An era of new learning and talent paradigms

For many companies, labour will remain both its biggest cost and source of potential competitive advantage, even in an increasingly digital and automated world. A given organization’s ability to compete and execute strategy is increasingly dependent on its ability to manage its workforce strategically. Indeed, matching resources with shifting and often temporary business requirements will require whole new talent paradigms – in terms of recruiting in-demand and scarce talent, in terms of management and in terms of developing talent further.

language

Current practices would seem inadequate for the future. 85 percent of employees worldwide are reckoned to be performing below their potential due to engagement issues[i]. Furthermore, more than 50 percent of employees in digitally immature companies state they are planning to leave within three years, yet only six percent identify recruiting and retaining digital talent as their first-priority[ii].

Whilst HR has seen some recent changes, it has largely avoided the pressure to change in recent times as much as the numerous functions it supports. With pressure on the old system emerging at the organizational level, change is no longer an option. Evidence of this is already emerging; ‘…with many companies now organising their work project by project, their management and talent systems are becoming more team focused[iii].’  if HR heads – and the companies they inhabit – are to survive and thrive, ongoing renewal must become a reality rather than one-off or episodic change.

If as is reckoned the half-life of the average skill is now around five years, many companies are primed for disruption whether they accept it or not. Desired skill sets are set to change at an increasing rate for a range of jobs, ensuring that organisations could change dramatically within a decade or so. Profound changes in customer taste and needs, new markets emerging at the intersection of old ones together with the push to digitize and automate ‘…will impact current and future employees in terms of the required speed to adapt to the changing business climate[iv].’

Nearly two-thirds of employers expect leader and manager activities to change over the next three years[v], let alone ten. Planning for this within HR and by the CEO and Board, will have long term implications. What kind of skills and capabilities do you need to execute on your strategy and differentiate yourself[vi]? How do you assess these needs and on what basis? As noted by McKinsey, those organisations ‘…that are able to identify the critical 2 percent of the organisation, the people that generate most of the value (now and in the future) are the ones that are going to see extraordinary returns[vii],’ when appropriate structures are built around, and to support, it.

[i] http://www.digitalistmag.com/future-of-work/2018/05/16/hr-in-age-of-digital-transformation-06167140

[ii] https://www.burning-glass.com/blog/if-talent-is-ready-to-flee-then-maybe-its-time-to-plan/

[iii] https://hbr.org/2018/03/the-new-rules-of-talent-management

[iv] https://workforceinstitute.org/the-future-of-talent/

[v] https://blog.willis.com/2018/04/shaping-the-future-of-talent-rewards-and-work/

[vi] http://www.ey.com/Publication/vwLUAssets/ey-talent-strategy-designing-a-workforce-for-the-future-of-insurance/$File/ey-talent-strategy-designing-a-workforce-for-the-future-of-insurance.pdf

[vii] https://work.qz.com/1259950/mckinsey-co-chief-dominic-barton-on-talent-management-and-the-future-of-hr/

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The future of analytics: Geospatial targeting and situals

One of the next big trends in analytics, notes Wharton[i], is the emergence of geospatial targeting. Establishing someone’s physical location and targeting offers accordingly could open up whole new business models, redefine consumer relationships and supply trustworthy firms with swathes of insight rich data.

compete

The emergence of the quantified customer will blur the difference between existing market boundaries further, yet offer an infinitely richer picture of real-time consumer indicators by including contextual and situal information. Harvard Business Review correctly notes that ‘…the next generation of smart assistants and connected devices will learn from user habits and pick up on behavioural and environmental patterns in order to make these experiences more predictive[ii].’ This changing nature of engagement fundamentally shifts the product and services insurers are able to offer. For example, Buy+, a Chinese virtual reality shopping experience backed by Alibaba, engaged over 8 million users within a week of launching[iii]. Imagine if this experience could be tailored to your whereabouts, your purpose in that given location and your transaction history.

The changing nature of engagement changes the product, and since the IoT provides an expansion of quantifiable parts, we will have ever more data at which to shape price points. Of equal import is that there are more points at which we can engage consumers, especially with forthcoming micro-GPS that can better contextualise data to within mere feet of our position, and the ambient passivity with which we will ‘interact,’ with technology. Emerging data sources and personalisation will ultimately spawn new industries and enable businesses to add value in entirely new ways.

Care will need to be taken given GDPR and its likely successors. What data we hold and how we use it will be the life and death of our companies; this data could prove poisonous if mis-selling or similar can be proven using situal and contextual data. The risk of retroactive judgement for misusing data, whether reputational or legally, allied to sheer volume will likely create a need for regulated third party data aggregation, dissemination and marketplace formation. New data architectures will likely be required; customers, first and foremost, want problems solved – something that may go beyond an app or individual business silos. Real-time, multidirectional data will deliver situal information and insight, requiring new data strategies and even organisational set-up.

