How To Future Proof Your Organization
Stay ahead in the post-pandemic era
Advances in technology had already changed the nature of work before COVID-19 occurred. Bases of competitive advantage had shifted to innovations in most industries, and, consequently, the way companies attracted and managed talent had changed as well. Most companies had found a gap in their workforce capabilities and the ones they needed to succeed. However, the pandemic put off the efforts of most companies to close critical capability gaps. Many had to lay off 25% or more of their workforce. Covid-19 required the companies to focus on economic survival and defer the search for new talent with required capabilities.
Now, as the recovery efforts are underway, businesses can rebuild and future-proof their workforce. Those that take this opportunity to rebuild and reshape their workforce in a well-thought-out manner will pull far ahead of competitors.
Even before COVID-19 made working from home a necessity, digital technology had been transforming the work that is done, how many employees are required to do it, and where work gets done.
So how should companies rebuild? At ThriveVance, we have worked with hundreds of companies of all sizes that have built technology-enabled workforces. Regardless of their sector or geography, they all seem to follow six practices in rebuilding and managing their teams.
1. Evaluating, Defining, and Prioritizing Business-Critical Roles
Not all jobs are equally important. Research has identified that fewer than 7% of roles in an organization are credited for more than 96% of its ability to execute its strategy and deliver results. Most companies have not identified which 7% are delivering 96% of the results.
The pandemic has challenged assumptions about productivity and sustainability; companies must rethink which skills are the most important in the current environment and, as they adapt to the technology-enabled future, develop the existing workforce to master those skills and continue to search and recruit talent with those skills.
One of our clients, the COO of a Consumer products company, Dan, and his team recognized that their ability to navigate the future challenges would greatly depend on augmenting the conventional technologies with data-driven innovations.
Dan, engaged with us to evaluate and rethink their workforce to meet their current and future needs cost-effectively. This company traditionally employed hundreds of people to monitor supply-chain activities to ensure that the right products are delivered to the right places at the right time. Before COVID-19 took hold, we worked with them to employ predictive analytics powered by real-time point-of-sale, manufacturing, and logistics data that changed how work was going to be done and by whom. However, the pandemic required a massive downsizing to survive. Now, this client must reevaluate the work that needs to be done, the necessary competencies for the job, and the talent they need to attract. Since these are primarily technology-enabled roles, many can work remotely.
To test the impact of big data analytics and digitization on the company’s strategy and competitiveness, Dan started with supply-chain operations. Like most other companies, they had relied on seasoned Managers to oversee the process. When issues arose, the management developed mitigation plans based on their personal experience and was informed by the data collected from experience. These managers played a business-critical role at this company.
The advent of supply chain optimization, combined with AI, machine learning, and analytics, meant that the company could make better and faster decisions using a broader range of more accessible data sources and data science expertise. Accordingly, Dan and his team began experimenting with advanced analytics and machine learning across the organization, using data analytics tools. The workforce started using AI-enabled tools, incorporating 50-plus years of experience to identify ways of improving productivity.
Integrating technology into day-to-day work meant that the definition of critical skills at this company had changed. Data scientists, experienced managers, and employees that can make data-driven decisions have become crucial to the company’s success. Starting in 2018, this company established a dedicated group of data analysts. This team is now responsible for focusing on spreading data analytics and other digital skills across the organization.
Rethinking business-critical skills contributed to a growing perception of the company as an innovator in the consumer product industry. As your company emerges from the pandemic, you should consider and think about the capabilities that will be critical in the future and not only today.
2. Imagining What Great Looks Like
Since the nature of the work is changing, traditional employee assessment approaches break down. As we know them, performance assessments work well when the jobs people will be asked to perform in the future are essentially the same as those they do today. However, the nature of the work changing causes companies to struggle to identify candidates who can take on the new tasks. In the same way that our assumptions about which capabilities are mission-critical, our assumptions about what success looks like must change in the aftermath of the pandemic.
Post pandemic, we find that what people do and how success is defined has changed. Not only do businesses need to recruit people with the right competencies, but they also must find candidates that are comfortable with the new normal. Leveraging technology can help companies recruit smart.
As luck would have it, new tools and methods that utilize people analytics and behavioral science can help define what great looks like in a specific role and identify employees who already have the needed skills and behaviors or develop them through training. This approach allows companies to create talent development and recruiting strategies to meet their needs.
At ThriveVance, we help businesses create dynamic job descriptions that include the primary responsibilities, behaviors, and skills for each role. We help our clients rigorously define what great looks like, companies establish a benchmark against which they can recruit internally and externally.
Lynne, the CSO of a leading telecom company, engaged us in redefining what great looks like for them, benchmarking the roles, and identifying the behaviors and competencies required to succeed in the job. In determining what great looks like in this company, it was crucial to understand the changes in the industry that was created by the smartphone market. Hence, the company’s leaders realized that they needed to shift the retail operating model from pushing equipment sales to emphasizing customer confidence and service. They trained, coached, and encouraged employees to adopt new mindsets and behaviors to achieve this transformation.
