CEOs are sharing their focus on digitalization with their investors; mentions of “digital” on earnings calls have increased 20 percent year-over-year since 2010. CEOs are seeking ways to keep costs down while achieving gains in efficiency and productivity, and the HR function is expected to lead digital transformation efforts across their organizations.
“As more organizations become increasingly digital across their operations, HR departments are facing a tall order: not only do they have to lead the digital transformation of their company and satisfy the desires of the CEO, but they must also meet employee demands that digitalization efforts provide improved experience for them,” said Brian Kropp, group vice president of Gartner’s HR practice.
To lead this digital Gartner has identified five macro strategies to lead this transformation:
- Attracting more digital candidates
- Gaining better insights about employees
- Coaching managers to develop the digital capabilities of their teams
- Improving technology to drive employee self-service at work
- Evolving performance management
Realizing the expectations of the employees is critical given the state of the labor market, which includes decreased employee effort amid some of the lowest unemployment numbers in recent history.
According to Gartner research, the number of employees who are willing to go above and beyond the call of duty in the workplace has declined significantly, both globally and in North America. In 3Q18, only 17 percent of North American employees reported high levels of discretionary effort, down from 26 percent in 2013. Globally, a mere 14 percent of employees reported high levels of discretionary effort in 3Q18, six percentage points lower than in 2013.
“The U.S. unemployment rate was 3.8 percent in the third quarter of 2018 and the U.K.’s wasn’t much higher at four percent, indicating labor markets that are the tightest they’ve been for some time,” said Mr. Kropp. “For most organizations, talent is the single biggest overhead expense, and the biggest competitive advantage. As such, heads of HR are under extreme pressure to deliver on the promise of what digitalization has to offer, both in terms of the business and employee experience.”