Almost 30 percent of business apps will be updated to include artificial intelligence (AI) enhancements within the next two years, according to a new article from a CCS Insight analyst.
In addition, nearly 60 percent of enterprises are using or trialling AI technology in their business.
Artificial intelligence is developing at an increasingly rapid rate as it diversifies into more applications and environments. Companies are betting big on AI tech to drive forward digital transformation, improve efficiency and deliver better customer experiences.
According to a study cited by CCS Insight analyst Nicholas McQuire, 58 percent of IT decision makers are using, trialling or researching AI and 29 percent plan to incorporate it into their apps by 2019.
The above figures demonstrate strong interest in AI on the part of enterprises.
At the same time, other recent studies have shown that consumers remain sceptical and general adoption of AI is still quite sluggish. Companies are yet to demonstrate to their workforce or customers that AI is capable of enabling its oft-attributed benefits. In addition, they also need to show that the benefits — if obtainable — can offset the risks to human roles that many people perceive.
McQuire, writing on the Google blog, said companies must be prepared to scale-back their AI deployment plans. If adoption is to be successful, the introduction of new tech should be completed gradually. This gives employees time to adapt to the incoming processes and concepts.
As people gain familiarity with the tech, they’re more likely to fully utilise its features and will be less fearful of potential privacy violations. The same approach should be used for consumer-facing technologies. Continuing to implement AI-based systems at breakneck pace could destabilise the machine learning industry, causing resistance amongst users still concerned about privacy considerations.
Change management & employee engagement
Successfully introducing AI technology will require enterprises to proactively manage change and inform their employees.
McQuire warned lingering fears and confusion must be properly addressed, including points that might be raised by customers.
During the transition period, companies should keep traditional alternatives to AI operational, while steering users towards the AI service and highlighting its benefits. Some types of AI service, such as automated support desks, are already benefitting from use of this strategy. The customer is allowed to make an informed choice that leaves them feeling more comfortable. Regular reminders of the benefits could eventually cause them to use and then trust the AI.
“While our surveys reveal employees are generally positive on AI, there is still much fear and confusion surrounding AI as a source of job displacement,” wrote McQuire. “Be mindful of the impact of change management, specifically the importance of good communication, training and, above all, employee engagement throughout the process.”
Companies can also try early adoption of services that use AI subtly, such as next-generation workplace collaboration tools. This helps employees to engage with AI on a regular basis and furthers the business’ transition towards new digital tech. Gradually incorporating AI allows firms to start benefitting from efficiency improvements immediately, while ensuring employees and customers don’t feel alienated or disillusioned.
Three big examples of DX culture shift
Digital transformation is not just about technology and big ideas. For digital transformation to be undertaken smoothly, a cultural change, involving all employees, need to take place.
Most headline messages about digital transformation discuss the necessity of switching from legacy systems; avoiding siloed data; and focusing on developing the digital understanding of C-suite executives. What is often missing from the discussion is the need to develop a new culture. This is a culture of innovation, understanding and shared values in order to innovate product and service development.
Analysis by MIT Sloan and Deloitte into business-focused digital successes and failures concluded:
“The history of technological advance in business is littered with examples of companies focusing on technologies without investing in organizational capabilities that ensure their impact. In many companies, (failures are) classic examples of expectations falling short because organizations didn’t change mindsets and processes or build cultures that fostered change.”
The survey also found, as Sloan Review summarizes, that the ability to digitally reimagine the business is a key factor of clear digital strategy. Such organizational vision, supported by leaders, fosters an innovative, change-friendly culture. For this to happen, the workforce needs to willingly and determinedly take on the digital transformation path.
Taking employees on the journey
This means every employee in the company should understand and support collaborative practices, innovation, open culture and adopting a digital-first mindset; plus, having the agility and flexibility, customer centricity to deliver change. Once this is in place a data-driven culture will start to form and new technologies can be steadily adopted.
This means companies need to implement systemic changes in how they organize and develop workforces. Organizations also need to seriously consider how they drive workplace innovation, and work collectively to cultivate digitally-minded cultures and experiences.