They also created a new role in each of its retail stores focused on boosting the customer experience. We developed a profile for what great would look like in that role using behavioral science and customer survey data. Then using behavioral assessments, we assessed their 3800 employees to discover critical capability gaps, which resulted in identifying employees with the potential to succeed in that role and designed training modules to help them develop critical skills and behaviors.
They upgraded their recruiting practices to use an interactive tool to screen more than 15,000 job applicants a month without human involvement. Using an online platform, candidates respond to a series of scenarios likely encountered on the job, which has led to hiring more qualified employees. As a result, it has enabled store managers to spend less time dealing with employee issues, allowing more presence on the floor serving customers. These initiatives have helped save more than $5 million in operating costs and have earned positive feedback from 95% of customers surveyed.
3. Management Development Is A Must
Covid-19 pandemic temporarily loosened labor markets for the most part; however, data suggest the impact of the pandemic is much more significant than anticipated. Peoples’ priorities have changed, and many are quitting their jobs in record numbers. Technical jobs in software engineering, digital design, and data science remain challenging to fill. Hence, companies look to management development, in best-case scenarios supported by technology, to develop their current workforces and fill some of their capability gaps with existing employees.
The good news is that if companies develop employees well, it does help. In our experience, more than 55% of a company’s future roles can be filled by existing employees, assuming that proper development programs are in place. Developing is also cheaper than the “fire and hire” model to fill the roles. For example, the direct costs of severance pay associated with workforce reductions are substantial. It also damages the morale of the workforce and reduces engagement. Additionally, recruiting new talent is expensive, particularly for candidates that are in high demand.
One of our clients at ThriveVance, in manufacturing industry that has grown from a small company to a giant in the industry, provides an excellent example. James, the CEO of this organization, spearheaded an extensive digital transformation focused on modernizing technology, use of data, and processes to improve performance and support a customer-centric culture. James and his team knew that to be successful, the company had to extract the maximum possible value from its accumulative data set. They broke down historical data verticals at the company, created an integrated data lake, and converted the raw data into usable customer insights, which traditionally required significantly more analysts than the company had or could realistically recruit and hire. To fill the gap, we looked at the current employees’ skills sets, moved them into broader data analysts positions, and trained them in several essential new skills, such as predictive analytics.
Additionally, we helped them realize that they needed to shift their marketing capabilities, focus, and talent from traditional avenues to digital channels. We used assessment tools to identify the members of its existing marketing organization with the most significant potential to succeed in digital marketing roles, invested in training programs to provide them with the knowledge and skills to thrive in the new positions.
When faced with a crisis, it’s appealing for companies to reduce the budget for training and development, which is not a smart strategy. The pandemic has sped up the inadequacy rate of professional skills. Unlike the old saying, it is easier and less costly to teach current employees new tricks than to find new employees who are already trained, which brings us to the next practice.
4. Tech-enabled HR Function
Recruiting and hiring is a crapshoot at best, indicating the need for change in recruiting and managing employees. This fact is even more evident for the scattered companies needing to hire talent during the recovery from the pandemic. From a human resources perspective, a model that relies too heavily on frequent human involvement and interaction is not efficient or cost-effective. Hence, the need to improve the HR function with tech-enabled tools and resources.
HR has traditionally been a non-revenue generating function and usually has a tight budget and will get cut during a crisis, as it has been in the COVID-19 era. Every company can benefit from investing in AI-enabled tools to improve talent acquisition and effectiveness, and performance. By utilizing AI-enabled tools, businesses can benefit from people analytics across a range of HR activities by making sense of the data on employees regarding skills, performance, ability to learn new skills, and potential to take on new roles.
Technology increases the rate of success in recruiting, deploying, developing, and retaining talent at a lower cost. Most companies are not currently fully using the workforce information they have. In fact, they have barely scratched the surface.
This realization brought Marcy, the CHRO of a Security Services Provider, to us at ThriveVance. This organization relies on nearly 9000 agents to build trust with its subscribers and sell its array of security products, which means that the company has to hire hundreds of new agents each year. Marcy and the team are now utilizing big data and artificial intelligence in their recruiting and management development efforts to accomplish that efficiently and cost-effectively. To identify the characteristics of top performers, they collect and analyze data on its existing agents to include performance data, customer records, and training information combined with the outside experts’ views regarding productivity, career ambition, customer service, adaptability, and sales ability. This information drives AI-enabled interviews that generate questions and check candidates’ responses against a collection of answers to determine the best matches on the characteristics that matter most.
Marcy has significantly improved the organization’s ability to identify, recruit, and retain great talent at a dramatically lower cost using new technology and big data. For example, the company has increased its 18-month retained-agent ratio to 95% while cutting close to $15 million in costs and keeping pace with the overwhelming demand for new agents.
5. People Engaging with Technology
Companies everywhere are increasingly using AI-enabled resources and processes. Pandemic has accelerated this trend, as more and more people work virtually. Unfortunately, technology underperforms leadership expectations as companies don’t coordinate engagement with technology, which makes employees suspicious of it. That’s disappointing, as when people and technology work together, we see the immense benefit to the organization and employees.
