Alice Mann, author of “Future First: How Successful Leaders Turn Innovation Challenges Into New Value Frontiers,” talks with Senior Editor Lauren Dixon about how to turn externalities into innovations and business opportunities and how the private sector can address global challenges.
Today we find ourselves in the middle of a turbo-charged version of Britain’s Industrial Revolution. Since the late 1970s in the U.S., GDP per worker has pretty much doubled, but average real wage is still exactly the same. All the signs are that this disruption is only just beginning. A recent report by the McKinsey Global Institute forecasts that by 2030 around 15 percent of today’s work activities may be automated and between 75 million and 375 million workers will need to shift occupational categories. My colleagues at MGI outline four priorities for policy makers and business leaders as they adapt to this disruption: Economic growth, skills upgrade, fluid labor market and transition support. The role of human resources is key in at least three of these priorities. But right now HR is nowhere near ready for such a massive change.
Don’t get me wrong — HR hasn’t been standing still. If we go back to the 1980s and before, HR could be described as a wholly administrative and industrial relations function — HR 1.0 so to speak. In the 1990s, an increasing awareness of the value of talent to organizations transformed the HR function into more of a business partner, with increasing professionalization of the field and greater use of analytics for reporting purposes — HR 2.0. But to navigate the increasingly complex world of talent, HR needs to grow more quickly into a strategic adviser. More companies will need CHROs, and they will need to have an equal voice alongside CEOs and CFOs in the most critical business decisions. In the coming decades of disruption, the management of talent will become the main differentiator of high performing organizations. This requires HR 3.0.
The CHRO of the future will need to preside over a function that is fundamentally better prepared in three ways. Firstly, HR 3.0 will be much more analytically sophisticated; people analytics and data driven decision-making will be at its core. Secondly, the HR 3.0 function will be more agile and more efficient, with fewer silos, swim lanes and specializations and a greater ability to deploy HR professionals flexibly across the human capital spectrum. Finally, to enable a more data-driven and agile operating environment, we will need the HR 3.0 professional, with skill sets more oriented around business acumen and problem-solving skills and less dominated by focused customer service and process management capabilities, both of which are themselves targets for future automation.
Practicing People Analytics
People analytics in particular has had a head start on the other elements of HR 3.0. The need for more sophisticated analytics around human capital first entered the business consciousness around 2010. Much excitement has been generated around the topic in recent years, often by data and technology that stand to benefit from a growing interest in this space. In the course of a decade or so, it’s fair to say that HR analytics has come out of the dark ages. Recent research by Bersin by Deloitte shows that over two thirds of organizations now believe they can generate solid reporting and have a consistent approach to the use of people data. While that’s certainly progress, it’s not very rapid progress. A recent study by the Corporate Research Forum concluded that more than half of organizations were very limited or worse in their ability to use talent data to predict and improve business outcomes.
For HR 3.0 to take hold, it is critical that people analytics can get to a point in organizations where it can help link talent to value. This will require much more than recordkeeping systems and dashboards. It will require a strong understanding of how talent dynamics can affect outcomes like recruiting, mobility and retention. It will require creative use of internal and external data. It will require a variety of domain expertise, such as statistics, organizational psychology and epidemiology. It will require integrated data across the employee life cycle and strong engineering of that data.
The Bersin report also concluded that more organizations now have a people analytics team than do not — an important watershed moment for the field. In reality, however, the majority of these teams have not moved past very basic reporting around simple measures like headcount, attrition and employee engagement. Examples of more advanced people analytics teams do exist and serve as good examples of how to enhance the impact of people analytics in organizations. At McKinsey, we have made substantial progress in understanding individual skills and better matching them to roles, as well as understanding how talent factors such as diversity, connectivity and engagement can influence attrition, retention and other outcomes. At Google, the people analytics team has built a sophisticated understanding of high-performing teams, concluding that the team environment is more important that the individual constituents of the team. At Microsoft, creative use of email and calendar data has revealed the daily behaviors of effective managers.
There are others, too, and these more developed people analytics groups have a few things in common. They were birthed in an environment where a data-driven approach is part of the prevailing culture. They are resourced well and are well positioned in the organization to drive impact. They include a broad mix of skills including data scientists, organizational psychologists and “translators,” who act as data-savvy “account managers” for critical projects and use cases. It would be wise for CHROs to look to these organizations for inspiration as they try to embed analytics in their functions.
