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Today's digital transformation is not just about cutting-edge technology. It does not only affect the labour market. It is not just affecting societies in the developed world.
It is a global transformation on a macro scale of governments, multinationals and gargantuan amounts of data generated all over the world and at any given time. And it's also a local, micro, individual-level transformation. The human being is at the heart of the digital transformation since it is the human being who produces the continuous flow of data feeding the new technologies. This human participates in the effort of innovation, design, imagination and original applications of these new technologies. This human must also make an unprecedented effort to adapt: things have never moved so fast, knowledge and ways of doing things have never evolved so strongly. As a result, the opportunities and risks have never been so high.
If the whole world is concerned by these major transformations, it is not a homogeneous or orderly transformation. As such, Quebec has assets and particularities that allow it to forge some meaning out of this chaos. We need to identify these advantages, as well as the pitfalls and problems, in order to register not as a follower but as an actor and model of digital transformation.
The industrial digital sector (manufacturing and assembly of components and systems; software design) has a significant impact on Quebec's economic landscape. Jean Matuszewski presented the conclusions of a large study conducted by E&B Data that paints a portrait of four technological sectors in full mutation.
1,400 companies in these sectors were monitored quantitatively with descriptive indicators (measures of company size and growth) and strategic indicators (historical and forecast dynamism, growth factors). The objective of this monitoring was to aggregate data and information in order to understand the reality and the stakes of these companies, and subsequently to identify the solutions and assistance to be provided to these companies.
These 1,400 companies account for more than 75,000 jobs (with 10% growth per year). 82% of them have an export share of their products representing a total of 54% of the agglomerated turnover.
While small and medium-sized enterprises are much more numerous, they account for less than a third of jobs in these sectors. SMEs do not face the same challenges as large multinationals: as the size of the company increases, financing is less of a significant barrier to growth. But the larger the size of the company increases, the more problematic are human resources, the search for talent and the right profile.
In addition to the financing issues and the lack of human resources, the capacity to invest in research, development and innovation is also a crucial component of the company's growth. R&D&I is done either intramural by recruiting employees or extramural by establishing links with other companies and allocating research funds.
As an example, E&B Data presents the case of the photonics sector where the share of employment growth dedicated to R&D&I is compared to total employment growth, a proxy measuring the growth of the company. The figures collected for the years 2016, 2017 and 2018 show a strong positive relationship between company growth and RDI recruitment. Nevertheless, for all company profiles, the share of extramural RDI is very high and varies between 70% and 80%, reflecting strong integration and collaboration between companies in a sector as well as the involvement of research in the academic environment.
The capacity to market products is a final obstacle to business growth, reported in third place. There are several explanations for these marketing issues: local and international competition, the rapid evolution of technologies, information asymmetry between the developers and consumers of these technologies (partly due to rapid change), exposure and advertising, and finally confidence, willingness and resistance to change that can hinder (or duplicate) sectoral inertia.
It is not only the high-tech fields that are affected by the digital transformation. Audrey Murray, President of the Commission des partenaires du marché du travail (CPMT), presents the issues, challenges and levers of employment in Quebec. Three forces apply at the same time in the field of employment: demographic change, technological change, and energy change.
Quebec is experiencing a historic low in unemployment, but at the provincial and overall job level, it lags behind in terms of training and worker qualifications, including basic training (level 3 reading and writing, numeracy). And this delay has strong implications for a correct management of the transformation of the labour market: the jobs most at risk are the least qualified (level of employment or sector of employment), and in fact these workers have less capacity and/or opportunity to adapt and train in order to remain competitive or find new jobs.
The CPMT's "360-degree Portrait of the Workforce" describes a certain paradox of the business and employment world with regard to digital transformation and training. For example, 94% of companies (100 or more employees) invest in developing, maintaining skills, adapting to the market or standards, and integrating and retaining employees. However, these investments are for training that responds to short-term issues. The integration of new technologies and preparation for profound job transformations is mentioned by only 17% of the businesses (100 employees or more) surveyed. Technological changes are not considered a major threat: 86% of the workforce does not think that technology threatens their jobs and only 14% of employers consider that adapting to new technologies is an important issue. These results echo the Ministère de l'Économie et de l'Innovation's 2019 Industry Perception Survey 4.0:
These figures underline the urgent need to develop large-scale transition strategies at the level of current low-skilled jobs and at the level of high-skilled jobs.
At the level of current low-skilled jobs: these jobs are the most threatened by the digital transition, the most at risk of simply disappearing. The risk is to create a new wave of unemployed, low-skilled workers who will have great difficulty in finding a new job of the same quality or remuneration.
Innovative and rapid plans to include these workers in the digital transformation by raising their skill levels must therefore be found and put in place urgently. Ms. Murray presented several directions, levers in place or inspiring models.
