Future of staff engagement

The rationale implicit in digital transformation and a wide range of reorganisation projects lies in customer experience, or customers’ journeys. The focus on the customer has become the new source of differentiation in an era of commoditized consumption yet the exclusivity of this focus ignores a key group of people that help drive productivity. BCG notes that whilst ‘…companies spend $1 trillion a year understanding and shaping their customers’ journeys, they spend 1,000 times less gathering and acting on insights about their own employees[i].’ This is remarkably unbalanced and more likely than not to contribute to a degree of turnover, both customer and employee, given the key role customer service can play in customer retention.


That is not to say that business ignore their employees – some 77% of executives believe that people analytics is important[ii]. The purpose and application of such analytics is, however, equally important – whether it used as a carrot, a stick or something in between. But as BCG notes, ‘…what if companies used the same tools and techniques to learn what engages, frustrates, and inspires their employees?’

The benefits from introducing such a worker focussed system is two-fold. First, public trust is greater in organisations that actively treat their employees and second is the new normal that an imminent Millennial-dominated workforce represents. Millennials are forecast to achieve numerical advantage in the workforce in many countries over the next decade yet remain the least engaged part of the workforce (less than 29% report feeling engaged[iii]). Standard prescriptions of flexible working and the promise of a provision for work-life balance are unlikely to increase this or suffice as stand-alone efforts to increase the in-flow of Millennial talent to a given company.

Research has revealed the desire amongst a majority of Millennials for a sense of purpose in their job, as well as a desire for more feedback compared to other generations. This latter point also extends unto technology, where the choice of a given medium will increasingly be expected to at least match the consumer technology experience empowering their personal lives. Meeting these initial Millennial needs will require many companies to either restructure, learn new capabilities or in some cases, repurpose their business model and the difficulty in doing-so – whether stemming from cultural or managerial inertia or just the cost of implementing change –  will undoubtedly dissuade many companies from attempting fundamental change. This would be a major mistake however; since aside from constituting the future workforce, Millennials offer the perfect testing ground for introducing metrics that actively measure employees’ performance, wellbeing and engagement as well as unearthing insights into how these measures can be improved. It is about time worker engagement and experience received the levels of attention given to customers.

[i] https://www.bcgperspectives.com/onwards-upwards-growth/people-productivity/need-treat-employees-thoughtfully-as-customers

[ii] http://dupress.deloitte.com/dup-us-en/focus/human-capital-trends/2016/people-analytics-in-hr-analytics-teams.html

[iii] http://www.forbes.com/sites/adigaskell/2016/02/25/how-to-engage-the-millennial-workforce/#7b22b3028d26


Board-level tech awareness

Board-level tech awareness

In response to the challenge posed by digitally enabled upstarts as well as the the opportunities inherent in digital business, a wider swathe of industries and business than ever before are aiming to prove that, ultimately ‘…every company is a technology company[i].’


The disconnect between corporate ambition and ability in using these technologies, and the need to remodel corporate architecture to maximise the potential of such technologies receives much attention, and rightly so. However, a greater issue – and one generally receiving less attention is the issue of board level technological competency.

Technology and its role in digital transformation compels board level expertise, and the issue ostensibly resonates. Research suggests that almost two-thirds of boards prioritising widening the skillset of board members, especially in digital. However, a number of worrying statistics suggest that efforts to date are insufficient. Digital efforts have tended to lack strategic alignment since 29% are still led by individual business units[ii]. Worse still, 69% have not discussed cybersecurity at board level in the preceding six months[iii] and 46% have made no efforts to educate their directors[iv], whose average age is 63. Overall, only 14% claim their boards have produced a comprehensive digital strategy[v]. With risks inherent in digital and the rewards far from assured by employing an operational plug and play tech strategy, such a set-up could well account for the predictions of an increased future turnover of the Fortune 500 and of corporate failure.