The New HR Function
Efficiency and agility will be critical to HR functions operating in a more unpredictable and complex talent market. Traditionally, leaders have considered it a more or less binary choice to have either a stable, predictable, efficient and lean function or a more well-resourced, dynamic and nimble function. There is no longer a choice to be made here; there is an increasing expectation to deliver on both.
HR leaders, like those in many other functions, need to embrace automation and process efficiency to create a lean backbone of critical administrative and process management functions, while cultivating a dynamic, nimble team that can apply itself to varied talent-related problems across the organization. The HR 3.0 function will more or less be comprised of 50 percent fixed staff — back-office shared services enabled by advanced automation, senior account managers, subject matter experts — and 50 percent “pooled” HR professionals who have the skills and business acumen to be deployed broadly.
A new breed of HR professional is required in substantial numbers to make all this happen. The successful HR 3.0 professional will be data-driven, business savvy, comfortable with unpredictability and ambiguity, and capable of thinking and communicating strategically. Pay scales will need to adjust to attract this caliber of HR professional, MBA programs will need to invest more time in human capital subject matter, and more teachers, professors and practitioners will need to contribute to building this new class of professional.
HR 3.0 is an exciting and challenging prospect, but one which is critical for the future of work. It’s a big step to take for a function which until not long ago was mostly administrative and back-office oriented, but it is also the final step in bringing talent strategy to the top table in companies and organizations. The first to move to HR 3.0 will enjoy substantial advantages in the rapidly changing talent marketplace we find ourselves in.
Keith McNulty is head of people analytics and measurement at McKinsey & Co. in London. To comment, email firstname.lastname@example.org.
Demand for talent that can function in a global business environment is highly competitive. This is especially true for leaders and potential leaders who can work effectively across cultures. Major surveys and studies by Development Dimensions International Inc., IBM Corp., Training magazine, Right Management, among others, conclude that cultural issues will dominate the new competencies required for global leaders over the next decade.
In order to meet this requirement, global companies and their talent leaders are either making significant investments in global development assignments or are planning to do so. These assignments are complicated and expensive, and if not managed well present risk for the company and for those who take on these assignments. Company risk includes disruptions for the home country in the gaps left while the employee is on international assignment and the potential to not leverage the global learning that person is likely to achieve. Risks for the receiving country include not successfully integrating the employee into its processes and not making use of new approaches presented by the assignee. Risk for international assignees includes not adapting to the culture of assignment, not fitting into the job role and ways of doing things in the new country, and the home country not valuing or maximizing the learning and growth achieved from the experience.
The names and titles of those quoted in this article moving forward cannot be revealed due to confidentiality agreements. Furthermore, the people quoted were drawn from several sources that have been aggregated and reported for this article. These sources include:
An ongoing study on behalf of all of Tucker International’s corporate clients, which include 217 employees living and working in 30 countries. All participants in the study are manager level and above and have completed an assessment titled “The Survey of Expatriate Training and Development,” where the participants also have an option to write in comments and observations.
The Dow Chemical Co. CEO International Exchange Program where 40 high-potential employees exchange positions with their international counterparts across 20 countries.
My own personal experience and individual interviews I’ve conducted as I’ve traveled to meet with clients and their expatriate/repatriate employees globally.
The purpose of development assignments is not just to fill an international job opening. Companies have generally improved over the past few years in “localizing” employees in their native countries to perform essential jobs and thereby reducing the cost and challenges of expatriate assignments. Still, localization doesn’t give potential global leadership talent the cross-cultural experiences they need to lead dispersed businesses in international markets. This is where global development assignments really come in.
For example, global development assignments actually help to develop and spread the all-important corporate culture around the globe on a face-to-face basis. A strong corporate culture and brand is often the difference in global business success and it is certainly a primary factor in attracting the best talent.
Global development assignments help leaders to achieve the following:
Dealing with Ambiguity. One of the hallmarks of the global business environment is that things are not as they appear on the surface. This is because people interpret their world and respond according to their own cultural lenses. Everyone carries these lenses around with them and expects others to respond as they do. The term “misattribution of motives” is used to describe how people misread the behavior of other cultures based on their own lens.
