When CEB asked several thousand business leaders how much more employee productivity they needed to meet their goals, the average response was 20%. IT has always had an important role in driving productivity but traditional approaches such as process automation and outsourcing are running out of steam. For example, the benefits of ERP upgrades diminish over time, and wage arbitrage from offshoring is in decline. To deliver the next 20%, CIOs must look elsewhere. They must understand how work is changing and re-center IT around the productivity of individual employees and teams.
CEB has surveyed tens of thousands of business leaders and frontline employees to understand the new work environment. The workplace has been reshaped by four realties. CEB’s data shows that the realities are near universal; they are not limited to desk-bound employees nor to the millennial generation.
1. Greater interdependence
Today’s employees collaborate with at least 10 colleagues to get their work done. As a result, 49% of an employee’s impact on business profitability comes from “network performance” — the ability to help (and be helped by) others. Ten years ago, this figure was only 20%.
2. Frequent organisational change
Organisations never stand still. The average employee has experienced changes to organisational structure, strategic objectives, or leadership, every seven months.
3. Greater knowledge intensity
Some 82% of employees have roles that require analysis and judgment. Even in traditionally process-centric areas such as manufacturing or customer support, more than 50% of employees undertake a least some knowledge work.
4. More technology choice
Device consumerisation has been well documented but it is only the start. After BYOD comes BYOI, BYON, and BYOA (bring your own information, networks, and applications). Almost 50% of employees already use external, unofficial information sources for work purposes, 24% source their own collaboration and networking tools, and 21% use their own analytic tools.
Five opportunities for IT
Our research points to five opportunities for CIOs to drive productivity and growth in this new work environment.
1. Ready IT to drive employee productivity
The first opportunity is to change the capabilities IT delivers. Better employee network performance is critical to meeting the 20% productivity goal, so more investment is needed to enable collaboration within and between teams of all sizes, locations, and compositions. To support better decision making, investments in information management must expand beyond structured information in core internal systems to include diverse sources of structured and unstructured information.
2. Equip employees with competencies, not just tools
Employees need three competencies in the new work environment - collaboration, judgment, and adaptability – but 62% don’t have the skills and judgment to use data for decision making, 80% struggle with collaboration, and 77% are slow to adapt to change. IT and other corporate functions must collectively address this shortfall to ensure that new capabilities for collaboration and insight don’t go unused. IT can play its part by devoting less effort to supporting employees when technology is deployed or breaks and more toward coaching employees to use technology productively.
3. Separate flexible interfaces from foundational data
Most enterprise-wide solutions are accessed through a single, off-the-shelf interface. While this promotes efficiency and integration, forcing employees with very different needs to use the same interface reduces productivity and increases insecure behaviour.
In response, IT should retreat from the interface by establishing corporate apps stores to collect and disseminate apps developed by employees and third parties. In addition, CIOs should reposition some business-facing IT staff to act as buyer’s agents to guide employees and business leaders in selectively provisioning technology for themselves. Beneath the apps store, IT will need more resources for integration and security as these become ever more critical.
4. Shift engagement focus from business leaders to employees
For years, IT has relied on business leaders to represent less senior employees, but business leaders cannot tell IT what will increase the productivity of frontline employees. IT needs stronger mechanisms to directly engage with employees to continuously identify and test their unarticulated needs. CIOs should adopt techniques used in consumer product marketing, such as ethnographic research and market share measurement, as well as sophisticated segmentation models, and stronger skills and processes for user experience.
5. Move IT strategy and budgets from anticipate to respond
Most IT organisations try to anticipate demand through multiyear plans, roadmaps, and annual budgets, but today’s rates of change limits IT’s foresight. Instead, CIOs need more flexible, iterative planning processes and rolling budgets. Similarly, business case decisions should be made quickly based on use cases and strategic alignment, as “hard dollar” ROI estimates are slow to assemble, unreliable, and often biased against truly innovative and experimental ideas.
To realise the five opportunities, CIOs will need to make sweeping changes in IT’s skills and roles. We estimate that 97% of IT roles will be affected by at least one of the opportunities, but this is such an important topic that I will leave it for another article.
CIOs who fail to adapt to the new work environment risk leaving their organisations at a competitive disadvantage as productivity lags. Those who embrace the five opportunities will see corporate IT remain relevant and valuable in an environment where business leaders and employees are increasingly willing and able to obtain technology of themselves.