Free Essay Sample on Digital Transformation

Introduction

The digital transformation of the business to leverage on AI is a form of organizational change. Like most organizational changes, there is bound to be some resistance from both forces within and outside the business. That is mainly to be the case for those employees who are uncertain of their job security. AI tends to be a controversial topic, and many people associate it with workplace redundancy (Pol & Reveley, 2017). Therefore, it is expected for some people to be worried about their job security because of its introduction or adoption. However, getting all stakeholders involved in the transitioning process and reducing misinformation are ways of taking the business to the next level of expansion and growth.

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Main Assumptions

One of the main assumptions made in this exercise is that the family business uses a corporate governance model and has a fully functional, independent board of directors. According to Bettinelli (2011), one of the main reasons for the existence of the board of directors is to ensure stability and smooth transition of company leadership. Therefore, the board gets to be a significant player in the transition of power. There is also the assumption that the board of directors agreed to that transfer of ownership and that there are no internal wrangles in the business in terms of inheritance. Another assumption is that the adoption of AI would fit into the business model of doing business.

The business currently operates with minimal automation, with most of the work being performed by individuals. At the same time, the employees use technological devices such as computers and the internet, which enhance their overall efficiency, the productivity can still be increased through the automation of routine tasks (Wamba-Taguimdje et al., 2020). Processes such as making payments to suppliers can be automated to reduce the time taken to compensate business partners. The same applies to the employees who would experience salary delays because of the manual processes. The automation also extends to payment of utility bills such as electricity and telephone costs to avoid inconveniencing the suppliers of such services. While discussing utility, the business incurs extra power costs because wastage related to lighting and temperature control. Automating these processes would result in cost savings for the business.

Primary Issues

There are two primary issues to be addressed in addressing the adoption of automation in the family business. One of those issues is job security, especially for the high-level employees that have spent a significant deal amount of time with the company. The second issue is one to do with the skill level of most of the workers. That is, whether they possess the necessary skills to make full use of AI. Petropoulos (2018) indicates that AI has the displacement and the productivity effect. The displacement effect will significantly affect the low skilled workers whose work involves performing simple skills.

Therefore, the primary strategy for taking the business to the next level is to involve all the stakeholders in the transition process actively. That includes not only seeking workers input, but also making them part of the instruments used to initiate change (Yilmaz, & Kiliçoglu, 2013). The recommended route is to take those workers that have been with the business for more than thirty years and convince them of why AI is needed for the future of the company. Then proceed to use those employees to educate and implement some of the changes in the organization. It is highly unlikely that the high-level employees will be affected by the change because they do not perform routine work or tasks which are vulnerable to automation (Frontier Economics, 2018).

Conclusion

A transformation, such as the introduction of AI, is bound to have a significant impact on business operations and employee perceptions. The chances of resistance are increased if the stakeholders are not brought in on the transformation. Bringing them on board early in the process is the best way to minimize resistance and ensure the transformation is useful for business productivity.

References

Bettinelli, C. (2011). Boards of Directors in Family Firms: An Exploratory Study of Structure and Group Process. Family Business Review - FAM BUS REV. 24. 151-169. 10.1177/0894486511402196.

Frontier Economics. (, 2018). The impact of Artificial Intelligence on Work: An evidence review prepared for the Royal Society and the British Academy. Zugang.
https://royalsociety.org/-/media/policy/projects/ai-and-work/frontier-review-the-impact-of-AI-on-work.pdf

Petropoulos, G. (2018). The impact of artificial intelligence on employment. Praise for Work in the Digital Age, 119. https://curis.ku.dk/portal/files/198709895/Work_in_the_Digital_Age.pdf#page=143

Pol, E., & Reveley, J. (2017). Robot induced technological unemployment: Towards a youth-focused coping strategy. Psychosociological Issues in Human Resource Management, 5(2), 169-186. https://ro.uow.edu.au/cgi/viewcontent.cgi?article=2323&context=buspapers

Wamba-Taguimdje, S. L., Wamba, S. F., Kamdjoug, J. R. K., & Wanko, C. E. T. (2020). Influence of artificial intelligence (AI) on firm performance: the business value of AI-based transformation projects. Business Process Management Journal. https://www.researchgate.net/profile/Kala_Kamdjoug_Jean_Robert/publication/340210939_Influence_of_Artificial_Intelligence_AI_on_Firm_Performance_The_Business_Value_of_AI-based_Transformation_Projects/links/5eaa905645851592d6abcf63/Influence-of-Artificial-Intelligence-AI-on-Firm-Performance-The-Business-Value-of-AI-based-Transformation-Projects.pdf

Yilmaz, D., & Kiliçoglu, G. (2013). Resistance to change and ways of reducing resistance in educational organizations. European Journal of Research on Education. 2013. 14-21. https://www.researchgate.net/publication/301292908_Resistance_to_change_and_ways_of_reducing_resistance_in_educational_organizations.