As to how this might work in practice, one example is Coca Cola. The company acknowledges that culture change is one of the most difficult aspects of digital transformation to realize.
The soft drinks firm’s digital strategy officer, David Godsman notes that changing culture across the marketing team is the hardest thing Coca-Cola has to tackle as it undergoes the necessary transformation to bring the enterprise into the digital age.
Coca Cola is also attempting to alter its customer focus, acknowledging the need to create personalized experiences for consumers and customers, to fit in with consumers seeking multi-channel experiences and fast mobile access, especially when receiving promotions.
Latitude financial services
A second example of digital transformation with a customer focus is with Latitude financial services. According to Caroline Ruddick, who is the company’s general manager of marketing, there needs to be a twin strategy of developing and improving the customer experience. This shift in strategy, says Ruddick, must be bound to the process of ensuring that employees are responsive to the changes taking place within the organization so they can successful and emphatically offer high quality outfacing services.
Tied up with this is recognition that customers are increasingly more concerned about the experience of dealing with a product or company, seeking an easier, multi-channel offering, and they are less concerned about the actual product, or at least with having any significant loyalty to one product over another.
Adobe provides a third example of a company that has recognized the value of culture change. According to Vision Critical, when Adobe made the decision to transition from physical software to a cloud-based model, the company recognized that it was necessary to shift its employees’ focus towards the the customer.
This was undertaken by developing a staff Experience-a-thon. Adobe had employees role play testing and providing feedback on Adobe portfolio of products, pretending to be customers. This led to an employee engagement strategy and a shift in culture, paving the way for Adobe’s evolution into a cloud company.
These examples demonstrate that the ‘big moment’ for an organization is when it embraces the fact that digital transformation is not a a technical problem to be fixed, but instead it is a cultural change to be enacted through the enterprise.
Here’s the thing about how digital transformation will impact your business
Here’s the thing about digital transformation: Everyone knows it’s happening.
But it’s hard to know which new technology or innovation is going to be the one that upends your industry, opens up massive opportunity, threatens your company, or forever alters your role.
Today we’re introducing a new, custom-tailored service to help you figure that out. The service combines journalism, research and market analysis to help you and your team understand the state of digital transformation (DX) and explore the key developments that will impact your employees and industry.
We call this our “Here’s the thing about…” service. Teaming up with the DX Journal, we leverage journalists, analysts, researchers and strategists to help your company get a full picture of:
- What is likely to impact your industry
- Your team’s readiness to deal with it
- An in-depth look at major developments you need to pay attention to
Here’s how it works:
This service is designed to give perspective on how digital transformation will impact your company. We present our findings in an easy-to-understand format breaking down trends for multiple departments and for every skill set with documented takeaways and action items.
We uncover and share those findings in a simple, two-step process:
Step 1: Research & interview process
- Custom research on digital transformation trends impacting your industry, customers, and competitors.
- One-on-one interviews with your company’s executives, department heads or managers, employees and/or customers.
Step 2: Research presentation
- A presentation to your company in an internal keynote-style presentation to any size group — be it a small strategy team or an all-hands employee seminar.
- Our team of researchers, journalists and analysts will share the research findings, key trends in your industry and provide an overview of how well you’re set up to address challenges or embrace opportunities based on the employee interviews.
Who this service is for:
Let’s start by clarifying that digital transformation is not just an IT problem. Our clients are often leaders who are not technologists. In fact, many companies we speak with are surprised to learn how many areas of the business are impacted by DX, including marketing, HR, IT, sales, operations, legal, and others.
There’s no escaping that every area of a business is going to have to manage change that digital transformation brings. Digital transformation should not be left for the IT department alone to figure out.
With that in mind, we’ve designed this report and presentation service most commonly for executives and managers in:
- Operations, finance & strategy
- Human resource departments
- Marketing and sales departments
- IT departments
Sure, you might not have to deal with artificial intelligence in your accounting department tomorrow. Or chatbots in your HR department. Or big data solutions for your manufacturing warehouse. But how can you be sure if you don’t understand these emerging technologies? What if your competitors are? And what if they’re getting a 6-month head start?
To get started, please contact the DX Institute.