[i] whr.tn/2KTzfKc

[ii] https://hbr.org/2016/11/how-predictive-ai-will-change-shopping

[iii] https://venturebeat.com/2017/09/08/vr-will-be-an-essential-part-of-the-future-of-retail/

The future of talent

For many companies, labour will remain both its biggest cost and source of potential competitive advantage, even in an increasingly digital and automated world. A given organization’s ability to compete and execute strategy is increasingly dependent on its ability to manage its workforce strategically. Indeed, matching resources with shifting and often temporary business requirements will require whole new talent paradigms – in terms of recruiting in-demand and scarce talent, in terms of management and in terms of developing talent further.

training-2874597_1920

Current practices would seem inadequate for the future. 85 percent of employees worldwide are reckoned to be performing below their potential due to engagement issues[i]. Furthermore, more than 50 percent of employees in digitally immature companies state they are planning to leave within three years, yet only six percent identify recruiting and retaining digital talent as their first-priority[ii].

Whilst HR has seen some recent changes, it has largely avoided the pressure to change in recent times as much as the numerous functions it supports. With pressure on the old system emerging at the organizational level, change is no longer an option. Evidence of this is already emerging; ‘…with many companies now organising their work project by project, their management and talent systems are becoming more team focused[iii].’  if HR heads – and the companies they inhabit – are to survive and thrive, ongoing renewal must become a reality rather than one-off or episodic change.

If as is reckoned the half-life of the average skill is now around five years, many companies are primed for disruption whether they accept it or not. Desired skill sets are set to change at an increasing rate for a range of jobs, ensuring that organisations could change dramatically within a decade or so. Profound changes in customer taste and needs, new markets emerging at the intersection of old ones together with the push to digitize and automate ‘…will impact current and future employees in terms of the required speed to adapt to the changing business climate[iv].’

Nearly two-thirds of employers expect leader and manager activities to change over the next three years[v], let alone ten. Planning for this within HR and by the CEO and Board, will have long term implications. What kind of skills and capabilities do you need to execute on your strategy and differentiate yourself[vi]? How do you assess these needs and on what basis? As noted by McKinsey, those organisations ‘…that are able to identify the critical 2 percent of the organisation, the people that generate most of the value (now and in the future) are the ones that are going to see extraordinary returns[vii],’ when appropriate structures are built around, and to support, it.

[i] http://www.digitalistmag.com/future-of-work/2018/05/16/hr-in-age-of-digital-transformation-06167140

[ii] https://www.burning-glass.com/blog/if-talent-is-ready-to-flee-then-maybe-its-time-to-plan/

[iii] https://hbr.org/2018/03/the-new-rules-of-talent-management

[iv] https://workforceinstitute.org/the-future-of-talent/

[v] https://blog.willis.com/2018/04/shaping-the-future-of-talent-rewards-and-work/

[vi] http://www.ey.com/Publication/vwLUAssets/ey-talent-strategy-designing-a-workforce-for-the-future-of-insurance/$File/ey-talent-strategy-designing-a-workforce-for-the-future-of-insurance.pdf

[vii] https://work.qz.com/1259950/mckinsey-co-chief-dominic-barton-on-talent-management-and-the-future-of-hr/

Why every company needs a foreign policy

This was the thought provoking phrase posited by the World Economic Forum[i]. In an age where 40 years of British-European integration can be unravelled in a couple of years, or 70 years of U.S foreign and trade policy undone in a few tweets, this would seem sage advice. The international rules of trade are being rewritten, and at times, without the consultation of business. Many companies remain outwardly apolitical and whilst disruption brings opportunity, destruction of business as usual could necessitate a greater depth of political understanding. With various forms of ‘national branding’ under various forms of assault, those wishing to protect their own will need to actively project their own values.

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Geopolitics has a very real business imprint; consider for example that global logistics spending is forecast to reach $10.6 trillion in 2020, with transport accounting for the majority of this[ii]. Also consider that some 65 percent of the total value of a company’s products and services comes directly from suppliers[iii]. It hardly needs noting that supply chains are increasingly international, which perhaps in part explains why 60 percent say their organisation faces more crises today than 10 years ago[iv]. Only 17 percent test their crisis planning

At present companies do not only lack a foreign policy, but rather any meaningful insight into their own operations. Just 6 percent of CPOs have full transparency of their entire supply chain, while 65 percent have limited visibility or none. Supply chain risks are therefore mostly unknown[v]. Such opacity does not bode well for those looking to maximize value, predict disruption and adapt with agility.

