Ask a Chief Human Resources Officer (CHRO) what most concerns them and they’ll probably give you an answer connected with talent management – and normally that’s as far as the conversation goes. But talent management is complex and in order to get to the heart of the issue it’s necessary to peel back the covers to better understand the problems.
So many of our HR practices have their roots in the industrial revolution. Think about motivation: you do a job and I’ll pay you. You keep doing that job and I’ll continue to pay you. For many families in this era, housing was associated with their jobs. If you lost your job through a lack of performance or sickness, you also lost your house. This is a strong example of extrinsic rewards at work.
In the last 100 years we have moved forward in so many different ways – technologically, socially and financially. Unfortunately, talent management has failed to keep up. If we narrow in on just the last 15 years, with the rise of the mobile phone, we have now slipped behind. Why is the mobile phone important? Because it has given people the ability to seek, secure and move jobs before their existing employer can act to prevent the loss of a key employee.
As with many app-based employment opportunities (e.g. Uber, Lyft, Deliveroo, Instacart, TaskRabbit), people can now run their business from their phone. They can determine their level of work, track their location and destination, and collect their earnings. Which is the next problem for CHROs: people can now opt in to the gig economy at a time of their choosing; they can choose a portfolio career that provides them with flexibility and uses all of their strengths across a variety of jobs.
Now that the technologically aware generations are entering the workforce, the idea of a connected life is normal and the notion of a ‘job for life’ is something that happened to their grandparents. This is where the difficulties start for CEOs and CHROs.
In years gone by, labour was cheap, plentiful and required low skill levels to perform repetitive tasks. As the years have passed, an increasing level of skill and technological understanding are needed to perform even an entry-level job. Some industries that rely on an ‘old’ skillset are finding it increasingly difficult to recruit as their key employees approach retirement age. But the bigger problem is for companies who have not changed their view that employees are simply a line item on a spreadsheet.
Some have embraced the resource-based view, in which human capital is seen as valuable and rare, but those who take the knowledge-based view of human capital as “socially complex and hard to imitate” will fare better than others. In the future, we will need to value the complex and hard-to-imitate knowledge people have rather than focus just on what they can do. The future of work sees the automation of tasks and whole jobs, which then strips away the monotony of work to leave humans adding real value where robots cannot.
A recent report by McKinsey & Company found that up to 400 million jobs worldwide could be affected by automation. The greatest effects will be felt where cognitive requirements are minimised: such areas as production lines, office support and agriculture. On the other hand, some of the biggest gains will be seen in management/executive, legal and medical work. Surprisingly, one of the areas that will see little impact from automation is IT. We will need new jobs to support a new way of working and many of these jobs haven’t been invented yet. The need to scan the external environment and identify opportunities has never been greater. But with this comes a greater emphasis on staying ahead of skills requirements to deliver the competitive advantage of the future.
The message is clear for CEOs and CHROs: start planning how you are going to retain your knowledgeable workforce. If you you’ve heard this all before, I ask you to think how you are going to do this from a strengths-based approached rather than a deficit-based approach. This means building your workplace and culture around what makes people stay. Ask your people the following:
- What’s the best story you tell your friends about our business?
- What was the best day you’ve had in the business?
- Who has been inspirational to you at work?
- What is it that you are most proud of at work?
- Which reward do you most value at work?
- How have you positively impacted someone at work?
- On your first day in the business, who was the most welcoming person you met and why?
If your comfort level is asking people questions using a deficit-based approach (such as “What is it that wastes time at work?”) simply because this is how you have developed people strategies in the past, then you’re going to struggle. Find out why people stay and replicate that greatness for people who haven’t even thought of joining your business. Then encourage your people to talk about the environment and culture on a variety of social media platforms.
The future of work is exciting, beguiling, uncertain and will make the last 100 years of work seem like a sideshow to the main event. You need to have a talent management structure in place that focuses on the retention of people but allows for the continued development of their skills.
Are you ready?