The integrated approach to developing and deploying AI-enabled tools and engaging the employees with the technology can form a competitive advantage for the organizations that do it correctly, so leaders can focus their attention and resources on expanding markets.
Our client Marcy, the CHRO of a leading provider of security products and services, provides a case in point. In this security services company, subscriber service representatives handle more than 3 million calls and cases each year, managing all process aspects. Providing excellent customer service means making the processing more convenient, faster, accurate, and less costly.
Accordingly, leadership has taken steps to ensure that service representatives are supported by machine-learning algorithms that use artificial intelligence to handle the cases more accurately and efficiently.
In deploying these AI-enabled tools, we engaged the technology team to collaborate closely with the service representatives to design and train its AI model, ensuring that the AI learns to think like an experienced rep. The company’s risk management uses the model in assessing risk. Still, they can also adjust its risk estimates with an explanation that feeds back to the AI so that the AI model can be continually updated and improved. Lastly, AI directly takes on lower-value tasks such as fraud detection and prevention, allowing the rest of the team to focus more intensely on connecting with and providing guidance to subscribers. This approach is more satisfying for people and better leverages their capabilities, delivering results on multiple fronts.
6. What Is It That Your Super Stars Want From You?
We live in a very significant generational change. Based on the U.S. Bureau of Labor Statistics findings, by 2030 Millennials will make up 75% of the workforce. Millennials want it all, flexible schedules, diversity, equity, and inclusion in the workplace, engagement, autonomy, and a meaningful connection with their employers. This is a clear indication that tomorrow’s employees look for a workplace value proposition that is very different from the last decades. The pandemic, however, has accelerated this process. COVID-19 has been traumatic for most of us. People’s priorities have changed, and we all have rediscovered the importance of meaningful jobs, supportive colleagues, and flexible and appreciative employers.
Let’s look at a Software and Technology Services company in Colorado as an example of how to attract and retain top talent. Jeff, the CEO of this $2 billion enterprise software and services company based in Denver, Colorado, had a desire to attract the most qualified candidates that will stay with the organization. Before Jeff joined the company two years ago, the turnover rate was at 63%, which was unacceptable to Jeff. He engaged with ThriveVance to clarify what it takes to change the company culture, reduce its attrition, and improve recruiting the best talent. Like many other organizations, this company engaged in activities to attract and engage its employees, such as fancy offices, a gourmet cafeteria, free lunches, and beverages.
We encouraged Jeff and the team to focus on the most critical factors to employees, the elements that inspire and retain them. These factors are often less transactional and more transformational. Such as a culture of inclusion, not just in diversity, but inclusion in what the company does and the results that employees contribute to, processes that make getting things done fast and easy, and excellent rewards for people who live the organization’s values. The data made it very apparent that Jeff’s employees wanted a deeper connection with the company’s purpose. They want to be part of a team that takes civil responsibility seriously, and what they do is something meaningful. They want to feel included and belonging to be part of a culture that encourages and appreciates employees to bring their very best selves to work every day.
In 2020 Jeff and his team set out to transform the organization from a technology-centric culture to a people-centric one. The efforts rebranded the company, both externally and internally, as an organization dedicated to making the workplace work better for people internally, and the services work better for their customers externally.
Accordingly, Jeff and his team have built a culture of diversity and have taken dramatic steps to foster inclusion in every aspect of the workplace. Diversity and inclusion is not a check the box matter; instead, it is a talent strategy. As we gathered, synthesized, and analyzed the data, leadership discovered that their employees aren’t very different from their customers. So they deployed many of their products internally to make onboarding and routine administrative activities easier and faster. The processes are people-centered and focused on offering growth and development. People are treated like adults with a sense of personal responsibility and accountability without a lot of clutter or nonsense to get in the way of getting things done.
Additionally, adopting the work-from-home model and unlimited paid leave time practices makes it easier for employees to have a work-life balance, supporting a culture of productivity, not face time. These practices provided the leadership to present the company’s new value proposition to employees and potential recruits. These practices proved particularly valuable amid the pandemic.
Jeff and his team’s approach have not gone unnoticed. When we surveyed the company’s employees, 81% of respondents indicated that they would recommend the company as a place to work. This level of employee advocacy puts the company in the top 5% of employers globally. And they have reduced attrition to a record low of 25%.
Technology has fundamentally changed the nature of work. But the approach to workforce planning and management hasn’t changed much over the past two decades. As a result, this has created a gap in getting the maximum results from deploying the technology across the functions. Companies must rebuild their workforces as part of the COVID-19 recovery effort and consider moving into the digital age. Talent management must become more strategic, holistic, rigorous, and data-driven. Organizations that rebuild following traditional processes will be outperformed by competitors that are learning and adopting the new approach.
The rethinking and rebuilding of the workforce and workplace take much time, and companies must begin future-proofing their organizations today. At ThriveVance, we have helped many satisfied clients rethink and rebuild their workforce to deliver productivity and results. We can do the same for you.