Ms. Murray presented initiatives that promote skills development and recognition, such as the Fonds de développement et de reconnaissance des compétences de la main-d'œuvre (FDRCMO):
Finally, the importance of a meeting point between all actors in the world of work was stressed. The CPMT provides a place where sectoral committees, regional councils, remote workforce advisory committees and the Conseil de l'emploi métropole can meet, exchange ideas, understand each other, consult, and thus mobilize and act together by identifying issues and proposing applicable solutions.
Benoit Dostie, HEC Montréal and CIRANO, completed an overview of employee skills development and training issues in the workplace by presenting an overview of the results of Statistics Canada's Longitudinal and International Study of Adults (LISA).
In Quebec, only 60% of those surveyed reported that their skill level had improved, with a majority reporting much improvement. Quebec employees make greater use of informal training methods (self-training, working with another person, discussions, meetings, personal research) than formal training (school training, computer-assisted, correspondence, workshops, tutoring, seminars via the employer). And in both categories, particular means contribute in the majority to training and skills improvement: for informal means, experience and seniority are the most important, while for formal means, colloquia and workshops are cited as contributing more to the improvement of the employee's skills.
The reasons for training are diverse, but Quebec workers train first and foremost to do their jobs better and improve their knowledge and meet the requirements of their jobs. Changing careers, finding a job or a new job, starting a business, keeping a job or increasing income are reasons that are given very little emphasis.
The reasons for training or for offering training to its employees are opposed to the reasons for not providing such training. There is still an ongoing debate about the risk of investing in the training of an employee and then losing him or her to another employer. In this regard, the majority of employees responding to the study felt that the training received and offered by their current employer could indeed be useful to a different employer within the same industry.
The issue of the portability of skills is very important as it guarantees the freedom of the employee to choose his work and not to be imprisoned as he is being trained. For many, this is a debate that is not really relevant since for any employee who leaves after training, another employee with the same or other skills can be acquired.
In the future, this study will have to be further developed, in particular with a more refined socio-demographic portrait (age, sex, initial training, etc.) and with a focus on technological innovation.
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On the theme of skills development and training issues in companies, the discussion began with the presentation of the APN company which produces precision parts for various industries, particularly aerospace. APN is a company that has very actively begun its digital transformation and therefore has many training, recruitment, skills development and know-how acquisition issues that have had to be resolved. The cornerstone of this transition seems to have been the vision of the owners who immediately grasped the challenges of the transformation and were able to make room for the talent needed to manage it. Today, the family company's management committee has made room for new young profiles to fill the gaps in terms of technological knowledge. The young profiles are not only dynamic and competent, but above all are not afraid to challenge the old ways of doing things in the company. APN continues to grow and increase its number of employees every year, and the company has been keen to keep everyone on, even though automation and robots have taken an increasingly important place on the factory floor: no layoffs have been made, several jobs have been transformed or moved. Even the oldest workforce has its contribution to make and can support the newest and most technical employees who lack the basic knowledge or accumulated experience in the design and construction of the machines.
This point has been emphasized many times: when the company is transforming, digitizing, it is necessary to find ways to encourage older employees to stay, to train where necessary and to contribute actively as an actor to the transformation of ways of doing things.
Obstacles are standing in the way of business:
At these levels, government assistance funding, digital transition assistance and ongoing employee training play a crucial role. There are many programs, but companies are not always fully aware of all the assistance they can apply for. This is where the whole balance of finding the right levers and incentives for businesses is complex.
The universities also play a crucial role in the successful digital transition of all industrial sectors. Strong links already exist between certain industrial clusters and academic training, but they must continue to develop, strengthen links and dialogue between companies and universities in order to integrate students into companies as soon as possible (internships, sandwich courses). The integration of young competent profiles is an accelerator of the digital transformation since, while receiving additional training in the company, students will bring with them new ways of doing things. The industry-university dialogue also enables companies to clearly express the needs and expectations of training courses so that there is no dissonance between the skills of an outgoing student and the skills needed in an industry.
Finally, one must also be careful of what can be called an exacerbated effervescence for the 4.0. For many technology companies, these new processes, this 4.0, are nothing new. Just a generalization, a larger scale of certain RDI processes that they have known and mastered well for a long time. The proliferation of new technologies, the powers of calculation, data generation and data processing are out of all proportion to what was done 10 years ago, but it is not always the revolution so much in demand by certain industrialists or technology companies. Access to these processes is becoming more democratic, but we must also be careful of a bubble effect, or other "buzz words" that unnecessarily mystify processes and can create a trust gap, information asymmetry or any other obstacle.