A shift in board education, competencies and even composition may be necessary if a clear, cohesive and strategic view of technology is to be achieved. This means adding directors with technical knowledge and a concurrent strategy to build IT awareness amongst existing members. The latter will require significant investment of time and money, at least initially as the board grapples with core issues:

  • How does our tech infrastructure and specifics compare to peers, within and outside of the industry?
  • To what extent does legacy technology impinge us? What investment is needed?
  • How and where does our digital strategy match our overall strategic priorities?
  • What capabilities do we need to achieve our strategies? Does our operational structure maximise technological ability?

One established an oversight position can be better established and should be aided by a new emphasis on lucid and open contact with the (right) CIO, as well as an outside-in perspective by subject-matter experts when needed. Periodic review, educational boot camps could also help inspire not only competence but perhaps the longer-term goal of the board providing tech education to the workforce. The challenges and opportunities presented by a digital world are both imminent and immense; can analogue boards change in time?

[i] http://blogs.gartner.com/mark_raskino/2013/11/28/every-company-is-a-technology-company-more-and-more-evidence/

[ii] http://digitising-it.eiu.com/what-is-its-role-in-digital-transformation/

[iii] http://www.ey.com/Publication/vwLUAssets/EY-Global-Capital-Confidence-Barometer-April-2016/$FILE/EY-Global-Capital-Confidence-Barometer-April-2016.pdf

[iv] https://marketing.kpmgenterprise.co.uk/TakingTheOffensive

[v] http://www.hrinasia.com/hr-news/board-appointments-still-made-within-closed-networks-why/

Act 1 Part 2: What if? Post BREXIT and EU wildcards

The BREXIT campaign was marked on both sides by a complete and utter absence of a future vision. The opportunities to discuss the UK’s true place in the world were never fully explored. The ‘what if’ question or ‘what happens next,’ scenarios are basic tenets of corporate and indeed government planning. They also seem to have been singularly excluded from anybody’s thinking in the British body politic in the run up to the referendum vote. The protagonists on both sides rightly shoulder significant blame and whilst this shouldn’t be mitigated, extricating the UK or some variant thereof from an already complex and far from homogenous 27 nation institution is the stuff of planning nightmares. In many ways, BREXIT was the wildcard, but what happens next will have far more significance than the vote itself.

Perhaps the most obvious short term impact from the vote is for a protracted period of political instability and infighting in the UK, of volatile markets, and regardless of the way in which they voted, a disappointed and angry public. The current situation of no negotiations without triggering Article 50 look like an invitation for years of stasis, but it needn’t be this way.

Here we look at some of the wildcard possibilities emerging in the post BREXIT world.

EEA membership (the Norway model): Although this option minimises the mid-to longer term economic fallout and is likely the preferred option for many pragmatic politicians, it is unlikely to satisfy the public given the notion that the vote was effectively decided on a question different to the one that was asked. Immigration controls would not in this event be any stricter, potentially leading to a further schism between the public and its politicians. There are signs that the genie is out of the bottle with regards to legitimised racism and xenophobia – this option would not help assuage this is any way. No matter how people voted, nobody voted for a combination of a) an imposition of slightly higher costs of single market access, b) the surrender of any say in rules that you have to submit to and c) continued immigration levels.

The end of the Union: With Scotland voting ‘remain’ logic has it that a break-up of the 300-year-old plus union is more likely since independence would allow for Scotland’s people to stay in the EU. Complicating matters are political circumstances in some EU countries regarding restive regional secession – such as Catalonia from Spain that would block any attempt for a trailblazing Scotland to secede and (re)join the EU. Since any one member can veto a new country joining the EU, this path would appear non-viable. In such an event, Scottish attempts to block BREXIT would strengthen – perhaps by forcing a Parliamentary vote (since the public vote was not legally binding) that would ostensibly indicate a preference to remain. Protracted legal wrangling would almost certainly ensue – and if a skilful politician of unity does not emerge, maybe there would be impetus for English nationalists to seek divorce from Scotland in a new referendum on the state of the UK.

