APRIL 2017 NO. 129
THE NEW “WORKPLACE CULTURE” IS SHIFTING. ARE YOU READY?
Companies are facing a radically shifting context for the workforce, the workplace, and the world of work. These shifts have already changed the rules for nearly every organizational people practice, from learning and management to executive recruiting and the definition of work itself.
Every business leader, no matter their function or industry, has experienced some form of radical work transformation, whether it be digitally in the form of social media, for example, demographically, or in countless other ways. Old paradigms are out, new ways of thinking are in — and talent, that one ‘commodity’ we’re all after, is caught up in the middle of it all.
Almost 90 percent of HR and business leaders rate building the organization of the future as their highest priority, according to Deloitte’s latest Global Human Capital Trends report, “Rewriting the Rules for the Digital Age.” In the report, Deloitte issues a call-to-action for companies to completely reconsider their organizational structure, talent and HR strategies to keep pace with the disruption.
A NETWORKED WORLD OF WORK
“Technology is advancing at an unprecedented rate and these innovations have completely transformed the way we live, work and communicate,” said Josh Bersin, principal and founder, Bersin by Deloitte, Deloitte Consulting. “Ultimately, the digital world of work has changed the rules of business. Organizations should shift their entire mind-set and behaviors to ensure they can lead, organize, motivate, manage and engage the 21st century workforce, or risk being left behind.”
With more than 10,000 HR and business leaders in 140 countries weighing in, this massive study reveals that business leaders are turning to new organization models, which highlight the networked nature of today’s world of work. However, as business productivity often fails to keep pace with technological progress, Deloitte finds that HR leaders are struggling to keep up, with only 35 percent of them rating their capabilities as ‘good’ or ‘excellent.’
“As technology, artificial intelligence, and robotics transform business models and work, companies should start to rethink their management practices and organizational models,” said Brett Walsh, global human capital leader for Deloitte Global. “The future of work is driving the development of a set of ‘new rules’ that organizations should follow if they want to remain competitive.”
TALENT ACQUISITION IS THE BIGGEST ISSUE FACING COMPANIES
As the workforce evolves, organizations are focusing on networks of teams, and recruiting and developing the right people is more consequential than ever. Deloitte survey respondents point to talent acquisition as one of the biggest issues organizations face, with 81 percent of companies citing it as ‘very important’ or ‘important.’
However, while Deloitte finds that cognitive technologies have helped leaders bring talent acquisition into the digital world, only 22 percent of survey respondents describe their companies as ‘excellent’ at building a differentiated employee experience once talent is acquired. In fact, the gap between talent acquisition’s importance and the ability to meet the need increased by 14 percentage points over the last year.
HERE’S HOW ELSE THE WORLD OF WORK IS CHANGING
It is, indeed, a landscape of shifting priorities, and nowhere are we seeing this unfold more than among the group that matters most: job candidates. Five years ago, benefits topped their list of preferences. Today it’s culture and flexibility. What comes tomorrow? That’s anyone’s guess – but you can better believe it will be a new priority with more strings attached. In a candidate-driven market, after all – they instruct, we listen. Organizations need talented employees to drive strategy and achieve goals, but finding, recruiting and retaining people is becoming more difficult. While the severity of the issue varies among organizations, industries and geographies, it’s clear that this new landscape has created new demands. And organizations are scrambling.
It is critical, according to the report, to take an integrated approach to building the employee experience, with a large part of it centering on ‘careers and learning,’ which rose to second place on HRs’ and business leaders’ priority lists, with 83 percent of those surveyed ranking it as ‘important’ or ‘very important.’ Deloitte finds that as organizations shed legacy systems and dismantle yesterday’s hierarchies, it’s important to place a higher premium on implementing immersive learning experiences to develop leaders who can thrive in today’s digital world and appeal to diverse workforce needs.
The importance of leadership as a driver of the employee experience remains strong, as the percentage of companies with experiential programs for leaders rose nearly 20 percentage points from 47 percent in 2015 to 64 percent this year. Deloitte believes there is still a crucial need, however, for stronger and different types of leaders, particularly as today’s business world demands those who demonstrate more agile and digital capabilities.
TIME TO REWRITE THE RULES
As organizations become more digital, leaders should consider disruptive technologies for every aspect of their human capital needs. Deloitte finds that 56 percent of companies are redesigning their HR programs to leverage digital and mobile tools, and 33 percent are already using some form of artificial intelligence (AI) applications to deliver HR solutions.
“HR and other business leaders tell us that they are being asked to create a digital workplace in order to become an ‘organization of the future,’” said Erica Volini, a principal with Deloitte Consulting LLP, and national managing director of the firm’s U.S. human capital practice. “To rewrite the rules on a broad scale, HR should play a leading role in helping the company redesign the organization by bringing digital technologies to both the workforce and to the HR organization itself.”
Deloitte found that the HR function is in the middle of a wide-ranging identity shift. To position themselves effectively as a key business advisor to the organization, it is important for HR to focus on service delivery efficiency and excellence in talent programs, as well as the entire design of work using a digital lens.
HOW JOBS ARE BEING REINVENTED
The trends in this year’s Deloitte report show signs of reinvention on all fronts, including jobs themselves. Organizations should approach external talent, robotics, cognitive tools, and AI systems as the “new, augmented workforce.” This year, 41 percent of respondents reported having fully implemented or having made significant progress in adopting cognitive and AI technologies within their workforce. But only 17 percent of global executives report they are ready to manage a workforce with people, robots, and AI working side by side — the lowest readiness level for a trend in the five years of the ‘Global Human Capital Trends’ survey.
While many jobs are being reinvented through technology and some tasks are being automated, Deloitte’s research shows that the essentially human aspects of work – such as empathy, communication, and problem solving – are becoming more important than ever.
This shift is not only driving an increased focus on re-skilling, but also on the importance of people analytics to help organizations gain even greater insights into the capabilities of their workforce on a global scale. However, organizations continue to fall short in this area, with only eight percent reporting they have usable data, and only nine percent believing they have a good understanding of the talent factors that drive performance in this new world of work.
“This represents one of the biggest opportunities for the HR organization,” said Ms. Volini. “To be able to rewrite the rules, HR needs to prove it has the insights and capabilities to successfully play outside the lines.”
Source: Deloitte
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