Harvard Business Review
https://hbr.org/2020/10/the-post-pandemic-rules-of-talent-management
Technology
The Post-Pandemic Rules of
Talent Management
by Becky Frankiewicz and Tomas Chamorro-Premuzic
October 13, 2020
Summary:
At the onset of the Covid-19 crisis, talent literally left the building, and
we’re now beginning to realize that in many places, it is unlikely to come
back. Technology is moving humanity away from the office and back into
homes across our nation every day. We are building culture outside of
buildings, with work that supports life on a more even playing field, with
talent that can come from anywhere. As we look to the future, it’s time to
unleash these new way of working for the long-term, with a focus on
well-being, equality, and productivity that can work for both employers
and employees long after this crisis ends. It’s time to embrace the truly
global talent pool that is available to drive growth, regardless of where
people call home.
Over the past decades, rapid digital transformation has enabled
organizations to completely reimagine the way they work and manage
talent. From reliable video conferencing platforms, to digital collaboration
software, to ubiquitous cloud-based connectivity, and a data-centric
approach to strategic decision-making powered by the synergy
between artificial and human intelligence, an imaginary worker from the
1950s would surely marvel at the current landscape of work as if they
were in a Black Mirror episode.
And yet, it took a pandemic to truly accelerate this trend and transform the
way most people work day to day, leveraging these foundational aspects
of technology to dramatically change how we approach jobs and careers,
perhaps forever. Indeed, for those with the skills to work remotely, the
crisis has turbocharged an unparalleled shift toward more flexible work,
and being able to live one life that better blends work and home — trends
we know workers have wanted for some time.
Technology has the potential to be a great enabler, providing humans
with the tools to remain emotionally and socially connected even while
in physical isolation, and the crisis has been the critical catalyst for
change. At the onset of this crisis, talent literally left the building, and
we’re now beginning to realize that in many places, it is unlikely to come
back. In what will surely count as one of the strongest demonstrations for
the extraordinary human capacity for adaptability, workers of the world
have been able to remain productive even in lockdown.
Humanyze, a technology firm that specializes in social sensing (led by
MIT’s Ben Waber, who coined the now widely-used term people
analytics), mined anonymous company e-mail, chat, and calendar data to
find that working without an office has actually extended people’s working
time by an average 10–20%, while also reducing work-related stress and
negative emotions, increasing confidence and well-being, and increasing
communication with close collaborators by a staggering 40%. In the early
days of the pandemic, Microsoft reported a 200% increase in virtual
meetings (mining their client data from Microsoft Teams), with a total of
2.7 billion meetings per day. Although virtual teams and remote work
were already quite prevalent prior to Covid-19, it is likely that overall
collaboration will actually increase when everyone is remote, with firms
like Twitter and Square announcing their employees can work from home
forever, and early indicators suggesting that business collaboration is
stronger now than before the pandemic.
As we look to the new next, unsurprisingly, many people have no desire
to return to the office full-time, and, by extension, be forced to live close to
it, especially if it is there mostly for symbolic or decorative purposes. As
our newly released ManpowerGroup global analysis shows, 8 in 10
workers want more remote work to attain a healthier work-life fusion. To
be sure, we had been talking about the benefits of an agile, hybrid, and
fluid workforce for some time, but the pandemic marks the formal
entrance to the age of digital nomads and a personalized workforce, with
five salient trends (and opportunities) to consider:
1. Technology Is Deepening Human Connections: Discussions about
new technologies, such as AI, often paint a bleak and dehumanizing
picture. For example, the author of Sapiens: A Brief History of
Humankind, Yuval Noah Harari, has warned of the rise of a “useless
class” of humans. And there are vastly exaggerated alarm bells being
rung over automation. A more obvious trend so far has been that humans
working with, and enhanced by, AI, almost always produce better results
than humans without AI, or AI without humans. While the crisis
accelerated the use of technology, which enabled the decoupling of work
from a “place”, this shift was already occurring as a large proportion of
organizations — large, medium, and small — made necessary
investments in online collaboration tools like Zoom and Teams, growing
the market for collaboration software to more than $45 billion globally
(resulting in a 300% increase in Zoom’s share price since the pandemic
started).
