Digital Transformation: The CHRO's Role

Digital transformation has become critical in the post-pandemic era. Even though the term may evoke images of a process brimming with technological complexity, DT is as much a cultural shift. Given that a reorientation of the organisational culture is integral to it, CHROs are well-positioned to help facilitate such change. At a recent India CHRO Forum session in Bangalore, Pankaj Rai, Group Chief Data Analytics Officer at the Aditya Birla Group, shared his experience of driving transformation in large organisations.

Roadmap to Change

Below the surface, different businesses and functions grapple with common problems, which often have common solutions. For example, a cement business might be able to streamline its logistics tracking and tracing using a tech platform built by a paint company. Extending this concept to the broader organisation, DT efforts typically include the setting up of systems and processes that cut across diverse fields and operations. Tech transformation and integration necessarily stem from a deliberate strategy, and facilitating a data-driven culture requires a conscious framework. At the Aditya Birla Group, the Data Analytics team follows a Gartner framework with 3 layers. The upper layer is business-focused, covering issues like strategy, increasing revenue, lowering cost, etc. The middle layer – or operating model – is concerned with HR, funding, culture, talent governance, etc while the bottom layer focuses on technology.

Data-driven transformation is executed through a series of mechanisms. First, a project team identifies issues or business processes that can be optimised using data. Next, work begins on automating the process, with data scientists and engineers working in tandem to streamline data processing. Once the common problems are identified, data engineers create platforms that address these issues. Once the process proves successful, partners and vendors are brought in, and teams are built to transfer the learnings into the business.

CHROs can help drive the shift to digital by catalysing cultural transformation. Any successful operating model needs to be agile, and must work at every level. HR leaders can enable an agile culture by removing distinctions between functions (HR, business, IT, manufacturing, etc) and by creating ‘fusion teams’. Hindalco, for example, set up a cross-functional task force that drove cultural transformation across 5 of its plants as a pilot. The CHRO must also consciously avoid a top-down approach and ensure that teams are fully empowered, following the ‘transformation’ phase, to drive the new organisational vision.

Barriers to Transformation

Change can be unsettling, particularly for those who have been with the organisation for a long time. Many will put up resistance to the series of changes required by any DT effort. Every population has early adopters and laggards, and change management strategies typically focus on the former. To help overcome internal resistance, Hindalco picked modern plants with the most open-minded plant managers for its pilot transformation. The plant managers identified a set of ‘ideal workers’, which helped smoothen out the process. They also worked to continuously incorporate learnings from the process.

Attracting Talent

Ultimately, digital transformation may be guided by HR but it must rest on a solid pool of talent, including both technology/data specialists and core-engineering talent. Increasingly, however, it has become a challenge to attract young graduates to fields such as manufacturing and engineering. (Factory visits are perhaps the least-enjoyed aspect of such jobs.) Most young engineers and data scientists prefer to work for technology-services companies, even if the work they do there is less meaningful or exciting. HR leaders have a crucial role to play in this regard. They must help create interest in the manufacturing/engineering space, and find novel ways to retain existing talent. Ather Energy, for one, invested disproportionately in attracting talent for its manufacturing operations. The decision has yielded great results, and Ather now has a solid, high-performing team in place.