Traditional barriers to digital acceleration fall away

Article, Lilia Guan, CIO Tech Asia

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Post pandemic lockdown sees acceleration of digital projects.


A new IBM study of global C-suite executives revealed that nearly six in ten responding organisations have accelerated their digital transformations due to the COVID-19 pandemic.

Traditional and perceived barriers like technology immaturity and employee opposition to change have fallen away – in fact, 66 per cent of executives surveyed said they have completed initiatives that previously encountered resistance.

Participating businesses are seeing more clearly the critical role people play in driving their ongoing transformation. Leaders surveyed called out organisational complexity, inadequate skills, and employee burnout as the biggest hurdles to overcome — both today and in the next two years.

The study finds a significant disconnect in how effective leaders and employees believe companies have been in addressing these gaps. 74 per cent of executives surveyed believe they have been helping their employees learn the skills needed to work in a new way, just 38 per cent of employees surveyed agree. 80 per cent of executives surveyed say that they are supporting the physical and emotional health of their workforce, while just 46 per cent of employees surveyed feel that support.

The IBM Institute for Business Value (IBV) study “COVID-19 and the Future of Business,” which includes input from more than 3,800 C-suite executives in 20 countries and 22 industries, shows that executives surveyed are facing a proliferation of initiatives due to the pandemic and having difficulty focusing, but do plan to prioritise internal and operational capabilities such as workforce skills and flexibility – critical areas to address in order to jumpstart progress.

“For many the pandemic has knocked down previous barriers to digital transformation, and leaders are increasingly relying on technology for mission-critical aspects of their enterprise operations,” said Mark Foster, senior vice president at IBM Services. “But looking ahead, leaders need to redouble their focus on their people as well as the workflows and technology infrastructure that enable them – we can’t underestimate the power of empathetic leadership to drive employees’ confidence, effectiveness and well-being amid disruption.”

The study reveals three proactive steps that emerging leaders surveyed are taking to survive and thrive.

Improving operational scalability and flexibility

The ongoing disruption of the COVID-19 pandemic has shown how important it can be for businesses to be built for change. Many executives are facing demand fluctuations, new challenges to support employees working remotely and requirements to cut costs.

In addition, the study reveals that most organisations are making permanent changes to their organizational strategy. For instance, 94 per cent of executives surveyed plan to participate in platform-based business models by 2022, and many reported they will increase participation in ecosystems and partner networks.

Executing these new strategies may require a more scalable and flexible IT infrastructure. Executives are already anticipating this: the survey showed respondents plan a 20 per cent point increase in prioritisation of cloud technology in the next two years. What’s more, executives surveyed plan to move more of their business functions to the cloud over the next two years, with customer engagement and marketing being the top two cloudified functions.

Applying AI, automation, and other exponential technologies to help make workflows more intelligent

The COVID-19 pandemic has disrupted critical workflows and processes at the heart of many organisations’ core operations. Technologies like AI, automation and cybersecurity that could help make workflows more intelligent, responsive, and secure are increasing in priority across the board for responding global executives. Over the next two years, the report finds:

  • Prioritisation of AI technology will increase by 20 per cent
  • 60 per cent of executives surveyed say they have accelerated process automation, and many will increasingly apply automation across all business functions
  • 76 per cent of executives surveyed plan to prioritise cybersecurity – twice as many as deploy the technology today.

As executives increasingly invest in cloud, AI, automation and other exponential technologies, IBM recommends leaders should keep in mind the users of that technology – their people. These digital tools should enable a positive employee experience by design, and support people’s innovation and productivity.

In India, according to research analyst firm IDC, Enterprises are relying on AI to maintain business continuity, transform how businesses operate, and gain competitive advantage. According to IDC’s Worldwide Artificial Intelligence Spending Guide Forecast, India’s AI spending will grow from US$300.7 million in 2019 to US$880.5 million in 2023 at a CAGR of 30.8 per cent.

“COVID-19 is pushing the boundaries of organizations’ AI lens. Businesses are considering investments in intelligent solutions to tackle issues associated with business continuity, labor shortage, and workspace monitoring. Organizations are now realizing that their business plans must be closely aligned with their AI strategies,” says Rishu Sharma, principal analyst, Cloud and AI at IDC India.

Other key highlights of the IDC report are:

  • Enterprises rely on AI to maintain business continuity, transform how businesses operate and gain competitive advantage. As per IDC’s 2019 Cognitive AI Adoption Survey, almost 20 per cent of enterprises are still devising AI strategies to explore new businesses and ventures.
  • As per IDC’s 2020 COVID-19 Impact Survey, Wave 7, half of India enterprises plan to increase their AI spending in 2020.
  • Data trustworthiness and difficulty in selecting the right algorithm, are some of the top challenges that hold organizations back from implementing AI technology.

“The variety of industry-specific tech solutions supported by emerging technologies like IoT, Robotics, Blockchain, etc. are getting powered by complex AI algorithms and are cloud-enabled to reach their max potential. In India BFSI and Manufacturing verticals are the two biggest spenders of AI across different use cases making almost 37 per cent of the AI spending in 2019,” said Ashutosh Bisht, senior research manager for IDC’s Customer Insights and Analysis group. “With the fast adoption of cloud technologies in India, more than 60 per cent of AI Applications will be migrated to cloud by 2024.”

Leading, engaging and enabling the workforce in new ways

IBM’s study showed placing a renewed focus on people may be critical amid the COVID-19 pandemic while many employees are working outside of traditional offices and dealing with heightened personal stress and uncertainty.

Ongoing IBV consumer research has shown that the expectations employees have of their employers have shifted amidst the pandemic – employees now expect that their employers will take an active role in supporting their physical and emotional health as well as the skills they need to work in new ways.

To address this gap, IBM recommends executives place deeper focus on their people, putting employees’ end-to-end well-being first. Empathetic leaders who encourage personal accountability and support employees to work in self-directed squads that apply design thinking, Agile principles and DevOps tools and techniques can be beneficial. Organisations should also think about adopting a holistic, multi-modal model of skills development to help employees develop both the behavioural and technical skills required to work in the new normal and foster a culture of continuous learning.



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