Referendum 2.0: The EU certainly as a history of re-running referenda in which the ‘correct’ result was not attained. Such a decision here would almost certainly render a complete redrawing of the UK political scene. The semantics of openly defying a public referendum and promise of a Prime Minister to act upon it, no matter how badly constructed the original referendum and debate was, would possibly cement a very real divide in UK society. The possibility of newly formed political parties impacting the scene would be significant in this scenario. Future referenda that are cognizant of both the UKs democratic system (as a Parliamentary democracy) and the concerns of its public cannot be dismissed but a like-for-like replay is as close to inconceivable as is possible.

A vengeful EU: Given the urgent need to prevent further disintegration by setting an example, the EU could become hostile to any form of negotiations – effectively forcing a somewhat reluctant UK to enact Article 50. This could erode any remaining good will and render it more difficult to salvage mutually beneficial economic ties. The UK economy, whilst slowly orientating towards increased ties in the emerging world or Commonwealth, would suffer a sharp and perhaps lasting recession as the source of over half of its foreign investment is effectively shut off. It is also possible that Article 50 will be postponed indefinitely by the UK government – perhaps encouraging the EU to explore measures that legally exclude the UK from aspects of the European framework, including services. The disorderly divorce that this scenario represents would almost certainly handicap the British legal system and consume its political system for years, as little time would be given in preparation for sorting out the swathes of British vs. European law issues. This would in turn maximise instability and represent a worst case scenario for global business.

A reformist EU: None of the above scenarios would achieve two goals that Britain must currently try to satisfy – unify a divided society and preserve access to the single market, which even leading Brexit advocates wish to retain. In hindsight, had Mr. Cameron been given an emergency brake on immigration of some sort at the EU summit a few months back, the whole scenario of Brexit could have been avoided. This opportunity was plainly missed and the EU is unlikely to radically one of the four pillars on which it stands – namely the freedom of movement. Whilst the EU has the ability to act with considerable speed and assertiveness, as any Greek may attest to, the possibility of populist risings in France and the Netherlands that would surely seal the fate of the EU, demands a new agility. If the EU can demonstrate flexibility and a renewed sense of democratic accountability in the face of this crisis, then perhaps the groundwork is laid for a Parliamentary vote to end the current impasse and reign in the worst of the economic and social fallout.

The end result: Current indications seem to suggest EU pressure for a quick BREXIT yet a number of drivers explored above are set to complicate this. If nothing else, compromise would seem a very European political skill although this calculus may change in the face of an EU that is fighting for its very existence. Even so in this scenario, BREXIT does not happen since the possibility of others following the UK’s lead is deemed too high a risk. This does of course, require a public figure with requisite skill and widespread public support on the UK side to navigate a tightrope style deal and an EU realisation that reform is needed urgently. Both of which are far from guaranteed. However, the wildcard has already happened – nothing that follows should be considered much of a surprise. The UK public seemingly voted on a different question to the one that they were asked; perhaps they will receive a different outcome to the one borne out in the results

The Future CEO

With the pace of change increasing in the aftermath of the global financial crisis, more than ever CEOs need to be visioning and driving a strategic plan for their company. This will increasingly involve the reinvention of their business model and displaying a tech savvy that blends people with technology in smooth, agile and proactive processes.


The future pipeline of potential CEOs would seem at least well positioned to address the technological aspect. Both CIOs and CMOs – two of the most technologically involved positions, are heavily touted as possible steeping stones to the number one position. Technology – ironically enough, may help alleviate some of the stress on CEOs to better enable them to address these fundamental core issues. Whilst CEOs spend 1 percent of their time on things they need to accomplish, according to Professor Richard Jolly, the ideal is around 50 percent[i]. However, it is estimated by McKinsey ‘…that activities consuming more than 20 percent of a CEO’s working time could be automated using current technologies[ii].’ This would suggest the digital divide between CEOs evident now is of critical import; those with a better strategic understanding of how automation can increase productivity and free high-end professionals from some of their more mundane tasks stand to benefit more than those that do not. A bifurcated standing of CEOs, regardless of their position within the emerging networked economy, would appear in the offing and arguably, only the fittest will survive.

