Digital transformation held back by lack of employee engagement

Companies’ digital transformation projects are failing due to a lack of staff buy-in, according to new research from software provider IFS.

The report, The undeniable people factor, showed that when going through digital transformation projects, businesses focus more on implementing the key technology and solutions rather than considering staff buy-in.

Over a quarter (27%) of companies have acknowledged that despite being key to tech change, people are often overlooked when planning and executing transformative projects.

A further 23% of respondents in the survey said people are the “unsung heroes” of such projects.

Jane Keith, chief human resources officer at IFS, told HR magazine: “A company’s plans for digital transformation must start with its people. If employees are aware and inspired to support the transformation, the business is much more likely to reap success.

“We know, for example, that when new technology is implemented effectively, it provides a perfect platform to retrain, upskill and retain employees while attracting new talent to the business.”

Although HR’s involvement in such projects was recognised by respondents as being important for successful digital change, a quarter (25%) admitted to being guilty of forgetting to include them.

This goes hand in hand with the fact that nearly one quarter (24%) of respondents identified poor change management as a key reason for transformation project failure.

Further reading:

The employee engagement gap: From debate to action

Digital transformation a mystery to employees

Digital transformation: HR faces a twofold challenge

Keith added: “In order to see these kinds of benefits, companies need to ensure they involve all departments in the business and make sure their people are the driving force behind their project before, during, and after the execution - after being the most important.

“This will not only encourage employee engagement and buy-in, but improve the overall impact of the project. It is clear that this is where businesses are currently missing the mark.”

Employees are keen for HR to play a bigger role in transformation, but also for digital transformation projects to include HR technology that will benefit them in their current roles.

Nearly one third of respondents (30%) stated that employees want more HR technologies to help them be more efficient.

Keith concluded: “The key learning that HR teams should take away from this is that when planning and executing transformative projects, staff involvement should not be seen as a just a tick-box exercise.

“Rather, people are the secret sauce in any transformative initiative. Engaging them early and winning their support is what will ultimately ensure a favourable outcome.”

The study is based on responses from 3,032 executives in the UK, the US, Australia, France, Germany, and the Nordics. Data was collected between April 8 and 5 May 2020, by Censuswide.