Article

Driving prosperity in the digital era

The role of digital talent, innovation and entrepreneurship

Technological innovations will fundamentally change the way we live and work. They bear enormous potential for economic prosperity and social progress. But how can society successfully carry out this transformation?

By Elisabeth Denison, EMEA Talent Leader Deloitte

Artificial Intelligence, the Internet of Things, Big Data and Robotics are keys to shaping a positive future. Within a few years, networked and sustainable cities, autonomous vehicles, intelligent factories and personalized health services will determine our everyday lives. With these technological innovations, the way we live and work will change fundamentally. They bear enormous potential for economic prosperity and social progress. But how can society successfully carry out this transformation? Governments and businesses need clear digitalization concepts to ensure sustainable growth. These provide the basis for future-oriented jobs, greater resource efficiency, and responsible economic activity. Smart regulation and focused investment in education, research, and entrepreneurship are crucial.

New key competencies, more pioneering spirit

Advancing connectivity and automation are revolutionizing the world of work. Algorithms and software are entering into every area of business, all workers are becoming knowledge workers. New occupational profiles are emerging and demands on employees’ qualifications are rising. Analytical skills, data competences, interdisciplinary thinking, and problem-solving skills are essential for the future. School and university education is becoming increasingly important, hand in hand with continuing professional development. The encouragement of STEM competencies and innovative training programs using creative learning methods and formats must be promoted. Online or Blended Learning, Virtual Reality, and Big Data encourage broader access to education, tailored educational offers are being created. Learning is becoming more flexible, more effective - and is available to a wider audience.

One thing is clear: in order to take advantage of the opportunities offered by technological disruption, the entire education and training system must adapt to a dynamic environment, anticipate new professional requirements more quickly, and impart those skills which will be needed in future. Moreover, the entrepreneurial spirit must be fired up – both among young talent and among business executives. With creativity, a love of experimenting, and risk appetite, promising ideas in one’s own start-up can be led to market maturity. Young people should develop a fundamentally entrepreneurial attitude at an early stage. With the help of mentoring programs and contests, students can learn playfully how to implement their own ideas. Higher education should provide entrepreneurial know-how. In addition, the education system should focus on specifically promoting the talents of young people rather than trying to make everyone average. We need the highly-motivated, the above-average, to shape the future.

However, good ideas and future-oriented solutions are by no means a sure-fire success. They need optimal conditions. A good infrastructure for incubators and corporate accelerators, funding programs for start-ups, and targeted investment in research and development are the prerequisites for pioneering new developments. Legislation has a major influence on the innovative power of a country. To what extent does it promote innovative business models? Does tax policy provide incentives for start-ups? How attractive are framework conditions for venture capital providers? Is diversified financing available? How much bureaucracy is involved in a business start-up?

Digitalization demands dynamic labor markets. The platform economy is making the lifelong workplace model obsolete. The focus is on new forms of cooperation: open-talent networks and crowdsourcing make it possible to access valuable expert knowledge and integrate external talent into entrepreneurial value creation. In future, work will be characterized by agility: employees, temporary workers, and freelancers will form the digital age’s project teams. Work will become detached from time and place and will be self-determined. This is what young talents expect. For digital natives, the place, timing, and quantity of work will have to fit the current career segment, their capabilities, and their private situation. The key to more flexibility is simple and transparent labor market regulation. Existing structural barriers and rigid legal regulations must be removed.  

Innovation needs diversity

Diverse cultural backgrounds and competencies create the breeding ground for innovation. As technology penetration increases, a further aspect emerges – the degree of networking is on the rise. Global value chains promote the transnational mobility of talent. At the same time, the labor demand is growing: in the European Union alone, the labor force shortage will grow to 35 million people by 2050. Modern migration policy addresses this challenge and contributes to open labor markets. Many governments are aware of this, but implementation is still difficult. Rigid and constantly changing regulations too often make it difficult for businesses to attract talent from abroad. The increasing mobility of workers ultimately benefits their home countries. A strong diaspora supports direct investment, know-how transfer, business expansion, and entrepreneurship. Politics and business must explain in a transparent way the contribution that migrants make to growth and prosperity. This applies just as much to the societies in which they live and work as to their home countries.

In addition to opening up to talent from other countries, greater participation of women in the economy is a key factor for prosperity. Women can and must help shape digital change. Much unused potential is still lying idle here. And in the digital age, flexible working models provide the perfect basis for the full integration of women into working life. The World Bank estimates the productivity gain from integrating women into the economic value chain in many countries and industries at up to 25 percent. Promoting more diversity in leadership will also enhance innovation and ultimately the success of businesses. With the right incentives, this potential can be realized. What counts are long-term solutions, and politics, business, and society must cooperate to implement them. For one thing, better framework conditions are needed – from employment-oriented tax and education policies to affordable childcare facilities in day-care centers and schools. And for another, more flexible, individual career models, training programs for talented female executives, and social acceptance are needed for more women decide in favor of a career.

Globalization, increasing interconnectedness and exponential technological progress create a wealth of opportunities for our common future. Concerted efforts will allow us to unleash the benefits of these developments for all of society.