Episode Transcript
Speaker 0 00:00:01 Hi, this is Josh person. Welcome to Research-Based Perspectives on the ever-changing World of work, leadership, learning, and HR with a heavy dose of insights on the exciting world of HR technology. Here it is August. We've now been dealing with the pandemic for a good six months, and I think it's time to take a little bit of pause and think about where we've been and where we're going. And I know a lot of you're gonna be taking a week or two off this month to get ready for the fall. And it's pretty clear to me in all the conversations I'm having with hundreds of companies that this pandemic is a transformation. It's an economic transformation, it's a social transformation, and it's a business transformation. And there are quite a few pieces of it that are now clear that weren't completely clear when I first started talking about the big reset.
Speaker 0 00:00:54 The first, of course, is that, well, the digital life is exploding. Well, 28% of the s and p 500 is now made up of the top five tech companies in the United States. That is just a astounding number. According to Bloomberg, the price to earning ratios of the NASDAQ is 38, which is almost twice the normal P to e ratio. So there's a lot of money, expectations, and growth in the tech industry because we're using technology in amazing ways. And, and the positive thing about it all is it's working well. Productivity at home and on the internet is very high. Virtual reality is becoming mainstream in education. Learning on demand is becoming real. Skills. Clouds are starting to work in the HR domain, and many, many other things are happening that are making life better with digital tools, including the fact that we're realizing we don't have to get on a plane or a car quite so often.
Speaker 0 00:01:50 In fact, one of the conversations this last two weeks was with 20 CHROs of healthcare providers. What they said to me was, we're just beginning to realize the impact of digital work on our culture, and we actually can deliver and assess healthcare digitally extremely well. And that includes having meetings and staff meetings and everything else. So that's number one. The second transformation, of course, is the transformation of businesses that are safer, more hygienic and higher value, but lower touch. And that's happened in every single industry. We're in the middle of a benchmark survey of about 750 companies and their responses to the pandemic, and the one area of weakness in the results, and we haven't published it all yet, is that companies haven't spent enough money training their managers on how to adapt to the new world of lower touch employee and customer relationships. And the industry that was the lowest of all was manufacturing, because manufacturing has a lot of high-touch jobs where you actually have to be on a plant, you know, on a team, in a factory working together.
Speaker 0 00:02:58 But we're learning how to do that, and companies all over the world are adapting. I have an interesting case study on Danone, the, uh, yogurt and health food company and how they've done it and, uh, had an also an interesting conversation with L'Oreal and their strategy for their white collar workers is, is they expect the workplace in Paris to be the safest and cleanest place in your life, cleaner than your home cleaner than the restaurant cleaner than the shopping experience you have at home. So this is number two, and I think this is long lasting. If you look at some of the studies that have been done on the history of the economy for many hundreds of years, you know, we used to have open sewers. We, we didn't have running water, we didn't have soap, we didn't have antibiotics. Every one of those innovations allowed us to do new things and live in different ways.
Speaker 0 00:03:47 And I think the same thing's happening here. We're going to find that these new principles and practices are not just temporary. Some of them are gonna be permanent. The third transformation that we're all going through is understanding that human wellbeing, human health, human wellness, human mental health is essential to business success. This has been sort of bubbling around in H for a while. We had wellbeing programs and lots of, you know, money spent on insurance benefits and HSAs and various different programs to help employees stay healthy. We're now realizing that actually performance of organizations is innately dependent on the wellbeing of the employees. Now, wellbeing doesn't just mean being fit and staying in shape, not having a sore back from sitting at your computer all day. It also means feeling a sense of energy, feeling a sense of commitment, feeling included, feeling mission and purpose.
Speaker 0 00:04:48 So one of the conversations that's been happening continuously in our big reset group is that what we used to consider a benefit in wellbeing, and it was really kind of in the comp and benefit part of hr, is now existentially linked to diversity, inclusion, trust, citizenship, social responsibility, and a fair sense of pay and progression in the company. The thing that can be the most irritating or frustrating or debilitating part of work is the sense of injustice of somebody got promoted and I didn't get promoted. I got a poor performance rating because my manager doesn't like me. Whatever. Those things have enormous negative impacts on your mental health and not only your career. So those are all coming together and I think there's a new framing going on in hr, and we're gonna be writing about this in the next chapter of the big reset on how all these pieces are being integrated.
Speaker 0 00:05:47 But we can throw the word employee experience at this too, but that's also part of this. The final point I want to talk about in terms of this transformation is that companies operate in a cadence. There is a cycle to a business. If you've ever worked for a fast growing company and I have, you know, multiple times, they, they go through cycles. Uh, if you look at what just happened to Intel, Intel is now being criticized as losing their edge in semiconductor manufacturing. A very significant problem. If it's true, read the book on GE Lights Out. What you find in GE is that because they wouldn't tolerate down cycles and their financial performance, they did all sorts of unnatural acts and essentially hollowed out the skills and talent of the company. And it's a really fascinating book for those of you in HR, because many of you probably considered GE to be the model of leadership, the model of succession, the model of performance management, the model of pay, the model of career.
