HR Viewpoint: David Collings on why organisations are not prepared for the future of work
In the third of a series of interviews with future of work and HR experts, we ask David Collings, full professor of human resource management at Dublin City University, about leadership and the future of work, why fewer than 30% of CHROs are confident about their organisation’s preparedness and why having a North Star matters
David Collings: So, towards the back end of last year, we conducted a large programme of research that was focused on the future of work. And we were really interested in how learning and development as a function was enabling workforces for the future of work. And as part of that research, we spoke to a number of CHROs, chief learning officers, chief operations officers and CEOs, as well as doing a survey of about 250 HR and L&D professionals.
We saw some really interesting things. So, in this survey, for example, about 40% of our respondents say that the future of work was a priority for their organisation but fewer than 30% of them were confident in their organisation's preparedness for the future of work.
So, we saw on one level worryingly low number of organisations that were even seriously focused on the future of work. And on the other hand, an even lower number of organisations that were confident in their ability to prepare for the future of work.
The kind of issues that we saw in those organisations that were thinking about these questions, and focusing on questions around artificial intelligence and its role in the workplace, like robotics in certain sectors and its role in the workplace, and also changing work practices – what's broadly termed the gig economy and how that was impacting on employment structures and how work was structured in organisations. So, these were the three big buckets of change that we saw those organisations focused upon.
When we spoke to leaders about these questions, we got some really interesting insights. And I think it also helps us understand why some of those organisations are less prepared than we might have expected them to be on one level. The reality is that, for most organisations, they're busy in the present and their resources are very stretched and managed in the present.
I often have this conversation with leaders about talent. So, if you look at data on the availability and skills. If you track data – for example a good reference I find is the PWC CEO pulse survey – and since the last recession a decade ago we have seen the percentage of CEOs that say that the lack of availability of talent and skills is a constraint on their ability to deliver on their strategic agenda increase year on year and over the last number of years, it's been between 70 and 80%. So, 70 to 80% of CEOs say we don't have the skills and capabilities we need for today.
If that's the case, it's very hard for them to really think about the future. In those organisations that we did see that had a clear sense of the future, one thing that defined them and made them stand out was that they had what we called a North Star. So they had a clear view and a vision for how technology should impact in their business. So they weren't chasing that technology. They were doing things like saying we're going to use technology to improve customer experience.
We did some really interesting research in a logistics company that was trying to position itself as the leader for customer experience in that sector and their strategy was that every minute of time that was freed up through using technology was to be used to improve customer experience. So if I had 10 minutes created by the work that's automated, I pick up the phone and contact a customer.
We saw some other organisations, for example in the banking sector, that were very much focused on that digitisation journey and digitising the processes. So, they had this North Star that was driving their behaviour and that really set apart those organisations that were more mature in their thinking about the future of work - they weren't chasing the technology, the technology was strategically driving their business from a proactive point of view.
I think it's quite obvious that COVID has really shifted the dial in terms of a lot of the trends that we were seeing as recently as last year. COVID has accelerated so many of these trends. So, if you think for example of banking and how many of us that may have traditionally done some of our banking in branch have now shifted entirely to digital. I put on this jacket for the first time in five months for today's call and I found cash in my pocket. It's probably the first time I've seen cash in six months!
But these trends have been accelerated so much by COVID and I think that's forced leaders to really think strategically about the role of technology in their businesses. If we look at the hospitality sector, it's a great example where we see particularly the bigger brands and the bigger chains differentiating themselves by their ability to have contactless check- in contactless room keys and taking the individual interaction out of the process.
But I think what's equally happened in the context of COVID is that leaders have been forced to completely reevaluate their decision-making processes. Because if you go back to early in the crisis, we saw decisions forced upon leaders without data and without precedent. So they were forced within days to make decisions about whether their employees will be in the workplace or not, whether they would cancel large preplanned events, whether they would shut down sites or businesses. They had no data or precedent to make those decisions upon.
So, what we saw actually in some more recent research we did where we worked with a group of CHROs in Europe and the US largely, we saw those CHROs tell us about the importance of values. And with the lack of data and precedent to make decisions, those leaders in their organisations reverted to the organisation’s values, and that helped them make informed decisions around what was the best thing to do response to the crisis.
We also saw a clear recognition of the importance of humility and the willingness to reevaluate decisions when the data changed. So one CHRO, for example, when we spoke to him, said that prior to the crisis he would have always felt obliged to enter the boardroom with an answer, whereas it quickly became apparent in COVID that the answers simply weren't there.
A term we picked up from a number of the HR leaders we spoke to was the idea that perfection is the enemy of the group 'good' and they were required to make good enough decisions to manage the short term problems and have the willingness to iterate and reevaluate those decisions as better data and more insights became available.
When we think about the disruption that's happened over the last number of months and we think about those leaders that have been very effective in managing through that disruption, some of the priorities that we heard of when we spoke to those leaders were things that we would have recognised in the past that were important, but that have actually become even more so.
So simple things like communication. I would say one thing that sets apart those leaders that have managed effectively through this process is their ability to communicate clearly to their employees. And sometimes communicating clearly was simply saying we don't have all the answers here, but here are the kind of frameworks that we're going to use to inform our decision making.
I remember at one stage of the crisis seeing a letter that was written by the CEO of Airbnb, when they have to make some very difficult decisions about restructuring their business. And it struck me as a really good example of where there was empathy, there was a clear outline of how the decisions were made around the redundancies that the organisation was making and also what the organisation was going to do to help those employees to find new roles. To me, it was an excellent example of communication. So, I think communication is one skill that's become really important in this context.
I think trust was another one we heard a lot when we spoke to senior HR leaders. And we saw examples where that trust had been built prior to the crisis which really helped those leaders leverage their teams and work with their teams through the process.
The other thing that I think, and we've been working a lot with the data from our CHRO study over the last month or two and trying to make sense of it, is that one of the things that comes across consistently is the ability to manage paradox. Paradox was a lens we came up with from some academic thinking that really was trying to help understand how we move from binary decisions, which are an either-or decision, to decisions which recognise the benefits of both ends of the spectrum.
One way we thought about this was, for example, strategic versus tactical. And so, if we look at how HR has evolved over the last number of decades, we see a real focus on the strategic role of HR. And anything that was seen as non-strategic was delegated to line managers or automated and moved out. But actually we saw some of the tactical stuff become really important in the context of the crisis: the role of the HR generalist as a sounding board for leaders, as a coach. The importance of the practicalities of getting people into the workplace, keeping them safe, but also retaining that strategic eye on the future where HR leaders were able to have conversations where they balanced their role in terms of protecting the people and the values of the organisation with the strategic realities and the operational realities of the organisation. That ability to manage these competing tensions was something we saw come through really strongly in our data.
David Collings is full professor of human resource management and associate dean for Research at DCU Business School, Dublin City University.
This is one of a series of interviews The People Space is conducting with HR leaders and futurists in advance of the release of new research into leadership behaviours in disruptive times by our Brand Partner 10Eighty on Wednesday 14 October, 14.00- 15.30 BST. In this interactive session, you’ll also have the opportunity to take part in a small discussion group to explore the identified themes and what these mean for businesses. If you're interested in attending the event and receiving your copy of the white paper, please register here.