Big Idea 2015: Technology Is Great, But Companies Still Need People

In this series of posts, Influencers and members predict the ideas and trends that will shape 2015. Read all the stories here and write your own (please include the hashtag #BigIdeas2015 in the body of your post).

We see the impact of fast-changing technology across our business every day. Within PwC, we use technology to help our audit clients better communicate with their stakeholders through accurate and transparent financial reporting. In tax, we help clients use data to make better decisions when managing compliance and risk. And in consulting, we’re helping clients use technology to reimagine the way they conduct business in today’s digitally interconnected world, from how they interact with customers to how they manage their supply chain.

At PwC, we define “digital IQ” as an organization’s ability to truly understand technology’s value and weave it into the fabric of their business. According to our 2014 Digital IQ survey, nearly every organization lays claim to being a “digital enterprise,” yet only 20 percent of respondents gave their own companies top marks for having “excellent” digital IQ (as defined by five behaviors demonstrated by companies that are adept at leveraging digital technologies). Our survey found that those businesses with a strong digital IQ were 2.2 times more likely to be top performers in revenue growth, profitability and innovation.

Companies of all kinds increasingly depend on 3D printers, robots, sensors and other technology to enable their businesses. Many of these new technologies have an element of "digital autonomy"—which is when a robot, software agent, or other "device" is able to make sense of its environment, make decisions, and take action in its environment. As organizations incorporate these technologies into how they do business, one question we'll collectively wrestle with in 2015 is: how to best balance people versus machines?

Advanced technologies that enable digital autonomy are already being applied across a number of industries. For instance, we are seeing the development of self-driving cars and the popularity of personal devices to measure all aspects of our well-being, from how long we sleep to how many calories we burn each day. In insurance, companies are considering the use of drones to improve rapid response to disasters. In healthcare, doctors and hospitals are using robots for specialized surgery. Retailers are using infrared sensors at checkout lanes to reduce shoppers’ wait time. People are an important part of each of these scenarios, but the role of technology is also increasing.

Digital autonomy also governs a significant part of the activity on stock exchanges through technology that can take action such as program trading and flash trading. Meanwhile, marketers are implementing advanced data analytics strategies to bid for customer clicks based on algorithms. And in education, as interest in massive open online courses (or MOOCs) is growing, so is the use of machine learning to grade essays from thousands of students.

To be clear, this isn't brand new. Some of the pioneering ideas of artificial intelligence were described over 50 years ago. But this coming year—with the confluence of the internet, smart devices and increasing connectivity—the impact of these technologies is exponentially increasing and has reached the C-Suite agenda. The question every forward-thinking executive needs to ask: Are we sure our organization has the optimal balance of digital autonomy and human judgment for maximum agility, productivity and quality?

Consider that 86 percent of CEOs recognize that technology will have a major impact on their organization over the next three years, yet only 39 percent say that HR is well prepared to support this transformative change. Optimally leveraging technology for the future is no easy task for any business. Here are some key questions businesses operating in this new world of digital autonomy must ask:

• What is the right mix of people and machines?
• Do we have the right talent to design the work and processes in this new world?
• Do we have partnerships, alliances and connections that keep our organization deep enough into the technology to understand what's possible?
• Do we have the culture and leadership capable of not just thinking about the possibilities, but driving them home?

We're working hard to address these questions at PwC as we think about the needs of investors, clients and the many stakeholders whom we serve. To come up with the right solutions, however, requires highly skilled people who bring objectivity, principle, judgment and commitment to the work they do each day. That's what we want our organization to be known for—and that's what our stakeholders and clients expect of us.

At the same time we know that our future will depend on finding the right combination of people and technology—to allow us to be agile in a fast-changing world, to work efficiently and globally, while maintaining our commitment to high quality audit, tax and consulting services.

We're embedding technology into how we work while recognizing that the foundation of our business will continue to be our people, their experience, their industry insight, their skills, and their commitment to our clients and their stakeholders. With all that is changing, our profession’s essentials remain the same.

As I look ahead at 2015, I believe this will be the year when we see digital autonomy—in all its forms—course through our economy. There's much to think about, and we are moving quickly to leverage all that technology has to offer.