Talent & Resourcing: Opportunities & challenges with the New “Digital”

Digital Transformation is one of the defining themes of today – impacting industries, consumers, and society at large. It encompasses many – AI/ML being the most transformative

Digital Transformation impacts Talent & Work in 2 ways :

• Wider implications on talent in operating roles across, as industries compete (including the emergence of new segments and the fade-out of some old ones);  and within an industry, as work gets restructured/optimised

• Deeper, but more focused impact, on the teams & companies directly working on the Digital Capabilities (technology, processes) – internal teams in companies as well as external partners / Service Providers

  
  

The former is a wider but more dispersed impact which will pan out over a longer time, encompassing all functional roles (eg, Digital Marketing, Digital Supply Chain)

The latter impact (on the Digital IT and associated process/project teams) is sharper and more imminent. A very relevant paper by Andrew Ng - one of the Gurus of AI  - calls this out especially with respect to Deep Learning and AI. ( for detail (https://www.deeplearning.ai/the-batch/issue-317/)

This is a challenge for all talent & teams working on Digital/IT capabilities, but more so on the technology teams in IT service providers and also GCCs (Global Capability Centres) and in-house teams.  This is also very relevant for us as a country that has the largest IT talent pool, delivers the largest chunk of IT services, and is home to a multitude of GCCs, with its secondary implications going beyond the industry per se – on to larger society, employment, and economy.

It is useful to look at this from the construct of the “Resource Pyramid” that the industry is familiar with, and is a subject of much debate today. IT teams have followed a typical “pyramid” structure in IT services companies, and also (maybe to a lesser degree) in internal technology teams of companies and in GCCs. Most recruitment was of fresh graduates (largely from engineering colleges and similar professional courses) joining the large & wide base of the pyramid. The entry levels of the pyramid would be developers (coders), testers, and junior business analysts. There was some talent (often from top-tier engineering/management institutions) who may join “higher” in this pyramid, but that as a percentage of the workforce was small. Middle levels (in the hierarchy) would have a large number of “coordination” roles (eg, Project Managers, Team Leads ) along with some architects/technology leads and customer / business-facing roles.

Pyramids narrow as it goes up – which means not everyone gets promoted. But that became an accepted fact of life (as is true in all organisations) – and the pyramid made careers stable and predictable. Most talent would continue in the same overall construct for a good part of their working career (even if it meant zig-zagging across organisations, all pretty much doing similar work). Revenue models of IT services firms were directly or indirectly linked to resources deployed (irrespective of whether the actual commercial contracts were “fixed price” or “time & material”). Even in internal IT teams, team size & budgets were proportional to the volume of development & support work.

This whole model is being upended by a host of factors, including the nature of work (more modern “digital” capabilities versus “Traditional IT”) and Agile methodologies with Product teams (as opposed to the traditional “waterfall” projects. But most importantly, the opportunities with Gen AI – both on how technical work gets done and the demand for newer work on AI.

What is the new organization construct? Frankly, it is evolving, but we can see almost two distinct facets – the “Traditional IT work” and the “Modern Digital work”

The overall share of “Traditional IT work” shrinks as organisations focus on the “New”.  Also, the effort/resource required to do this “traditional IT work” (on building and maintaining systems) is now significantly lower with automation. This then has a compounding effect of the overall resources required.

There is an even greater shrinkage at the “middle” level roles, who performed coordination-type activities for the larger teams below. This work is impacted with modern technology and the drive for efficiencies. This is seen in the redundancies announced by a number of IT services companies.

In the midst of this, the demand for the “Modern Digital” work is growing. This has the potential to generate disproportionate value for businesses. However, the resources required for this work are very different. It requires higher skills (modern technologies incl AI/ML, data proficiency) and competencies (business re-imagination, critical thinking, growth mindset). There is an opportunity for “exponential talent” – where the right person can be 100x the impact of the average resources! (multiples which are not seen in traditional IT or in any other traditional line of business)

All this presents the challenge that Andrew Ng refers to in his article – on the one hand demand for critical high skill, roles – but not enough talent to meet this; and on the other side a significant glut in traditional IT roles.

This leads to a number of critical challenges as well as opportunities:

• There is likely a glut of - what used to be  - entry-level IT talent who would have joined the industry as developers/testers but now find fewer of these roles. How do academia, corporations, and society at large handle this?

• There are also redundancies of middle-level roles in organisations

• In the higher skill “Digital” roles, there will be increasing demand – beyond the supply of talent - both in numbers and readiness.

• Customer-facing roles will continue to be critical. But with more client teams becoming more digitally savvy, it will be less on traditional account management. It will be with deeper domain expertise and the ability to “reimagine” the business, working along with client teams.

• Continuous upskilling will become necessary. It can no longer just be on-the-job experience-based learning. Talent will be expected to upskill and leverage the huge learning resources available. This conscious investment in “sharpening the saw” – supported by industry as well as academia.

• It has an implication on the education system – esp. technical (engineering). A model that was thriving on providing entry-level IT engineers will now have to look at providing leading-edge skills and also continued education throughout professional life.

  
  

We are living in interesting times, as they say!

And in this, the brave, the innovative, and resilient will not just survive but can also thrive.

This is an area where Leadership Teams (especially Digital leaders) across both user organizations and service providers need to think hard on the options and make the right decisions, which helps manage the current and, most importantly, prepares them for a future that is likely to be very different.

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