Mr. Deguire, Chair of the Advanced Manufacturing Table, explains the objectives of the Canadian government< which in 2017 created 6 policy tables to increase the standard of living of Canadians and the GDP by 2030. The work of the Advanced Manufacturing Table focused on how to grow manufacturing sales, increase exports and diversify sources of exports. The main objective is to accelerate the pace of improvement. Lack of knowledge sharing is what he said is limiting Canada. Benchmarking studies (benchmark) have identified barriers, competition and best practices. Technology adoption among Canadian firms is highly variable and this is what undermines our productivity. To increase productivity, the Better Manufacturing in Canada initiative is the result of the deliberations of the strategic table chaired by Mr. Deguire and includes four areas: capital, talent, productivity and the market. Each axis includes government measures and financial commitments.
Mr. Deguire concludes by noting that "we know what Canada's problems are, now is the time to focus on adopting technologies and increasing the number of trainees at all levels of the organization. It's important that every company embodies change and we will succeed.
In recent years, the governments of several countries have put forward a series of support measures aimed at helping businesses (mainly SMEs) to succeed in their digital transformation. A review of the literature presenting these main support measures and support modalities as well as the factors favouring digital transformation is the subject of this presentation.
In most governments, the approach adopted to meet the challenges of the digital transformation has been to intervene all stakeholders (government, business, professional associations, academic institutions, trade unions and civil society) to create a true ecosystem, which in itself represents a change in the role of governments. The support measures are varied and have different complementary objectives; whether they are measures aimed at financing businesses (tax breaks for example), the deployment of infrastructure to facilitate broadband internet coverage, regulation, particularly on issues of personal data, or the development of skills and measures to facilitate access to technology.
In terms of the factors driving digital transformation, successful companies are those that have developed a digital digital culture within their organization and have made the strategic choice to integrate differentiating technologies such as AI. As for the very process of a successful transformation, the involvement of mixed teams, the need to experiment and explore different avenues, while identifying the prerequisites and the main internal levers tends to facilitate the digital transformation. The evaluation of the expected impacts and spin-offs (ROI) allows us to know how far we have come and to what extent adjustments are necessary. Finally, in terms of the results of the transformation, clarification of the vision and expected outcomes are necessary to fully understand and anticipate the effects on employees, operational efficiency, customer experience and the possibility of creating new business models. This last point seems to be the most ambitious for companies.
Mr. Poba-Nzaou concludes that this field of study is still recent and therefore the scientific literature is still relatively poor. Moreover, the very process of digital transformation has been little studied empirically, since it has been initiated by only a few companies. However, successful transformation cases confirm the superior performance of these companies.
The MEI has a series of tools to help SMEs in their transformation, including 3 strands of the digital pathway. Strategic planning is required for SMEs wishing to take advantage of the aid, including the 4.0 audit.
For its part, Invest-AI aims to bridge the gap for SMEs in the implementation of artificial intelligence projects. A $35M fund over 3 years is offered to help companies make the switch. However, AI is not the first step in the transformation process; fundamentals such as access to data, internal resources and a data-driven vision and culture are required.
Françoys Labonté of CRIM is working more on data exploitation and business process transformation. These are SMEs that want to create value from their data. However, there are obstacles facing companies and CRIM wants to help them. Among the obstacles mentioned are current financing terms and conditions that are not aligned with concrete business objectives, or the understanding of issues from a managerial perspective, since we are not talking about technology here.
Charles Deguire points out that intellectual curiosity and a digital culture are the main factors that will facilitate a successful transformation. To accelerate the pace, there are several tools available to companies, but these are little known. There is also the need to adjust the ambient discourse on the potential job losses associated with digital. On the contrary, it is by disseminating concrete cases with specific professions (for example, an assembler who benefits from better tools) that the level of technology adoption will increase.
Finally, Nathalie Robitaille mentions obstacles to change within companies, including the fact that some SMEs have been burned in the past. She believes that experimentation on the plant floor while having a clear vision of where we want to go can certainly contribute to the success of a digital transformation.
In response to the question of whether companies are ready for AI projects, it was noted that few are and that there is still education to be done. Disseminating successful application cases will help to increase the level of readiness. At the moment, it is mostly large companies that are benefiting from AI. The creation of new business models related to transformation is an important issue, but this remains poorly documented. Innovation in strategies, creation of new products goes beyond technology. At this level, a marriage between CV and government funding tools is needed.
Moreover, several resources are available to SMEs and it is their responsibility to find them, although a better linkage between the different initiatives is desired. Efforts are being made among the different ministries to reduce complexity. It is also suggested that experimentation and fail-fast be recognized in the criteria of different programs given the non-linear nature of innovation cycles. The ecosystem remains complex and difficult to navigate, and the lack of standardization of reporting methods may discourage many from doing so.
On the issue of gender , mentoring, high school student group visits and programs aimed at increasing the number of women are showing encouraging results.
In conclusion, humans must be at the heart of any transformation. In this respect, the vision of the business leader, the creation of a culture of inclusion and the management of change are among the means to succeed. Innovation in training and placing young trainees in critical positions in mixed teams are success factors according to Kinova.