Another aspect that a practiced and principled foreign policy could address lies with consumers. Thanks to blockchain, RFID, the IoT and the media in general, consumer awareness of product history and origin is increasing. This collides with a more demanding Millennial cohort. 88 percent of Millennials believe employers should play a vital role in alleviating social concerns[vi]. Since, social concerns often travel beyond political borders, supply chains would seem an apt place to start crafting foreign policies – not just to build resilience in a world adjusting to the ending of the American century but to a new demand from consumers for sustainability, justice and fairness. Indeed, 86 percent of Millennials agree that ‘…the success of a business should be measured in terms of more than just its financial performance[vii].’

[i] bit.ly/2JmaOnx

[ii] bit.ly/2GoAcre

[iii] bit.ly/2F1YvOB

[iv] on.wsj.com/2MdZBq8

[v] bit.ly/2HbVZTb

[vi] bit.ly/2lHzP2s

[vii] bit.ly/2BCZ0glw

The future of competition: a network of networks

‘The top-down model of innovative change is impossible for today’s fast-moving industries[i],’ notes INSEAD professor Henrik Bresman. Networking effects ‘…are driving the winner-take-all economic shift[ii],’’ exemplified by Amazon. The winner, with a dominant market position is emerging as the hub, or integrator, of the economic system. This role is born bout more from how things are done as opposed to any notion of market boundary. For example, Rakuten Ichiba is ‘Japan’s single largest online retail marketplace. It also provides loyalty points and e-money usable at hundreds of thousands of stores, virtual and real. It issues credit cards to tens of millions of members. It offers financial products and services that range from mortgages to securities brokerage. And the company runs one of Japan’s largest online travel portals—plus an instant-messaging app, Viber, which has some 800 million users worldwide[iii].’

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Tomorrow’s organisations will increasingly inhabit a network of networks, whether they orchestrate, facilitate or contribute to such networks. It is likely that ‘…the network will help companies understand the dynamics of their business and whether their operational metrics are where they should be[iv].’ People, sensors, and devices are increasingly interconnected, in many cases beyond traditional organisational boundaries. The future network, comprising company, supply chain, sub-contractors, markets, investors and more will all exist within a single network yet constituent parts will inevitably be enmeshed in other networks. Whether owned or not, networks are becoming increasingly embedded within organisations. Network-centric businesses would appear to be the way forward for many industries as is demonstrated in the construction industry; each project sees a reconfiguring of constituent parts based on what is needed. Long term, this may lead to networks competing with one another and the necessary development of network-centric capabilities.

 

Adjusting to this changing business environment will require organisational renewal. Everyone on the leadership team has a role to play in adjusting successfully to a network of networks. The CIO needs to articulate and demonstrate how IT can work across silos and businesses to help units meet their goals and collaborations succeed. CIOs need to help align business strategy cohesively to the network in question Networking customers and partners could become a key feature of the future CMOs remit. Common forms of dataflow will be necessary if partners are able to work collaboratively on a given issue or project. Common third-party security standards will need to be established in conjunction with the CIO and others. Security and privacy controls will need to be built at the edge and intrinsically part of every device and network.

[i] https://knowledge.insead.edu/leadership-organisations/preparing-teams-to-lead-innovative-change-7391

[ii] https://www.wsj.com/articles/investing-in-a-winner-takes-all-economy-1491790561

[iii] https://rakuten.today/blog/mckinsey-rakuten-ecosystem-challenging-banks.html

[iv] http://www.digitalistmag.com/executive-research/building-business-network-future

Education for the future

Education systems are already lagging in our emergent digital lives. Our schools remain stuck in the industrial age. One in four adults already report a mismatch between the skills they possess and the skills they need for their job[i]. This is set to increase since an estimated 85 percent of employment roles in 2030 do not currently exist[ii]. This suggests that organisations that want to stay ahead of the talent curve will need to develop new talent pathways and establish new skills for employees appropriate for their changing roles. Indeed, some 62 percent of execs believe they will need to retrain or replace more than a quarter of their workforce between now and 2023[iii]

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The impact on the education we provide for our children, how we teach, what we teach and where we teach will all need to change, but of equal import is the impact on the conception of education itself. It can no longer be a period that leads from childhood to workplace, since changes in the workplace are accelerating at such a rate that current workers will need to reskill, and often. Singapore is funding adult education in an attempt to induce voluntary, lifelong skills development in an attempt to address this.

