Organisations in Australia are turning their attention to business transformation to improve employee systems as the post-pandemic world increases the reliance on technology, according to a new study from analyst firm Telsyte.

The Telsyte Australian Digital Workplace Study 2020 found Australian IT spending (or investment) is expected to be spared from the impact of the recent pandemic disruptions. Overall, organisations plan to increase spending by 5 per cent in 2020, a rate in line with research conducted by Telsyte in December 2019, showing that despite the economic headwinds, tech seems to be spared when organisations are looking at investing in technology.

Most transformation efforts have swung the focus from customers back to employees – a big shift from 2019. To this end, investment over the next 12 months is shifting to workplace modernisation (75%), data analytics (72%) cloud (68%), modernising business applications (66%), and cybersecurity (66%), including better security for remote workers.

Another big mover is improving employee productivity and engagement, which is increasingly driven by technology as more people work from home.

Rising transformation spend to combat “uberisation”

Despite the challenges, Telsyte found more than a quarter of IT budgets are now spent on business transformation: rising to almost one third in larger corporates.

The desire to transform is also being driven by non-IT business units, with more than half of all organisations also spending non-IT budgets on technology

Telsyte Managing Director, Foad Fadaghi, says spending on digital transformation was already set to increase in 2020 for a range of IT services, even before COVID-19 struck.

“Over 80 per cent of organisations indicate they have fast tracked their transformation initiatives.” Fadaghi says.

This “uberisation” of industries is the utilisation of computing platforms, such as mobile applications, to facilitate transactions between clients and providers (sometimes peer to peer), often bypassing the role of centrally planned corporations.

Telsyte’s research found more than 1 in 3 Australian organisations are afraid their industry will be “uberised” and there are growing uberisation fears among financial and insurance services, manufacturing and education industries.

As a result, more than half of Australian organisations have launched transformation initiatives to better prepare for future disruption both from new competitors but also market disruptions such as the global pandemic.

Transformation not easy amid shifting markets

Even with lofty goals for digital, Australian organisations are finding it tough to successfully execute a transformation program.

The study found around one-in-six initiatives end in failure, however organisations with a culture of innovation were less likely to fail.

Furthermore, up to a one-third are unable to scale their proof-of-concepts, despite over two-thirds having one.

The main problem (38%) being technical issues for failed initiatives with conflicting projects and priorities often another major cause for failure.

More digital transformation outcomes needed for digital employees

As companies transform, job seekers are showing the importance of their workplaces being equipped for the digital future. With more than 3-in-5 workers being digital natives in 2020, it is incumbent upon companies to modernise workplaces.

A digital native is a person born into the digital age, characterised by the abundance of modern personal computers, smartphones, search and social networking tools.

Telsyte found more than a third (36%) of jobseekers consider the organisation’s digital maturity important when applying to work at a company and a further 44 per cent see digital maturity as important when considering to stay with their current employer.

Companies are recognising the need for more future skills and over two thirds (69%) are providing training for employees such as IT service management, agile, project management, design thinking, cybersecurity, change management and others.

Entering an AI future

The study also looked at the role of artificial intelligence for organisational transformation.

Most organisations are “cautious, but comfortable” with any AI risks, with 25 per cent looking to implement AI wherever possible. A further 54 percent are comfortable to experiment with AI with limitations.

When it comes to the importance of customer service, Telsyte found Australian consumers are yet to be on the same page as businesses when it comes to AI. For example, more than 70 per cent of consumers are uncomfortable with AI that speaks indistinguishably from a human (e.g. Google Duplex), but only half of organisations believe that they should declare the human sounding voice is AI.