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Study: Employees Lack Skills for Digital Transformation

January 12, 2016 by Susan Galer 421

Digital transformation may dominate business conversations, but which organizations have a step-by-step action plan to make it happen?  Not many, according to a study entitled, “Skills for Digital Transformation,” conducted by Technical University of Munich and SAP.

The survey found 80 percent of C-Suite respondents view digital transformation as an important part of their company’s overall business strategy. What’s more, nearly four out of 10 report their company’s business model is threatened by digitization. Yet only 35 percent of the same executives claimed to have a defined digital transformation strategy. The study was small (81 executives) and sourced the most feedback from companies in China, Germany, Italy, Argentina and Australia. That said, Dr. Helmut Krcmar, a professor at the Technische Universitat Munchen (TUM), found the feedback from senior-level executives telling.

80% of C-Suite respondents view digital transformation as an important part of overall business strategy.

“The gap between recognizing the skill deficit and not having a dedicated recruiting and training program to close it could be because skill development is a strategic issue,” said Dr. Krcmar. “Companies haven’t established their company’s digital future or a digital transformation strategy. They are just beginning to prepare for new business models in the digital era.”

Source: “Skills for Digital Transformation,” survey by Technical University of Munich and SAP

Employee Training Lags Behind

Across every industry the C-suite is asking what digital transformation means to their individual company. CEOs are intent on being the disruptors and not the disrupted as cloud-enabled services blur industry boundaries. CIOs are under pressure to show what outcomes technology innovations can bring to the business. Perhaps the biggest challenge around digital transformation is the depth and breadth of its sweeping change. Leaders and their teams have to understand not only specific technologies like analytics, security and mobile, but also the accompanying new business models and the impact company-wide including human resources, supply chain, finance and more. Yet only 27 percent of respondents in this study said their business executives have the technology skills necessary for digital transformation. And, only 10 percent of respondents said their Human Resource (HR) division has implemented a recruitment/training program to close the skill gap.

“Digital transformation impacts a broad set of skills that have to be moved forward at once,” said Krcmar. “The data scientist without business model knowledge is not in a good position to make the greatest contribution. You either need widely trained talent or a group of experts able to work together from different areas. Both are rare. Knowledge used to be T-shaped; inch wide and mile deep. Now you need more of a Pi shape that’s mile wide and mile deep—employees need technology and business acumen, and the ability to connect the two deeply.”

Beyond Just-in-Time Learning

In response to these challenges, learning itself is undergoing a digital transformation. Along with in-person classroom sessions, companies now have the option of using digital learning platforms for employee education.

“The ability to decide what to learn, how to learn it, and use that knowledge immediately is a big plus for employees and their companies,” said Bernd Welz, Executive Vice President and Global Head of Solution & Knowledge Packaging at SAP. “The shelf life of knowledge is much shorter as we ship software more frequently. For example, we’re shipping a new version of SAP S/4HANA almost every quarter. The only way for both IT and the business to stay on top of innovation is through a digital learning platform.”

Learning itself is undergoing a digital transformation

Welz added that many SAP customers and partners rely on both the company’s classroom and digital learning platforms to explore the potential of new solutions before release dates, getting ahead of innovations for competitive advantage. For example, the SAP Learning Hub is a central, cloud-based learning offering that provides participants with hands-on SAP software experience, including a virtual learning environment through openSAP Enterprise MOOCs (massive open online courses). Training sessions featuring self-study, discussion forums, videos and gaming. The constantly expanding curriculum addresses much more than SAP solutions, covering a range of digital transformation topics from both SAP and external experts such as leadership in the digital age and internet of things.

Regardless of what learning tools companies select, they need to thoroughly evaluate technology in sync with business strategy. It’s the only way to know which technology is the best to achieve objectives. The action plan begins with a digital strategy and never ends as companies scale out relevant knowledge.

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