Prof. Amit Gupta, ISMR Sep, 2024
Digital disruption is the change that occurs when new digital technologies and business models affect the value proposition of existing goods and services. The rapid increase in the use of mobile devices for personal use and work, a shift sometimes referred to as the consumerization of IT, has increased the potential for digital disruption across many industries.
Generally, digital disruption happens after a digital innovation, such as big data, machine learning, internet of things or the BYOD (bring your own device) movement. Digital innovation then affects how customer expectations and behaviors evolve, causing organizations to shift how they create products and services, produce marketing material and evaluate feedback. This shift in digital strategy can occur on an individual, organizational, industry or societal level.
Digital disruption is an effect that changes the fundamental expectations and behaviors in a culture, market, industry or process that is caused by, or expressed through, digital capabilities, channels or assets. In other words Digital disruptors are organizations that have “taken advantage of digital capabilities in one form or another to create and drive fundamental shifts intentionally or otherwise in their market and perhaps others, either by design or as a secondary effect.
There are four elements of digital disruptions: BUSINESS, TECHNOLOGY, INDUSTRY & SOCIETY. Digital disruptions should be viewed within three dimensions — the scale of the disruption, the reach and the richness of the experience. These three dimensions can create huge market advantages given that more content is produced faster, is available on demand, and generally provides a deeper context and extended depth of customer interaction. Examples Uber, Netflix, zomatao
DIGITAL DISRUPTION IN HR
On the bright side, better technology means better recruiting and task management. Tools like Applicant Tracking Systems (ATS) and resume reformatting solutions free recruiters from getting stuck in repetitive, unnecessary admin tasks. Overall, these tools enable recruiters to do their best (and preferably only) function: selecting the perfect candidates for the right jobs.
Digital disruption in HR involves digitally transforming how organizations interact with their workforce and customers. This transformation entails modern communication technologies, such as automated email and messaging solutions. This makes workplaces more productive, enabling recruiters to do a better job by accessing accurate data, reducing errors, and making more intelligent decisions.
Digital transformation positively affects HR & recruitment by creating more agile and focused teams. For example, teams no longer need to spend over 30 minutes reformatting each CV. Now, they can leverage digital tools like Allsorter across all of their candidates’ and employees’ lifecycles. As a result, tools like Allsorter help them enrich customer interactions, amplify their branding, and simplify the process for everyone involved. After all, recruiters still need to put meaningful relationships above other repetitive tasks.
DIGITAL DISRUPTION CAN TAKE MANY FORMS, INCLUDING
Digital transformation: The integration of digital technologies into all areas of a business.
Digital innovation: The creation of new products, services, or processes using digital technologies.
Digital disruption: The use of digital technologies to disrupt traditional business models or industries.
EXAMPLES OF DIGITAL DISRUPTION INCLUDE:
- E-commerce platforms disrupting traditional retail models.
- Ride-hailing apps disrupting traditional taxi services.
- Streaming services disrupting traditional media consumption.
- Digital payments disrupting traditional banking and financial services.
- Artificial intelligence and automation disrupting traditional manufacturing and supply chain management.
DIGITAL DISRUPTION CAN BRING MANY BENEFITS, INCLUDING:
- Improved efficiency and productivity.
- Enhanced customer experience.
- Increased competition and innovation.
- New business opportunities and revenue streams.
- Cost savings and reduced waste.
HOWEVER, DIGITAL DISRUPTION CAN ALSO POSE CHALLENGES, SUCH AS:
- Job displacement and skill gaps.
- Cyber security risks and data breaches.
- Regulatory and compliance issues.
- Cultural and organizational resistance to change.
- Digital divide and unequal access to technology.
To navigate digital disruption, businesses and organizations must be willing to adapt, innovate, and transform their operations and strategies to stay competitive and relevant in a rapidly changing digital landscape.
DIGITAL DISRUPTION VS DIGITAL TRANSFORMATION
Digital disruption and digital transformation are two distinct concepts with different relationships depending on the situation. However, there are some similarities between these two in some extensions.
TECHNOLOGY IS THE CORE: Technology will always play an important role in digital disruption vs digital transformation, but the technology itself is not only the primary element. Other factors that should be considered in the innovation would be: business, technology, industry and society.
NOT ONLY FOR THE DIGITAL GIANTS: have digital disruption and transformation happen across thousands of small, medium and large companies. Creating a disruptive innovation isn’t just a story for Amazon, Apple, and others. Keep track of and learn from these digital companies. To begin the process of exploiting a disruption or transformation, develop action plans that lead to organizational, cultural, financial, or business model change.
NEW APPROACHES TO OPTIMIZING THE CUSTOMER EXPERIENCE: Consumer behavior shifts as technology becomes more user-friendly. A new app or online service can quickly dominate an existing market. The primary goal of digital transformation and disruption is to improve customer experience, as Amazon, Apple, and many other leaders have pioneered new levels of customer service and experience.
DIGITAL DISRUPTION VS DIGITAL TRANSFORMATION
Digital transformation mainly relates to organizational change; it relates to how organizations transform themselves. Digital disruption, on the other hand, is an outside-in force of transformation or destruction. Developing a strategy for digital transformation that fully leverages the value of digital technologies is crucial. Companies often assume that if they embrace digital technology in any way, they’re digitally transforming their business. However, they often make only ad hoc changes and investments in the digital arena, with ineffectual results.
Using the analogy of the eggshell, it means the cracking of the eggshell from the inside represents digital transformation, while the cracking from the outside implies digital disruption.
TO NAVIGATE DIGITAL DISRUPTION IN HRM, ORGANIZATIONS SHOULD:-
- DEVELOP A DIGITAL HR STRATEGY: Aligning with business objectives and employee needs.
- INVEST IN DIGITAL TOOLS AND PLATFORMS: Selecting solutions that integrate with existing systems.
- UP SKILL HR PROFESSIONALS: Building digital literacy and analytics capabilities.
- FOSTER A CULTURE OF INNOVATION: Encouraging experimentation and continuous learning.
- MONITOR AND EVALUATE: Regularly assessing the impact of digital disruption on HRM.
By embracing digital disruption, HRM can become a strategic partner in driving business success and enhancing the employee experience.
In conclusion, digital disruption in HRM is a transformative force that requires strategic adaptation and innovation. By embracing digital technologies and platforms, HR professionals can enhance efficiency, accuracy, and agility, while also delivering personalized employee experiences and data-driven insights. However, it’s crucial to address the challenges of change management, cyber security, ethical considerations, and digital divide. With a well-crafted digital HR strategy, organizations can navigate this disruption and unlock the full potential of their human capital. As the digital landscape continues to evolve, HRM must stay ahead of the curve to drive business success and empower employees to thrive in the digital age.