiatives, their revitalized technology platforms and the new, avant-garde management approaches they are implementing.

But look beneath the covers, and you’ll find organizations that appear remarkably like they did before the supposed transformation occurred. There is not a lot of real action beneath those words.

The reason is as simple as it is devastating. Executing real digital transformation requires fundamental shifts in just about every facet of the organizational structure, operating model and business strategy.

That flavor of transformation, however, is a lot harder than merely executing a technology project. It requires a very different type of organizational talent — a kind that is sorely missing in most enterprises. This talent gap is the real reason most efforts are stalling. And it is digital transformation’s silent killer.

Digital Transformation: Changing How We Work

Digital Transformation demands that enterprises re-envision their business models, organizational structures and operational workflows at every level. These will be fundamental business transformations — and they will take courage and leadership from the corporate board and on down through every level of management.

Part of the reason that we scoff at those executives who tout their successful transformation efforts is that we know very few enterprises have even begun to execute these types of foundational changes.

But there is no question that these changes are coming. Whether via visionary leadership or a scurried response to a disruptive competitor, enterprise organizations will either fundamentally transform their core business models — or they will fade out of existence.

The result of this type of business transformation, however, will also transform the very essence of the organization itself — and what it means to work within it. But most enterprises are doing very little to reshape their workforce for their near-future reality.

The Digitally Transformed Workforce

The workforce of the digitally transformed organization will look very different from today’s workforce. The essence of digital transformation will cause organizations to restructure core business processes, workflows and customer engagement models.

But it will be more than just a different way of working; it will be a very different type of work. Organizations will invest heavily in the automation of these re-envisioned business processes and customer engagements.

Additionally, technologies such as artificial intelligence will obviate many job functions — either in part or whole — that presently consume tremendous amounts of employee resources. Moreover, new business and operating models will necessitate a move toward new organizational models that rely more heavily on self-organization and other less hierarchical management models.

Put all of these changes together, and it becomes clear that the very nature of work in the digitally transformed enterprise will look starkly different than in its industrial age predecessor. In the transformed enterprise, the organization will automate any task that it can reduce to an algorithm — a shocking predominance of the work in most enterprises.

This AI and algorithm-powered automation will yield substantial gains in productivity and efficiency, but will also entirely disrupt many, if not most, current job functions.

The question is, how will organizations adapt the workforce to this new reality?

This is the big, unanswered question as most organizations are only now beginning to grapple with it. The great challenge is that creating this type of transformed workforce will require individual and personal transformation — transformation that is difficult to manage at an enterprise level.

Organizations will need their workforce to execute this type of personal transformation because the nature of work in the digitally transformed organization will demand not only new skills, but new attitudes.

Closing the Talent Gap

You need to close this talent gap and get going on the not-so-fun and admittedly arduous work of executing the broad, foundational transformation that your organization needs if it hopes to compete in the digital era.

To close this gap, you should take three simple, if challenging actions.

First, you must acknowledge the fundamental nature of digital transformation and the impact it will have on how the enterprise works. You must accept that it will impact nearly every role and will require an almost entirely new set of skills.

Second, you need to come clean with your organization. You cannot sugar-coat this any longer. There will be no more business-as-usual. Things are going to change — everything is going to change — and everyone in the organization needs to understand it. It will be exciting for some, but terrifying for most. As their leader, your job will be to calm their fears without placating them with false assurances.

Finally, you must make it clear that the first step of this type of fundamental transformation is a personal transformation — and that each member of your team must take personal responsibility for their own transformation. No amount of corporate retraining programs, organizational change initiatives or motivational speakers can transform someone who is not first willing to transform themselves.

The Intellyx Take

The relative lack of progress when it comes to digital transformation often surprises and dismays industry observers, myself included. It would seem especially surprising when you take into account the endless drumbeat about both the need for transformation and the proclaimed success stories.

In truth, however, it should be no surprise at all. As with any significant organizational or cultural change, the first order of business was to get some quick wins.

As organizations marched forward with their digital transformation efforts, they adopted the language of transformation and proceeded to execute what amounted to technology transformation initiatives. The intentions were right, the efforts true and the results real — but they were also shallow representations of the true essence of digital transformation.

The problem with this quick win approach was that it created a false sense of progress — especially when the not-so-quick wins require such fundamental changes to the way everything works. As a result, digital transformation efforts stalled after these initial victories.

The reason they stalled is that there is a visceral talent gap in enterprise organizations that no one acknowledges. Few enterprises have staff capable of leading and executing this sort of foundational business transformation, which must occur at every level and across every job function and role.

Moreover, the organizational change required to transform both these core operational and customer engagement models — along with the corresponding changes to the job functions necessary to support them — is significant and potentially debilitating if enterprises do not execute them with precision.

Throw in a healthy dose of employee resistance-to-change, and you get organizational stagnation. The net result is not good news: the talent gap is silently killing digital transformation efforts at the very moment that executives are claiming their success.

If you’re an enterprise executive (and if you’re not, send this to one), consider this your wake-up call. The time to acknowledge the talent gap and close it is now.

Copyright © Intellyx LLC. Intellyx publishes the Agile Digital Transformation Roadmap poster, advises companies on their digital transformation initiatives, and helps vendors communicate their agility stories. As of the time of writing, none of the organizations mentioned in this article are Intellyx customers.