Leading digital and hybrid workforces

Mohsina Malla and Alexandra Venn-Brown from Deloitte New Zealand explore the effect of artificial intelligence (AI) on the workplace in the context of flexible working, including potential benefits and challenges.

Since the COVID-19 pandemic, a global shift has occurred towards hybrid and remote work models, fundamentally changing workplace dynamics. The pandemic proved to many organisations that work is truly agnostic of physical workspaces and that, with the right technology and tools, work can be performed anywhere, anytime. Alongside this disruption of work has been the increasing adoption of AI, a trend that is forcing business leaders to reconsider how to support productivity, performance, connection and culture.

A recent Deloitte Global report found that 94 per cent of business leaders agree that AI is critical for success. This same study found that over 60 per cent of business owners believe AI will increase productivity and 82 per cent thought it will increase job satisfaction and enhance performance. However, while AI can generate such benefits, it requires careful consideration and integration of three critical variables: people, place and technology (see diagram above right).

PEOPLE REMAIN CRUCIAL IN AI ADOPTION

Embedding AI into a hybrid or remote model can generate a variety of people-related benefits, including boosting employee engagement and empowering decision-making. As AI is increasingly adopted, digital workers (eg, chatbots) will redefine how work is performed. It is anticipated that 67 per cent of roles performing repetitive and highly manual tasks are at risk of being automated and performed by virtual assistants, automation tools and chatbots. While this displacement of work sounds concerning, it allows organisations to reimagine the work they do, creating greater value, meaning and purpose for employees. It also releases time and capacity for employees to focus on highervalue activities like problemsolving and innovation.

These human capabilities –curiosity, empathy, creativity and other examples – become critical differentiators of the value added by humans. Interestingly, the World Economic Forum’s top 10 core skills only include one technical skill, with the other nine being inherently human. Organisations that invest in developing these human capabilities will be more resilient and create a greater sense of purpose as capacity is released, ultimately improving job satisfaction.

Despite its potential, AI has limitations, including a limited understanding of human emotions, embedded bias and privacy issues. With AI tools being trained to use data collated and created by humans, the insights they produce often reflect embedded social biases, perpetuating existing inequalities. Moreover, privacy and ethical concerns often arise when AI is used to collect employee data. Addressing these challenges involves ensuring transparent AI adoption, implementing data protection measures and prioritising ethical AI practices.

Workplace Experience Will Influence Culture And Connection

AI and new ways of working fundamentally change work. The shift away from a traditional 9 to 5 in office work to a more ‘fluid’ workforce where the typical working day comprises a series of personal and professional moments, will find organisations re-evaluating their investment in commercial real estate.

The modern worker will use physical workspaces to connect over moments during the day,” says Hamish Wilson, Deloitte Partner and Head of Workforce Transformation. He believes shifting the focus from the ‘number of days in the office’ to defining ‘moments’ is where workers will connect and has a greater chance of increasing physical presence in the office.

In a Deloitte-conducted roundtable discussion with senior leaders, 41 per cent believed the quality of human connections would decrease because of an over reliance on technology. This, together with remote and hybrid work, requires business leaders to be more intentional about how physical workspaces are designed to encourage a return to the office, to nurture human connection, create value, and increase productivity and performance.

As the emphasis on returning to the office increases, commercial real estate providers will likely see a greater demand for two things: (1) better quality of space to enable productivity and inclusion, and (2) more collaboration spaces to foster connection and culture.

Organisations will look to their property managers to design workplaces and precincts that enhance connection and collaboration, and workers will seek out workspaces that enable ‘live, play, work’ experiences.

AI can help analyse data to influence workspace design by understanding how workspaces are used. However, business leaders will need to be discerning about the moments of lived work experiences they want workers to access physical workspaces for.

The two examples that follow demonstrate how AI analysed work and workforce data to influence workplace design and increase collaboration

A large global oil and energy company analysed anonymised data from workplace tools and technologies like email, calendar, conferencing and chat data to understand how teams in its 500-person corporate law department collaborated. The organisation used these findings to redesign the workplace, which not only increased collaboration but also improved retention.

When a Finnish railway company shifted to hybrid work and wanted to optimise its physical space more effectively, it used occupancy sensors to detect worker movements and use of its spaces. The data helped the organisation reduce real estate costs by downsizing building space while making sure workers were still able to move about easily and access critical workplace assets.

Both examples highlight how AI was used to not only influence culture and workplace design but also improve the overall quality of the workspace and collaboration spaces.

