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HR management in digital business transformation Larjovuori 2016
HUMAN RESOURCE MANAGEMENT
IN DIGITAL BUSINESS TRANSFORMATION
Riitta-Liisa Larjovuori ,
Jaana-Piia Mäkiniemi and
Well-being at work –
THE CONTEXT OF THE RESEARCH
USCO (Using digital co-creation for
business development) –project conducted
by Laurea - University of Applied Sciences and
University of Tampere, School on Management in
• Project aims to understand what kind of: a)
leadership, b) organizational culture, c)
management practices, and d) co-creation
processes digitalisation requires.
• Co-funded by Tekes (the Finnish Funding
Agency for Technology and Innovation) and
eight Finnish organisations (including SME’s,
large companies and two public sectors
Please visit us at: uscoproject.fi
Twitter #uscoproject @larjovuori
THE METHOD AND THE PURPOSE OF
To present preliminary findings from the sample of qualitative, semi-structured interviews
(n=11 from two organizations, of the total of 48 interviews from 8 organizations) with the
management of the organisations participating in the study.
• Interviewees were responsible for e.g. service or product development, marketing, various customer
segments or business areas and development of human resources i.e. the majority of them did not
• The interviews dealt with the phenomenon of digitalisation and what digitalisation means in practice in
each organisation as well as employee well-being at work, leadership, the culture of the organisation,
service development, open innovation, and co-creational practices in terms of how they are related to
digital business transformation. The practical purpose of the interviews was to establish an
understanding on each organisations “current state” related to digitalisation.
The main research question of this paper is:
• What are the challenges and opportunities of human resource management and
leadership in a context where the organisation is introducing and increasingly utilising
digitalised work processes (such as digital service production for customers, digital
working tools, and digital communication and information channels)?
HUMAN RESOURCE MANAGEMENT AND
DIGITAL BUSINESS DEVELOPMENT
In this paper, human resource
management is essentially viewed as
a strategic and invasive means of
utilising, developing, fostering and
mobilising human resources in order to
support organisational goals.
HR professionals and HR units have a
role in the planning and execution of it,
yet we assume in many cases the role
of the first-tier managers and
supervisors as well as the role of top
management is emphasized.
Gartner’s IT glossary (2016)
defines digitalisation on a broad
level and adopts a business
“Digitalisation is the use of digital
technologies to change a
business model and provide new
revenue and value-producing
opportunities; it is the process of
moving to a digital business”.
HUMAN RESOURCE MANAGEMENT ISSUES
RECOGNIZED IN THE INTERVIEV DATA
as an integral
part of the
What and why do we digitalise? How does it affect our business as a whole?
1) Considering the digitalisation as an integral part of the business strategy
• “Our strategy is all about digitalisation.. Well maybe not all of it, but it is well integrated and we
take it account to in everything we do.”
• “It was not introduced as a technical gadget or innovation, but it was proceeded through practice
where the digitalization has been taken to the core.. It means that every line of managers here is
strongly committed to put it (the digitalization) forward.”
How do we communicate the strategy to and with the employees? How do we ensure
that everyone knows how their work is changing and how do we deal with
2) Open and solution-focused management communication
• ”The lack of communication often leads to individual surffering of conflicts.. Along with the
digitalisation, the pace of the society is speeding up, yet the communications we use have been
left behind, in the analogic world..”
• ”The top management actually operates as a communicative front figure (for the digitalisation
process), to carry it through..”
How do we assure that employees are supported and encouraged to change their
3) Close and persistent supervisory support
• “At least for the moment, the best way appears to be that the supervisor shows in practice how
the process should go in the new situation. We have many web-based training courses, but they
are not sufficient on their own. It just goes in one ear and out the other and after training people
do as they always have done.”
• ”The area managers’s task is to be a coach to their own subordinates. To be close enough to
make sure that the subordinates succeeds.”
How do we ensure that we have the capabilities and knowledge needed to
transform the business and its value-creation logic?
4) Developing transferable skills
• “Every time I speak to our people, I mention that what is going to be your future capital is your
expertise, because it’s what a machine can’t [do]. When it is combined with empathy, it can’t be
produced by a machine.”
• “I don’t see the need for training on how to use a computer. It is more the kind of policy-training
that is constantly needed.
• (…) the (IT-)expertise to make the development work smoother, can’t be found - even with big
How do we reform work processes so that the whole potential of the digitalisation is
5) Redesign of work practices
• “The digitalisation has also enabled us to organise tasks differently, as the information is no longer
attached to the physical paper or location. So it has enabled, the organising the work and, for
example, concentration, which improves efficiency.”
• ”Do we use the right tools..? Quite often I hear comments like ”let’s have more meetings to keep
ourselves posted.. We still think in terms of the analogical world..”
• ”The problem is, that every time new modifications or applications are introduced,their effects to
individual employees’ work are not examined. We don’t have such control.”
How do we utilise the whole potential of our human capital?
6) Engaging the employees
• ”Last year we updated our strategy, and we conducted a survey about how our employees think the
world is changing. (..) The top management then circulated in the units and gave feedback. Last
spring we elaborated the strategic targets from the viewpoint of the digitalization and an inquiry was
made to out key specialist and midline managers, about 70 people altogether, about how they see our
current state, when compared to the target state..”
• “It is of great importance that the employees have been taken in the account. If the employees have
been doing it themselves, it makes the implementation smoother: the user sees that “Okay, this has
been made so that it supports the work I do”.
IS THERE STILL A NEED FOR “HUMAN RESOURCE
MANAGEMENT” AND WHAT IS ITS ROLE IN THE
DIGITAL BUSINESS DEVELOPMENT?
• Human resource management and development is increasingly
“mingled” with strategic leadership, business and service
development: business and customer understanding and “co-
creation” with both employees and customers are essential
• In the digitalizing world, the knowledge of how the human mind works
and thrives is maybe more important than ever: information
ergonomy, learning and training, efficient communication…
• Human resource professionals should be increasingly involved in
renewing and redesigning the digitalizing work practices and
We are surrounded by change from all sides. In a world that is increasingly
VUCA (Volatile, Uncertain, Complex and Ambiguous). Human resources are
prepared for the world we know, but they struggle with change. Resourceful
Humans adapt to change, and are the only humans with the change of thriving
in a VUCA world.
You can change the world
only if you know how it works.