Make your business future-proof (2023)

Summary idea

The problem

Even before working from home became widespread, digital technology was transforming how and where work gets done and the number of people it takes to do it.

The opportunity

Post-pandemic, companies can build a better-resourced workforce for an economy where routine, repeatable tasks are increasingly machine-based.

The solution

Based on research by Bain & Company, which involved more than 300 major companies around the world in all facets of the global economy, the authors identify six best practices companies should follow as they regroup and reorganize for the inevitable recovery.

Technology was already changing thatthe nature ofwork before Covid-19 sets in. Innovation redefined the fundamentals of competition in most industries, and with it the talent companies that needed to win over the long term. The pandemic has derailed efforts by most organizations to address these challenges and close critical capacity gaps. Many have had to lay off 15% or more of their workforce. Covid-19 required the search for new talent - with new skills - to put economic survival on the back burner.

But as companies rebuild in the wake of the global pandemic, those who seize the opportunity to reshape and future-proof their workforce will be well ahead of the competition. Even before working from home became widespread, digital technology was transforming how and where work gets done and the number of people it takes to do it. Consumer goods companies, to cite just one example, traditionally employ hundreds of people to oversee purchasing and inventory, ensuring the right products are in the right place at the right time. Predictive analytics – backed by real-time point-of-sale, manufacturing and logistics data – is changing that by reducing the number of people needed to do the job, changing the skills they need to thrive in their new technology-enabled roles and to allow more and more of them to work remotely.

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So how should companies transform? In the following pages, we draw on research from Bain & Company, which involves more than 300 leading companies around the world and all facets of the global economy, from manufacturing to retail, healthcare to technology. Half of these companies are headquartered in North America or Western Europe and the rest in South America, Asia Pacific, the Middle East or Africa. We have identified a select group of companies that are already building a technology-enabled workforce. Regardless of their industry or region, they all seem to adhere to six best practices when building and managing their teams. In the following pages we offer these best practices for businesses to follow as they regroup and reorganize for the inevitable recovery.

[Praxis 1]

Think ahead when defining business-critical roles

Not all jobs are equally important. Research by Bain and others shows that less than 5% of an organization's functions account for more than 95% of its ability to execute its strategy and deliver results. But which 5%? As we emerge from a pandemic that has challenged assumptions about productive work, companies need to rethink what skills will be most important in an increasingly technological future, develop them in today's workforce, and actively recruit them.

Smart businesses started doing this even before the outbreak of Covid. Woodside Energy, one of Australia's leading natural gas producers, is one of them. When the recently retired Peter Coleman became CEO in 2011, the company was a typical LNG producer with large, multi-billion dollar projects and complex onshore and offshore operations. Coleman and his team recognized that Woodside's ability to meet the challenges of the future would depend in part on improving its conventional technologies through data-driven innovation.

To test the impact of big data science and digitization on the company's strategy and competitiveness, Woodside turned to power generation. Like most other oil and gas producers, it had experienced engineers overseeing each asset. When problems arose, engineers developed mitigation plans based on their personal experience and supported by data collected on their websites. They played a crucial role in Woodside's business.

The advent of new sensor technology combined with access to low-cost computing power and big data analytics meant enterprise facility operators could make better, faster decisions using a wider range of data sources that are more accessible and experienced in data science. As a result, Woodside began experimenting with advanced analytics and machine learning across its offshore and onshore operations, using a mix of homebuilt and off-the-shelf solutions. The workforce began using AI-enabled tools that leveraged Woodside's 30+ years of manufacturing experience across all sites to find ways to improve safety and productivity.

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More than 60% of a company's future positions can be filled by current employees, provided the right programs are in place.

The integration of technology into the way of working has meant that Woodside's definition of “critical skills” has expanded. Data scientists, along with experienced engineers and plant operators, have become critical to the company's success. As of 2015, Woodside has built a dedicated team of data scientists. The team is now focused on driving data science and other digital skills across the organization using a variety of new tools and platforms. The company recruits data scientists from top Australian and international universities to work alongside and learn from Woodside's operationally experienced team members.

