As Workplace Automation surges, relatively few North American employers have a formal Digital Transformation strategy

ARLINGTON, VA – With the surge in workplace automation showing no signs of abating, relatively few North American employers have developed a formal digital transformation strategy, according to a new survey by Willis Towers Watson (NASDAQ: WLTW), a leading global advisory, broking and solutions company. Additionally, a majority of employers say they need a “breakthrough in leadership development” to address the challenges arising from workplace automation and the increased use of contingent workers that has accelerated in its wake.

The Pathways to Digital Enablement Survey found the proportion of work completed by using automation among North American companies doubled over the last three years, from 6% to 12%, and is expected to nearly double to 23% in the next three years. Additionally, nearly all respondents (95%) expect to be using workplace automation, including artificial intelligence (AI) and robotics, in three years.

“Workplace automation has been growing in leaps and bounds, and all signs point toward continued expansion,” said Tracey Malcolm, global leader, Future of Work, Willis Towers Watson. “With such widespread change, companies must address how they’ll get work done. Those companies that understand the impact of automation and digitalization on their workforces and organizations will be best positioned to gain competitive advantage.”

Despite the surge in workplace automation, only 14% have developed an integrated digital and business strategy and road map. Instead, just over half of all organizations either are reacting to changes in the digital environment — with very rudimentary digital capabilities — or have a digital strategy that is not aligned with their business strategy.

The survey also reported three-quarters of respondents (75%) cited leadership development as requiring breakthroughs for organizations to successfully address the challenges of automation and digitalization.

“Effective leaders develop strategies that integrate workers and automation to change the way work is done. This not only creates new sources of value but also shapes a culture of innovation that will attract and retain talent, and deliver growth,” said Laurie Bienstock, global leader, Talent Management, Willis Towers Watson.

As workplace automation expands, employers expect to add more contingent workers and other “nonemployee” talent to their workforces, reducing their reliance on full-time employees. Free agent workers are expected to represent 5.2% of workforces in North American companies in the next three years, an increase from 4.2% today. The percentage of workforces comprised of consultants or workers on loan from other organizations, or from free-agent platforms is also expected to increase in three years. At the same time, full-time workers will represent 76% of workforces at these organizations in three years, a decline from 80% today and 82% from three years ago.

While companies are expanding their use of contingent workers, many are struggling to blend them into their workforces. Only four in 10 respondents (41%) say they are effective at integrating contingent workers with specialized skills into their work teams while just 14% are effective at combining automation with talent. Less than half (45%) are effective at retaining employees and contingent workers with needed technology skills.

“As the use of contingent labor continues to evolve, it’s critical for companies to proactively address the new mix of workforces to effectively compete for highly skilled talent. We know from our research that organizations that successfully integrate contingent workers with automation and their teams are reaping benefits in the form of cost savings and less disruption in the short term,” said Malcolm.