Focus on human potential, not digital: Forrester

Digital may play an integral role in every modern organisation, but the future of business is human-centred, not digital, according to Sam Higgins, principal analyst, Forrester.

Higgins spoke at the Forrester Technology & Innovation Summit in Sydney and discussed why organisations need to break the boundaries of their current thought processes and business models.

He said organisations have a hyper-focus on digital and under-appreciate the importance of human potential and human capital in business.

“When we talk about customers, shareholders, employees, workers, stakeholders, policymakers, what we need to remember is all of these labels relate to people. People have dreams, they have values, they seek purpose,” he explained.

Higgins discussed the three main challenges organisations face when it comes to digital in a business.

The first is digital sameness, Higgins said he is increasingly seeing in Forrester research a plateau in an increase in customer experience, return-on-investment and other factors.

Competing apps are basically the same in how they operate, he explained.

“Pick a food delivery app, or an airline booking app, and tell me how different each of those are in terms of functionality and utility,” he said.

“What you'll probably find is that pretty much the same, between DoorDash and Uber Eats there is not much difference there. The colours are different, the branding is different, but the fundamental core of that digital experience is the same.”

The second challenge is that technology investments no longer promise productivity gains. Higgins said that this sameness or lack of impact is starting to occur.

“Whether it's the front office to the back office, hardware to software, or data to insights. What is happening in our technology investment profile is that we have never been pumping more money into technology than ever before, yet the returns are lower than ever,” he explained.

There has been a 21st-century boom in technology spending and a 21st-century bust in terms of productivity, Higgins explained.

“About five years ago, what we started to see in the economic data from both the US and Australia was a reduction in productivity for every dollar we invest in technology.

“It used to be spend one dollar on technology and you would guarantee, without doing a lot you could ignore the people altogether, you basically get a 3 percent boost in productivity. Today, we're talking about a ratio that is closer to one to one,” he said.

Thirdly, tactical automation undervalues the knowledge and experience of people which tools automation provide a benefit.

Higgins explained that organisations are using some of that technology in a tactical fashion and undervaluing the knowledge and experience of the people with which tools like automation provide a benefit.

Looking at the impact of inflation on the Australian market, there are some jobs that are at risk as the tide of automation rises through different roles, Higgins said.  

“But actually, that's the tactical approach to automation or thinking about automation in a more strategic fashion as a means to augment and transform. Our labour market neglects the fact that we have here in Australia to find 1.7 million new jobs, new workers to fill new roles between now and 2030,” he added.

Higgins said that with record unemployment in Australia, but also right across the Asia Pacific there is some of the tightest labour markets in the OECD which means organisations need to embrace automation.

“We need to move from this tactical thinking around automation to something much more strategic,” he ended.