Workplace 2020

A study of the future of work

It is largely agreed that the rise of the new generation of connected workers, empowered by collaborative and mobile solutions, will radically alter the shape of the future workforce and workplace. We decided to look further at this thinking by conducting some original cross-industry research that measures digitalisation, working behaviours and readiness for the future. For this study we teamed up with Raconteur and surveyed 150 C-suite individuals from leading organisations in the UK representing a wide range of business sectors and sizes.

What we found is that there are varying ranges of digital maturity today, and similarly alternative opinions on digital readiness for the future. The time is in fact ‘now’ for many with industries such as retail already leading the charge and seeing real return and business change on the back of significant investment in digital technologies.

Inevitably some other industries, such as financial and professional services, are slower off the mark, held back by a historic lack of technology innovation or industry regulatory constraints. Within manufacturing, while it was determined that it was the least digitally mature sector, there is real appetite to better capitalise on the obvious potential gains here.

Motivations for moving to the cloud are too evolving. While there is still a clear cost saving rationale, collaboration, responsiveness and agility are commonly now seen as key drivers.

With flexible working set to become the ‘normal’ in the future workplace, the rise of the mobile worker has been widely debated. Empowering this phenomenon is set to soon become a critical priority for organisations of all sizes. 48% of respondents are today unable to access all the information they need via mobile devices, with 6% either poorly connected or not connected at all. In an age when people are used to a high level of connectivity in their private lives, it is only to be expected that this too should translate to their working world. Organisations who are unable to cater to the needs of the connected generation in future will struggle to attract the best talent.

In an ever increasing competitive market, industries such as retail fear that once they do get the best talent on board, they might not be able to hold on to it. Talent management is a key priority for all organisations surveyed with those in manufacturing, professional and financial services most concerned about their ability to harness technology to both lure and retain the best talent.

The demographics of the workforce are changing with people living and working longer. By 2020, digital natives, digital immigrants and the digital exiles will need to work in harmony and be fully enabled by technology if they are to deliver on shared business goals, against a backdrop of new working habits.

Many can learn from industries such as retail when it comes to seeing the value of digital thinking and digital investment today. The benefits of thinking digitally are there for organisations of all sizes operating in all sectors to take full advantage of. For this to happen though, it is clear that both the business itself and IT must work in tandem to make digital transformation and associated business growth a reality. The CIO is too central on this journey. Companies must place digital at the heart of their business if they are to realise the full potential offered in this highly connected era.

The survey analysis has been separated into five sections:

  • Cloud-enabled business
  • Reaching Maturity
  • The Future Office
  • A Connected Workforce
  • A ‘Digiculture’

About the survey

This report has been compiled through telephone interviews with 150 C-suite individuals from leading organisations in the UK. Interviews were completed by an independent surveying organisation on a pre-qualified but random sample. The individuals that participated in the survey covered a broad spectrum of industries and companies.


As organisations across all business sectors seek to adapt to the fast-changing dynamics of the digital economy, technologies such as cloud computing and mobile have entered the mainstream IT and corporate agendas.

But the drive towards digital transformation necessitates some changes of attitude towards investment in technology and some rethinking of the shape of the workplace, with some sectors better placed than others to meet this challenge.

Retail organisations are the clear leaders in profitable exploitation of the potential of digital technologies, including cloud, mobile and the emerging Internet of Things. This has enabled successful retailers to achieve an operational agility that allows them to compete more effectively with rivals, as well as innovate in a fast moving digital economy.

Across all sectors, the drivers for investment in technologies such as cloud computing and mobile have changed. While return on investment remains important, digitally mature companies, such as online retailers, look to technologies like those of the Internet of Things to enhance operational efficiency and enable them to deliver innovation.

The organisations that are most successful in their digital transformation efforts are also those that have built successful ‘digicultures’ focused on more flexible workplaces which will attract the best digital talent.

Such ‘digicultures’ pivot on a willingness and ability to exploit ever increasing amounts of data to drive decisions that support long-term business growth objectives. Retail organisations again prove themselves to be most fit-for-purpose in this respect and provide best practice leadership lessons for other sectors to follow.

The most important of these lessons is that in an age of digital, technology investment is not an optional extra, but rather mission-critical to survival, let alone success.

Cloud-enabled business

Cloud computing has secured a position on the mainstream business and IT agendas of organisations of all sizes. The benefits of the cloud model - in terms of lower Total Cost of Ownership, increased speed to deployment, agility and scalability - compared to traditional IT make it an essential focus for companies that want to succeed in the digital economy.

