Season 2: Episode 18 – The Future of Work: Reflecting on the Discussion So Far

Jason West: Welcome to the Underscore Transformation podcast. My name is Jason West.

Joe Ales: My name is Joe Ales.

Jason West: And together we’re the founders of Underscore, this is the fifth episode in our bonus miniseries on the future of work and the pandemic. We had another panel debate set up for this week on buying digital transformation expertise from the market but due to a slight change of plans, we are actually going to cover that next week. So it’s just me and Joe this week. Instead, we’re going to focus on the slightly bigger picture and consider some of the macro trends that have been driving digital transformation.

But before we get into that, we’ve been covering this over the last couple of weeks, Joe, haven’t we? But we haven’t actually defined what is digital transformation?

Joe Ales: Digital transformation can be difficult to pin down, Jason, because it’s naturally going to be different for every organisation.

At a high level, though, it’s about making a fundamental set of changes, enabled by technology, of how the business operates and delivers its services or products to its customers. It’s a lot more than just simply moving applications from on premise to the cloud. And it’s more than technology. It actually affects maybe the culture of the organisation, the people within it, processes, the ways of working. In large part technology is secondary and actually a point that Rachel Kay, the Learning Director of Capita, made in last week’s episode was that she’s seeing a lot of demand from customers, not just about technology, it’s really about cultural change, people needing to embrace technology and the new way of working.

Jason West: And I think when you do embrace this technology, as you say, you mentioned moving to the cloud, I do think there is something in that that move to the cloud that’s driving some of this pace of change Especially when you consider the back office of organisations, which have been pretty static, from a technology standpoint, in that you spend millions, you install a new ERP system and it’s so big and complex and difficult to change, then it kind of sets your ways of working in aspic almost. It freezes your processes for quite some time because it’s just so difficult to change the thing.

And then when organisations make this move to the cloud, it provides a level of agility that, from a systems standpoint, that you can change it. And if you’re going to get value from it, you must change it. So, you’re moving from a very static environment to one that suddenly become dynamic. Even if all you did was try and maintain where you were at the point of go live your new ERP system, this thing updates every three to six months. So whatever you go live with, if all you tried to do was hold that position over a period of a year or two, you’ll be forced to change it because the system updates in the way that your applications update on your phone.

Joe Ales: Yeah, absolutely it does. But what what’s interesting is what’s happened in recent years, if we if we compare the consumer world to the enterprise world, consumer world is far more sophisticated. And I think the enterprise world has come on in leaps and bounds actually in recent years to catch up with some of the user experience, for instance, that we have in everyday life. And naturally, I think technology service providers will be developing, putting more and more R&D into their products. So we are going to see, to your point, software getting updated every three months and actually, with some technology vendors they do minor updates every week. Not fundamental changes to look and feel or perhaps that would impact the user experience, but there are adjustments being made in real time on weekly patches and so on. So, yeah, absolutely, organisations have to embrace new ways of working, new technology because we’re no longer in a world of ERP on premise where the system gets upgraded every three to four years instead of every two to three months.

Jason West: Yeah, three to four years if you’re lucky.

Joe Ales: Yeah, if you’ve got a big budget to do so as well.

Jason West: Yeah, because it used to cost millions each time you had to have the upgrade and now it just happens automatically overnight and you better be ready for it because it’s happening. It’s a totally different mindset.

Joe Ales: It’s really exciting, though. It’s really exciting that we have, in the enterprise world now, technology that’s akin to tools we use every day, apps, real time information and systems available 24/7. And these sorts of things and agile technology solutions, really, where you can make real time changes to your business processes, for instance. Because we’ve encountered a challenge like COVID, for instance, has hit everybody. And very, very quickly, organisations are going to have to change their ways of working their business processes to take into account the fact that we’re in a pandemic. And the beauty of some of these software packages, it’s is agility to be able to make changes quickly. Notwithstanding the fact, you have to test and so on and so forth. It just provides organisations that agility that they need to survive. But the organisation equally has to be able to embrace it and adopt it. So it’s not just about the tech, it’s people. It’s the culture of the organisation.

Jason West: And that’s really what’s driving this demand for new capabilities, their whole being able to understand a problem, analyse it using data, come up with a solution to that problem, engage people in saying this is a problem or get them to buy into it and buy into a new way of working and then manage that as a project to manage the business change, so it actually happens. And that’s a demand that’s being placed on back office functions like never before. They’ve not had that sort of opportunity to make changes quickly, because whenever they wanted to make any fundamental changes, sadly, it was a lot of the time the IT department saying, “I’m sorry, we can’t. Talk to me when we get to our next update, our next upgrade. And maybe we can answer that in your requirements then, because it was just too difficult to change things.” So, I think that’s the sort of demand for skills that we’re seeing. But I think Craig made a really interesting point last week, which where you have constant change, people are being asked the question, well, what are we changing to, why are we changing? And some of the more progressive HR functions out there are getting really heavily involved in that whole what is the purpose of the business? What’s its strategy? What does it mean for people? And as HR functions, particularly, embrace this new world of constant change, they’re the sort of conversations that they should be having to add the most value to organisations.

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Joe Ales: We think of how organisations have had to respond to COVID of how some organisations of overnight had to transform the way they deliver their services to its customers. If you think the restaurant industry, for instance, where some of them have gone from having restaurants open to restaurants closed but actually started doing home deliveries of ready meals, and without organisations embracing technology and so on, these things wouldn’t have happened. So, having organisational agility is now vital because you’re going to get shocks like this. I mean, we’ve had COVID. We’ve in some cases, Brexit was a slower burn, for instance. But there’s always, always external factors that actually forces you to revisit the way you operate.