How Canada’s new digital service for government is approaching culture change
The digital transformation of organizations begins with an internal cultural shift promoting agile strategies, a hunger for innovative practices and the ability to change direction quickly.
As serial entrepreneur James Bilefield pointed out in an interview with McKinsey, culture change can be the biggest challenge of any major organizational shift:
“In my experience, culture is the hardest part of the organization to change. Shifting technology, finding the right talent, finding the right product set and strategy—that’s all doable, not easy, but doable. Hardest is the cultural transformation in businesses that have very deep legacy and cultural roots.”
That all seems taxing enough. Now imagine the organization in question has more than 100 departments and 250,000 employees. That’s exactly the challenge that the Canadian Digital Service (CDS) is facing.
CDS is a team working within the Treasury Board Secretariat to help the government design and build better services. Structured on the delivery of useful tools, the team is also helping government departments to build greater capacity for digital problem solving. The CDS team retains control of their communication tools allowing for their work to be shown out in the open. And through the government’s Interchange Program, they’re able to recruit private sector talent on short-term assignments.
Pascale Elvas, Director of CDS, has an up-close view of the government’s hunger for change and how many roadblocks there are along the way.
“We’re trying to get departments thinking about digital differently,” says Elvas. “We want them to really understand their users, the citizens that they serve and to unpack the problem.“
Traditionally, the government puts out a request for proposal (RFP) — the average size of the RFP and bids related to it is 8,000 pages long — detailing its requirements, a solution and asking vendors to build that solution. However, this traditional method is far from agile project development.
“By the time it’s deployed, it’s already obsolete and there’s no room for course corrections along the way,” says Elvas. “We’re trying to get departments thinking about digital differently. We want them to really understand their users, the citizens that they serve and to unpack the problem.”
Since Elvas joined CDS a year ago, the organization has grown from three people to 45, they get more than 40 requests from departments per month, and they’re recruiting just to keep up with demand.
Elvas says a change in perspective within government departments is at the root of the work being done by CDS:
“It’s getting departments thinking about digital in a different way, and not necessarily starting with an end-state solution from the outset. So allowing the discovery work to happen, to talk to real users along the way, to iterate and to adapt and course correct based on the insights gained through that work.”
Elvas and her team at CDS are advocating for whole new methods of addressing and carrying out projects, reworking the culture around tasks within the government, in order to put the needs of the citizen at the forefront.
“Part of this work is about culture change: It’s about breaking building projects down into smaller chunks, it’s about building microservices, it’s about using different methods, it’s about moving away from waterfalls to agile, it’s about active prototyping and constant iteration, moving to user needs over government needs, and iterating along the way based on user feedback.”
CDS follows the efforts made by both the Government Digital Service in the U.K. and the United States Digital Service to transform government in the 21st century. While everyone can agree that governments around the world need to revolutionize their use of digital tools to improve user experiences, the way forward can often appear muddy at best.
In one ongoing project, Natural Resources Canada (NRCan) is using CDS to open up data on household energy use in a transparent and reusable way. The initiative is particularly insightful as an early CDS project, as it involves working with legacy database systems, and includes user research sourced from various, unique data sets — specifically, provincial and municipal governments.
The expectations NRCan approached the project with, the kind of solution they already had in mind, changed radically after working with CDS to address the problem with a user-based mindset.
“When NRCan came to us,” says Elvas, “they came to us with a very specific solution in mind. NRCan wanted us to build them a database. They already had an internal database, so they wanted a database that was searchable by the public and that was more of a client-facing version of their internal database.”
“Now in doing the discovery work and talking to department officials and understanding their business, we discovered that what they were asking for wasn’t exactly what they needed. Building an API will enable all kinds of new services to be built and for private sector partners to use the data to do all kinds of other neat things — and open the door for much deeper service redesign work.”
CDS is hoping they can build on the success of projects like the API for NRCan to get government departments to reassess how they approach digital problem solving.
“We hope that by demonstrating an alternative way of doing things, we’ll move away from the traditional waterfall approach of launching an 8,000 page RFP with set requirements to really using service design and other methods to unpack the problem, understand the users and to build smaller solutions that can be iterated along the way.”
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