Resistance is futile: The digital future is inevitable

Deloitte's Valter Adão is guiding internal and external clients towards an inevitable digital future. Failure to embrace the coming changes is not an option - for your prosperity and the nation's.

Valter Adão  is the chief digital and innovation officer for Deloitte Africa , a multi-faceted role serving both Deloitte as an organization and its clients. Here the focus is specifically on positioning companies to both thrive in a digital world and transform to remain relevant in the face of change so dramatic and exponential that it is not hyperbole to call it 'paradigm shift'.

Still Valter is quick to point out that he is not "a technologist". His background is steeped in the world of business venturing, economics and science, holding a Masters in Science, and a Masters of Business Administration.

"What I do in the world of digital," he says, "is that I understand the business value and economics of digital. Not being a technologist means not getting caught up in the technology itself, but rather keep the focus on the economic angle, and the benefits that bring these technologies to the world of business and society. ”

Rather than pushing generic tools or 'solutions', Valter believes it's more enabling to look at the needs of each organization individually, and develop a view on how innovation, and what kind of innovation, can be harnessed to make a team or company smarter , faster, more efficient, and - critically - to stay relevant to its market and staff.

Change is inevitable
No one is immune to the coming changes, not clients and not Deloitte itself, Valter explains. "The worlds of audit, tax, risk advisory, corporate finance and consulting are all changing," Valter says. "All of these are under threat by new digitally enabled ways of doing business, and so I've got to ensure that our business transforms at a faster pace." 

Internally this means focusing on transforming Deloitte's existing capabilities and augmenting them through innovation and digital. “How do I take existing products and solutions and modernize them with the use of digital? If we look at tax, for example, it had been done the same way for a long time, with incremental improvements to how the services were provided. To ensure our continued success in the future, we modernized the way tax services are delivered. ”

Working with the various tax leaders and teams, Valter and his team have explored the opportunities to engage robotic and cognitive automation (RCA), to improve the tax service they provide. "We either augment the products that we have with digital technology or we create new products using digital technologies," he adds.

“The way we train our people has also changed, and it's not just about the digital platform that we use to train people, but rather how and what we train them, such as teaching tax practitioners to become proficient in robotic processing and automation and other technologies like the blockchain, ecommerce platforms, etc, that influence how work is done, and how the flow or monies can be impacted. We refer to that as digital fluency, and we're developing our digital fluency in things like blockchain, RPA, artificial intelligence (AI), and the internet of things (IoT). ”

This is one means of future-proofing, so that Deloitte's human resources are constantly evolving along with their technology resources - rather than being stagnant and ripe for disruption.

The future is here
So, what tools and trends are on his watch list for the coming year? Valter says we should be less concerned about trying to "predict" the future of technology, but rather be focused on developing the correct leadership and culture that will allow an organization to navigate the change that lies ahead.

"Companies that get the latter right will know how to create value irrespective of the technology in question, or the pace of which changes," he says “The old way of business has reached a peak and is facing a barrier. That barrier is technology, but it's not through the deployment of technology that we want to get over this barrier. If that was the case, all the rich companies and countries would be the most digitally transformed. In fact, the opposite is true in fact. The right leadership and cultural construct of the organization is most critical. "

“In South Africa we need to be more deliberate regarding this topic. We need to put our businesses under a microscope, "Valter says.

It is his strongly held view that we need to understand how we can use these technologies to reduce the cost of doing business in SA and unlock efficiencies in our industries and sectors. "If we don't get this right, we're going to lose our global competitiveness," hey cautions.

Valter believes this is a national imperative. He points to automation in mining and manufacturing to make his point. In many developed nations, automation has been embraced, boosting productivity, output and therefore global competitiveness. “The hypothesis that technology will destroy jobs is true, but its only half of the story. Jobs can only be eliminated if they aren’t able to compete with the economics of the technology. Failing to automate will therefore reduce the competitiveness of businesses or sectors and they will eventually fail. This effect on job losses will be larger than any form of automation.” 

“What we fail to see is that throughout that last few decades large-scale sector employment declines due to technology have been countered by growth of new sectors that have absorbed workers while sustaining economic growth or the respective sector. We are not experiencing a technology crisis; we are experiencing a leadership crisis. "

Of course, that means visible job losses in the short term - a social and political tinderbox or great concern locally. “Every CEO and politician in the world is worried about this, and South Africa has the additional challenge or a negative populous view on the impact that technology is going to have on jobs. It is a dystopian view.

“But I believe that if we deploy a solid strategy to digitise and automate, we will create more jobs than what we lose. World Economic Forum research suggests that for every job we lose, automation will actually create 1.74 new jobs.”

He continues: “A labour-intensive, labour protectionist strategy is a negative one. We are being left behind. If we don’t automate, the job losses will be far greater. So we need to develop the skills to ready ourselves for new jobs. We need to take our lemon pickers and make then lemon-picking machine operators, and beyond. And to a degree, we need to accept that the big companies will probably no longer be our main employers, and that SMEs and micro-entrepreneurs will likely fill that gap.”

Coordination for success
Valter’s approach is a business-led digital transformation of the business, enabled by technology. He recommends the deployment people who are trying to bring about change to sit inside the division or team they are helping. He calls this a distributed model of change.

In financial services, for example, a first step is unpacking the constructs of the business, and asking what problems need to be solved in the sector, or what conversations need to be happening at the executive level, to ready them for change that is deep and integral.

“We do the same with mining, with telcos, and so on, helping them define those viewpoints, shaping the central viewpoint, and then developing plans specifically for each client that are deliberate and orchestrated around to address the challenges or implement the solutions.”

Another win of this approach is the creation of what Valter calls an “ecosystem of dependency” on one another in order to become successful. “These distributed digital teams must be hyper-coordinated, which means working in a connected but independent manner with a clear understanding of how their success is interdependent on each other.”

Understanding the market’s needs
How is this different from a digital agency or technologist approach? In a typical example, Valter says, a digital agency or ecommerce specialist might be tasked with acquiring an ecommerce solution for a business or business unit. They would find and deploy appropriate technology and perhaps “switch on” the platform for the client.

“What Deloitte does is ensure we have considered the full ecommerce ecosystem, ensuring that the client is ready for ecommerce, first asking if the business is geared for ecommerce? We then want to make sure that the roadmap to go the ecommerce route is as efficient, as comprehensive, as it can be. For example, is the supply chain effective enough to support the ecommerce business? Is the tax strategy the right one to ensure the company is compliant? Not having a full view of what is required to become digital can be frustrating, risky and expensive.

"The way that we are bringing in all those various elements is pretty unique and is further differentiating ourselves in the market."