Building Business Value from the Digital Workplace

MIT CISR research has found that growing numbers of companies are responding to the challenges of the digital world by redesigning how their employees work. They are, for instance, creating more flexible, open workspaces; distributing more user-friendly technologies; and enabling more social networking capabilities. We refer to the products of such initiatives as digital workplaces. Given their popularity, we want to understand (1) whether digital workplaces create real business value or are just a passing fancy, and (2) if they create business value, what design parameters matter most.

For MIT CISR’s digital workplace research, we joined forces with Erasmus@Work and analyzed data from a study of 313 companies.[foot]The Digital Workplace Barometer study (N=313) was administered by the third author while at Rotterdam School of Management (RSM), Erasmus University. Data from the study was analyzed as part of the MIT CISR Digital Workplace research, for which the authors concentrated on larger companies with at least 100 employees (N=196 of the 313).[/foot] In this briefing, we present our findings that high-performing companies intentionally design workplaces that enhance the employee experience by employee connectedness focusing on two critical dimensions: employee connectedness and responsive leadership. We then describe how one of the world’s leading digital banks, DBS, designs a digital workplace as part of a radically new approach to banking. 

Connectedness in the Digital Workplace 

Connectedness refers to the extent to which employees can engage—with each other, stakeholders and customers, information and knowledge, and ideas. Traditional work environments can inhibit connectedness, particularly across functional or product silos, geographies, or company boundaries. We found that high-performing companies have an integrated and company-wide approach to greater employee connectedness. They achieve this by designing physical spaces, digital technologies, and social networks specifically focused on enabling more collaborative work. 

Connectivity built across silos rather than in an isolated fashion is critical to empowering employees to provide seamless customer experiences. In other words, a physical and digital work environment designed for a collaborative, integrated employee experience enables the delivery of more complex customer solutions. 

Responsive Leadership in the Digital Workplace 

Responsive leadership requires a shift in mindset. We found that leaders in high-performing companies facilitate workplace design rather than direct it. They are open to employee initiatives and alert to feedback on employee experience, and they gather data from multiple sources that enable evidence-based decision making on workplace design. 

Responsive leaders communicate a clearly articulated vision that links workplace design to the strategic objectives of the company. They then empower employees to make decisions in the best interests of customer experience and their work. These leaders encourage experimentation with new approaches to work, have a high tolerance for failure of new workplace initiatives, and provide continuous learning opportunities. High-performing companies in the research tended to have cross-functional digital workplace leadership teams with representation from IT, HR, facilities, legal, and communications. 

Figure 1 illustrates that high-performing companies invest in both employee connectedness and responsive leadership.[foot]High-performing companies in the study were the twenty-five companies with the highest performance scores on our combined industry-related performance measure. Low-performing companies were the twenty-five companies with the lowest performance scores.[/foot] Based on the study, high-performing companies had the highest combined scores on the two workplace design dimensions. Companies that invested most heavily in both employee connectedness and responsive leadership reported an average of 76 percent (of a possible 100 percent) on our combined industry-related performance measure.[foot]Performance was self-assessed relative to direct competitors on five dimensions: revenue growth, profit growth, growth in market share, ability to attract new customers, and employee satisfaction.[/foot] In contrast, those with the lowest combined scores reported an average performance of just 48 percent. 

DBS Bank: Redefining the Employee Experience with DigitalJourneys 

It is not just about developing mobile apps but about rethinking the organization. How do you rewire an organization for [digital transformation]?

David Gledhill, Head of Group Technology and Operations 

DBS has grown to be the largest bank by assets in Southeast Asia, with over two hundred eighty branches across three major Asian markets.[foot]Siew Kien Sia, Christina Soh, and Peter Weill. 2016. “How DBS Bank Pursued a Digital Business Strategy,” MIS Quarterly Executive 15 (2).[/foot] It has been called the world’s best digital bank.[foot]In July 2016, Euromoney named DBS “World’s Best Digital Bank”—the first time an Asian bank won a global accolade from the financial publication.[/foot] In 2009 DBS had a reputation in Southeast Asia for slow response times and poor customer service. Today, led by CEO Piyush Gupta, DBS is the top-rated bank for customer service, driven by the purpose of making banking joyful for both customers and employees. 

DBS’s impressive journey to joyful banking was facilitated by a strategy that put technology at the core of its banking business, with the company deeply immersed for the last three years in its digital agenda. The DBS senior management team formulated a set of guiding principles around joyful banking known as RED—Respectful, Easy to deal with, and Dependable—drawn from the bank’s strong Asian heritage. These principles have been used to frame customer and employee journeys that have transformed DBS into the award-winning bank we see today.

Connectedness at DBS

In 2009 DBS was a traditional hierarchical bank. In order to create a new employee experience, DBS focused on building a culture of innovation and digital capabilities. Employees were invited to submit innovative solutions to reduce workplace “speedbumps” that hindered seamless customer experiences. Online platforms such as the “Ask Piyush” e-forum created a direct channel to senior management, allowing pain points to be raised directly with the CEO and either resolved quickly or addressed at regular Town Halls. This system and others like it connected employees across siloes, cut through hierarchies, dismantled layers of bureaucracy, and jumpstarted the digital workplace transformation. 

