Beyond Disruption · 2019-12-19 · business leaders for some time now, and the results are...

Beyond DisruptionNew Zealand organisations race to digital transformation success

1 | Beyond Disruption

Foreword

Digital transformation has been high on the agenda of New Zealand’s business leaders for some time now, and the results are showing.

Seelan NayagamManaging Director DXC Technology Australia and New Zealand

John MazenierCountry Manager DXC Technology New Zealand

Foreword

Speed up success to avoid digital transformation failures

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New Zealand businesses on path to organisation-wide digital approach

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New cloud, connectivity and customer experience technologies drive digital agendas

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Digital strategy requires a better approach to non-IT business unit technology spending

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Digital will usher in workforce transformation

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Digital disruption now high on New Zealand’s corporate agenda

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Key recommendations7

Methodology8


Processes have been streamlined and IT systems have been modernised – but these operational benefits won’t stop the growing pace of disruption.

Disruption goes beyond transformation where new, digital-only companies shake up traditional business models and transform industries.

There’s no doubt transformation will help New Zealand businesses compete in their existing markets – but treating disruption as an advantage can also enable them to enter new markets.

Perhaps the most famous example of a New Zealand company disrupting a market – and creating a new one – is Xero, the cloud accounting company. Xero didn’t just create an accounting app; it set out to change how small businesses could operate. Now there are over 700 apps that take advantage of the Xero platform.

It’s time to stop thinking about disruption as a future possibility, and start thinking about how to exploit it to thrive in the new digital-driven economy.

To explore the impact and opportunities for disruption, DXC Technology commissioned emerging technology analyst firm Telsyte to conduct the largest study of its kind in the ANZ region. The Telsyte DXC 2019 ‘Beyond Disruption’ Digital Study interviewed over 600 business and IT decision-makers, of which 158 were from New Zealand, to gather their opinions on the state of digital strategies.

The results are remarkable and show a definite shift in thinking when it comes to positioning our economy for a more digital future.

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New Zealand business leaders have a sense of urgency around digital transformation – understanding they have less than two years to integrate a digital initiative before the full impact of digital disruption hits.

This sense of urgency is translating into action as New Zealand organisations take a more proactive approach to disruption.

Beyond disruption is not a target; it’s a new paradigm for operational excellence and new business creation.

DXC Technology was born out of digital disruption. Our business was formed in April 2017 through the merger of several leading technology brands around the world. We recognised that we had to change to survive in the digital world, and our own learnings through this transformation were eye opening, but not surprising.

We are also continuously observing the 6,000 or so private and government clients we support in over 70 countries, including New Zealand, as they too grapple with the challenges of digital disruption. This gives us a wide perspective on what it takes to be successful in today’s market environments.

With this, we are pleased to introduce you to ‘Beyond Disruption’. We hope the findings in this research study and our six key recommendations will help your organisation take on today’s digital challenges and also thrive in the future. Now is the time to rethink digital disruption for your advantage.

Seelan Nayagam John MazenierManaging Director Country Manager

DXC Technology Australia DXC Technology and New Zealand New Zealand

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New Zealand businesses are on the cusp of rapid change, with digital leading the revolution.

A nation of innovators, New Zealand is leading the world when it comes to balancing innovative technology development with sustainability.

As we become a more global economy, New Zealand businesses face disruption from around the world. Most of this disruption will be digital, and all organisations must prepare to change and thrive.


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15%

31%

18%

36%

Our entire industryis being digitally disrupted

Our industryis not being disrupted

Our productsand servicesare not being disrupted

Some of our productsor services are being disrupted

Q. How is digital disruption impacting your organisation?

Source: Telsyte New Zealand Digital Workplace Study 2019, n=158

Figure 1. Perceived impact of digital disruption

Telsyte’s research shows New Zealand is a dynamic digital market, with two-thirds of business leaders believing their industry is being digitally disrupted.

This means the market will change dramatically and many companies will fail to keep up.


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39%Yes

61% No

Q. Is your organisation afraid of ‘Uberisation’ of its industry?


Figure 2. Fear of being ‘Uberised’

Fear of ‘Uberisation’ is widespread, with almost two in five (39%) business leaders believing their organisation might be disrupted by a new player in the market.

