Strategy & Leadership

Work in progress: Aligning workforce transformation to business strategy

November 26, 2019


November 26, 2019


The way we work is evolving but the future is not pre-determined. Here's how organisations are tying workforce transformation to their strategic objectives.

About the research

Work in progress: Aligning workforce transformation to business strategy is an Economist Intelligence Unit report, sponsored by Fujitsu and Citrix, that examines the extent of workforce change within organisations and the different approaches that firms take to manage it.

The analysis in the report is based on a survey of 200 executives, conducted in September and October 2019. Respondents are from eight countries: the US, the UK, France, Germany, Ireland, Australia, New Zealand and Japan. They work in 20 different sectors, with the largest representation being from financial services and technology firms. They have senior roles in their organisations, with half being C-level executives and the other half at managing-director or vice-president level. Nearly half (48%) work in organisations employing more than 1,000 people, and 42% in organisations employing between 500 and 1,000.

Additional insights were obtained from in-depth interviews with senior executives and other experts knowledgeable about workforce transformation. Our thanks in particular to:

  • Anna Gowdridge, director, 100% Human at Work Programme, Virgin Unite 
  • Julia Herpel, expert in digital work and innovation, Digital HR Innovation, Deutsche Telekom 
  • Jennie Sparandara, head of workforce strategies, Global Philanthropy, JP Morgan Chase 
  • Colin Silvester, group chief information officer, JAC Recruitment 
  • Michel Servoz, senior adviser, artificial intelligence, robotics and the future of labour, European Commission

The report was written by Denis McCauley and edited by Pete Swabey.

Executive summary

It is widely accepted that technology, as well as economic and demographic trends, are changing the nature of work. It is less clear how the roles and tasks that employees perform will change, and what organisations should do as a result. This report examines workforce transformation, defined as significant and deliberate change to the nature of an organisation’s employee base, and how organisations are tying it to their broader strategic goals.

Our analysis of 200 executives across eight countries shows that widespread workforce transformation is under way, with more than eight in ten respondents confirming this to be the case in their organisation. Nearly four in ten respondents say the transformation has been extensive.

"This is not pre-determined. Executives can shape their own future workforce by the decisions they make.”  

The survey also suggests a link between effective workforce transformation and strategic performance. Organisations that have significantly over-delivered on their strategic objectives are more than three times as likely to have extensively transformed their workforce. This is, however, less than a quarter of the survey group.

Other key research findings are:

Digital and workforce transformation are closely intertwined. Technology is both a driver and enabler of workforce transformation. The most common changes made by organisations as part of workforce transformation have been increased investments in technology and digital-skills training.

CEOs and CIOs lead the charge on workforce transformation. Among respondent organisations, the chief executive officer (CEO) is most likely to lead workforce transformation initiatives. However, in European and North American organisations, as well as those with more than 1,000 employees, the chief information officer (CIO) is more likely to lead, further highlighting the intertwining of workforce and technology transformation.

Organisations focus equally on training and technology. Instead of choosing between investing in their skills base and investing in technology, respondent organisations are doing both. Many (39%) are also looking to design or improve the employee experience. Tactical measures such as changing human resources policies or re-designing organisational structures are employed less frequently.

Cost and complexity are the price of workforce transformation. The most common negative consequences of workforce transformation are one-off costs and increased employment overheads, both cited by over three-quarters of respondents. Most organisations also report unwelcome increases in organisational complexity and staff turnover.

Lack of vision and leadership are the primary barriers to workforce transformation. Resistance to change and a lack of understanding of the ideal workforce are the two most cited barriers to workforce transformation. Taken together, both suggest that management in many organisations is failing to think strategically about what transformation requires and how to motivate employees toward being part of the future workforce.

Enjoy in-depth insights and expert analysis - subscribe to our Perspectives newsletter, delivered every week