An international assignment allows participants to get out of their comfort zone and figure out how things are done in all of the unfamiliar, ambiguous “gray areas” in another country. For example, an American on assignment to Japan reported the following: “I could not understand at the outset why my Japanese manager did not give me clear and direct performance objectives. He expected me to figure these out in the context of my role in the company. That meant that I was to first listen and learn from him and from my Japanese colleagues in order to understand how I could fit into the working environment. Once I figured this out, I was successful in adapting to the high context business culture of Japan. Back home, I now have increased confidence and a higher level of competence in dealing with ambiguity in my international work.”
Global Perspective. Even the best employees working from their home countries do not naturally develop a broad perspective. They focus on what is going on in their world, which limits their performance in a global company. An international assignment directly challenges this rather parochial view and broadens it. As this employee said: “An assignment from the U.S. to Europe was really an eye-opener for me. At home in the U.S., I followed markets and news, but I was totally focused on the U.S. While in Europe, I had to keep up with my colleagues — they knew so much more about the U.S. than I did about Europe.”
Company Culture. A strong company culture applied worldwide is a marker of the most successful global companies. It is adapted to accommodate national cultures, but consistency is critical for service delivery and company relationships. “Since my company is based in the U.S., while on assignment there I learned much more about the company culture and what is expected of company employees,” an employee from Germany said. “I learned how to adjust my language and attitude while dealing with Americans.”
Focus on People. Most companies say their people are their most important asset. Some really do believe this and practice what they preach — but some don’t. The most talented people today are drawn to and likely to remain with companies that treat their people well. Seeing how this is done in other countries can be very valuable. “On assignment to Latin America, my company there is ranked highly in terms of great places to work. I noticed that a reason for this is how they view employees in a holistic way, showing they care both personally and professionally. I am trying to support this approach now in my home country.”
Meeting Management. Nobody likes endless meetings that aren’t productive, but they remain essential, especially since a great deal of work is done as part of a team. Seeing first-hand how meetings are managed in other countries can be instructive. “I was impressed by the way meetings are managed in the U.S. People arrived on time and prepared, and meetings were shorter and ended promptly. This was quite different in my home country, where meetings can be chaotic. I am now setting up a similar approach in my home country, but adapting it to our culture.”
Rapid Advancement. Advancing high-potential employees is a major goal of international development assignments. These stretch assignments are a great way to test potential. “I was being considered for a broader leadership role in my home country before my international assignment. I received this advanced position upon return, in no small part because I took on a much broader role in my assignment country. I managed my multifunction team there and continued to support my team back home, despite the time differences.”
Networking. In a 2014 study of global leaders my firm conducted with Ron Bonial, Adam Vanhove and Uma Kedharnath, we discovered that the demonstrated ability to develop and maintain a network of international relationships was one of the leadership success factors. This was a study of 1,880 global leaders of nine nationalities. A set of intercultural competencies was used to predict success over time. The study found that the demonstrated ability to develop and maintain a network of international relationships was one of the success factors. There is no better way to do this than on an international assignment, and in fact this people-to-people connection is often reported as the most satisfying aspect of the assignment. “I developed a good relationship with my swap partner. She helped me to connect with her network and adjust to my assignment country and me to hers. We have continued to stay in touch and I am using my new network in many ways in my job back home.”
Leadership Exposure. According to Albert Bandura of Stanford University in his 1997 work on social learning theory, individuals develop by learning from their surroundings, either from interacting with people or observing other peoples’ behaviors. An international assignment can result in such deep learning and expose future leaders to how leadership is exercised in different parts of the world. “My supervisor, a wonderful high-level female leader, became a mentor and coach for me. I was able to observe her style and she introduced me to other great leaders,” said one of the people included in my studies.
These valuable learning experiences and outcomes do not come easily, however. Everyone who engages in these assignments faces job-role and intercultural challenges. Some don’t succeed. Some of these challenges include:
Integration and Culture Differences. An American employee on assignment to China said: “I never really felt integrated into the group. I was not given a lot of responsibility or work. I wanted to do more and often felt I wasn’t making much use of my skill set. It took time to get used to the Chinese culture. There is huge respect for elders in the workplace.”
Isolation. “Being abroad can be very isolating. I felt I was being ignored by my home office. My messages were being answered very late or not at all, which caused unnecessary stress. The big time difference between Thailand and my home office in the U.S. just made it worse.”
