Microsoft Report: Digital Preparedness Helps Organizations Adapt to Pandemic
May 10, 2021
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Overwhelmingly, business leaders cited digital preparedness as key to their ability to adapt, according to an in-depth study by the Economist Intelligence Unit (EIU), commissioned by Microsoft, looking into how the relationship between technology, business and people evolved during the COVID-19 pandemic.

The mass move to remote work also led to a heightened focus on employee engagement — so much so that empowerment topics like skill-building, well-being and creating lasting benefits for society at large now lead the transformation agenda for many organizations.


The EIU research seeks to unlock insights from the past year and focus on the way forward. The study looked specifically at supply chains, remote work, predictive analytics, decision-making, and employee safety and well-being.

Researchers connected the dots between organizations' digital maturity and their ability to weather the unprecedented disruption and found a strong correlation: The more focused companies were on digital transformation, the faster they were able to recover operations and empower people to move forward.

"The COVID-19 pandemic showed how digital tools are critical in allowing businesses to create agility and respond to major disruption," said Michael Gold, managing editor, The Economist Intelligence Unit. "But this study shows that it's not just about business. Companies overwhelmingly see digital transformation as crucial in overcoming skills gaps, engaging employees and delivering broader benefits to society."

Focus on Employee Engagement

The study showed a renewed focus across industries toward engaging and connecting people to each other, to their work and to a shared sense of purpose.

The percentage of all respondents citing employee engagement as a technology imperative shot up from 24% pre-pandemic to 36% in the COVID era, and was up by 10 or more percentage points in manufacturing, financial services, retail and education.

Concern for people and society showed up in other ways as well, with most companies saying that the pandemic has highlighted the need to contribute more powerfully to social outcomes — 75% said digital transformation should go beyond business success to support societal improvements like creating a more inclusive, accessible workforce and addressing carbon footprints and climate change.

Technology Investments Accelerating

Digital tools became indispensable infrastructure across industries. Those with robust digital footprints reported more agility in facilitating remote work, supporting distributed roles, recovering disrupted supply chains and transacting with customers in new ways. But although digital transformation enabled business continuity, the study also revealed gaps in skilling, privacy, security and compliance as organizations apply new technologies.

Prepared or not, organizations across industries accelerated their transformation initiatives and began to rely more heavily on digital tools. Here cloud technology led the way, with 50% of organizations saying it played a critical role in their COVID-era operations. That was followed by technologies to enable remote work (40%), artificial intelligence and machine learning (33%), and the Internet of Things (31%).

Impacts on Specific Industries

Because each industry operates differently, the pandemic exposed digital gaps in different ways. Educators expressed concerns about access and inclusion, while automakers focused on climate change.

Across all industries, the human side of technology transcended their responses and, in some ways, overshadowed benefits to business.

Study highlights by industry include the following:

Automotive respondents were far more likely to cite climate change as a primary benefit of digital transformation. The industry also is investing in automation, process efficiency and enhancing digital skills among the workforce.

Education respondents cite skill-building and inclusivity as top benefits of digital transformation in their industry, but they're concerned about a lack of tools creating a barrier to digital progress, as well as the fragmented application of technology across departments.

Financial services organizations were the most prepared digitally to meet the challenges of regional lockdowns and supply-chain disruptions. Financial services respondents were the most likely to agree that the pandemic highlighted the competitive edge of digitally prepared companies.

Government organizations had an easier time obtaining budget to invest in technologies once the pandemic hit and generally prioritized tools to facilitate remote work and collaboration. However, skills and talent gaps — as well as perceived negative impacts associated with new technology — remain barriers to digital transformation.

Healthcare organizations relying heavily on in-person interaction may have had the most transformation to do when the pandemic hit, with regard to remote employee and patient experiences. While maintaining strict compliance with patient privacy regulations, administrators and clinicians rapidly expanded and adopted virtual capabilities as the pressure of COVID forced increased investments.

Manufacturing, pre-pandemic, was already working to address a skills gap. The sector also cited diversity and inclusion, skill-building and climate change among their top concerns that digital transformation can help address.

Media and communicationsrespondents expressed concerns about keeping up with the pace of technological change and shared their belief that combatting disinformation will be the key benefit of digital transformation in the industry.

Retail and consumer goods providers expressed optimism that digital transformation would enhance job prospects and was the industry most likely to focus on the positive societal impacts of the shift to distributed and remote working.

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