24 Proven Actions for Staffing Digital Transformation
As artificial intelligence is reshaping the recruiting industry, many talent acquisition leaders are embarking on digital transformation initiatives at their staffing company.
55% of staffing firms ranked digital transformation as their top operational challenge for 2020.
But many staffing companies don’t have a digital transformation strategy in place. To help you get a better understanding of digital transformation, I examined research from McKinsey, Bullhorn, and IDC.
Contrary to popular belief, there is a right and wrong way to go about digital transformation.
In this article:
- The problem with staffing digital transformation
- Why is digital transformation important?
- How to implement digital transformation
- Why digital transformation fails
- The key to digital transformation
- The 5 stages of transformational change
- The 24 actions for successful digital transformation
- Why digital transformation is about people not technology
- The future of digital transformation from 2020 and beyond
The problem with staffing digital transformation
Only 18% of staffing firms feel they have full adoption of their technology. It’s likely your staffing company historically embarked on digital transition rather than digital transformation.
Am I a digital transitioner?
If you adopt technology, never reach full adoption of your technology, and never see widespread lasting behavioral change – you’ve been following a digital transition model.
While transitioning to the latest technology does bring benefits, you’re missing out on the full benefits of digital transformation.
Why is digital transformation important
Digital transformation and innovation will unlock revenue and create increased profitability for your staffing firm.
How to implement digital transformation
1. Align digital transformation to the right goals.
The top 2 digital transformation goals for companies with between $501m – $3b in revenue are for 71.5% to improve customer experience and for 67% to reduce operational inefficiency.
The top 3 priorities for staffing firms in 2020 are candidate acquisition, client relationships, and candidate experience.
Think about what behavioral changes need to be made in your staffing company at every level to meet these priorities.
Overcome the top 2 barriers to digital transformation.
27% of companies report that not understanding how to establish metrics for success is the number 1 barrier to moving forward with a digital initiative.
54% report a lack of skills or insufficient training as the #1 barrier to implementing a digital initiative.
You need to set the right goals from the beginning. You also need to make sure you have access to the right skills to implement transformative technology.
Why digital transformation fails
Just 26% of executives say the transformation initiatives they’re familiar with were very or completely successful at meeting transformation goals.
How can you bridge the gap to execute a very successful digital transformation initiative?
Research from McKinsey found that companies who took action on all 5 stages of transformational change were 3x more likely to be very or completely successful.
Keys to digital transformation
McKinsey’s research created a digital transformation model. The model is segmented into 5 stages and 24 actions. Their research showed a strong correlation between adherence to the model and successful digital transformation. I’ve modified the model to make sense for staffing companies and recruiting teams. If you want to read the original model you can find it here.
Also, you can more information about the digital transformation model, by reading the book on which McKinsey based their model Beyond Performance: How Great Organizations Build Competitive Advantage.
McKinsey’s 5 Stages of Transformational Change:
- Set goals for performance and organizational health
- Assess organizational capabilities
- Design the transformation initiatives
- Execute the initiatives
- Sustain the changes that were made
The 5 stages seem simple. They are on paper. With the right guidance from vendors and buy-in from leadership it’s possible to execute a successful digital transformation initiative.
You’ll see reading through these actions, that the majority of them have to do with a behavioral change in your organization. Implementing technology is the easy part, but fundamentally transforming all levels of your staffing company will take some effort.
The 24 Actions for Digital Transformation
- Your senior managers must communicate openly across your staffing company about the transformation’s progress and success
- Every person, recruiters to your managing directors, must understand how the work they’re doing to support the transformation is tied to your vision
- Your team leaders need must role-model the behavior changes that they are asking their teams to make.
- All employees participating in the initiative must balance their day to day work to continue to meet customer demands.
- Senior managers, ex. recruiting managers must communicate openly across your staffing company about how the transformation is going to change the day to day work of individuals.
- Everyone, including recruiters and recruiting operations, must be looking for and involved in reporting errors before they affect your customers.
- Your teams must have a system for identifying best practices, for sharing them, and for improving on them.
- You must invest in your people. This can mean providing them with skills training and support to manage the transformation.
- The primary role of management at your staffing company must be to lead and develop team members.
- You must hold leaders accountable for impacts from the digital transformation during performance evaluations.
- To align your staffing company, leaders at every level of leadership should tell a consistent story about the transformation its goals.
- Define the roles and responsibilities all parties must play in the transformation.
- Engage all of your personnel. Ensure they are actively tracking their individual goals/targets.
- Make sure you have allocated enough employees towards the initiative to support its implementation.
- Adopting technology means you are also adopting new behaviors. Make sure expectations around those behaviors are aligned with annual performance reviews for all personnel impacted/involved by/in the transformation.
- Assign people to the transformation who believe in it and support it. If you have personnel at any level of your org involved in key roles in the transformation who don’t support there will be issues.
- Each level of your organization needs relevant goals. You can’t have the same goals for a VP of talent acquisition and a recruiter around the transformation. Or for recruiting ops and IT.
- A digital transformation is beyond adopting/implementing technology. It fundamentally changes how you do business. Your line managers should have the initiative as part of their everyday responsibilities.
- Assign your best people to lead the digital transformation and give them direct responsibility for their respective roles in the initiatives.
- Digital transformation will change the roles of your employees. You need to create programs to build capabilities so that employees can make the most of the benefits of the transformation.
- There’s a concept called scrum used by software teams. Every day, teams meet and discuss yesterday’s work and plan the day’s work. Do this to keep your initiative leaders and teams involved and accountable to the transformation every day.
- Peter Druker once wrote, what get’s measured gets managed. You need to quantify goals around the transformation. Especially for soft skills like mind-set,s behaviors, and cultural changes. Otherwise, your transformation will not be successful long-term.
- Your leaders may not have all the information they need to successfully lead their teams through change. It’s important that initiative leaders get change-leadership training.
- You need to have a team that owns the transformation and is coordinating the entire initiative. Think of them as a project management team for your transformation initiative. Staff it with cross-functional leaders (IT, recruiting ops, and talent acquisition.)
Digital transformation is about people, not technology
46% of companies state that their non-tech executives are responsible for leading digital transformation. Digital transformation doesn’t just mean adopting new technology.
To achieve true digital transformation, you need to deploy new technology to solve your business problems, improve efficiency, and create value.
Simply deploying it intelligently isn’t enough either. If you stop there you’ve achieved a digital transition, not a transformation. Making a transformation requires you to change the day to day behavior, alignment, and measurement of members of your organization at every single level.
The behavioral component is the challenging half of digital transformation. With integrations and support from vendors, adopting technology is straightforward. The real challenge is in figuring out how technology will change the context of how recruiters and other team members operate in your organization.
You need to understand that at every level, communicate the change in a way that makes sense to employees at every level, and create a plan to change behaviors at every level.
Digital transformation from 2020 and beyond
AI for staffing will power digital transformation for staffing companies in 2020 and beyond. 6 of the top 8 world’s largest staffing firms are already using conversational AI for recruiting. As you explore conversational AI, it’s important to think about the beneficial changes you can make in your organization after adopting it.
It’s a common misconception that adopting AI for talent acquisition means replacing human labor with machine intelligence. This is completely inaccurate. AI is the next frontier in digital transformation.
But without making the right behavioral changes, all adopting AI will do is make the initial stages of your hiring process more efficient. Adopting AI in the context of digital transformation at your staffing company is what will produce significant competitive advantage and revolutionize the way you do business today.