Jason West: Yeah. And just picking up on your earlier point, this is really about culture changes and it is about who we are, how we’re working, how quickly we can respond.

Although it sits atop of a set of kind of macro technology trends, whether that’s faster chips or it’s broadband or its smartphones being released and moving from 3G to 4G and now 5G, I think that whole world of social media and that kind of weaponising the user experience, so people are just constantly addicted to these apps and they want to scroll and find out what’s happening next and their amazing software that’s given away for free because the people that are using it are the product.

It’s not a free product. If you’re being given it for free, you’re the product. Because it’s your attention that’s being sold to advertisers to monetise this platform. And it’s an incredibly powerful business model that’s really fundamentally changing how culture works and that’s come into the enterprise space, into the corporate world.

And I think that’s actually a large part of what’s driving a lot of this, is that type of fundamental culture change and people’s expectations that are things that are going to constantly improve and get better and that happen at a real pace. And the affordability of that for organisations, that don’t have this massive network of effect of the type of, you know, sort of Silicon Valley winner takes all type of business model, it can be a real challenge. A real challenge. But the people that are able to get ahead of that are going to have a significant advantage when it comes to attracting and retaining the best people because they’re going to have all this great environment to work in.

Joe Ales: Absolutely, I mean, how would you do business really without it? If we just thinking in terms of what we’re experiencing now in the middle of this pandemic where everything is being done remotely and everyone’s working from home, how else would you drive your business without technology at the heart of it? It’d be impossible. I mean, organisations that haven’t embraced technology, or have struggled to embrace it, they’ll be faced with real difficulties right now.

And who knows how long this will last for whether they’ve got the ability to change whilst we’re in the middle of a pandemic, if they haven’t already done so. Again, that be an interesting sort of case study. Are organisations able to really transform from the living rooms of people’s houses? We’ve got a couple of clients we’re working with. Suggests it is possible. Absolutely. It’s a damn sight harder to do that cultural change when you don’t have people walking around a site, for instance. You know, everyone’s working remotely. Those touch points with those individuals, they’re working from within their living room. How do you then change the culture of the business when the only thing you see is the four walls of your living room. It becomes much harder. It’s an interesting few month ahead, hopefully only a few months ahead, and no longer.

Jason West: Maybe a year. I think the people that are going to be successful on this are going to be the ones that don’t treat this as a one-off event. Yes, there’s been external, horrific event that’s happened and everybody’s responding to it and some doing that incredibly successful and others perhaps less so. But it’s the same as if you treat business transformation as a one-off project or a programme. Whether it’s technology enabled or not, fundamentally, you’re probably not going to succeed because for any lasting change to the meaningful that it’s going to take effect, you have to be persistent with it. And the type of changes that we’re talking about here, is moving from quite static and slow moving environment, to being highly dynamic, highly reactive and with a real purpose and customers at the heart of it, that’s driving this rapid innovation. So, organisations are going to absolutely have to build this really enduring capability to scan the market, understand what’s going on, design new ways of working, new ways of being, and then make those changes happen through all the different elements of people, process and technology. I think it’s going to be a fundamental requirement of an organisation that’s able to keep up and be successful over the long term.

Joe Ales: Yeah, some examples of some organisations and how they’ve transformed overnight, it has been fascinating to see. But you made a point earlier about HR’s role in all of this we heard last week, actually, just in terms of the capabilities to HR need for the future, to be able to guide and support organisations in designing an organisation for the to survive in a new world. It’s not just the organisation changing the way it delivers its services to its customers, but actually internally, a lot has to change, isn’t there?

You know, we’re working with a couple of clients delivering remote transformation programs. If I think back to a few months ago, a couple of years ago, that would have seemed impossible. Some organisation, some functions are having to embrace the challenges in which we’re in. And we’re now sort of leveraging technology to run workshops, using technology to facilitate workshops. We use virtual breakout rooms. And another point, actually even testing this, testing a bit of software, testing a business process where in the past I would have all been done physically in a room, lots and lots of people around the table, for instance, we’re having to facilitate these testing sessions remotely using technology, which is which is a credit to those HR functions, those finance functions, procurement functions, they’re still continuing their transformation agenda despite the challenges imposed on all of us, by having to work remotely and a huge amount of credit to them.

Jason West: Yeah, it has been surprising just how much you can do through Zoom and Teams, and WebEx. But like you say, we’ve been running programs that are fundamentally changing the way business delivers to its customers through remote workshop sessions with breakout rooms and all the rest of it. And it’s actually worked out pretty well, shockingly well, in fact, which has been eye opening. And I think Richard Phillips made a point a while back in a couple of episodes back around, this can fundamentally change where you hire people. You don’t need to hire somebody in a particular location. You can hire somebody anywhere in the world to do a role.

But I think on the other side is you can find customers anywhere. But how you build the trust and that this is a way of working, that’s a valid way of working, that that’s something that actually has been proven out over the past few months.

So, yeah, it’s a massive opportunity as much as it is an eye-opening way of working.

Joe Ales: yes, if I look back to what Steve Hunt said around hiring over a thousand people and onboarding over a thousand people remotely, again, it just goes to show just how organisations that are having to just embrace these new ways of working, none of which none of which would have been possible without the right technology.

Jason West: So next week, we’re having another panel discussion, in fact, the final of our panel discussions focusing on the HR function. And that’s going to be, as we mentioned at the top of this podcast, a focus on buying in expertise around digital transformation and response to pandemic from the market. We’ve got a number of special guests lined up for that. So please do listen next week.

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