Both disruption and innovation are imminent; whether it is perceived as an opportunity of threat will depend in part on just how strategic and digitally-savvy education and skills providers are. Since the half-life of skills is now reckoned to be around five years, and adults arguably less flexible than children when it comes to learning, an increasing focus on the individual is necessary. For example, 98 percent of students express a desire for more personalisation in the classroom, as opposed to automation, perhaps revealing a need for teachers’ time to be freed up[iv].

Automation of course, is one of the most obvious ways for achieving personalisation at scale. We can apply machine learning to neuroscience data we collect, or to more prosaic ‘…things such as logs of how many times students re-watch a portion of a video lecture or where they stumble or where they slow the lecture down to watch it more closely[v].’

New models will continue to appear – both in delivery and funding. The Minerva model of learning has attracted a lot of attention as has a Californian coding school that only charges students once they earn a $50,000 tech salary[vi]. This is likely just the start; futurist Thomas Frey suggests that the largest internet company of 2030 is likely to be an education based one. One thing is for sure; the longer core facets of education remain unchanged, the greater the disruption once it does.

[i] http://www.businessinsider.com/workers-of-the-future-need-different-skills-2018-1

[ii] https://www.iothub.com.au/news/what-jobs-and-skills-will-be-needed-in-the-machine-era-486983

[iii] https://www.mckinsey.com/featured-insights/future-of-organizations-and-work/retraining-and-reskilling-workers-in-the-age-of-automation

[iv] https://www.capitalfm.co.ke/business/2018/04/mckinsey-report-shows-40pc-of-jobs-require-soft-skills-and-emotional-intelligence/

[v] https://www.mckinsey.com/featured-insights/artificial-intelligence/the-role-of-education-in-ai-and-vice-versa

[vi] https://www.fastcompany.com/40524232/this-coding-school-doesnt-charge-students-unless-they-snag-a-50000-tech-salary

5G. Evolution or revolution?

The benefits and advantages of 5G technology are expected to be available sometime in 2019. Although the extent of its impacts are unlikely to be realised immediate, WEF suggests ‘…that it will be as revolutionary as electricity or the automobile[i].’ Both the lack of an immediate ‘wow factor,’ and 5G’s long term potential are based in the fact that it is a significant enabling technology. In and of itself, the obvious immediate impacts include higher speeds, low latencies, lower power consumption and greater reliability.

Smartphone, Technique, Appliances, Link, Internet

However, the global economic impact of 5G in new goods and services is forecast to reach $12 trillion by 2035[ii] as the technology allows us to do different things and move from simply connecting people to information towards connecting people to everything.

In the short term, augmented reality apps could proliferate on smartphones, shifting how we access and display information. In the medium term, the synergy of 5G with emerging industries such as the IoT will ‘…open up potentially new roles for intermediaries in the value chain, positioned downstream of network operators, offering to bundle and repackage connectivity for particular industries[iii].’ 5G will also prove a catalyst for connected healthcare, autonomous vehicles and virtual reality as a medium across multiple industries including education and various customer facing industries.

In the longer term, 5G could enable edge computing and analytics – shifting consumer journeys, data strategies ad fundamentally redrawing business and operating models decisively. Ironically, what is largely a plug and play technology will prove much more complex organisationally. Data architectures, talent needs, ecosystem partnerships and fundamental role in newly emerging spaces will all need analysing and all will impact business and organizational models. Perhaps one underappreciated source of disruption is the geographic source of many of these models.

According to CCS Insights, China will account for half of all 5G users in 2022, and 40 percent of 5G connections by 2025[iv]. Since emerging markets are an increasing source of innovative models and services seen in developed economies, this could increase over the coming years; new competitors, new partners and new models will almost certainly abound. The economic impact within China of building a significant 5G capability could be profound, it could ‘…account for 3.2 percent of China’s entire GDP in 2025, generate 8 million jobs, and add 2.9 trillion yuan ($454bn) in economic value by 2030[v].’ The impact in developed economies could be greater still, especially if businesses are unprepared for the raft of organizational and business model changes that will be required to get the most out of 5G.

[i] https://www.weforum.org/agenda/2018/01/the-world-is-about-to-become-even-more-interconnected-here-s-how/

[ii] https://www.weforum.org/agenda/2018/01/the-world-is-about-to-become-even-more-interconnected-here-s-how/

[iii] https://berec.europa.eu/eng/document_register/subject_matter/berec/reports/8008-study-on-implications-of-5g-deployment-on-future-business-models

[iv] https://www.sdxcentral.com/5g/definitions/china-5g/

[v] https://www.sdxcentral.com/5g/definitions/china-5g/