Technology is rapidly becoming more human. We aren’t simply
collaborating; we are running businesses, visiting family, attending
weddings, and educating our children through technology, making the
virtual world more humane, forging deep digital connections that are
founded on true human connectedness. The crisis has converted
collaboration software to “cohabitation software,” with Microsoft reporting
a 10% increase in social meetings (including “pajama day” or “meet my
pet day”) during the past few months. All this allows us to exist “in the
same space at the same time” together, while we determine the place.
2. Building Culture Outside the Building: Last year, when the world
could not even imagine the present state of affairs, we presented our
research on What Workers Want, and a Fortune 500 CEO asked us:
“How do you possibly build culture when you don’t sit together”? Our
response was that culture doesn’t exist within walls; it exists within
people, so you have to build culture through people, wherever they sit.
We could tell he was skeptical — yet the pandemic has proven that we
can and must build culture from living rooms and home offices across the
country. Workers knew this a while ago. It’s why people may use the
exact same technology yet experience work in a very different way when
they move from one company to another. Fundamentally, culture is “how
we do things around here,” and it’s the sum of default behaviors,
preferences, values, and decisions that make each organization a unique
habitat, regardless of whether people frequent an office or not.
Now company leaders are realizing it as well. Leaders can focus on
building culture anywhere by refraining from micromanaging, getting over
the politics of presentism, and learning to measure what each
employee actually produces and contributes to the organization with as
much objectivity and data as possible. Above all, by nurturing trust and
fairness in relationships with employees, leaders can upgrade the
company culture even in a virtual-only world.
3. Work That Supports Life: Our ManpowerGroup research shows that
the second concern after health for workers post-crisis is maintaining
flexibility. Most workers want to work remotely a few days a week; they
want a hybrid workplace between work and home that allows for better
balance. But the office does still have a role in human connection.
Companies like Ford are taking this as a moment to redesign how office
space works. Others are investing in new hubs where people come
together to collaborate and socialize. Gen Z employees are most positive
about coming back into the office (on their terms), and they, especially,
look to the workplace as a source of socialization as much as a place to
network and learn. Gen X and Boomers, who are leading many
companies today, enjoy the separation that the physical workplace brings
in their efforts to keep work and home a bit more separate.
It’s critical for leaders to realize that while workers may still want
to occasionally come to the office, few want to come in every day. For
jobs that must be in-person, it’s going to be important to flex the hours to
minimize the commute, flex the shift to allow parents to be part-time
teachers, and flex the days to enable the workforce to work in a way that
supports life.
4. Screens as the Great Equalizer: The great thing about video calls is
that the boxes are all the same size — it’s a great equalizer. Prior to the
crisis, we had all been in meetings where a portion of the team was in
person and part was online. The online participants were primarily
bystanders to the actual meeting. There was an advantage to being “in
the room,” akin to being in the right place at the right time, and saying the
right thing to the right person.
As companies work to improve diversity, equity, and inclusion, technology
provides the level playing field most groups want. Not only is it harder to
engage in office politics, show-off, or manage up when you are in a Zoom
call and everyone is watching, but the ability to capture, record, and
analyze meetings data provides organizations with hard facts to evaluate
DE&I in real-time. Diversity analytics, including a measure of how much
people from different groups speak during meetings, whether they are
included or excluded from the informal social networks that govern the
power dynamics of an organization, and whether their ideas and
comments are well-received by the group, promises to accelerate
progress in a still dysfunctional area. It is a wonderful silver lining that
technology and the global health crisis have sanitized a lot of the toxic
politics and nepotism that corrupt the meritocratic ideal of talent-centric
organizations: it is a lot harder to “pretend to work” when nobody sees
you or cares about where you are.
5. Talent Geographically Unleashed: The virus isn’t confined by
borders, and neither is talent in a virtual world. For years, the model has
been the same; when you’re interested in hiring talent, an early question
is often “Will you relocate?” On most talent plans around the world, it’s the
biggest career-limiting question, as it’s restricted career advancement and
company growth for decades. However, in recent years, we have seen an
empowerment of skilled talent calling the shots on separating where they
choose to live and where they contribute to work. Software developers
experienced the earliest shift — the work followed the talent. Then, with
record low unemployment in many areas of the world last year, we saw
this openness to location expand into other sectors, such as banking and
consumer goods.