New market entrants and opportunities should be strong drivers for adopting more digital capability. New Zealand companies can compete with global players – as long as service levels and portfolios are comparable.

Uberisation is the utilisation of computing platforms, such as mobile applications, in order to facilitate peer-to-peer transactions between clients and providers of a service, often bypassing the role of centrally planned corporations. The model has different operating costs compared to a traditional business – and most traditional businesses could readily offer this type of channel to market.

The term is derived from the name of the company which developed a mobile application that allows consumers to submit a trip request which is then routed to Uber drivers who use their own cars.

Source: htt ps:/ /en. wikip edia .org/wiki/UberisationSpeed up success to avoid digital transformation failures

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23%

13%

4%

6%

2%15%

19%

18% Less than 1 year

1 year

2 years

3 years

4 years

5 years

More than 5 years

Not sure

Q. How long do you believe your organisation has to integrate a digital initiative before the full impact of digital disruption hits your organisation?


Figure 3. Perceived time organisation has to integrate a digital initiative before full impact of digital disruption

New Zealand business leaders see more urgency around digital transformation compared with their trans-Tasman counterparts and, on average, they believe there is a 1.7-year timeframe to integrate a digital initiative before the full impact of digital disruption hits (0.5 less years compared to Australia, or 23% less time).

Generally, New Zealand is a small economy and organisations are less shielded from competitive threats.


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55%

12%

17%

16%

Do nothingbusiness as usual

Keeping an eye on itto react if and when it begins to impact us We are

lookingto partner with digital disruptor organisations

Already developingways to digitally disrupt our industry

21% in SME

9% in Large

Q. What is your organisation’s approach to digital disruption?


Figure 4. Approach to digital disruption

Moreover, 60 per cent believe they need to integrate a digital initiative within two years, which is 12 per cent higher compared to Australian IT and business leaders. There is a sense of urgency that disruption is coming quickly and companies need to act now.

This sense of urgency is translating into action as New Zealand organisations take a more proactive approach to disruption.

New Zealand less reactive than Australia: a high 68% there take a reactive approach to disruption.


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Importance of leapfrogging strategies by organisation size and industry

13%Not important

41%Important

46%Somewhat important

Large

SME

Manufacturing

Scientific and Technical Services

Media and Telecommunications

Education and Training

Retail Trade

50%

35%

50%

50%

33%

31%

29%

Q. How important is it for your organisation to leapfrog competitors’ digital strategies to build competitive advantage?

Source: Telsyte New Zealand Digital Workplace Study 2019, n=158, base: opinions based on an eleven-point scale from 0 to 10, 0 to 3 being not important, 4 to 6 being neutral and 7+ being important [multiple choice]

Figure 5. Importance of leapfrogging strategies (Pie chart – left)Figure 6. Importance of leapfrogging strategies by industry (Bar chart – right)

Having a competitive digital strategy is highly valued by New Zealand organisations, as 41 per cent place importance on ‘leapfrogging’ competitors. Leapfrogging refers to innovations that allow your organisation to overtake or stay ahead of competitors.

New Zealand software company Xero demonstrated this by disrupting the established accounting software market and helped create a new market for cloud-based accounting in the process.

Digital disruption can be a threat, but also an opportunity if treated that way. The time is right for New Zealand business leaders to exploit digital for new products and markets.


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New Zealand businesses on path to organisation- wide digital approach

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With on-demand digital products and services so pervasive, it has always been easy for staff and business units to go it alone and develop their own digital strategies.

Marketing can develop a mobile app, Operations can adopt a cloud solution and the Finance team can get access to online reporting tools.

The challenge with disparate digital initiatives is that the wider organisation might not have any visibility into – or benefit from – what each business unit is achieving.

More than three-quarters of New Zealand organisations now have a digital strategy, with the larger organisations leaning towards digital strategies that vary across business units. In this sense, New Zealand organisations are less advanced with organisation-wide approaches, but the holistic strategy will quickly become the main approach in 2019 and beyond.


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38%

38%

18%

6%

NoNo plans

YesOrganisation- wide

YesVaries across business units

NoWe are investigating

Q. Does your organisation have a digital strategy?


Figure 7. Adoption of digital strategy

Digital strategy approach

SME5-199 employees

Large200+ employees

Total

Yes, organisation-wide 38% 38% 38%

Yes, varies across business units 30% 48% 38%

No, but we are investigating 21% 14% 18%

No plans 11% – 6%


Figure 8. Adoption of digital strategy by business size

Despite the gap, an organisation-wide approach is high on the agenda for New Zealand organisations.

