Workforce Changes of Digital Adaptation
The advent of technology-empowered global workforces fundamentally changed the way employees and employers engaged. Technology connected workers around the globe, dissolving geographical boundaries. Today, fast-moving markets and customers’ ever-changing needs are creating an almost relentless pressure for companies to reinvent themselves and their employee models ─ again and again. How Offshoring Lost its Luster Digital adaptation arose from two significant workforce changes: (1) technology-enabled global labor; and (2) a geographically distributed workforce. These two fundamental shifts created a category of worker known as the “offshored.” As the Internet-connected workers around the globe, companies gained access to an international workforce that performed like local employees. Often, “follow the sun” development teams fast-tracked projects at near warp speed as compared to domestic-only, traditional workforces. At first, offshoring saved a lot of money for US-based companies that were able to move work overseas, take advantage of labor arbitrage, end benefits programs and layoff layers of middle management. For many companies, offshoring was a beautiful thing until one day it wasn’t. What began as a move to more cost-effective, less management-intensive workforces quickly exposed unintended, negative consequences of offshoring on two highly desirable outputs of work: innovation and collaboration. Lack of business context, ineffective communications, and virtually non-existent creativity constrained offshoring. The desired collaboration, communication, and innovation US companies sought from their offshored workforces did not materialize from a raft of geographically separated, workforces. For some, offshoring has become categorized by an untenable disconnect with customer demands. While the sheer economics of maintaining urban offices doesn’t support bringing everyone back in-house, a compromise must be found that balances budgetary constraints against digital adaptation’s need for collaboration. In many cases, employees’ preference for working from their home offices using online collaboration tools is helping companies move closer to this balance. However, a lack of specialized talent continues to plague companies’ looking for experienced assistance. In these instances, the availability of niche talent prompts companies to accept assistance from specialists who are dispersed geographically. While companies pioneering digital adaptation may have to use some distributed workforces, partnership models need to promote vitally important communication, collaboration, and innovative thinking. Digital Adaptation Matches Teams to Projects In the digital age, scalability, the massive availability of skilled workers, gives way to teams comprised of workers with diverse skills and mindsets. These teams will be created to meet the specific requirements of the project at hand, and they will be disbanded at the project’s completion. The constant change characteristic of digital adaptation demands a flexible approach to skills acquisition. The ability to quickly construct, manage and get the team to full productivity will become a key requirement for corporations. Acquiring new skills and a dedication to lifelong learning will become table stakes for employees in every workforce, whether traditional, distributed, outsourced, or contingent. At its heart, digital adaptation requires more management, more communication, and more collaboration –not less. As Daniel Newman pointed out, traditional leaders quickly became stumped as to how to manage these diverse and divergent groups of individuals. That’s why new workforce models, while a good place to start, require new management models as well. Digital Success Depends on Effective Recombining of the Workforce Workforce models and effective management approaches for fluid teaming present two of the most perplexing challenges in digital adaptation. Simply put, the traditional workforce models and proven management approaches don’t work. How effectively you combine and recombine people will determine your success or failure in the digital world. Companies knee-deep in digital adaptation need to get comfortable with constant change and reinvention on the fly. To learn more about how to navigate this complex landscape, download our white paper on digital adaptation or read the blog series on this fundamental sea of change.