Technology has now untethered talent from location. Talented individuals
with in-demand skills in any sector now realize they can live where they
choose and work where they are qualified. And employers now realize
they can source “best of” talent from anywhere in the world as long as
they have internet connectivity. The idea that workers have to physically
move to get a job is gone, along with the costs of relocation. It’s actually
quite simple: talented workers want to be free — free from geographic
borders, free from physical location expectations, and free from
government restrictions. As The Economist estimates, opening borders to
free up talent would result in a $78 trillion increase in global GDP: “Labor
is the world’s most valuable commodity — yet, thanks to strict immigration
regulation, most of it goes to waste.” If technology and cultural
organizational changes enable people to do their work from wherever
they want, they will set talent free even with current immigration laws and
restrictions, countering the recent political trend to slow down
globalization in favor of nationalist policies.
***
Workplace and workforce have now been separated, while work, home,
and school have been brought together. Technology is moving humanity
away from the office and back into homes across our nation every day.
We are building culture outside of buildings, with work that supports life
on a more even playing field, with talent that can come from anywhere. As
we look to the future, it’s time to unleash these new way of working for the
long-term, with a focus on well-being, equality, and productivity that can
work for both employers and employees long after this crisis ends. It’s
time to embrace the truly global talent pool that is available to drive
growth, regardless of where those people call home.
In short, the global talent pool has arrived, and talent is the new global
currency… if businesses have the culture, confidence, and technology to
tap into it.
[END]
https://www.mckinsey.com/business-functions/organization/our-
insights/hr-says-talent-is-crucial-for-performance-and-the-pandemic-
proves-it
HR says talent is crucial for performance—and the pandemic proves it
By Bryan Hancock and Bill Schaninger
Five talent-management practices can help steer organizations through
new ways of working and into the post-COVID-19 era.
To say that chief HR officers (CHROs) are busy in the COVID-19 era
would be an understatement. Now, more than ever, they are central to
how companies are reimagining their personnel practices to build
organizational resilience and drive value.
In the earliest days of the crisis, CHROs kept people safe while fostering
connectivity and caring in an intensely stressful time. In planning for and
implementing the restart, they have been working to maintain morale
and productivity for remote workforces while trying to figure out how and
when to get folks back into office settings.
Those responses were to circumstances that no one had ever faced
before. Now, though, the COVID-19 crisis is accelerating preexisting
trends in five areas of talent management that are part of the CHRO
playbook: finding and hiring the right people, learning and growing,
managing and rewarding performance, tailoring the employee
experience, and optimizing workforce planning and strategy. In this
article, we look at how CHROs can take action in those areas to craft a
strong and durable talent strategy for the postpandemic world.
Finding and hiring the right people
During the COVID-19 crisis, changes in customer demand have caused
a temporary spike in hiring in areas such as grocery while leading to
massive layoffs in sectors such as hospitality. Even with those shifts and
an overall rise in unemployment, efficient and effective hiring will
continue to be important—especially for the scarce skills required for the
next normal in areas such as IT.
In May 2020, we surveyed more than 190 chief officers and functional
leaders across industries to find out how they were thinking about
spending allocation in the months ahead. Of those leaders, 67 percent
say they anticipate spending less on permanent hiring in the next 12
months (Exhibit 1).
While some of that decline is related to a reduction in labor demand,
organizations are also rethinking their hiring processes more broadly.
For example, given successful experiments in remote hiring during the
COVID-19 crisis, companies are reconsidering the need to go on
campus for interviews (which would admittedly be more difficult now,
with many colleges and universities planning to use remote learning in
the fall). That is an acceleration of a preexisting trend: companies such
as Goldman Sachs were using remote interviewing for on-campus hiring
before the pandemic. We expect that trend to continue in the
postpandemic era.
In addition, temporary labor, which shrank faster than overall jobs did (a
29 percent reduction from February to May, compared with a 13 percent
employment drop overall, according to the US Bureau of Labor
Statistics), is poised for a faster recovery. Organizations should be ready
to use that flexible labor in additional ways.