Social Adaptation. “At first my American colleagues seemed very friendly, but to me they turned out to be quite superficial. People seem to have just a few close friends and relatives, and it is difficult to be accepted,” said an employee from Brazil.
Decision-Making. “It was difficult to adjust to the fast decision-making process in the U.S. and I still don’t think it is the best way to get things done. In Germany, we think things out much more. We consult and consider what problems there might be before moving forward. My American colleagues thought my suggestions were a waste of time.”
Communication. “English is the global language of our company, but daily work and personal life is tough if you don’t speak the local language. Even the same words or phrases in English can mean different things,” observed an employee from Australia.
Leveraging Experiences and Learning Achieved. “When I returned to my home site in Shanghai, no one seemed very interested in my international experiences. They were in fact a little upset that some of the work that I was responsible for was either not done or had to be assumed by them.”
Value Model, Management Plans
The following model is presented to manage success with global development assignments. Each step in the model is then explained.
It is essential that global leadership assignments have senior leader sponsorship. This will ensure maximum exposure, attract the most promising high-potential talent, provide reliable funding and help to get home and host country management onboard. The talent management function will of course manage the program, but the company’s senior leadership team must also openly and directly support the program.
This seems rather obvious, but too many participants are selected for these programs only because of their technical ability. In addition to being very good at their jobs, they should also have demonstrated leadership behaviors beyond job tasks and responsibility. They should at least be at passage one as described in the “Leadership Pipeline,” written by Ram Charan, Stephen Drotter and James Noel. This is the passage from individual contributor (managing self) to managing others. Their pipeline includes six passages, from Managing Self all the way to Enterprise Manager. Passage one is the first stage in management development, where leadership is taken on for the first time and a good stage for early incorporation of international capability. Those at higher stages can also be good candidates for a global development assignment, especially if their jobs are transitioning from a domestic focus to an international one.
In my aforementioned 2014 leadership research, Tucker International identified a set of competencies that predict adjustment and performance on an international assignment. Some of these that are especially important for global development assignments are listed below. These can be measured and included in development plans.
Internal Locus of Control. The belief that one’s own actions and abilities play a direct role in the process and outcome of the events in life instead of relying on fate, luck or circumstance. It means to take responsibility for one’s actions.
Open-Mindedness. Being receptive to and nonjudgmental of the ideas and ways of other countries, cultures and ethnic groups and demonstrating respect for diverse spiritual and political beliefs.
Lifetime Learning. Engaging in a pattern of learning over time, which includes reading news, periodicals and blogs; tuning into national and international news broadcasts; and attending formal learning sessions.
Social Adaptability. Being comfortable in new and unfamiliar social settings, seeking out and enjoying diverse groups of people, and showing genuine interest in others.
Ambiguity Tolerance. The ability to see through vagueness and uncertainty, not become overly frustrated and eventually figure out how things are done. It means to take the initiative and lead through difficult situations.
Patience. The ability to be patient in the face of unanticipated delays or frustrating situations, with people who don’t meet expectations on time.
Home Country Management
Guidelines. Provide clear guidelines about what will be expected while on assignment for the employee and their supervisors and colleagues. This should include job tasks as well as developmental learning experiences.
Performance Evaluations. Ensure that any performance evaluations following the assignment include what was accomplished during the assignment.
Communication and Support. Have consistent home office communication and support throughout the assignment. This includes timely responses to email messages despite time differences, communicating important information about goings on in the company and providing requested resources.
Share Experiences. Ensure that participants deliver presentations and other communication back home to share experiences and what was learned to enable them to positively contribute to a global learning company culture.
Host Country Management
In development programs that include “swap partners,” the host country would also be selecting and managing participants from their country, so they would be responsible for the management plan described above. Their hosting plan includes the following:
Mentor. Assign a mentor to work with the assignee. This mentor should be responsible to implement the job and developmental learning guidelines for the assignment as stated above.
Entry Onboarding Process. Smooth the onboarding process by making sure that colleagues are aware of and support the program.
Social Integration. Help with the potential isolation problem by ensuring that the assignee is included in company social events. A mentor can be helpful here to include the assignee with networking at professional events, club and community activities, etc.
Learning. Contribute to the learning culture by having the assignee make a presentation near the end of assignment, communicating observations and what was learned.