Telsyte’s research found an overwhelming 91 per cent of those with business unit-varied strategies are looking to transition to an organisation-wide approach.

An organisation-wide digital strategy is now considered a superior approach by most IT leaders as it best places companies to fend off competitors, innovate and deliver long-term outcomes. It is also a better way to allocate scarce IT resources and ensure consistent technology decisions.


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49%

34%

8%

9%NoDon’t know or have not considered

Yes

YesPlanning to move to organisation-wide

NoToo difficult

Q. Is your organisation able to create and execute organisation-wide digital strategies?

Source: Telsyte New Zealand Digital Workplace Study 2019, n=158, base: all respondents

Figure 9. Capability to execute organisation-wide digital strategy

More than one-third of organisations with a digital strategy have changing business strategies and employee reskilling as part of their plan to keep up with and facilitate disruption.

Smaller enterprises are taking a more reactive approach to digital disruption as many face budget and employee engagement challenges in their digital transformation programs.

Small-to-Medium Enterprises (SMEs) also have a high focus on employee reskilling as part of their digital transformation strategy and are ahead of large organisations when it comes to digital skills training such as cybersecurity.

Of those with a varied business unit approach: 91 per cent are executing or planning to move to an organisation-wide strategy.


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Changing business strategies

Reskilling or retraining

Changes to business model

Integration with partners

Organisational structure changes

Hiring skilled workforce

Customer engagement

Operations and value chain

Redundancies

Changes to reporting lines

Customer cooperated product development

34%

32%

31%

26%

25%

24%

24%

21%

14%

14%

13%

Q. Which of the following components does your organisation’s digital strategy have?

Source: Telsyte New Zealand Digital Workplace Study 2019, n=120, base: those with a digital strategy [multiple choice]

Figure 10. Key components of digital strategy

SMEs can improve by taking advantage of cloud services previously only within reach of large enterprises. This should be a core part of an SME’s digital strategy.

Innovation while keeping the lights on

A key challenge for many organisations when investing in digital is limited budget – particularly for large-scale transformation – when it’s needed for regular operations as well as innovation.

Telsyte research shows that, on average, most New Zealand organisations spend around half their IT budget on operations, with the remainder on transformation and innovation.

To free up operational costs to allow for more innovation, organisations need to increase the efficiency of their IT operations. Furthermore, addressing issues of shadow IT and business unit spend on IT can refocus resources for a holistic digital strategy.


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By measuring process/service effectiveness

Through customer advocacy

By measuring revenue increase

Through employee advocacy

By measuring agility

By measuring amount of cost savings

Through partner advocacy

We do not measure digital transformation outcomes

38%

33%

33%

28%

27%

27%

19%

3%

32% rank 2 KPI for Australia

14% for SME33% for Large38% rank 1 KPI for Australia

Q. How does your organisation measure digital transformation outcomes (KPIs)?

Source: Telsyte New Zealand Digital Workplace Study 2019, n=120, base: those with a digital strategy [multiple choice]

Figure 11. KPIs to gauge digital transformation outcomes

Larger New Zealand organisations are more aware of the impact of digital disruption on their industry. These organisations are leading when it comes to intended recruitment of IT staff and agile methodology training, in order to be more adaptive to the digital dynamic.

Larger organisations are always challenged by time to change and agility, and get an advantage by removing silos and red tape within the business units.

New Zealand organisations are focused on measuring effectiveness, revenue and employee-customer advocacy, which will help realise the outcomes of digital transformation projects. In comparison, Australia’s top digital transformation outcomes (KPIs)

are measured by amount of cost savings and process/service effectiveness.


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By adopting a holistic digital strategy, IT leaders are more likely to have the levers they need to change their businesses in the future and are less likely to waste resources, or create duplicate projects and initiatives.

