Digital Transformation and HR

I confess that my eyes start to glaze over when I read terms such as “digital transformation,” because writers rarely define what they are talking about and It often ends up being a mish-mash of assertions about new technologies making everything different.

I´ve always been a fan of the studies authored by Mary Young. The conference Board´s principal researcher. I recently had her on my radio show (In the Workplace, on SiriusXM Channel 111) talking about her digital-transformation reports. They are the clearest statements I´ve seen as to what´s happening in this area and what it means for organizations. Here´s my view.

First, the technologies we are talking about are pretty specific. No, they´re not driverless cars or robots. They are mainly about how we interact with each other, and with products and services.

Second, the reason the technologies that connect us matter is primarily because they create new data and information – and the reason that matters is because the data can be analyzed and used to identify new opportunities for business.

Take the example of wellness plans, through which employers encourage employees to adopt heathier lifestyles. Here, employers are often collecting new data about the changes employees are making in their lives and in the work they do. That data is useful to someone – those who sell products associated with lifestyle changes, those in insurance who estimate morbidity and related risks, and those trying to create social communities of people with similar diet or exercise habits.

One could easily argue that these developments are further along in HR than anywhere else. The fact that job applicants can share information about companies online through site such as Glassdoor has changed the nature of hiring by taking away the monopoly of information the employer used to have about how candidates see their organizations.

It should be noted that this transformation is unlike the use of robots in manufacturing or computers driving cars, because it is much more difficult to predict how it will be used. We have a pretty good idea what happens when a robot is used in manufacturing workers are replaced, fro example. The digital transformation that generates new data and information doesn´t have such straightforward implications since someone has to have the insight to figure out how to use the information.

How will these digital transformation change organizations and the workplace? One possibility is that the boundary of what is done in the organization and done outside the organization will weaken, because the access to information and to resources outside the organization is easier. But boundary is already pretty weak now, driven mainly by changes in how businesses think about “employment” (that it is better to hire temps because fixed costs are bad).

We all have a huge need for certainly about the future and a desire for a roadmap that will tell us how to respond to changes such as those cited above. Unfortunately, we don´t have it, and the danger of assuming we know precisely how digital transformations are going to play out is that we make investments that turn out to be wrong.

About the best we can do is to say that information is becoming potentially more useful, analysis of that information more important, and insights as to how to make use of that information remain a rare asset.

Sobre o autor

Peter Cappelli

Peter Cappelli

Peter Cappelli is the George W. Taylor Professor of Management and director of the Center for Human Resources at the Wharton School of the University of Pnensylvania in Philadelphia.

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