Woodside's rethinking of business-critical capabilities has contributed to a growing perception of the company as an oil and gas innovator. As other companies emerge from the pandemic, they should take a leaf out of their book and reflect on the skills that will be critical in tomorrow's world - not today's.

[Praxis 2]

Redefine the great

Traditional approaches to employee appraisal work well when the tasks people are expected to perform in the future are essentially the same ones they (or others in the organization) are performing today. However, these approaches fail when the nature of that work changes, leaving companies struggling to find candidates to take on the new roles. Just like our assumptions about what skills are business-critical, our assumptions about what success looks like need to change post-pandemic.

Fortunately, new tools and techniques that leverage people analytics and behavioral science can help organizations define what is “great” about a particular role and identify employees who either already have the skills required or who can develop them through training. This allows organizations to design talent development and recruitment strategies to meet their needs.

One such approach was developed by Chemistry Group, a UK-based people analytics organization that helps companies create robust job descriptions for new roles – descriptions that include not only basic responsibilities, but also traits, behaviors and skills that each role requires . By rigorously defining what's great, companies create a benchmark by which to recruit—both internally and externally.

Make your business future-proof (1)Alex Eben Meyer

A leading mobile operator applied Chemistry's tools and approach with great success. In response to the changes in the smartphone market, the company's executives recognized that they needed to shift the retail operating model from increasing hardware sales to emphasizing intimacy and customer service. To achieve this transformation, they encouraged employees to adopt new ways of thinking and behaving through training and coaching.

The wireless carrier has also created a new feature in each of its retail stores that focuses on improving the customer experience. Using behavioral testing and survey data, leaders developed a profile of what would be great in that role. The company then assessed its 22,000 employees to uncover critical capacity gaps. The result was a list of employees with the potential to be successful on the job and training modules were developed to prepare them quickly.

The company also developed interactive recruitment tools to screen more than 10,000 candidates for this position monthly without human involvement. Using an online program, candidates respond to a range of scenarios they are likely to encounter. Improved recruiting allowed store managers to spend less time mentoring and mentoring, allowing them to serve customers right on the spot. These initiatives helped save more than $7 million in operational expenses and received positive feedback from 85% to 93% of the customers surveyed.

Post-pandemic, companies will find that what people do and how success is defined will need to change. You need to recruit people who are comfortable with the new normal. Smart businesses will now use technology to figure out how.

[exercise 3]

Don't skimp on management development

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While the Covid-19 pandemic has temporarily eased the labor market in some areas, many positions in software engineering, digital design and data science remain difficult to fill. Consequently, the best companies rely on management development, often supported by technology, to develop their current workforce and to fill at least some of their skill gaps with existing employees.

The good news is that retraining done well helps. In our experience, over 60% of a company's future positions can be filled by current employees, provided the right programs are in place. Reskilling is also cheaper than the "fire-and-hire" model to fill new business-critical roles. On the one hand, the direct redundancy costs associated with downsizing can be significant, just as the morale of the remaining team members can be impacted. And recruiting new talent can be expensive, especially for high-demand industries like data science, digital marketing, and software development.

Guardian, one of the largest mutual life insurers in the US, provides an example. Like many other companies, it is undergoing a comprehensive digital transformation focused on modernizing technology, data and processes to improve performance and support a customer-centric culture. Deanna Mulligan, Guardian's CEO until October 2020, and her team knew that in order for the company to be successful, it needed to derive as much value as possible from its wealth of data. So they broke down the company's historical data silos and created an integrated data lake. Turning that raw data into actionable customer insights required far more data scientists than the company realistically had or could recruit. To fill the gap, Guardian reached out to its actuaries, placing them in broader data science roles and training them in several key new skills, such as: B. Predictive Analytics.