Of surveyed leaders, 63 percent expect to spend the same amount or
more on IT-staff augmentation in the coming months. The number of
online freelancers in software and tech jobs has actually increased
significantly during the pandemic, according to the Online Labour Index.
Digital skills are still in short supply, and remote working for all
employees places remote and online freelancers on a more equal
footing with full-time employees. Even in other talent categories,
temporary labor usually responds more quickly in a crisis recovery, as
employers value flexibility during its early (and uncertain) stages.
Across both permanent and contingent hiring, CHROs should take a
fresh look at the range of tools, including assessments and platforms,
that are making it easier to connect people to work. There are a large
number of up-and-coming organizations in the prehire ecosystem, and
innovation is making it easier to connect people to employment based on
a deeper understanding of their skills and how those match with
available jobs.
Learning and growing
Learning organizations face a tension between continuing cost
pressures in a downturn and the need to deliver training to help workers
adapt to a changing organization and business environment. That
tension was reflected in our survey, which shows that 29 percent of
learning and development organizations plan to invest more in the next
12 months and that 38 percent plan to invest less.
Our research on reskilling shows that CHROs need to think about the
effects of large workforce transitions being accelerated by the COVID-19
crisis and how reskilling plays a key role in helping close talent gaps
while keeping employees connected to jobs. The agenda for
postpandemic learning and development extends beyond reskilling,
however, to three categories of cost-effective training:
Broad-based digital training in essential skills. Many organizations are
expanding remote training to address challenges, such as effective
leadership of remote teams (a new skill set for most managers) and
building personal resilience in difficult circumstances. McKinsey
Academy, for instance, has updated its Ability to Execute platform with a
COVID-19-related edition that provides a series of training modules on
remote working, leadership during a crisis, and executional capabilities
that matter.
Focused upskilling rooted in changing work. Such forms of upskilling are
function and work-group specific and tied to different ways of working.
For example, a sales force that is moving from a largely in-person to a
hybrid remote model will need to be upskilled in the practices that drive
remote success. The right data-driven approach can bolster sales-force
performance—and help HR departments draw a direct line from talent to
revenue.
According to recent McKinsey research, 77 percent of leaders indicate
that retraining salespeople is very or moderately important. To do that,
some companies are retraining field sales reps for inside sales roles,
including those that require an increased use of data and analytics and
those that provide customers with technical expertise via a website’s
chat function. In our survey of leaders, IT, marketing, and supply chain
were among the most cited areas for specific upskilling. That holds true
for HR: 61 percent of respondents believe that upskilling will be very or
moderately important in the area (Exhibit 2).
Leadership development. In response to the current crisis, the slow pace
of corporate bureaucracy has been replaced by clear goals, focused
teams, and rapid decision making. CHROs have a key role to play in
making sure that the change sticks. Leadership-development programs
can provide support for faster, more agile organizations. In particular,
organizations can identify the three to five shifts in leadership behavior
that would be required to keep them moving in a more focused way.
Leaders who are working on these skills can spend a small amount of
their learning time in formal settings (in classroom, online, or with a
coach) and the majority of it working on real project-based business
problems (which the COVID-19 crisis naturally provided).
Exhibit 2
Managing and rewarding performance
The COVID-19 crisis is speeding up needed shifts in how organizations
manage and reward performance. As our previous research has shown,
the majority of business leaders don’t believe that their performance-
management system accurately identifies top performers—and the
majority of employees don’t feel that the performance-management
process accurately reflects their contributions.
The current crisis has dramatically affected goals and performance
plans, with the added wrinkle of making the people who are working
remotely even more reliant on performance management to tell them
how they are doing. That makes three CHRO actions more relevant now:
Transparently link employee goals to business priorities and maintain a
strong element of flexibility. Managers should have regular
conversations with their employees to set priorities jointly in a changing
environment. Annual “set it and forget it” goal setting was already seeing
declining relevance among knowledge workers before the pandemic,
given the pace of change and need to adapt. And the radical shifting of
priorities during the COVID-19 crisis highlights how challenging the
annual system has become.
Invest in managers’ coaching skills. Coaching is the heart of managing
performance, which is even more critical when workers are remote.
Organizations need to invest in managerial skills—and mindsets—
around coaching and feedback as a continuing process.