When asked to rank investment on a scale of 1-5, where 1 is insignificant and 5 is significant, respondents from enterprises with over 6000 employees said they have already made or will make a significant investment (4.06).

But even those firms at the opposite end of the scale with headcount of fewer than 250 report some spend has happened or is going to happen (3.06). Across the entire range of organisations surveyed, the average ranking comes in at a healthy 3.53.

Retail organisations lead the way in cloud spend (4.19) and indeed the best practices seen in this sector stand as a powerful benchmark for others to measure themselves against. This is a sector that has seen considerable disruption from internet-only providers, which has resulted in bricks-and-mortar businesses looking to cloud-based technologies to enable them to compete against more agile competitors.

It’s interesting to note that respondents aren’t as a priority looking to the cloud to drive them into new lines of business or assist them in introducing new products and services. Only 27% and 29% respectively of those polled cite these as strategic priorities. In fact, the top priorities are improving operational efficiency, cited by 46% of all respondents, with 600+ enterprises most enthused on 52%, and boosting penetration of existing markets, cited by 39% overall.

Broken down by sector though, there are clear disparities. Some 57% of manufacturing companies do see cloud technologies as enabling them to deliver new products and services, compared to only 10% of professional services firms and 7% of transport and logistics organisations.

This seems to reflect the relative lack of innovation in manufacturing industries practices and processes, with enterprise resource planning (ERP) and manufacturing resource planning (MRP) systems only now making their way off premise and into the cloud, opening up new possibilities in terms of service delivery and operating models. The manufacturing industry is now empowered to reinvent itself, just as they already have done in the front office with customer management.

Retail firms again report the greatest impact (4.06), with cloud and digital technologies enabling newcomers to existing markets to scale up and become competitive without the legacy baggage of many existing sector leaders. The grocery market is a case in point, with a number of supermarkets which failed to make the necessary tech investments now struggling to adapt to an age of online and mobile shopping, while purely digital grocery outlets thrive.

Reaching Maturity

During the global economic downturn, the primary reason for cloud adoption was typically cost reduction, compared to traditional, on-premises technology. Today there’s still a clear financial element, with top line growth cited as the second-most important impact overall (3.79), with large enterprises ranking this particularly highly (4.22). Interestingly bottom line performance is ranked relatively low across all sectors, (2.65) with transport and logistics organisations seeing the least impact from the cloud (2.24).

But it is the ability of cloud to achieve customer-centricity aspirations that is now the most important business impact cited. Collaboration with customers is seen as the main return (3.82), followed by increased agility and customer responsiveness (3.71).

Retail organisations are those most active in seeking improved customer collaboration (4.42) and customer responsiveness (4.16). In a digital economy where customers are looking for highly-personalised services and a firm’s competition is only a click of the mouse or a tap on a phone away, this is critical to ongoing success.

Online retailers learn from the way their customers engage with them in order to offer proactive recommendations for purchases. The most sophisticated retailers are platform-agnostic, able to push offers and ideas directly to the mobile devices carried by their customers.

Close behind retail comes transport and logistics (3.79). The ability of customers to use cloud technologies to interact and engage with providers in this sector has seen an increase in new operating models built around self-service on the buy side, both at a B2C and B2B level.

Overall, a majority of organisations (77%) agree or strongly agree that they are in a good place when it comes to digital maturity, with a further 21% sitting on the fence, neither agreeing nor disagreeing. Only 2% of respondents were downbeat on their organisation’s maturity levels.

Positivity is particularly high among retail respondents, with agreement or strong agreement around maturity from 97% of those polled, closely followed by media (87%). Retail’s spend in online and digital has delivered demonstrable Return On Investment, with only those who have failed to invest feeling the pinch, while new media formats have been built around exploitation of digital technologies.

In contrast, the manufacturing sector, still built around traditional enterprise resource management (ERP) systems is the least digitally mature sector (60%). The rise of the industrial internet (also known as the Internet of Things) will undoubtedly lead to a change in levels of perceived digital maturity across the manufacturing industry.

The Future Office

Flexible working will be the defining characteristic of the future workplace, rising from 4% today to 32% of organisations polled by 2018. While today in organisations with fewer than 750 employees, no respondents to the study offer staff the option of flexible working. The same organisations expect this to rise to 16% by 2018.

But it’s at the top end of the employee scale, among organisations with headcount of 6,000+, that the most startling increase is seen, up from 10% today to 66% in 2018. This shift will require technology investment to support the underlying organisational processes that need to be restructured or introduced to support the shift towards a flexible working operating model.