Likewise, Guardian recognized that it needed to shift much more of its marketing energy and talent from traditional avenues to digital channels. The company used assessment tools to identify the members of its existing marketing organization with the greatest potential for success in digital marketing roles, and then invested in training programs to give them the knowledge and skills they need to be successful in these new roles to be.

In times of crisis, it is tempting for companies to cut training and development budgets. But that's not a smart move. At the very least, the pandemic will accelerate the obsolescence of professional skills, and it will be easier to teach old dogs new tricks than to find new ones that are already trained.

Which brings us to the next exercise.

[exercise 4]

Improve HR function

Businesses that rely on large workforces need to change the way they manage employees. This is even more true for the dispersed workforce that has become commonplace during the pandemic. From an HR perspective, a model that relies heavily on frequent human interactions is not profitable.

Ping An provides a glimpse into the future of human resources. Founded in 1988, Ping An (Chinese for "peace and security") is China's largest insurance company with premium income of nearly US$100 billion and a market value of over US$180 billion. It relies on nearly 1.5 million brokers to earn the trust of the company's policyholders and sell its offering of insurance and financial products, which means the company must hire thousands of new brokers each year. To achieve this, Ping An leverages big data and artificial intelligence in its recruitment and management development efforts.

To identify the characteristics of top-performing agents, Ping An collects and analyzes data about its existing agents (including performance data, client visit logs, and training information) and combines it with external expert opinions on the importance of each agent's career aspirations. , customer network, adaptability and sales capacity. This information is fed into AI-powered interviews that generate questions and compare candidates' responses to a set of answers to identify the best matches for key characteristics.

Through the use of new technologies and big data, Ping An has greatly improved its ability to identify, recruit and retain top talent at a significantly lower cost. For example, the company increased its 13-month retention agent ratio to 95% while cutting an estimated $90 million in costs and keeping pace with impressive demand for new agents.

All companies can do more in this area. As companies collect more and more data about employees and contractors—about each person's skills, performance, potential, and ability to learn new skills and assume new roles—people analytics is being used across the spectrum of HR activities. Technology will enable companies to recruit, deploy, develop and retain talent much better at a lower cost. We are not aware of any company that makes full use of existing employee information. Most organizations have barely scratched the surface.

[exercise 5]

Involve people in technology

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Businesses and workers around the world are increasingly turning to AI-powered processes like Ping An's recruitment system. This trend will only accelerate post-pandemic as more and more people do business and work in the virtual world. Unfortunately, few companies - or employees - manage technology engagement in a coordinated manner, leaving employees wary and technology exceeding management expectations.

It's a shame, because when people and technology work together, everyone benefits. USAA, a leading provider of financial products and services to current and former military personnel and their families, is one example. Within USAA's insurance operations, Member Services representatives process more than 5 million claims annually and manage all aspects of the process. Providing the best customer service means making claims processing more convenient, faster, more accurate and less expensive for USAA members. As a result, USAA executives have taken steps to ensure service workers are assisted by machine learning algorithms that use artificial intelligence to more accurately and efficiently estimate the extent of damage to vehicles or property.

In times of crisis, it is tempting for companies to cut training and development budgets. But that's not a smart move.

USAA's technology team worked closely with the company's service representatives to deliver these AI-enabled tools. The team relies on them to "train" their AI model and ensure the model learns to "think" like a seasoned USAA representative. The company's claims adjusters use the model to estimate customers' insurable losses, but they can also adjust their estimates on the spot with an explanation that is fed back to the AI ​​so the model can be continually updated and improved. Finally, machines directly handle lower-value tasks like fraud detection and prevention, allowing claims teams to focus more on connecting and guiding USAA members negotiating the claims system, which can often be a difficult process. This type of work is more satisfying for people and makes better use of their skills.