Balancing Cost with Speed and Quality is Key to Digital Adaptation and Transformation
In our last blog post, we broke digital adaptation down into four key areas: Evolving Needs, Workforce Change, The Consumerization of IT and Competitive Threats. This post, which focuses on Evolving Needs, will explain why balancing cost, speed and quality is vital as companies apply technology to solve business problems in the digital age. By definition, digital adaptation is at once disruptive and unpredictable. This fast-moving phenomenon forces companies to adjust on the fly to meet the demands of ever-changing markets, making digital transformation one of the most important movements to affect business in decades. Experts point out that today we operate in the era of “Digital Darwinism." Characterized by rapidly evolving technology and society needs that outpace business’ ability to keep up, companies that plan to survive, and even thrive, will need flexible leaders who take an “evolve or die” approach and can pivot quickly, according to Brian Solis of Altimeter Group. Clearly, there are economic rewards for companies that leverage digital adaptation to remake themselves and their processes from the inside out. Companies deemed to be digitally remade produce more revenue from their physical assets, generate more profit and command higher market evaluations according to CapGemini. However desirable these financial results are, the road to digital transformation is fraught with twists and turns. As technologies advance and capabilities expand, businesses have more options from which to choose and decide where to invest becomes more difficult. With more choices comes more risk, and the time lost to chasing a “wrong” choice can be devastating from a competitive standpoint. When it comes to acquiring the talent needed to succeed in this fluidity, the “multiple guess” influence is clearly seen. Effectively prospering and competing in this era of digital transformation means companies need to wage the war for talent using three distinct and inter-related strategies: Sourcing a wider range of skills and talent. Being able to navigate the nuances of agile. Using innovation to balance cost against speed and quality. Accurately forecasting the portfolio and corresponding volumes of skills and talent combinations needed to develop and deploy software makes up the first challenge companies need to address. While that is a tall order, the current environment of rapid change adds complexity to this mission. For example, the application development teams you have in place will see demand for their talents wane over time ─with some skills fading more rapidly than others and others enjoying heightened demand over time. What can you do today to predict the coming shakeup with confidence and actually plan for it? Once you’ve aligned that cube of possibilities, you’ll notice that the spectrum of skills you require is expanding exponentially. This expansion will most likely outpace your ability to find the talents you need at a reasonable price. This scenario is particularly relevant to companies that discover their needs have grown to encompass data scientists as well as mobile app developers. There is simply not enough money in corporate staffing budgets to afford the wide range of talent that is needed, especially in a hyper-competitive marketplace. Secondly, we know that it's no longer good enough for an organization to be able to leverage “standard” agile. You must "customize" it to fit your needs ─even as they evolve in real-time. To do that, you need to accumulate enough agile expertise to be able to spot the unintended consequences of clumsily applying this proven mindset. For example, the benefits of using a common language, sharing a time-zone, and commanding a familiarity with U.S. business culture are hugely important, particularly when projects move quickly. Sharing common ground eliminates the need to translate idioms, accommodate varying time zones and explain unfamiliar behavior. A shared perspective can enable a faster, more sustainable transition to a customized, thriving agile environment. Third, in this era when customers’ behaviors and expectations are shifting quickly, you need your development and deployment teams closer to your operation ─not geographically dispersed. The current prevalence of distributed workforces complicates the execution of a pivot, even as environmental factors call for acceleration. Creativity and innovation share two negative influences: distance and isolation. These barriers cause particular angst when speed and creativity are at a premium as they are today. Consider following the examples of noted remote work advocates IBM and Yahoo. Both companies have recently required workers to return to physical offices in an effort to regain the interaction and collaboration that accommodates change and fuels innovation. Despite this remote worker homecoming, budget constraints continue to prevent most companies from recruiting every professional they want to a staff position. Evolving needs demand that you apply a balanced model to hiring that balances three key influences at play in the talent landscape: quality, cost, and speed. However daunting this new environment may seem to be, it’s not as if business has been stagnant in the past. Companies have always adjusted their output and operations to evolving needs. Today’s challenges center on the unpredictable pace and unknown direction of those evolving needs. Those two characteristics add a new layer of complexity that makes it difficult for companies to go it alone and reduces the appeal of previously revered software development models. Offshoring development has proven to complicate the process with its “follow the sun” approach that, in the end, often delivered more complexity than the round-the-clock advantage. While it is likely that in-house teams, offshore resources, and staff augmentation will continue to fulfill specific skill needs, these options are not the answer to every phase of software development, especially those affected by the unpredictable disruption common to digital adaptation. Just as digital transformed the marketplace, it has altered the hiring environment as well. Digital adaptation requires flexibility. In these volatile times, companies that want to assure continued success will need to listen carefully to the whistling winds of change and adjust on the fly. To learn more about how to succeed as a Digirati in charge, watch for the next blog and download our digital adaptation white paper.