HR’s Five Actions in Crafting a Business’s Digital Strategy

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No one anywhere doubts or can avoid contact with the digital revolution that affects every part of daily living: from health monitors on wrists (e.g., Fitbit and Apple watch), smartphones, and home entertainment to healthcare, travel, payments, and so forth. So it naturally affects the business world as well.

A digital business agenda helps any organization access and turn data into information, use that digital information to make better choices, and ultimately add more value to the firm for all stakeholders. In recent years, HR professionals have become increasingly focused on adding value through strategic work more than administrative work. To further this strategic HR focus, we have identified five actions HR professionals can pursue to help make a digital business agenda happen (see figure 1).

Figure 1: HR’s Role in a Digital Business Agenda

Build a Business Case

For a digital business agenda to be accepted, employees need to have a shared awareness of and need for digital information that improves decision-making. HR wants to help employees recognize the dramatic implications of technology advances that come from accessing and using digital information. Communication of this business case from HR should reduce employee fear about emerging technology disruptions and help them see artificial intelligence as an assistant or enabler. As smart devices (e.g., home automation) and technology assistants (e.g., Alexa, Siri, Cortana, Google Assistant) become more widespread in personal use, employees may become more aware of their potential for improving work settings as well.

HR can facilitate communications additionally through blogs or videos, question/answer sessions, discussion forums or chat rooms, town hall meetings, recognition systems, and other means. The rule of thumb is that someone needs to hear a message (e.g., that AI enables but does not replace people) ten times for every one unit of penetration. This consistent, simple, and redundant messaging about the impact of the digital on business helps employees replace fear with hope, and pursue the digital business agenda without hesitation or trepidation.

Facilitate a Digital Business Team

Some firms have mistakenly made the “IT” function the steward of the digital business agenda. Building an overall digital business agenda requires a cross-functional team because each business function accesses information to make better overall business decisions.

  • Marketing provides information about current and future customer trends to tailor and customize customer solutions.
  • Finance accesses information on the economics of technology investments and their impact on shareholder confidence and value.
  • Information technology builds the hardware and software and deals with other technology issues (e.g., privacy, security) in order to build the backbone of good information.
  • Operations require information to understand the supply chain and the operations of the organization.
  • HR provides employee and organization information required to make change happen.

In addition, HR professionals should be gifted at creating and managing a high-performing team to ensure that this collection of different functional specialties workstogether to deliver on the digital business agenda.

Articulate Digital Business Outcomes

A digital business agenda must deliver business outcomes that matter. The digital team should ensure that these outcomes are defined, tracked, and woven into an accountability system.HR can lead the facilitation of these outcomes since HR professionals have skills in performance management, which requires clear expectations and outcomes.

In general, the digital business outcomes follow the logic of a balanced scorecard and might include outcomes such as:

  • Financial:
    • Increased revenue from digital information as information creates new markets and products.
    • Reduced costs as digital information creates operating efficiencies through lean manufacturing, automation, sourcing, or other mechanisms.
    • Increased investor confidence as investors recognizes the digital agenda that will help a firm adapt to future opportunities.
  • Customer:
    • Increased revenue from targeted customers (e.g., complement market share with customer share of key customers) through digital information on them.
    • Increased net promoter scores as customers experience more positive interactions with the firm in ways that work best for the customer by connecting with them through technology
    • Increased customer loyalty as retention grows with more customer information.
  • Organization:
    • Increased ability to track key information sources to build key capabilities—such as innovation, collaboration, service, and change—that are required to win.
    • Increased ability to create the right culture that turns customer promises into employee actions by monitoring and measuring the right culture
  • Employee:
    • Increased productivity by having employees focus where their unique talents add the most value by tracking employee data and desires.
    • Increased employee sentiment as employees finds meaning and purpose from working in the organization by connecting people through technology.

HR professionals can work with the digital business team to facilitate the selection of those specific outcomes that would be most relevant for their business. These outcomes then become expectations that HRweaves into communication plans as well as compensation packages.

 Audit Current Digital State

Digital business agendas don’t happen by chance; they require management attention. This attention often begins with a digital business audit to set a baseline for the use of digital information for business results and also assess the extent to which digital information is used in the multiple functions of a business to improve decision-making.

HR professionals have experience doing leadership 360 assessments where leadership competencies are assessed by multiple assessors, and organization (or culture) audits where the systems in an organization are assessed as a baseline score. With this background, HR professionals can help the digital business team form an audit by selecting audit questions and then collecting data from multiple perspectives (like a 360).

The outcome of this audit is a baseline that can be used to track progress in the digital business agenda.

Craft Digital Business Plan

The fifth and final action in creating a digital business agenda is to prepare a digital business plan.This plan, prepared by the digital business team, turns awareness into desired outcomes.Often an organization has a template for planning.If so, this template can be adapted to a digital business plan.If no planning template exists, the four steps in figure 2 can be readily adapted to the digital business plan.By asking the questions about vision, goals, actions, and follow up, an HR professional can work with the digital business team to prepare a plan that gives a company confidence in achieving their digital business outcomes.

Figure 2: Steps in a Digital Business Plan

Conclusion: Building a Digital Business Agenda

A digital business agenda should communicate the importance of digital work to all employees (HR role 1), be created by a multifunctional team (HR role 2), offer clear and important business outcomes (HR role 3), be tracked regularly (HR role 4), and incorporated into an ever-evolving planning process (HR role 5).As HR professionals engage in these five roles, they help shape and deliver a digital edge to the business.

The 3rd HR Congress Brussels will take place on November 27-28 and will feature 50+ speakers and a selection of sessions that will explore a huge range of topics! Make sure you follow the HR Congress blog and social media channels to stay up to date with the latest information, and for more interesting ideas and content from around the world of work!

Dave Ulrich is the Rensis Likert Professor of Management at the Michigan Ross School of Business, and is the Co-founder and Principal at The RBL Group. He is a leading authority on HR and Management practices, as well as an internationally renowned speaker, business coach, and bestselling author.


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