Employees’ fear of change putting competitiveness of British firms at risk

Organisations failing to realise value of digital transformation programmes due to a lack of investment in cultural reform

Employees’ fear of change is putting British businesses at risk, according to a new research report unveiled today by Microsoft.

The study conducted in collaboration with Goldsmiths, University of London, and YouGov, found that the majority of businesses investing in digital transformation programmes face a common challenge in realising value from their investments: the human factor.

Findings reveal that moves to improve how people work by introducing new technologies creates anxiety among employees (61 per cent), the automation of tasks creates fears about job security (59 per cent) and staff express a fear of change when digital transformation initiatives are introduced (49 per cent).

The report, entitled Creating a Culture of Digital Transformation, is based on interviews with more than 1,000 business leaders and employees in organisations across the UK, making it one of the most extensive reports on the country’s digital transformation to date.

Cindy Rose, Microsoft UK Chief Executive, said: “Digital transformation is not just a technology deployment or an IT exercise, it’s a people exercise. Leaders of all organisations must therefore embrace cultural transformation from the top and explore the behavioural shifts needed to bring about lasting change.

“This comprehensive report shows there is a deep-rooted connection between those organisations that invest in nurturing cultural change and those that are able to fully unlock the value of their technology investments.”

Despite the concerns shown by employees and the impact this is having on organisations’ ability to boost productivity, less than a quarter (23 per cent) are investing in cultural change programmes to help their workforces adapt to changing working practises and realise the value of investments in technology.

Clare Barclay, Chief Operating Officer, Microsoft UK, says: “We are seeing a growing divide between those organisations that are geared towards driving the cultural change that supports technology investments, and those that aren’t.

“This is a major concern – evidence suggests that if you don’t address the human elements of change, successful transformation is unlikely to happen. Organisations must have the right culture and change programme in place to unlock the true value of technology. Creating a culture in which technology blends with human potential is where the magic happens.”

The report also reveals that just 53 per cent of organisations are currently investing in digital transformation programmes, despite the same number (53 per cent) expecting their industries to face disruption within the next two years.

Carol Dweck, Professor of Psychology, Stanford University, says: “Some people are afraid of the technology, don’t want to use it, don’t feel comfortable with it, and want to keep using their old skills as long as possible. It’s vital to shift the ethos from being outcompeted or sub-genius in a genius culture, to the idea of a shared struggle where mistakes are inevitable and your team members and company have got your back.”  

Patrick Murphy, Director of Finance and Corporate Services, British Medical Association, said: “Four years ago, our workforce had not experienced technological change like what we hoped to undertake.

“We needed to pave the way for change and invest significantly in change management to see the transformation required. It takes time to embed itself into people’s daily work lives but, by getting an insight into how people use our systems, we reframed the way our staff do things.

“It is critical to create an environment that allows for positive engagement so people are more informed, know what’s going on around the business and what we’re saying to the outside world. We created a sense of engagement, which enriches the experience of working in any organisation.”

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