SME5-199 employees

Large200+ employees

Perceives limited budget and employee engagement as key challenges to digital transformation

Majority are taking a reactive approach to digital disruption

Future digital transformation programs to focus on employees

Almost half believe they will maintain status quo in terms of digital disruption and IT staff numbers for 2019

High focus on reskilling staff as part of digital transformation

Segment faces the most technical challenges when it comes to digital transformation strategy

Leads large organisations in training staff in cybersecurity

Almost half utilise a business unit-centric digital strategy

More aware of the impact of digital disruption on industry

Segment facing the most challenge with cybersecurity in digital transformation

Customer- and partner-focused digital transformation programs

Leads in intended IT staff recruitment increase in 2019

Innovation program driven by developing new products and services and web application development

Has much higher priority on training staff to be agile

Summary of digital transformation themes by organisation size

Source: Telsyte New Zealand Digital Workplace Study 2019

Figure 12. Summary of key differences in approaching digital by organisation size


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As we approach 2020, there are new cloud, 5G, Internet of Things (IoT) and customer experience technologies set to drive digital transformation even further.

In New Zealand, 5G and cellular IoT technologies are high on the digital transformation agenda for organisations as the connectivity of all ‘things’ in the enterprise quickly becomes an opportunity to transform for the future.


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5G and Cellular IoT

1 2 3 4 5Next-

generation Interfaces

Deep Learning

Artificial Intelligence

Machine Learning

Source: Telsyte New Zealand Digital Workplace Study 2019, n=158 [rank]

Figure 13. Top technologies investing in for digital transformation, large and corporate organisations

Q. Which of the following technologies does your organisation invest in for digital transformation purposes?

High-speed connectivity can deliver real-time intelligence and the ability to extend automation into the field. Better connectivity is not the only advanced technology on the radar for digital change. New Zealand organisations are also showing more interest in Deep Learning, Artificial Intelligence (AI) and Machine Learning.

This interest indicates a move towards process automation and streamlining to cut costs, or augment resources where there are skills shortages.

This push for process automation through robotics and AI will have a profound impact on the workforce. Roles that involve customer service, driving, or hazardous work are likely to be impacted the most, as businesses target these areas first.


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Customer Service

Driving

Hazardous or dangerous work

40%

24%

13%

Q. What percentage of employees in your organisation are involved in the following type of work?


Figure 14. Employee involvement in customer service, driving and dangerous work

The massive growth in popularity of cloud services from the likes of AWS and Azure are also testament to this desire for rapid service delivery, and organisations are increasingly taking to multiple clouds and standalone Software as a Service (SaaS) applications for more agility.

In 2019, the rapid deployment of cloud-based applications will be critical to support the requirements of organisations looking to scale digital services.

Emerging technologies are essential for digital transformation and disruptive organisations are continually exploiting every opportunity.


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4 Digital strategy requires a better approach to non-IT business unit technology spending


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As with business units focusing on their own digital strategies, in recent years staff in non-IT areas of organisations have been procuring more IT services to deliver their requirements.

So-called ‘shadow IT’ is highly prevalent in New Zealand organisations, with 80 per cent of all business units spending on some IT-related products and services outside of the central IT budget.


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Yes

No Don’t know

Yes

No 20%

80%

56%

31%

13%

Has your organisation experienced any problems arising from non-IT business units purchasing IT products and services?

Q. Do any non-IT business units spend on IT-related products/services outside of the IT budget?

Source: Telsyte New Zealand Digital Workplace Study 2019, n=158; Telsyte New Zealand Digital Workplace Study 2019, n=126, base: those with IT spend by non-IT business units

Figure 15. IT procurement by business units outside of IT budget (Bar chart – left) Figure 16. Result of IT procurement by non-IT business units (Pie chart – right)

IT spending by non-IT business units in New Zealand organisations is driven by a number of factors, including: business needs exceeding IT delivery speed (27%), and the availability of accessible point solutions delivered via the cloud (27%).

Consequently, this high occurrence of IT procurement by non-IT business units has led to problems arising in almost one-third of organisations (31%).


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Q. What problems arise for IT and the whole organisation when non-IT business units procure the IT services they need?

Source: Telsyte New Zealand Digital Workplace Study 2019, n=39, base: those that experience problems from non-IT business unit purchasing IT products and services [multiple choice]

Figure 17. Problems arising from IT procurement by non-IT business units

The main challenges of shadow IT stem from inconsistent technology selection (46%), integration requirements (44%) and higher costs (36%).