As leaders and organisations navigate the geographic separation caused by hybrid and remote working models, a more intentional approach to investing in AI-powered virtual and physical spaces will be required. The design of both virtual and physical spaces will need to enable seamless interactions with real-time communication, to ensure teams can effectively collaborate regardless of their location, focusing on the human experience of connection, purpose and meaning.

In addition, leaders and organisations will need to explore flexible approaches to property investment . This may include reducing the size of office space, negotiating shorter lease periods, sharing office spaces with other workers, and creating a new mix of office locations closer to where employees live.

TECHNOLOGY IS A CRUCIAL ENABLER FOR WORK, WORKPLACES AND WORKFORCES

Various AI applications are aimed at improving human efficiency. However, their usefulness depends on the organisation’s strategic priorities (ie, efficiencies and cost optimisation, service delivery, employee experience and value creation).

Using AI to automate routine operational tasks frees up workforce capacity to focus on higher value activities. It also frees up time for employees to upskill or reskill. It allows organisations to redesign the work that needs to be done, thus focusing on creating better value and business outcomes for the organisation and the individual worker.

These are just some of the ways that organisations are thinking about using AI in HR over the next 12 to 18 months.

The potential capacity released by AI in the above cases allows HR professionals to apply a more strategic lens to optimise employee experience, retention and culture. Focusing on these and generating insights that help business leaders develop strategies to create those unique ‘in-office moments’ that increase engagement, innovation, collaboration and connection, redefines the role of HR and increases its value. It is in these moments of connection that learning and teaching are nurtured, making the commute to the physical workplace more attractive and meaningful.

Leadership Challenge In The Era Of Ai

Ultimately, integrating AI across people, place and technology is essential for leading remote and hybrid workforces. AI has the potential to enhance connection, culture, productivity and performance, but organisations must navigate its challenges and limitations. Ensuring ethical practices, addressing biases, and fostering a culture of connection are critical for leveraging AI’s full potential in transforming the modern workplace. As the workplace continues to evolve, the strategic use of AI will be crucial in shaping the future of work.

One way AI can improve the future of work is by augmenting human capabilities, providing leaders with an opportunity to redesign work to deliver better work outcomes and value. Using AI to execute routine and repetitive work, will help free up human capacity to focus on more complex, creative and strategic tasks, and pursue wellbeing interests.

In a world of distributed workforces and digital workers, human connection and collaboration are vital to nurturing culture and learning. Workplace design and an understanding of worker experiences of the physical workspace can help leaders improve connection and collaboration. Being clear about the moments we want workers to be in the physical workplace will allow for better use of office spaces.

The leadership challenge in the era of AI and distributed workforces will be on how best to enhance the human experience of work, worker and workplace. AI is revolutionising and transforming the nature of work and workspaces, not exploring possible-use cases and its implementation is no longer an option.

How are you thinking about your future workforce impacts?

GENERATIVE AI FOCUS AREAS FOR HR

Early adoption patterns suggest many organisations plan to use generative AI in a few targeted areas over the next 12-18 months

GENERAL KNOWLEDGE WORKER AUGMENTATION

Providing ‘co-pilot’ type tools to support knowledge workers with developing first draft documents and analysis in Word, Excel, PowerPoint, and so on

Automating the organisation and synthesis of different human communication mediums, including Outlook, Teams and Slack

HR PROFESSIONAL AUGMENTATION

Enhancing the creation of HR-specific artefacts through specially trained models and tools relying on talent data

Augmentation will be delivered on a use case by use cases level and will affect traditional HR work in different ways

SKILLS-BASED ORGANISATION

Generative AI unlocks the ability for organisations to fully transition toward skills-based talent management without significant administrative overheads 

AI helps workers maintain accurate skills profiles and augments HR to manage a dynamic view of skill demand based on business needs

NATURAL LANGUAGE INTERFACE FOR WORKFORCE SUPPORT

Using large language models (LLMs) to accelerate the deployment and maintenance of HR chatbots and digital assistants to provide frontline support to the workforce

Creates a 24/7 digital support channel and will start the journey toward AI as the user interface (UI)

Mohsina Malla is a key contributor to shaping the Work Redesign narrative across Deloitte New Zealand. Drawing on her experience as an industrial psychologist and HR professional, she helps leaders understand the future workforce effects of AI and work redesign to unlock value and achieve business outcomes.

Alexandra Venn-Brown is an experienced workforce transformation analyst at Deloitte New Zealand, specialising in supporting organisations to become more efficient through work redesign and strategic workforce planning.