The challenge of digital and human capital for business competitiveness

The solutions that the digital marketplace makes available to businesses today are constantly evolving and are capable of reinventing the operating models and delivery system of many organizations. We are in the presence of a continuous reshuffling of success factors that impose ever higher levels of performance on companies. And also of preparedness to meet the challenge posed by digital transformation in the right way.

The challenge of digital from the perspective of business organization

Technological innovation, and thus the challenge of digital transition, has until yesterday had a greater focus on operational processes by focusing on their efficiency. Business intelligence systems, management software specialized on certain processes: these are some examples of digital solutions that aim to simplify and speed up business activities. Even the immersive technologies of virtual reality and augmented reality, which Roncucci&Partners offers its clients through the DIGISUITE platform, can be understood as a tool for streamlining various business activities, from sales to design to after-sales service. These are all activities that yesterday involved moving people around while today they can be done remotely and with less cost to the company.

Then there is another impact of technological transformation: digitization can reinvent offering systems, enabling organizations to offer new products and new services. This is the heart of the digital challenge: with this transition, the company transforms and offers something different than it did yesterday. A typical application is the industrial machinery sector: the offering goes beyond just selling the product, offering remote management of the machinery itself through IOT and digital twin technologies.

• Read also: Business process optimization and AI: a quantum leap in operational efficiency for Italian SME

The impact of AI in the challenge of digital transition

In the past year we have experienced another frontier of innovation: artificial intelligence (AI). This can create original content, such as text, images, video, audio or software code, in response to a user’s prompt or request. AI has initiated an unprecedented wave of innovation.

Analyst Gartner predicts that by 2026 more than 80 percent of organizations will implement generative AI applications in their operational processes. A recent study by EY says that in Italy 61 percent of large enterprises and one in five SMEs have already launched AI projects, with the potential to generate up to 40 billion in added value. The transformative effect of AI is associated with significant increases in productivity and operational efficiency: an average improvement in worker performance of 40 percent is expected for various job profiles.

AI will impact value generation processes, inventing and creating new business areas, new offerings, new propositions to the market. Significant development potential opens up, accompanied by a major reshuffling of success factors. Those who will prevail or remain competitive will be the players who know how to make the best use of new technologies starting with AI.

• Read also: Artificial Intelligence in Italy between growth and challenges

Human capital for business competitiveness

However, as much as AI is proposed as an alternative to so many typical human labor activities, it remains crucial to clarify that the determining factor for its integration into organizations is, as always and again, human capital.

Innovations must be integrated into organizations and applied operationally in daily processes. It is people who are the key factor in integrating these technologies into corporate business. This challenge is even more complex as AI makes experimentation with new solutions increasingly rapid. Such experimentation is accelerating and fueling new appetites for new frontiers. The speed with which such experimentation is being conducted is increasing. So the innovations are happening, and people will increasingly be subjected to new stresses that will reinvent the way they work. In other words, not just innovation, but faster and faster innovation!

Final thoughts

What can smaller organizations do to compete in this increasingly challenging and pervasive innovation environment? If human capital is the success factor, what can organizations do to make their people capable of absorbing new technologies? What cultural paradigm should companies adopt to integrate technological innovation more rapidly? Here are some insights to answer these questions introduced by the digital challenge:

• People at the center. People are a key resource and an area of continuous investment to which energy and resources should be devoted, including finding and attracting the best talent.
• Cross-functional teams. Processes involve multiple functions, and their innovation must take place through continuous discussion among people.
• Project management. New solutions need to be introduced in the company, and this can be done if the right tools are adopted. In this context, project management is a factor in business improvement.
• Dedicated innovation leadership. A team of people dedicated to the introduction and diffusion of technological innovations in the company: it can become the organizational solution to put digital evolution at the center of the organization.

Roncucci&Partners supports companies on paths to improve competitiveness and to face the digital challenge in the right way, with the necessary tools and with the best possible prepration. It does this by focusing on the levers mentioned above, working on change processes, the introduction of project management and training people to make organizations a fertile ground for continuous evolution.

At Roncucci&Partners we help companies develop themselves and their business, embrace change and evolve to thrive in a world that is increasingly complicated, insidious and requires great expertise. We do this by applying punctual methods and rigorous strategies, the result of many years of experience and the richness of the numerous success stories we have conducted all over the world. Passion and method are indeed our guides to enhance the present and build the future.