That’s not to say business units cannot be helpful when it comes to digital. New Zealand business leaders believe placing IT as the strategic driver of cross-functional collaborative projects with non-IT business units can ensure successful project delivery and, less budget and resource wastage.

Inconsistent technology selection

Higher costs

Integration requirements

Poor technology / fit-for-purpose decisions

Security (including data loss / privacy)

Auditing / regulatory requirements

Lack of transferable skills

Inability to get good prices / discounts

46%

44%

36%

33%

33%

26%

23%

13%


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Q. What do you believe is the best solution for working with non-IT business units to deliver an IT outcome?


Figure 18. Approaches to successful collaboration with non-IT business units

As businesses transition to an organisation-wide strategy, CEO leadership becomes critical to effectively drive cultural changes, as less than half currently have a culture of change or innovation.

41%IT to be strategic driver of the project

24%IT covers integration requirements

23%IT pre-selecting options

12%Non-IT business units to driveIT decisions

Q. Which of the following types of culture does your organisation currently have?

Culture of adapting to change

Culture of innovation

Culture of agility

None

42%

39%

13%

26%

15% in SME38% in Large

Source: Telsyte New Zealand Digital Workplace Study 2019, n=158 [multiple choice]

Figure 19. Types of organisational culture


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Q. Who in your organisation leads the digital transformation strategy?


Figure 20. Who leads digital transformation in the organisation?

CEO

Board orChairman of Board

CIO

CFO

CTO

IT team

CMO

COO

CDO

28%

6%

8%

30%

10%

10%

1%

2%

1%

Senior Leadership

C-level – IT

C-level – Other

39% in Large

In New Zealand organisations, the CIO is still often the lead of digital strategy, which is good for strategy development; however, this needs to change to facilitate the CEO driving the required cultural changes in the organisation.

Digital disruption can impact all levels of an organisation, from operations staff to senior management – and getting people involved with digital strategy from the outset will help prepare for change. Digital training is an important need for the future enterprise.

In New Zealand, one in three CEOs are now involved in leading digital transformation strategy, highlighting the importance of top-level leadership when it comes to driving digital strategy. However, this needs to dramatically increase if organisations are to embrace the future and build businesses that both withstand digital disruption and also develop strategies to become a disrupter.


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Business leaders have evidence that digital strategy and transformation can make a positive impact, but there is always the chance of a program or project failing to deliver value.

Overall, apprehension towards digital transformation is lifting; however, the cultural concerns about failure remain within the New Zealand business community. This is creating a cautious backdrop for many organisations undergoing or considering digital transformation.


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Figure 21. Why business change programs typically fail

Q. Why do business change programs typically fail to produce desired results in your organisation?

On average, 16 per cent of technology and business initiatives among New Zealand organisations end up in failure, with over one-third (35%) of these the result of technical issues.

Technical issues

Employee resistance

Lack of investment or financial backing

Lack of measurement

Risk or compliance issues

Lack of internal culture able to adapt to change

Lack of accountability

Poor cross-functional collaboration

Changing needs outpace initiatives

Lack of employee engagement

Lack of management support

35%

25%

20%

18%

17%

16%

16%

16%

16%

16%

14%


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Figure 22. Percentage of failed technology and business initiatives

Q. What is the estimated percentage of technology and business initiatives that end up in failure in your organisation?

If contained within pilot projects, or in models such as agile development, a one-in-six failure rate is not necessarily bad – and can encourage a ‘fast fail’ mentality to avoid costly monolithic projects and unproven experiments.

New Zealand business culture needs to be more accepting of the benefits of ‘fast failure’ and use it as part of an overall digital strategy. In the case of a new product development, the ability to try something quickly and discontinue it if it is not delivering on the promise can mean the difference between its ultimate success and failure.

