The six most valuable companies in the world are almost all household name brands (Alibaba would be in China and Alphabet being Google’s parent). And all are technology companies. Apple has spent decades setting the standard for hardware, while Amazon has shifted our expectations in retail.
Digital success is paramount, even for those companies we’d consider ‘traditional’. And the number departments responsible for delivering it, is expanding.
According to Gartner’s 2018 CIO Agenda Report, 84 per cent of those surveyed at top performing organisations have responsibility for areas of the business outside of traditional IT, the most common being innovation and transformation. The CIO’s job is shifting, delivering business results is increasingly expected.
Digital transformation isn’t an end goal, but a shift in mindset within organisations.
Here are five trends that may define your company's future.
1. A slimming pool
We have a talent crisis. The demand is rising every year and there’s not enough new talent graduating into the industry. Robert Half Technology interviewed 160 Australian CIO/CTO’s and found that only 3 per cent said today’s education system is capable of meeting the demands of the IT employment market. In fact 82 per cent say it’s more challenging to find qualified IT professionals today compared with five years ago.
In Europe, the EC digital single market chief, Andrus Ansip, has been quoted as saying: “Despite rapid growth in the ICT sector, creating some 120,000 new jobs a year, Europe could face a shortage of more than 800,000 skilled ICT workers by 2020”.
We face our own problems here, as a recent Deloitte Access Economics report found that just to keep up, we’ll need 100,000 extra workers in ICT by 2023. To become a global leader, we’ll need another 100,000. With only 5,000 graduating every year, that means we’ll need to import talent.
Are there programs organisations can run to entice young people to develop required skill-set?
2. Mobility breeds flightiness
And the experience for those already in the market isn’t fantastic. Database Developer is one of the top seven in-demand tech jobs this year. But the position worryingly lacks loyalty - with three out of every four developers claiming they are open to new opportunities in 2018 according to Stack Overflow study from last year.
Two thirds said they would lose interest in a job if there had been no follow up within two weeks of a job interview. And bearing in mind that Glassdoor found it takes 4.5 weeks to fill a role, this leaves many businesses struggling to equip themselves with the best team.
There are now platforms like openhyre.com with pre-loaded tech tests, which connect employers with tech talent in just seven clicks. So recruiting is getting more streamlined.
3. Expectation setting
The problem for ‘traditional companies’, is that it’s not just tech giants that are expected to be digital leaders now. Your business is no longer rated against competition just in your sector. The pinnacle of digital customer experience, soon becomes the benchmark against which your brand is judged.
Redesigning your brand for a digital experience for your customers is not a simple process. According to SAP’s 2017 Australian Digital Experience report, 35% of consumers’ digital interactions are still unsatisfactory. Which is why as a brand, you need to ensure your teams are well stacked with appropriate talent to deliver against heightening expectations.
4. Change of pace
Legacy thinking and inaction are responsible for an increasing number of closures. The digital impact on businesses, like Toys’R’Us, is speeding up the rate competitors can fall behind (although other factors contributed to the toy giant’s downfall).
The average age of an S&P 500 company is now under 20 years. It was around 60 years in the 1950’s. The speed of change is down to disruption and now automation as Industry 4.0 claims more victims every month it seems (Sears etc).
Those businesses that fail to keep up with the change in technology are falling further behind at quicker rates than we’ve ever known. It’s predicted that by 2027 the average tenure of companies on the S&P 500 will be just 12 years, halving from the 2016 figure. Identifying digitally literate talent has never been so important.
5. Governmental influence
Earlier this year The Institute of Public Affairs (IPA), released a report into Demographics and Entrepreneurship. It highlighted Australia’s ageing population and its negative effect on building on the startup scene domestically. Not only that, but red tape is costing the economy $176bn a year - it’s killing the entrepreneurial spirit which contributes so much to our national productivity.
To keep talent in this country we need to ensure there’s work they want to contribute towards. According to a Stanford Graduate School of Business 90 per cent of MBA graduates, ranked social responsibility high on their list of needs when choosing a company to work for. Which is why startups are attractive. The idea of working towards a common purpose is a compelling sell to millennials and those entering the workforce. However small business startups as a percentage of all small businesses has halved since 2003.
When we factor in the Visa issues with getting foreign talent to plug the gaping holes across industry, it becomes clear just how vital importing talent is and creating the right environment for them to succeed.
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