The results are clear. USAA continues to lead in customer and employee engagement thanks to USAA's integrated approach to developing and delivering AI-enabled tools and the people who use them. In 2020, it received the highest ratings among J.D. Perfomance. And to characterize the findings of a 2018 USAA study by consumer research organization Raddon, a newsletter dubbed the company "the most popular financial brand in the world." This year, Great Place to Work recognized USAA as one of their Best Places to Work for employee advocacy. Equally important, USAA grew its market share in insurance and financial services for military personnel and their families from 63% in 2010 to 75% in 2019.

[exercise 6]

Discover what the stars of tomorrow want from you

Even without the pandemic, tomorrow's managers would be looking for a very different workplace value proposition than what appealed to workers 10 or even five years ago. Millennials will make up 75% of the workforce by 2030, according to the US Bureau of Labor Statistics. This generation wants it all: flexible working hours, workplace diversity, commitment, autonomy, and a meaningful connection with their employers. But with the trauma of Covid-19, we have all rediscovered the importance of meaningful jobs, supportive colleagues and flexible employers.

To get an idea of ​​what companies need to do to attract and retain talent in the future, take a look at ServiceNow, a $3.5 billion enterprise software and services company based in Santa Clara, California. Unlike many of its Silicon Valley peers, ServiceNow doesn't rely on workplace amenities like fancy offices and a gourmet snack bar that offers free lunches and bottomless lattes. Instead, the company focuses on the factors that matter most to retaining and inspiring employees: an inclusive culture, a workplace that makes tasks quick and easy, and world-class rewards for people who "stay hungry and humble." .

In 2017, then-CEO John Donahoe (former CEO of Bain) and his team set out to transform ServiceNow from a technology- and engineering-centric organization to a people- and customer-centric organization. They began to rebrand the company, both externally and internally, as an organization dedicated to "making the world of work better for people."

Pat Wadors, who was ServiceNow's Director of Talent until mid-2020, and Alan Marks, the company's Director of Marketing and Communications, have teamed up to introduce employees and potential hires to the company's new offering. They found that in addition to good pay, tomorrow's workers also crave a deep connection to their employer and purpose. They want to be part of an organization that is doing something meaningful, like making work easier for everyone. They want to feel a sense of inclusion and belonging - to be part of a culture that encourages all employees to do their best every day.

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So ServiceNow built a culture of diversity and took drastic steps to promote inclusion in the workplace. This sets it apart from other tech companies, many of which view diversity as a “hiring issue” rather than a pillar of their talent strategy.

ServiceNow also found that potential employees are not that different from the company's customers because they want the company to work better for them. As such, it has deployed many of its own products internally—an initiative requested by Now on Now—to make integration and routine administration easier and faster. The company's HR processes are human-centric and geared towards growth and development. "People are treated like adults," an employee told us. "Not too much clutter gets in the way of getting things done." Finally, ServiceNow's liberal work-from-home and vacation practices make it easy for employees to work when and where they want, and support one Culture of productivity, not "time of presence". These practices have proven particularly valuable amid the pandemic.

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ServiceNow's unique approach has not gone unnoticed. When Glassdoor surveyed current and former employees of the company, 69% of respondents said they would recommend ServiceNow to family or friends as a place to work - a level of employee representation that places the company in the top 5% of employers worldwide.

. . .

Technology is fundamentally changing the way work is done. But most companies' approach to workforce planning and workforce management hasn't changed much in the past two decades. As companies rebuild their post-Covid-19 workforces, they need to enter the digital age. Talent planning and management needs to become more strategic, holistic, rigorous and data-driven. Organizations that rebuild using traditional analog processes are outclassed by more forward-thinking competitors. Given the time it will take to build a successful talent pool, companies need to start preparing their organizations for the future today.

A version of this article appeared onSeptember to October 2021EmissionHarvard Business Review.


1. Best Practices to Future Proof Your Business
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2. How future-proof is your business?
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3. NODE Talks 2022 | How to future-proof your business
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4. Future-proof your business with ACCA’s global talent network
5. How to Make your Business Future Proof and the Six Critical Components to any Business
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6. What to Do To Future Proof Your Business
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