We encourage people to speak up, to put their views on the table. We want people with the change agenda. This is a big shift in culture.

David Gledhill, Head of Group Technology and Operations 

In 2011 Paul Cobban (Chief Operating Officer, Technology and Operations) led the redesign of an employee workspace. The new design deliberately pushed the boundaries of the physical environment with completely “hackable” open and flexible meeting and learning spaces and unbanklike décor. DBS creates new workspace designs as opportunities arise. The company’s human-centered design approach aims to hardwire new employee behaviors into the physical environment to send strong signals that collaboration and innovation are part of the company’s DNA. 

If you design people spaces with behaviors in mind, you can make quite significant advances in your transformation program. 

Paul Cobban, Chief Operating Officer, Technology and Operations 

Integral to the open, flexible workspaces[foot]Employees had assigned neighborhoods. While some senior managers opted to retain an office in the new DBS workspace, many others joined their teams in flexible office spaces. The focus was on collaboration and learning to transform the culture for digital.[/foot] was the introduction of new workplace technologies, such as enterprise portals for sharing data, a unified communications infrastructure, telepresence conferencing systems, and social media platforms. DBS prioritizes getting great information into the hands of employees to give them a better experience with customers. Empowering employees in new ways has required a massive cultural shift. For example, customer center employees at DBS set up social media platforms (e.g., Facebook) to share ideas, collaborate across siloes, and enable self-organization. One of the most influential developments of these self-managed social platforms has been shift bidding (to replace the traditional top-down scheduling), with options to trade shifts, breaks, and leave. 

The attrition rate in our call center is world class—absolutely rock bottom. It’s been a fabulous journey.

Paul Cobban, Chief Operating Officer, Technology and Operations 

Increasingly, responses to making working life easier are achieved fully or in part with digital solutions that help employees resolve customer needs more seamlessly. Training in new ways of working is central to creating the building blocks for thinking digitally. From mobile app-delivered induction to digital ways of working, to face-toface training on how to lead a digital journey, everything is designed to be playful and fun. According to Paul Cobban, simplifying connection and building a common dialogue for challenging existing approaches to work “changes the minds of our people. Not only can they deliver better customer service, but they start to think, feel, [and] behave like a GANDALF company.”[foot]GANDALF is an acronym for digitally born enterprises (Google, Apple, Netflix, DBS, Amazon, LinkedIn, and Facebook) whose business models are used as to illustrate the future for DBS. [/foot]

Responsive Leadership at DBS

An equally significant change in the digital transformation process was a new company approach to cultivating digital leadership among senior management. 

The company established the Customer Experience Council, comprised of both business and IT executives and led by the CEO. Described by Paul Cobban as “the one place where various customer journey visions come together,” it is charged with developing and executing the bank’s vision and strategic direction and cultivating digital innovation throughout DBS. 

The committee holds the leadership team of two hundred fifty general managers accountable for designing, implementing, and explicitly linking digital journeys that characterize employee and customer experiences.[foot]Currently DBS has three hundred digital journeys in play. While employee experience features in most customer-facing initiatives, just over a third of such initiatives are dedicated exclusively to improving the employee experience.[/foot] By focusing management on employee journeys, DBS has fundamentally altered the employee experience. 

The overall experience of [employees] is made up of a number of journeys, whether it’s the onboarding experience, whether it’s the training experience, whether it’s the work experience, doing travel expenses, and getting approvals.

Paul Cobban, Chief Operating Officer, Technology and Operations 

For example, one initiative aimed to empower employees to resolve some customer issues quickly in order to improve customer experience. One measure, customer hours, is used by DBS as a record of waiting time to evaluate customer experience. Senior management with customer service employees set a target to remove 10 million customer hours from the system. Employees were authorized to use up to $200 per customer to resolve situations immediately. Management then analyzed data from all transactions, leading to enhancements to employees’ resolution capabilities; and monitored employee performance for coaching and training purposes. Customer service employees shared their experiences and ideas on the enterprise social network and worked with management to further reduce customer hours. Employees and an in-house journalist published stories of experiences to foster further learning. The combined efforts from this initiative and others in the program surpassed the customer hours target and ultimately cut 250 million hours from the system. 

DBS requires senior leadership to be more facilitative and less directive, more innovative, and less focused on control. The company enables this mind shift by encouraging leaders to take a hands-on role in digital innovation in DBS’s talent development program. For example, leaders conduct regular hackathons in which bankers team up with young coders for a week to embed digital thinking and skills through experiential learning. 

We really think we have ignited a very magical spark that changes people’s thinking.

Neal Cross, Chief Innovation Officer 

Your Most Important Challenge 

The greatest challenge in many companies is cultivating a focus on reimagining the employee experience that permeates through the entire company. Our research has shown that high-performing companies like DBS are building business value through an iterative approach to designing and implementing the digital workplace, which requires investments in both leadership and connectedness.