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Jobs threat: IDC predicts cuts in Kiwi knowledge worker numbers

Jobs threat: IDC predicts cuts in Kiwi knowledge worker numbers

Flatter organisation structures will enable businesses to operate with fewer knowledge workers on staff

Louise Francis (IDC)

Louise Francis (IDC)

Credit: IDC

At least 55 per cent of New Zealand organisations will be "digitally determined" by 2020 according to IDC, transforming their markets with new business models and developing digitally enhanced products and services.

That's the good news, the bad is that knowledge worker jobs are under threat.

"We estimate that by the end of 2020, more than 60 per cent of New Zealand business-to-consumer organisations will have adopted Net Promoter Score as their leading success metric," IDC A/NZ research director Louise Francis said.

"In the same time period, at least 20 per cent of businesses will have created digital twins, which will enable flatter organisations and reduce the number of knowledge workers they need by 33 per cent."

Francis said, however, that 33 per cent number is much lower than was predicted just a few years ago, with new jobs also set to be created as a result of the changes.

The predictions come as part of the research firm's top 10 digital transformation trends for New Zealand.

IDC is also predicting the demise of the chief digital officer, saying the job title will be short-lived and declining by 2023, because “digital will be fully embedded in organisations and no longer regarded as something special.”

According to Francis, by 2023, 40 per cent of local workers will be working with bots or some other form of artificial intelligence (AI).

“There has been some misinformed comment about AI coming to ‘steal all the jobs’," she said. "In reality, many roles will be augmented and extended with smart bots or some form of AI.

"This trend will require company leaders to redesign operational processes, performance metrics, and recruitment strategies."

At present 60 per cent of New Zealand organisations do not have any digital KPIs, she said. However, IDC sees this changing quite rapidly, with 85 per cent creating digital KPIs by 2023.

The analyst said by the end of next year, successful businesses will be allocating capital budget equal to at least 10 per cent of revenue to fuel their digital strategies.

“By the end of 2020, 55 per cent of NZ enterprises will have created data management and monetisation capabilities, enhancing enterprise functions, strengthening their competitiveness, and creating new sources of revenue," Francis said.

"The other 45 per cent will be in trouble if they cannot break free of their digital deadlock. Now, more than ever, speed and flexibility will beat size every time."

Top 10 trends in New Zealand at a glance:

1. By 2020, at least 55 per cent of Kiwi organisations will be digitally determined, transforming markets and reimagining the future through new business models and digitally enabled products and services.

2. By 2023, the CDO title will be in decline, as digital will have become fully embedded, but more than 60 per cent of New Zealand CEOs will have spent part of their careers leading digital initiatives.

3. The paramount importance of customer advocacy will result in 60 per cent of B2C brands in New Zealand embracing Net Promoter Score as their leading success metric by the end of 2020.

4. By 2020, 55 per cent of New Zealand enterprises will create data management and monetisation capabilities, enhancing enterprise functions, strengthening competitiveness, and creating new sources of revenue.

5. By 2020, 20 per cent of NZ100 companies will have implemented advanced digital twins of their operational processes, which will enable flatter organisations and one-third fewer knowledge workers.

6. By 2023, 40 per cent of Kiwi workers will start working with bots or other forms of AI, requiring company leaders to redesign operational processes, performance metrics, and recruitment strategies.

7. By 2020, 25 per cent of NZ100 companies will have allocated capital budget equal to at least 10 per cent of
revenue to fuel their digital strategies.

8. By 2022, prominent in-industry value chains, enabled by blockchains, will have extended their digital platforms to their entire omni-experience ecosystems, thus reducing transaction costs by 35 per cent.

9. By 2022, approximately 25 per cent of large manufacturers and retailers in New Zealand will have built digital trust through blockchain services that enable collaborative supply chains and allow consumers to access product histories.

10. By 2023, 85 per cent of entities will have incorporated new digital KPI sets — focusing on product/service innovation rates, data capitalisation, and employee experience — to navigate the digital economy.


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