Some 38% of large enterprises recognise that among the top threats facing them are dated management structures, which in turn don’t allow them to respond to the changing needs of the workforce (32%), while the main driver for shaping the workplace is the pursuit of new efficiencies (72%).

The top priority across all sectors is the deployment of apps to support mobile working (58%). Again high end enterprises show most interest (66%) but organisations in the 251-750 employees range aren’t far behind (60%). The rise of the mobile worker has been well documented and empowering this phenomenon is a critical priority today for organisations of all sizes.

With a workforce that is operating at different times and places, collaboration is vital. It’s not surprising then that 45% of organisations are looking to invest in social media solutions, such as corporate employee networks, while 34% will seek to share work via web-based collaboration tools like Dropbox and Google Drive.

However, there’s a long way to go before most organisations can boast a fully connected workforce, with only 5% of all respondents saying their employees can access all the information they need via their mobile devices. Furthermore that number is derived entirely from enterprises with 6,000+ employees, with no respondents from other sized organisations able to make that claim.

Some 48% of all respondents reckon their employees are connected for communication, but not with everything they need, while 41% define themselves as relatively well connected. The transport sector, well used to the need to communicate from remote posts to a central point, is well-positioned with 62% saying they’re well connected for communications. Those organisations that are not able to cater to the needs of the connected generation will struggle to attract and retain the best talent.

Today, mobile technologies, such as smartphones, are seen by a majority (57%) as a tool of choice for collaboration. This is particularly true in retail, cited by 81% of respondents, where mobile pricing, supply chain and payment systems have revolutionised operating models. In stark contrast, less than a third of manufacturing firms (30%) see mobile technologies as their primary collaboration tool.

Overall the installed base for enterprise social networks as a collaboration platform is remarkably low at present, with only retail and manufacturing respondents able to muster 10% usage, while adoption is as low as 3% among professional services and transport and logistics firms. This leaves considerable room for improvement.

That said there are examples across all sectors of the power of effective collaboration in action.

A Connected Workforce

Much has been written about the evolving nature of the workplace by 2020, with the rise of the millennial worker generation - permanently connected in their private lives and they expect to be able to do the same in their working lives.

With talent management a moving target in the digital economy, successful organisations will use technology both to attract and retain the best employees. This may take the form of online social networks such as LinkedIn or dedicated cloud-enabled talent management offerings from HR technology vendors.

Once talent is on-boarded, expectations are now high among employees that they will have access to the kind of digital technologies in the workplace that they are accustomed to using at home. In addition, it’s important to recognise that in the digital economy there will be a direct correlation between technology policies and job satisfaction, whether this involves social media access at work, Bring Your Own Device programmes or enabling remote and flexible working practices.

The challenge of attracting, managing and retaining a diverse workforce is among the main priorities for organisations, with failure to meet that challenge cited as a threat. Some 32% of respondents fear not being able to respond to the changing needs of their workforce, while 25% are concerned about their ability to attract talent in a competitive market and 21% fear that once they do get the best talent on board, they might not be able to hold on to it.

These fears are particularly acute in certain sectors, with over half of manufacturing industry respondents (57%) worried about the challenge of meeting their staff’s changing needs, while 43% of professional and financial services organisations polled were worried about their ability to lure the best talent.

Effective exploitation of data is one tool that can be used to meet the challenges of talent management in the digital age. The advent of wearable technology and the recognition of ubiquitous data throw up new approaches to the sourcing and retention of talent under increasingly competitive market conditions.

Organisations today see such use of ubiquitous data as assisting with performance tracking and management (cited by 48% of respondents overall) and the creation of responsive work environments (47%). Given the rise in demand for flexible working, both of these applications of data will be powerful enablers. The next generation of employees will enter the workplace with different attitudes and perspectives on the use of such data and how it is gathered.

Interestingly it’s the smallest firms - less than 250 workers - which see most benefit when it comes to performance management needs (56% of respondents), while over half (52%) of the biggest firms - 6000+ employees - are more focused on the ability to create responsive work environments, reflecting the greater challenge of meeting the demands of a larger flexible workforce.

While market commentators focus on the rise of the millennial and the imminent arrival of the digitally-native Generation C, the reality for many organisations today is that they are top-heavy when it comes to the age of employees. This is an issue for the largest firms, but also for those middle-tier employers who don’t have a large regular intake of younger workers and find themselves with a more stable, but ageing, workforce demographic.