Build Intercultural Competency
Some of the risks involved with implementing global development assignments were discussed in the introduction. An additional — and significant — risk faced by global companies is not to engage in these assignments at all. This will leave a leadership gap in place, with no bench strength of emerging leaders with international experience. It is hard to imagine a global company led by individuals without this experience.
When a global development assignment program is implemented, leaders can mitigate the investment risks by following the value model described earlier. To do so requires planning, preparation, coordination and follow through. This work is necessary in order to overcome the false assumption that the assignment itself can result in higher levels of understanding and skills needed to lead global business.
This story originally appeared in the July 2017 issue of Talent Economy. Click here to view the issue’s digital edition
Desks outfitted with sensors that track movements and ergonomics are already changing how offices operate, writes Bloomberg.
Professional development for Gen Z will cover major U.S. cities, aiming to give incentives for the future workforce to get a head start on their careers, according to Fast Company.
Obama’s overtime regulation, which a judge blocked back in December, is being revisited by the current administration, reports NPR.
A major argument for diversity is that it creates more creative teams. Harvard Business Review explores if this is true.
Finally, Unilever is using artificial intelligence and brain games to prescreen entry-level candidates, resulting in greater diversity and cost-efficiency, writes Business Insider.
The rate of change is happening faster than ever before, and it’s imperative that we all focus on acquiring knowledge and building skills that will help us stay relevant in the workforce and prepare us for the future.
It’s incredible to think about how much has changed in the world of work just in the past 10 years. Today, my iPhone is indispensable, but a little over a decade ago, it didn’t exist. Nor did many jobs, including app developer, data scientist, driverless car engineer and YouTube content creator. It was difficult then to predict what skills people would need to be successful in the jobs that didn’t yet exist, and it remains difficult for individuals and companies to prepare for the skills of the future.
I’d also argue that companies have a more difficult time getting the workforce prepared for future work because the old model of corporate education moves at a relatively slow pace. For example, when I worked at Yahoo, we put together a corporate learning program on mobile development for software developers, but it took months to design and develop. By the time it was released, versions of the technology had evolved, and the offering was out of date quickly. In the new model, we have to keep up with this more rapid pace and meet people where they are. That means helping employees get skills and knowledge at the time of need.
To do so, first, stay up to date on ideas and trends. One way to stay relevant in your role and to be aware of what skills may be needed in the future is to make sure you stay up to date on all the current ideas and trends. You can do this by taking advantage of all the great content that is available. Many of you are probably already doing this and are unaware that you’re building skills for the future.
One of the ways I like to stay up to date on knowledge in my field is to listen to podcasts. I’m a huge fan of “HBR IdeaCast,” and every week they cover some of the latest trends and ideas from leading thinkers in business and management from Harvard Business Review. Another podcast I really enjoy is “Make Me Smart with Kai and Molly.”
I attended a webinar recently called “Invent Your Future” and the guest was Janet Foutty, the chairman and chief executive officer of Deloitte Consulting LLP. She spoke about the future of work, and her advice and practice is to read the New York Times or your favorite news daily so you are always up to date on what’s going on. Those are general ways to keep up with our constantly changing world and help set the foundation for what skills and knowledge you might need in the future workplace.
Focus on building specific skills. It’s also critical that we focus on building specific skills for the future. So much is changing, it’s important that we keep up on the latest trends. For example, as learning professionals it’s important to know what’s happening in the learning technologies market, to understand new learning platforms, build new skills and methods to create online content, learn how you can use data analytics and insights to tell the learning story at your company, and learn how machine learning works and how you might incorporate that into your future learning strategy. Christopher Lind, learning technology leader at GE Healthcare, wrote a great article recently on Going Digital where he talked about the six skills he feels are critical to going digital in the learning field.
Our field is still evolving, but more and more we are seeing new roles and skills emerging in learning, and in just about every industry. It’s important to build your knowledge and skills for the future.
If you stay up to date on current trends in the world and in your industry, that will help you see where the future skills and roles in the world of work are headed. You can also focus on building specific skills for where you are in your career now, or where you want to go in the future. And lastly, you can think about how you can help others gain knowledge and build the skills they may need in the future learning organization or in the rest of your company.
Kelly Palmer is chief learning and talent officer at Degreed. Comment below or email editor@CLOmedia.com.