Speaker 0 00:06:52 Mm, not so much that's turning out that that wasn't true. And it wasn't because any of these companies did anything wrong. I don't think they understand that human beings and businesses go in cycles and there are up cycles and there are flat cycles. There are periods of regeneration and rest and restoration and innovation, and then there are periods of growth and you can't grow all the time at the same speed without also taking stock of what you have and building preparedness for the next cycle. The economy goes through this, the weather goes through, this nature goes through this. Companies have to go through this too. And I think the month of August, this particular month is a cycle of regeneration for most of us. I know a lot of you personally are like me. You've been working since the beginning of the year. You haven't taken a lot of vacation.
Speaker 0 00:07:45 Now you're not sure what's gonna happen as the kids go back to school and they're probably not gonna go back to school and we need a break. So putting cadence into your thinking about your company, your team, your own personal life as a big part of this. The other thing I want to talk a little bit about in terms of where we are in August is that it is also very clear to me that the pandemic is helping companies prioritize between short and long term, close and far. You know, one of the paradoxes of the pandemic is it's asymmetric and unpredictable. We don't know where the virus is gonna crop up and when it's gonna go away. So we have to design our companies and our programs so that they can flex quickly, city to city, country to country. And some of the companies we talked to last week, for example, told me that in certain cities and countries in Asia, it's back to work as usual.
Speaker 0 00:08:41 The United States, it's absolutely not true. We don't know when things are gonna turn around here. We may need an election to get things to turn around, but that, what that means to a company is you have to design everything you do with the realization that there will be a distributed asymmetric nature to it. One of the problems a lot of companies had before this is when they would wanna design a new employee program, whether it was a performance management program or a leadership program, or a training program or a career program or whatever it may be, or rewards or whatever, they would spend months and months and months or many years building consensus, uh, getting everybody in the company involved and coming up with some common practices that people could agree on. I don't actually think that's worked anymore. Now what we're finding is the opposite is true.
Speaker 0 00:09:29 Let's design something quickly that works, roll it out, iterate on it, make changes as needed, listen closely to the people who are absorbing it, and then allow it to adapt to different parts of the company as needed. We called this the federated model of governance many years ago in the l and d market and in hr, but this idea of distributed authority with central coordination is absolutely critical to business success. Now, if you have a superhuman CEO who knows everything everywhere and can make every decision, you know, good luck to you, you may, maybe Elon Musk can do that. I don't know. I doubt it, but that's very rare in most companies. There's a lot of smart people in a lot of places, and they need to be given the authority to make decisions locally with a framework for success. And that is becoming absolutely proven in the pandemic.
Speaker 0 00:10:22 So this idea of an asymmetric growth with various forms of cycling going on in the company is really, really the secret to success. The other thing I'll just close with is creativity and innovation. You guys, the people listening to this podcast, a lot of you are HR people. You are doing amazing things in, I know you're actually inspired by the opportunities you have to add value in health, wellbeing, safety, hygiene, productivity, engagement, diversity. And that's because you've been given the freedom to do it now. And this idea of curiosity and creativity being unleashed in a time of stress is teaching us all a big lesson. Now, I'm not saying we're gonna remember this when we go back to normal again, and there will be some normal a year or two from now, but I think we're learning a big lesson that it's okay to break a little glass and try something new and roll it out.
Speaker 0 00:11:21 Because right now companies have a lot of forgiveness for things around the edges that aren't perfect. As long as we're adding value and moving ourselves towards this new transformed world of business, then we're doing the right thing. Anyway, these are sort of some big thoughts for the month of August. I wanted to just express that as we all take a little bit of time off before the fall, I can guarantee it's gonna be very busy in the fall. I'm in the middle of writing the HR technology report for 2021. I'll be excited to publish it probably around October, November, and many, many other things in the academy we're working on. We're launching a big program on resilience in September one on coaching at scale. We're working on an incredible program on diversity and inclusion that I think you'll find fascinating. One on org design, a advanced course on the learning space, and some other kind of cool things I'll tell you about in the next couple of weeks. So have a great summer, what's left of it, and please contact me if you have anything you'd like to share, comments or you want to discuss what's going on in your company. Thank you.
Speaker 0 00:12:31 If you like what you heard, please join the Josh Bersen Academy, the world's professional development academy for hr for less than a cost of a nice dinner in a town near you. You can have an entire year's access to hundreds of courses, articles, research studies, case studies, and an entire community of more than 10,000 HR professionals all collaborating with each other to help you learn and solve the problems in your particular company. We call the Buron Academy, the world's home for hr, and you'll find it to be one of the most important parts of your career and your company's HR strategy for the years ahead. Thank you.
