Five Forces Impacting Work, and Why You Can’t Ignore Them

Author: Mike Anderson       Date: August 15, 2011

Topic:  Workplace        Research Note Number: 2011-2

Issues: What are the macro trends impacting the evolution of work?

What are the best practices for enabling a high productivity work environment?

Summary: Relentless technological advances have been changing the nature of work for generations. Recently, these changes have accelerated and multiplied. Understanding the five forces behind this metamorphosis provides perspective for enterprises to plan their response. 

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Far-reaching forces of globalization and IT innovation are combining to create an environment of unprecedented change and disruption for nearly every business. At the center of this turbulence is the workplace, which is undergoing a reinvention. These changes are transforming the work being done; how, when and where it is accomplished; who the workers are; and what tools they need.

Five Forces Impacting Work

Five key forces have far-reaching and disruptive effects in the workplace. The effects will be felt across the global enterprise ecosystem, and require action at all levels, from individuals to enterprises. The five forces are:

  • Globalization
  • Optimizing Processes
  • Virtualizing Work
  • Computing in the Cloud
  • Beyond Consumerization

Globalization, process optimization, outsourcing and virtualization have retooled and restructured business priorities, models and process architectures. The Internet revolution is transforming enterprise IT from an individual closed, siloed, process-centric business computing ecosystem, toward an openly connected, highly collaborative, socially enabled environment that is globally integrated across employees, suppliers, partners, industry peers, customers and prospects. The result of these internal business changes and the dynamic enabling potential of IT innovation is a combustible mixture that is poised to explode into unprecedented opportunities – as well as far-reaching disruption.

Globalization

The effects of increasing business globalization have never been more profound. This continuing evolution can engage the global community in all aspects of business, with a granularity that can focus on individual work activities or encompass entire business functions. Enterprises can respond to competitive pressures by sourcing business functions, processes or work to providers across a global ecosystem.

Knowledge workers can similarly be drawn from anywhere in the world, or their work can be enhanced by crowdsourcing approaches also enabled by the Internet. At the same time, competitors or possible new entrants can use these global resources as a palette of capabilities to create new businesses. These initiatives can be constructed rapidly using low-cost optimized services that require less capital and organizational investment

Optimizing Processes

For decades, business has been squeezing out inefficiencies to increase process productivity. From top to bottom, enterprises have gone through multiple rounds of projects to refine, streamline and optimize their processes. Concentration on process has been a key tool in working across the silos that are relics of industrial-era structure. Reengineering, business process automation, business process management, business process modeling, business process integration and other disciplines have served to bring detailed attention to how individual businesses operate. As a result, the work of enterprises at the process level is not only more efficient, but also better defined, deconstructed and documented.

Business can more readily make adjustments at the level of operational functions or processes. Those that are core may get additional investment. Those that can be are automated. Those that are not core can be outsourced to external partners; even mission-critical processes are being moved outside. The resulting environment is one in which process expertise and knowledge lets businesses rapidly change course through internal adjustments or by moving entire processes and associated work outside the enterprise.

Virtualizing Work

Functional and hierarchical structures have been supplemented or replaced with horizontal realignment through projects, teams or wholesale restructuring as the work of business is virtualized. Outsourcing has resulted in iterative waves of realignment and rebalancing, and the substitution of external work for internal organizational investments. Offshoring, outsourcing and partnering have become essential enterprise tools, creating a new model for business. This movement away from the end-to-end vertically integrated enterprise toward an environment of more focused businesses with collaborative networks of partnerships is increasingly viable and attractive.

Having a clear definition of all the elements of business activities, processes and value creation, coupled with a strategy of using other businesses as partners, rather than investing internally in people and other resources, will increase business productivity and agility. Virtualization of work, and of the enterprise, results in demands for more open sharing and collaborative value creation and a dispersed, interenterprise architecture that redefines the traditional boundaries of a business.

Computing in the Cloud

Beyond the Internet, the World Wide Web or e-commerce, a new computing paradigm and framework is changing business IT priorities and direction. Cloud computing, in which the communications, data, computing, and application functionality elements are available merely by plugging in, offers a flexible, fluid, on-demand resource. The capability can be utilized by individuals anywhere in the world using nearly limitless choices of fixed and mobile devices, and by other applications, processes or services from globally dispersed organizations seeking to tap those cloud-based capabilities. This is enabling a new way to perform and organize around knowledge work as the central driver of innovation and growing business value.

Beyond Consumerization – Business Trumps IT

IT consumerization is predominantly identified with the expanding trend of workers bringing their personally-owned devices, especially those like tablets and smartphones that enable mobility, to work. More broadly, it represents the growing trend for information technology innovations to emerge first, and more rapidly, in the consumer market before spreading into business markets. It is also evident in enterprise attention to the business potential of the social media and social networks that consumers have so rapidly embraced. This trend has resulted in individuals who are eager to embrace the latest technology, and empowered business managers who can now deploy solutions without involving the IT organization.

The business implications certainly go well beyond the attention to devices and mobile access, but the pace of change in just devices and apps is overwhelming most IT organizations. Consumerization and empowered users with no fear of technology are redefining the pace at which new technology needs to be assimilated into the enterprise, as well as the heterogeneity of the enterprise ecosystem. Control is moving from centralized IT policies and standards to individual users finding their own ways to integrate personal systems. Control is also continuing to move into the hands of business managers who have immediate problems to solve and will not patiently wait for IT organizations that cannot respond rapidly because of workload, procedural controls, approvals and security issues.

Technology-savvy users, along with empowered and pressured business managers, are driving significant portions of new IT implementations. The IT adoption profile created by this shift in control is often in opposition to the more conservative approach typical of most IT organizations. This poses a significant threat to the security, manageability and integrity of the corporate computing environment. But it also presents a tremendous opportunity to leverage the knowledge, capability, energy and personally owned productivity of business users to drive increased collaboration and creativity.

Aragon Advisory

Enterprises need to take a fresh look at their work environment and evaluate how the five forces affect how their people work. Not all of the forces will impact every enterprise. Collecting feedback from users via crowdsourcing is a good way to gather input; benchmarking competitors is also a good best practice.

The increasing granularity of work and business processes that can be sourced as services from nearly anywhere demands constant attention to manage agility, costs and an increased number of relationships in order to remain globally competitive.

The ability to quickly provision work to the most effective source requires a suitable definition of the work itself, and depends upon effective senior-level strategy to maintain enterprise connection and continuity.

Bottom Line

The five forces changing the nature of work are having a disruptive effect upon every enterprise. The extent of this effect varies by industry, and the pace will be different for each business. The only certainty is that reliance on “standard operating procedures” is no longer enough. Understanding these disruptive forces and the new reality they create is an essential step toward planning and prioritizing new workplace capabilities to address these challenges and exploit these opportunities for each enterprise and each project in the optimum way.

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Copyright © 2011 Aragon Research Inc. and or its affiliates. All rights reserved.

 

 

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