Keep ratings for the very highest—and lowest—performers but also
celebrate the broad range of good performance. Instead of investing
time and energy in making small differentiations in ratings (and pay) for
those in the broad range of good performers, organizations should be
focused more on having robust development conversations.
The COVID-19 crisis has amplified how hard it is to make distinctions “in
the middle,” but those distinctions have always been hard to make for
knowledge workers. As a result, a movement toward recognizing the
broad range of good performance is welcome. At the same time, it is
important for CHROs to craft a talent strategy that calls out and
recognizes the truly distinctive (to motivate and retain them) and the truly
lagging (to boost morale and organizational performance).
Tailoring the employee experience
Employee experience and connectivity have taken on whole new
meanings as extended work-from-home policies have required
organizations to be intentional about building each. In blunt terms, work
can’t be another source of anxiety or uncertainty for employees right
now. They have more than enough going on.
The blurring of the line between work and life while working remotely
means that employee experience is even more critical. For virtual
workers, there’s no commute to the office, no coffee- or snack-room
chat, and no in-person gathering after work. Tethered video (or phone)
interactions during the course of the work day are going to make it or
break it for most people.
One way to handle employee experience in a remote environment is to
tailor the approach to individuals or segments of people. Our research
shows that experiences vary widely. That is also true for the hybrid work
environment, with some employees back in the office and others
remaining at home.
CHROs will need to help establish norms of working that foster
engagement and inclusion for all employees. There is no one-size-fits-all
solution. The answer, different for every organization, will be based on
what talent is needed, which roles are most important, how much
collaboration is necessary for excellence, and where offices are located
today, among other factors (Exhibit 3).
Exhibit 3
Optimizing workforce planning and strategy
Given the shifts in how value is being created in the post-COVID-19
world (for instance, the shift to contactless experience in grocery, retail,
and restaurants and the change from in-person sales meetings to
remote sales calls), the talent base required to deliver that value may
need to shift as well. As such, it is natural that workforce planning,
strategy, and change is the category of HR spending that survey
respondents cite as the most likely to increase over the next 12 months,
with 76 percent reporting that they will spend the same or more. There
are three important components of workforce planning and strategy:
Critical roles. Our research suggests that a small subset of roles (less
than 50) is disproportionately important to delivering a business-value
agenda. For each of those roles, it is critical to identify the core jobs to
be done, the qualities needed of the leaders, and whether the role is set
up for success. Given the shifts in the value agenda during the
pandemic, it is important that organizations reassess the roles that are
most critical in the current stage of the crisis (for example, new product
development and innovation) and in the recovery.
Skill pools. In addition to individual roles, organizations should look at
their major skill pools (for instance, digital coders) to understand the
skills required for the future and whether they are long or short on the
required talent. That means embracing a more expansive and dynamic
view of their talent supplies—one that tosses out the usual
preoccupation with titles and traditional roles, looking instead at the
underlying skills that people have. Indeed, we find that when companies
start with skills (the ones they need, the ones they have, and how the
mix may change over time), they can free up their thinking and find more
creative ways to handle the mismatches.
Talent systems. CHROs now have more workforce-planning tools to help
them match people to jobs. Artificial-intelligence-enabled tools can help
assess an individual’s skills, and performance-management systems can
be realigned to track skills alongside performance. Longer term,
interoperable learning records can serve as skills transcripts that track
the skills employees develop across educational institutions and
employers.
In an example of matching talent to jobs, Talent Exchange, an online job
marketplace powered by Eightfold AI, was launched in April 2020 to help
people who are out of work during the COVID-19 crisis find the right
employment. Based on an understanding of skills across an organization
(and beyond), “smart slates” can be developed for critical roles, agile
teams can be staffed dynamically based on matching skills, and
redeployment opportunities can meet talent gaps while preventing
layoffs. Such tools, in the early stages of deployment now, will become
increasingly critical for CHROs and other leaders as they meet the
challenges ahead.
The COVID-19 pandemic has imposed a tremendous cost on people’s
lives and livelihoods, and it has forced businesses to adjust rapidly to
survive. We have seen “HR’s finest hour” in managing the radical shifts
facing workforces during the pandemic, and we are excited to see how
CHROs reimagine core talent practices during the recovery—and
beyond.
[END]