With people living and working longer than ever before, certain sectors are particularly vulnerable to this. For example, the retail sector is more prone to having older employees working in shops, than heavy manufacturing. But every type of organisation needs to avoid ending up with a silo-ed workforce of digital natives, digital immigrants and the digital exiles.

Over half of all organisations (51%) look to flexible hours and part time workers to bring in a mix of age demographics, while 47% practice some form of ageless culture training. Keeping the entire workforce healthy and fit is practiced by 28% of respondents, while 27% create ‘wise’ mentoring networks internally so that younger members of staff can tap into the experience and knowledge of their older counterparts.

Within a few years, an organisation can confidently expect to employ 5 generations of workers. The critical objective is to create ageless organisational cultures in which all demographics are supported and older workers are actively encouraged to remain or return to work because they are motivated to do so.

Technological empowerment is key enabler here, allowing organisations to automate certain business processes while opening up fresh opportunities for all employees and removing organisational ceilings, such as standard retirement ages.

A ‘Digiculture’

As noted previously, there’s much room for improvement when it comes to exploiting connectivity, with, for example, 48% of respondents unable to access all the information they need via mobile devices, and a further 6% either poorly connected or not connected at all. In an age when almost everyone carries some form of mobile technology with them at all times, this is clearly not acceptable.

The onset of the Internet of Things and the age of the ‘connected everything’ provide the opportunity for that to change and for organisations to have insight into genuinely connected intelligence, but only if digital technologies are embraced to enable this.

Overall, 78% of all respondents agree or strongly agree that their organisations are well prepared for the IoT. Interestingly this includes over two-thirds (65%) of firms with fewer than 250 employees, but it’s at the top end of the scale among firms with 6000 or more staff that there’s almost unanimous conviction of the IoT’s potential, with 96% agreeing or strongly agreeing, 4% agnostic and none of the respondents believing they are not prepared.

According to the study, it’s the retail sector that once more is the most far-sighted in recognising the need to embrace the IoT, with 100% of respondents agreeing or strongly agreeing, followed media on 90%. Retail’s leadership here makes sense on the back of investment in connected intelligence technologies such as RFID tracking, which have enabled organisations to optimise mission-critical business processes.

Other sectors need to follow suit, but it’s important to recognise that these are early days. So while in the manufacturing sector today, only 44% of respondents see themselves as prepared for the IoT, this will change in the coming years, with the overwhelming majority (80%) believing that they will be IoT-optimised by 2020.

Across all industry groups, 2020 will be the tipping point for connected intelligence opportunities, with 64% of respondents overall choosing this date, compared to 25% who say 2016. Only 5% believe that this year is the time to invest here, reflecting the still relative immaturity of the technology supporting the IoT.

But it’s clear that the potential of such technology is of interest across all sectors and it is assumed that it will have matured sufficiently by 2020 to make budget spend in connected intelligence appropriate. By that time however the thought leaders in retail will be well on the path to maturity in this area as well.


The time for change is now - or at least it is for many, such as those organisations operating in the retail sector, where digital technologies have already attracted investment and have delivered tangible, measurable benefits.

Other sectors are inevitably slower off the mark, held back by a legacy lack of technology innovation (e.g in manufacturing where the MRP/ERP revolution has not particularly moved on) or by regulatory constraints (e.g in financial services where security, governance and data privacy concerns have held back the widespread adoption of cloud computing technology).

Across all business sectors, organisations need to look to the example of the retail sector to see the transformative potential of digital thinking and digital technologies and learn lessons that can be applied to themselves.

The rise of the new generation of connected workers, empowered by collaborative and mobile solutions, will radically alter the shape of the future workforce and workplace.

For this to happen however, the long-standing goal of business and IT working in tandem to support both transformation and business growth must become a reality. The CIO needs to work with his or her commercial counterparts to deliver on digital strategic objectives.

The benefits of thinking and operating digitally are there for companies of all sizes and scale, but they need to be embraced and realised. For the start-up or the small business looking to grow, investment in digital technologies opens up market opportunities and enables them to compete on a level playing field with larger competitors more easily.

For the larger enterprises, new, more agile technologies will enable them to throw off the shackles of legacy systems that in the past have constrained rather than supported responsive market opportunities and innovation.

While some organisations will move faster than others, by 2020, the business landscape must be ready to follow the example of the retail sector in reaping the potential of connected intelligence, mobile technology and the Internet of Things as drivers of transformation to create winners in the global digital economy.

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Workplace 2020

  • Author

    Veronique Lafargue, Senior Product Marketing Manager, Google Workspace

  • Topics

    Google Enterprise, Collaboration, Innovation, Productivity

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