People 'n' Issues

Companies can be digital magnets

April 11th, 2017
There is a huge disconnect between the rise of digital business models and the necessary skills to carry those jobs out, writes WERNER VOGELS, CTO at Amazon.com.
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Digitalization offers almost endless possibilities to communicate faster, work more efficiently, and be more creative – in real-time. But groundbreaking digital business models need pioneers: creators, forward-looking thinkers and inventors who don’t hesitate to leave the beaten path, embody ownership, and who understand how to translate customers’ wishes into superb new products, services and solutions that evolve with speed. It is a no-brainer, that getting the right talent on board can decisively accelerate a company’s digital transformation. At the same time, if your daily corporate practice doesn’t fulfill their expectations regarding a vibrant and flexible working culture and a social media-minded environment, digital natives will simply turn their back on you and go elsewhere.

Finding those kind of people is not easy. There are probably only a few companies that can say, they already have a sufficient number of such employees among their staff. Job openings for machine learning scientists, data analytics experts, IT security experts or developers are already difficult to fill, and the demand for this knowledge will increase significantly in the next few years as customers show their demand for digital engagements. The market for digital skills is “hot”, in the U.S. as well as in Germany. And these talents are by no means coveted only by companies that always had a digital business model to begin with; suppliers to the automotive industry, financial services companies, and retailers also, urgently need product managers, and technical staff who can quickly make their organizations digitally attractive to their customers. Recruiting and selection in the digital age therefore needs to be tackled in a more strategic way than in the past. So how do you position your company as an attractive employer for digital talent?

Preparing the organization for a new beginning

One way is to eliminate rigid structures, previously the enemy to digital thinking. Digitalization involves, among others, suddenly converging areas that used to be siloed. Take industrial companies. In the past, their sales departments defined specifications according to the customer’s wishes, which were then transferred step by step into the manufacturing process. These days, it’s expected that everything should happen almost simultaneously. Previously, the top priorities for IT departments were equipping data centers with hardware, purchasing software, and further developing proprietary software. Today, companies take their server capacity and software from the cloud. These changes have to be taken into account when scanning the market for talent. At Düsseldorf-based fashion retailer Peek&Cloppenburg, for example, the business, development and IT functions are increasingly cooperating with each other because they realize that isolated departments and rigid hierarchies can slow down the organization’s innovative strength and speed. That is also why employees have more and more room to make decisions themselves. P&C’s digital transformation is supported by an in-house consulting team that helps the specialized departments analyze and digitize those processes that strengthen the customer touchpoints.

The freedom to create

Another way to make your company attractive for digital talent is to give them as much creative freedom as possible AutoScout24, a Munich-based online marketplace for car, motorcycle and utility vehicle sales is a digital native company. Recognizing that it needed faster decision making, AutoScout24 started to empower employees who are close to their customers. The company created small and agile cross-functional teams with profit and loss responsibility for their market segments. These measures eliminated dependencies amongst business units, increased self-responsibility, eased communication processes and improved overall organizational alignment.

Showcase your best talent – and give them what they need

It’s important to encourage the employees you already have, provide them with resources and let them decide things themselves. They should be able to follow their ideas and feel accountable for them. Offering regular development opportunities can also help you make the most of your talent. In most cases, you won’t select a learning offer from a general training catalog, as in the pre-digital era. Development will have to be customized for each individual. That might be a course, the opportunity to lead a project, or gaining new insights by working in another part of the company.

Some companies have created cross-business-unit roles such as the Chief Digital Officer (CDO) in order to connect everything that needs to be thought of in a unified way in the digital world. Their responsibilities include defining future growth areas, spearheading change processes and allocating resources in a new way so that the company is ready to face the digital era and address the ever-changing customer expectation. They need to find allies who possess enough digital know-how to ensure the company can take advantage of the opportunities that stem from new technologies.

Wanted: Employees with a mixed skill set

Another way to attract the best digital talent is to keep an eye out for applicants who bring a diverse mix of skills. We hear again and again, and not only in Germany, how scarce IT experts and engineers are. At the same time, you need to discuss what role a person who designs cars for example, will play in the value chain in a future world in which the car manufacturer will probably earn most of its money with data and mobility services. How this affects the required skills mix needs to be defined and assessed on a case-by-case basis.

Two things are crucial here. First, you need talented individuals who want to be customer-centric and who are able to cross the traditional (internal) customer and IT organizational boundaries in order to truly feel what customers want. In some cases, it could be helpful to even ’embed’ your employees at the customerfor a period of time. Secondly, it’s clear, that digital business models require experts who view data as an essential element of future value creation — regardless of the specific expertise they bring to the company.

Create room for adventure

Finally, be aware of the impact of your culture. Today’s digital talent seeks adventure and a job that gives them meaning. The more comfortable they feel in the workplace, the more willing they will be to work harder for your company’s success. And they want to be surrounded by similarly minded colleagues. Companies must ensure their culture can meet these expectations. A company can differentiate itself on culture also by taking a strong stand on issues that are of concern to their employees, and by having a leadership principles that are not just on paper, but reflected within the employees every day. At Amazon, we stand for a culture where failure is explicitly allowed — and even desired — because in our experience the path to transformational innovations can never be straight and failure is a sign of progressive thinking. That’s why we need candidates who love to experiment, who are prepared to take other paths, and who are energetic enough to quickly find a way out of a dead-end. Our leadership principles also play a critical role; they describe in detail what is important to us. Everyone can find these values on our website, and they apply to everyone. We expect our employees to focus constantly on the customers’ needs and to continuously improve themselves. That can be inconvenient. But to thrive, innovations need a certain tension.

Digitalization is happening fast. That shouldn’t be an excuse for taking shortcuts in recruiting. Jeff Bezos once said: ” I’d rather interview 50 people and not hire anyone than hire the wrong person .” In the end, only a carefully planned and executed HR strategy will allow a company to achieve the digital transformation and develop it in such a way that it fulfills the company’s long-term goals .

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