It could therefore be argued that in addition to the ability to question, reimagine and redesign a company’s business model on an ongoing basis, an awareness of how technologies can a) support this process, and b) enable the emergence of new competitors, opportunities and markets, is central to the future CEO role.

Given the need for agility, transparency and global experience, future leaders will likely also need to demonstrate strong communication skills, a worldwide range of experiences and perhaps even an entrepreneurial record. They will be increasingly diverse too. It is likely that western multinationals in need of a new strategic positioning will turn to emerging multinationals for future CEO and C-Suite positions, whilst 30 percent of the top 2,500 CEOs around the world will be female by 2040 according to a report by Strategy&.

The pace of change in the world of work – driven by new work structures, automation, the erosion of market boundaries, new competitors from other verticals and shifting consumer preferences all demand a new type of company and a new type of CEO to lead in the new normal.

[i] https://www.entrepreneur.com/article/242590

[ii] http://www.mckinsey.com/business-functions/business-technology/our-insights/four-fundamentals-of-workplace-automation

Automation and the future of jobs

Technology has come a long way since Peter Drucker, having witnessed the first attempts to automate knowledge work in 1967, declared of the computer: ‘…It’s a total moron[i].’ Indeed, one widely cited paper by Carl Frey and Michael Osborne at Oxford University found that as many as 47% of jobs will be highly susceptible to automation over the next two decades.


Questions have been raised over the methodology used in this paper, with the OECD suggesting the method was too blunt and that, in fact, only 9% of jobs in the OECD were at high risk of automation[ii]. The differences between the two papers make for uncomfortable policy prescriptions since high degrees of uncertainty are not generally embraced by politicians. The extent to which cognitive AI will augment rather than replace humans is still to be settled. However, even 9% equates to millions of jobs lost and wider changes to the content of job typologies that do survive. Combined with a rise in freelance work, automation could easily reduce a wider percentage of jobs to a series of mini tasks that would easily be ‘auctioned’ off. The need to redesign economic and social systems is still pressing under such a scenario; the diffusion of work benefits from health insurance to pension provision would not work as intended, for example. Although the Swiss have rejected the universal basic income proposal, we are likely to see similar proposals elsewhere, perhaps even tied together with educational credits – which will surely be needed in the face of the need to reskill and retrain millions of individuals.

Although technology allows both more efficient ways of dissemination educational content (and indeed of creating more relevant curricula), there remain several structural issues in retraining such a wide swathe of people in a timely fashion – especially given the global backdrop of high youth unemployment and underemployment. Whether or not traditional educational models are agile or flexible enough to retrain and reskill at both a personalised level and at scale remains to be seen.

Lifelong accounts that comprise learning credits, benefit credits and other provisions have been floated and could better reflect the needs and wants of an individual than the currently strained welfare state. Issues of provision, tax and eligibility are complex and potentially have far reaching consequences – most notably on the notion of freedom of movement and immigration. Some, no doubt, view such proposals as a solution without a current problem. Given the rise of populism in key geographies and the acceptance by many of the idea that the current system is stacked against them, thinking about the nuts and bolts of a new safety net now would seem prudent. Automation, at either end of the forecasts, holds the potential to destroy the contemporary welfare state and/or result in costly and regressive policy action to preserve jobs. Automation holds great promise for the world, yet in order to benefit from it, we must actively explore a new social contract that doesn’t confine millions of workers to technological unemployment.

[i] https://hbr.org/2015/06/beyond-automation

[ii] http://www.economist.com/news/finance-and-economics/21699930-reasons-be-less-afraid-about-march-machines-im-afraid-i-cant-do

Changing consumer expectations and the need for outside-in thinking

Whilst businesses are no doubt aware of the need for digital transformation, whether to initiate it through processes, the business itself (including ‘culture’) or through customers has received less attention. There is a strong case for suggesting that customers are the biggest source of disruption and hence would be an appropriate place to start such a transformation. Indeed, executives believe that changing customer behaviour and expectations are a bigger source of disruption than technology – and this is leaving aside the international cultural dimension to changing consumer habits in Asia and elsewhere.