11%

49%

23%

4%

13%

None

Less than 10%

About a quarter

About a third

Half or more

11%

49%

23%

4%

13%

None

Less than 10%

About a quarter

About a third

Half or more

of technology and business initiatives on average end up in failure

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Figure 23. Challenges to digital transformation by business size

Q. What does your organisation perceive as the key challenges of digital transformation?

Cybersecurity

Skills shortages / management

Siloed and resistant culture

Employee engagement

Lack of expertise to lead digital transformation

Limited budget

Lack of assessment of ROI

Management support

Ineffective gathering andleveraging of customer data

Proliferation of consumerIT / tech-savvy workforce

33%

29%

27%

21%

20%

18%

17%

15%

12%

12%

25%

21%

37%

15%

21%

42%

15%

17%

16%

14%

SME Large

Other key challenges to success of digital transformation programs are employee engagement (33%), a limited budget (32%) and cybersecurity risks (28%) – with a notable difference for budget limitations when comparing SMEs to large enterprises.


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Q. Thinking about digital transformation in your organisation, what do you believe are the criteria for a successful digital transformation strategy?


Figure 24. Criteria for a successful digital transformation strategy

Another important change to improve success rates is better employee communication.

The good news is New Zealand organisations are getting better at communicating digital strategy to staff, with more than one-third (39%) of business leaders reporting clear strategy communication is a key criterion for a successful digital strategy.

Communicate clear strategy

Understanding the customer

Employee engagement

Organisational cultural change

Establish executable plans

Optimise processes

Define clear scope

Prioritise initiatives to resolvepain points and gaps

Progress measurement

Leadership from executive

37% in SME42% in Large23% in Australia

Seeking external help

Hire or retain talents

39%

37%

33%

28%

27%

26%

25%

23%

19%

17%

16%

12%

New Zealand organisations place more importance on strategy communication than Australian organisations


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Clear communication must be accompanied by a better understanding of the customer and employee engagement. Bring together as much customer data as possible to deliver real insight into service levels and purchasing intentions.

There is only a finite pool of resources available for digital projects, and it is recognised as a big challenge among IT workers. New Zealand is a comparatively small economy compared to other English-speaking nations and talent is often looking abroad for opportunities in IT. Staff must be kept engaged and offered challenging, relevant roles in the digital era.


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6Key recommendations7

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Digital transformation programs have the potential to modernise and automate processes, including those dependent on people.

While digital is giving rise to many new types of jobs, there is no doubt some workplace roles will change due to digital disruption and transformation strategy.

Some roles will disappear and others will change, but Telsyte’s research indicates that less than a quarter of roles will be eliminated or automated. About 20 per cent of roles will involve re-training and 13 per cent will be new roles. Telsyte predicts a net effect of more jobs being created in the digital economy. Key recommendations7

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Tota

l % o

f th

ose

th

at

see

peo

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wo

rkin

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AI IT

En

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Ma

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88

%

26

%

23

%

20

%

19%

19%

19%

18%

15%

13%

8%

4% 12

%

48

%

31%

In the case of Artificial Intelligence (AI), more than one in five organisations (22%) will create AI-related roles due to digital transformation. A clear majority of IT and business leaders (88%) see the potential in the collaboration between humans and AI to complete tasks. Furthermore, almost half (48%) see AI applications in IT-related work.

Q. In which of the following business areas does your organisation see people working together with AI to complete tasks?


Figure 25. Roles most likely to see AI and people working together


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Figure 26. Proportion of employees that are digital natives

Q. Approximately what percentage of your organisation’s workforce are digital native and non-digital native?

Almost four in ten (38%) of the New Zealand workforce is still non-digital native, with Manufacturing (49%) and Retail industries (46%) being the least tech-savvy. This means there is still a lot to do to educate people on where the economy is headed and how old roles might be replaced with new ones or even machines.

Rising automation might leave these industries more vulnerable to disruption and loss of job security as the push for digital transformation continues. This is why having a strong digital capability is so important – the need to take more advantage of rising automation.

Digital native

Key industries:49% in Manufacturing46% in Retail Trade

38%

62%

Non-digital native

Digital natives are those born into the digital age, characterised by the abundance of modern personal computers.


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Source: Telsyte New Zealand Digital Workplace Study 2019, n=158, those rated 7 to 10 (literate to fully literate) on an eleven-point scale

Figure 27. Digital literacy levels by role

Q. How do you rate your organisation’s digital literacy levels across your organisation?

Digital literacy among New Zealand middle management and general workers falls notably behind their Australian counterparts at 55 per cent for middle management (67% in Australia); and 43 per cent among New Zealand workers (64% in Australia). Combined with the skills crush, this could drive New Zealand organisations to favour outsourcing and automation of technical roles.

Overall

Mid-management

C-level

Workers

Board

55%

43%

59%

51%

54%

57% when Digital Strategy led by CEO48% when Digital Strategy led by CIO54% when Digital Strategy led by other C-level

70% Digital Strategy led by Board


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Unchanged

Retained

Automated

Eliminated

New roles created

Outsourced

27%

20%

13%

40%

17%

14%

9%

60%

Source: Telsyte New Zealand Digital Workplace Study 2019, n=120, those with digital strategy

Figure 28. Job changes following digital transformation

Q. Please provide the percentage of jobs in your organisation that will undergo the following during digital transformation.

With people becoming more digitally literate – and automation technology advancing – the economy is moving to an era of mixed AI and human-centric processes. People are good at planning, design and creative thinking, while machines are good at automation and repetitive tasks.

Telsyte’s research found some 40 per cent of roles will be eliminated, automated or outsourced as a result of digital transformation. This will be most profound for rudimentary roles which require less critical thinking.


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AI-

spec

ific

role

s

Ad

min

istr

ati

on s

taff

Bus

ines

s In

telli

gen

ce A

na

lyst

IT s

taff

Dig

ita

l Pro

ject

Ma

na

ger

Ca

ll ce

ntr

e st

aff

Da

ta A

rch

itec

t

Da

ta S

cien

tist

Ch

ief

An

aly

tics

Offi

cer

/C

hie

f D

ata

Offi

cer

Ente

rpri

se A

rch

itec

t

Tech

nol

ogy

Arc

hit

ect

Solu

tion

Arc

hit

ect

22

%

22

%

21%

20

%

18%

16%

15%

14%

14%

13%

11%

11%

Info

rma

tion

Sec

urit

y o

r P

riva

cy C

onsu

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nt

Da

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r

9%

Da

tab

ase

Dev

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9%

Ch

ief

Cus

tom

er O

ffice

r9

%

IT m

ain

ten

an

ce s

taff

9%

9%


Figure 29. Roles created due to digital transformation

Q. Which of the following types of roles will be created due to digital transformation?

AI does not mean all doom and gloom for the workforce. Telsyte’s research also showed a variety of new roles will be created as a result of digital transformation programs. These include data and analytics staff, digital project managers, and enterprise architects.


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Key recommendations


Key recommendationsDisruption is already upon New Zealand enterprises and the wider economy.

The following changes are recommended to help organisations thrive during and beyond disruption.

7

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Key recommendations


Expedite digital strategies

With most businesses recognising they have less than two years to integrate a digital initiative in order to mitigate disruption, New Zealand businesses must get on the front foot when it comes to digital capability. More than half still take a reactive approach to digital and this needs to change.

One key approach is to look at leapfrogging strategies which use the latest technology to get ahead of the competition. Key to this will be the capture and utilisation of enterprise, market and customer data to make faster decisions and optimise digital business. Methodology8

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Take a whole-of-business path to digital strategy and transformation to avoid silos and maximise efficiencies. The business unit approach – still in place at 38 per cent of businesses – risks fragmented projects which do not deliver value to the wider business.

The good news is most of these (91%) are looking at a organisation-wide strategy, but all organisations need to be conscious that some ideas will also fail. Failure is not all bad if it avoids other larger costly mistakes.

Remove fragmented approaches to digital

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Partner to achieve scaling success

A common challenge is failing to take Proof of Concepts (PoCs) or Minimum Viable Products (MVPs) company-wide – including both the ability to deliver at scale and the change management needed to ensure success. Not many organisations can do this all on their own, so partners will be important, particularly technology- and vendor-agnostic ones that can demonstrate scaling success in rapid time.

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Measure effectiveness Develop a capability to measure the efficiencies gained and revenue increased due to digital transformation. This is a high priority for New Zealand businesses which have already taken to Net Promoter Score (NPS) and other measures of success. Measuring customer outcomes is often a first step, as it doesn’t require massive investments in technology or services to do well.

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Key recommendations


The digital leader needs to be the CEO who can drive digital cultural change and innovation. New Zealand organisations need a more proactive approach to disruption and a culture that tolerates failure on the road to greater success. The next-generation CEO needs to be able to break down cultural silos and communicate effectively through a period of change. The next-generation CEO should encourage a shift to an ‘agile’ organisational culture.