Perhaps the most important issue for executives to grasp is that technology, whilst disruptive, is essential for understanding, responding to, and anticipating shifting customer trends. The promise of customer-centric predictive analytics can only be achieved if companies merge disparate forms of customer data, or at least allow data to flow between separate departments or systems. Many companies are hindered by systems that are not only non-customer-centric but all too often non work-efficient. Irrespective of industry, companies will increasingly require a nuanced view of customer preferences and to align the insights that flow from this to a new business model.

Customer centric design for new products, processes and even business architecture will become essential. It is even predicted that by 2020, ‘…customers are expected to entirely supplant traditional R&D as the primary source of new product and service ideas[i].’ Customers are set to become key agents in both overall innovation strategies and processes. Since consumers can also become proficient marketers in their own right, the idea of developing an outside-in mindset brings possible cost savings in addition to new revenue generation.

A key place to start lies in amplifying the customer voice within an organisation. This can only be reliably achieved by using real-time data – ensuring the need for a robust data architecture that efficiently captures and standardises data, as well as the ability to extract meaningful insights from it.

Beyond this, companies need to consider how to embed the customer at the heart of their decision making. Having a better handle of preferences is one thing, but how does this impact the wider business? Customer service (including proactive service), crowd-sourcing, the discovery of (perhaps auxiliary) insights from data that add value for customers and ease-of-use all stand out as key areas to investigate in the journey to customer-centricity and an outside-in perspective. Customers do not care whether legacy technology is limiting the ability to connect a to b or if the CIO and CMO of company do not collaborate effectively; all they want is a seamless experience that provides value and satisfies a certain need or desire.  Companies should coalesce around this very fact – technologically, culturally and organizationally, if they are to survive and thrive in a digital environment increasingly favourable towards consumers.

[i] http://thoughtleadership.ricoh-europe.com/eu/thenextdecade/disruption

Society’s problem with technology

Given the broad range of applications, processes, methodologies and gadgets covered under the broad banner of technology, it would be no exaggeration to state that the effective and selective implementation of it is critical to future business success.


Received wisdom would also suggest that technology – or rather the convenience it facilitates – is craved by todays savvy digital consumers. Mobile banking penetration and emptying or closing bank branches stands as but one example of consumer desire for technologically convenient solutions. Given the efficiencies that technologies can generate for consumers, how could there be too much technology?

Despite this narrative, an Edelman study cited 54 percent of consumers as very cynical about new technology, stating ‘business growth or greed/money are the real impetuses behind innovation[1][i].’ It is important that this cynicism does not become internalised within business – digital technologies offer a once in a lifetime opportunity for renewal of a range of business processes and models in the face of a highly uncertain and hyper-competitive business environment. Nevertheless, some important implications need to be drawn from it.

Technology for technology’s sake is a losing proposition, especially if it is perceived as merely a cost-saving tactic. Identifying areas in which it can add value for consumers is essential. Clearly, consumers will not complain about excellent customer service. Predictive analytics, machine learning and the selective use of A.I can all lead to more efficient service, higher levels of personalisation and better customer satisfaction if implemented strategically. It is probable that whilst developing a new value proposition for customer service will act as both a long term revenue generator and perhaps even induce cost savings, the customer perspective is of better service – not more technology.

Providing customer value is absolutely essential to any digital transformation, and this should not be confined to the back-end of the business. Customer facing technology should seek to allow customers to do different things rather than just do things differently – and to simplify the process in question. Increasingly these technologies will become embedded, ‘invisible’ to consumers and provide value rather than an additional clunky interface. Indeed, tomorrow’s winners will be those organisations that selectively and strategically apply digital technologies to be connected, analytical and agile.

[1] There are of course legitimate concerns of security surrounding some technologies such as the IoT, which in the UK is seen as a source of concern to one in every two consumers[1].

[i] http://www.brandingstrategyinsider.com/2016/01/lies-and-the-declining-trust-in-brands.html#.VuloreIrLIU