Develop the next generation of digital native leader

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A holistic approach to digital should curb shadow IT challenges

With 80 per cent of business units outside of IT spending on IT-related products or services, and problems arising in 31 per cent of these cases, it is imperative that businesses shift to an organisation-wide approach to digital. This will alleviate wastage, increase technology consistency and ensure more successful business outcomes.

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Methodology used in this study


Methodology

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Methodology8




In preparing this study, Telsyte used an online survey of 158 business and IT decision makers across New Zealand organisations. Sampling was conducted on a size-of-spend weighting basis, with more than 60 per cent of respondents coming from organisations with greater than 50 employees.

Respondents were required to have a strong understanding of their organisation’s IT and digital purchasing and strategy, but were not limited to the CIO or IT staff.

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Organisation-wide Respondents Percentage

Total respondents 158 100%

By number of employees

5 to 19 16 10%

20 to 49 26 16%

50 to 199 50 32%

200 to 499 26 16%

500 to 1,999 31 20%

2,000 or more 9 6%

By head office location 158 100%

Auckland 82 52%

Wellington 26 16%

Canterbury 16 10%

Otago 6 4%

New Plymouth 5 3%

Other 23 15%

By role or title of respondent 158 100%

CEO/MD/Company Director 43 27%

General/Senior Manager 32 20%

CIO 8 5%

IT Manager 18 12%

Other IT leadership roles 57 36%

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Organisation-wide Respondents Percentage

By Industry 158 100%

Accommodation and Food Services 4 3%

Manufacturing 15 10%

Retail Trade 12 8%

Professional, Scientific and Technical Services 17 11%

Construction 8 5%

Wholesale Trade 7 4%

Administration, Support and Professional Services 7 4%

Health Care and Social Assistance 7 4%

Agriculture, Forestry, Fishing and Hunting 2 1%

Transport and Storage 2 1%

Education and Training 13 8%

Electricity, Gas and Water Supply 8 5%

Information Media and Telecommunications 32 20%

Banking and Finance 3 2%

Insurance 3 2%

Public Administration and Safety 3 2%

Rental, Hiring and Real Estate Services 4 7%

Other 11 5%

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The content in this report is copyright protected, and is property of Telsyte. The contents in this report cannot be re-purposed for re-sale or commercial blogging by any organisation. Any non-commercial media related citations, must include Telsyte as the source of the data & DXC.technology as the sponsor of the research. All trademarks referred to in this study remain property of the respective trademark holders, are only used by Telsyte to identify the respective holder’s products and services and use by Telsyte in no way indicates any endorsement by or relationship with the respective trademark holder.

All surveys, forecasts, projections and recommendations made in this report are made in good faith on the basis of information available to Telsyte at the time; and Telsyte disclaims any liability for any loss or damage caused by errors or omissions, whether such errors or omissions resulted from negligence, accident or other causes. Neither Telsyte nor its agents will be liable for any loss or other consequences (whether or not due to the negligence of Telsyte or their agents) arising out of use of information in this report.

Licence and Disclaimer

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DXC Technology

8 Gilmer Terrace,

Wellington 6011

Phone: +64 4 901 4312

www.dxc.technology/nz

About Telsyte

Telsyte is Australia’s leading emerging technology analyst firm. Telsyte analysts deliver market research, insights and advisory into enterprise and consumer technologies. Telsyte is an independent business unit of DXC Technology. Visit www.telsyte.com.au for more information.

About DXC Technology

As the world’s leading independent, end-to-end IT services company, DXC Technology (NYSE: DXC) leads digital transformations for clients by modernizing and integrating their mainstream IT, and by deploying digital solutions at scale to produce better business outcomes. The company’s technology independence, global talent, and extensive partner network enable 6,000 private and public-sector clients in 70 countries to thrive on change. DXC is a recognized leader in corporate responsibility. For more information, visit dxc.technology.

DXC-017 Beyond Disruption New Zealand Study© 2019 DXC Technology Company. All rights reserved.

To discuss your digital transformation needs, you can contact us here www.dxc.technology/contact_dxc

https://www.dxc.technology/

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Beyond Disruption · 2019-12-19 · business leaders for some time now, and the results are...

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