Episode Transcript
Speaker 1 00:00:06 Hi everyone. This week I have a fairly long podcast. I'd like to run through with you and tell you about my three country trip to Europe. I just finished a series of meetings with Workday in Sweden and Stockholm, and then a whole series of meetings in the uk and then culminating in a fantastic event with the king and queen of the Netherlands at the Future of Work Symposium in Amsterdam. And I'm gonna tell you about all of these things and what I think we can take away from them. So first, let me talk about Workday Rising in Stockholm. Workday, as you know, is a five plus billion dollar company growing at 20 to 22% per year. Now expanding aggressively into Europe, where of course Oracle and SAP are well entrenched. And the company has developed some very strategic customers in many industries. And so Workday Rising was a two to 3000 person event filled with passionate HR and HR technology people and vendors and consultants.
Speaker 1 00:01:04 And I spent time on several workshops, something we called a Skills Jam workshop. I did a panel on skills with the head of human capital from Accenture, and then spent quite a bit of time talking to many, many individuals as I signed my book. And then I had a fantastic breakfast with Karina Berg, the C H O Spotify that I wanna tell you about. And something really big occurred to me as I was in all of these meetings, and that was that most of the Workday customers are in some process of figuring out what to do with the Workday skills cloud. In fact, while many companies have it, not many companies are using it yet because they're not sure how to use it. And one of the questions I heard continuously was, what's the difference between skills and competencies? And so benefiting from lack of sleep, probably too much caffeine and lots and lots of conversations, I realized we need to take a big gigantic step back and remember that skills and competencies are not at all related.
Speaker 1 00:02:03 And here's the story. Competencies are a 20 to 30 year old idea developed by OD psychologists to define the human competencies needed around jobs. Skills are associated with people, so that's a big idea. So what we did in the competency management world, which was going on long before I got into hr, is psychologists created a list of competencies. In fact, books of competencies, you could buy one, and then you would create a job with a set of job tasks and a job description, and you would assign competencies to the job, the purpose being to help select people for the job, to help give people in the job development plan of what they need to learn, and then even assess people around those competencies for growth. And each competency had a level of proficiency. So we had job titles, job level, job description, job tasks, job competencies, job proficiencies within the competencies.
Speaker 1 00:03:03 And so what you're dealing with here is thousands and thousands of pieces of data all dealing with a very amorphous idea of the human capabilities needed to do a job associated with the job, not the person. And then we build systems. And many of those systems I was involved in working with for learning and talent management that tried to take all of these competencies and use them in the integrated talent management model, which is essentially a 30 year old industrial based supply chain model for human capital, which I'll talk about in a minute. And the idea behind the competencies was that we could select people as fungible res who fit those competencies, we could develop them into those competencies, and eventually they would fit into these jobs like puzzle pieces, and they would work well because they knew these competencies. And somehow we would assess these competencies on this one to five level.
Speaker 1 00:03:59 And I've talked to companies that actually built definitions of competencies by level proficiencies, and we'd know who's good at what. But you know, it never really worked. Outside of manufacturing compliance, safety, and regulatory roles, there are a lot of jobs and companies that require you to be competent. If you're a nurse, if you're a telephone repair person, if you're drilling in the drilling business of an oil company, if you're a truck driver, if you're operating a piece of machinery, if you're manufacturing a pharmaceutical, you have to know certain things and you have to be proven to know those things. And you need to either be certified or tested or observed, otherwise you're not gonna be able to do that job. And if you do do the job, you could cause a massive amount of problems. And those forms of competency models still exist and they're still very, very useful.
Speaker 1 00:04:50 And specialized systems like kauna are designed to manage those regulatory or compliance based competencies, but for the entire company, including the white collar workers, the managers, the project leaders, the designers, et cetera, these kinds of artifacts are a lot of overhead. And most of the companies I talked to that had these large competency models, not only took many years to build them, but later discovered that they weren't really that useful and they would fall out of date. Now in the world of leadership, we do try to do this pretty regularly because you really can't assess leaders unless you have a framework for leadership. And every company's framework for leadership is slightly different because of their business strategy. But let's leave that aside for now. Now the skills world is completely different. Think about skills as complex metadata about human beings. I went to Cornell and studied mechanical engineering.
Speaker 1 00:05:42 I learned a lot about heat transfer and math and physics and other forms of science. I have a lot of background in those topics. So one might say I am skilled as a thermodynamics oriented engineer, which I am. I haven't used it that much, but I do know a lot about it. We also know that people's skills can be inferred from the courses they take, the activities they've had, the people they know, the jobs they've had in the past, the companies they worked in, the technologies they've used and so forth. And in some sense, the skills cloud is really just a word cloud, because in a skills cloud, everything from salesforce.com to Microsoft office, to collaboration, to leadership, to teamwork are all considered skills. And obviously some of them are very complex and some of them are very simple. Some of them are technical, some of them are soft skills.
Speaker 1 00:06:31 Some of them take decades to build, some of them take hours to build, some of them take minutes to build. And so we're going down a completely different path with the skills cloud than we did with competency models. And so what we talked about in the skills workshop, in the skills jam workshop, which by the way we're now doing for many other companies, if you'd like some help on this, please let me know or let us know, is we're taking these skills models like the one from Workday and others, and we're showing companies how to use this technology and this information to apply to specific business problems as opposed to building a gigantic infrastructure like we did with competencies, which for some reason seemed like a good idea at the time. So while we would like to have a skills model for the whole company in every job, I'm not sure that's the best idea, and we haven't really found it to be a very good strategy In very many cases, what is a good strategy is to pick an underperforming business area, a critical new technology or initiative or domain that the company's moving into maybe a new form of energy, a new type of product, a new consumer segment or a transformational process going on in the company like a merger and acquisition to use the skills technology to bring people together and align them around this new domain that needs to be developed.
Speaker 1 00:07:45 And you can't do it in HR like you can with a competency model because we're not gonna pick these out of a book like the FYI book from Korn Ferry. These are gonna come from the outside world. The skills that software engineers need are being created by software engineers, and they're always changing, and that's true for every other part of business. So we have to develop these skills models in what we call skills academies or capability academies or skills groups so that the business people are involved in the definitions and the creations and the prioritization of skills. Because let's face it, a lot of these skills aren't very strategic at all. If you look at most skills cloud data sets, the number one skill in most companies is usually collaboration, whatever that means. And the number two is usually Microsoft Office, which obviously has very little to do with strategic value.
Speaker 1 00:08:34 So this is a big, big deal. And lots and lots of technologies are being applied to this. And the applications of skills are very clear. Recruiting, sourcing, tele mobility, career, marketplace, career and skill adjacencies, career pathways, learning and development, and eventually leadership. I don't know that we're using skills so much for leadership, we're still using competencies, but that will come too. So anyway, I won't spend much more time on this right now, but we spent a lot of time on that with Workday, and we're gonna be doing a lot more work with Workday and with other vendors on helping you develop your skills strategy. The second thing that happened when I was in Stockholm, as I met with Karina Berg, the C of Spotify, she's a really amazing human being. She's not only the C H O, she runs strategic planning and several other business functions.
Speaker 1 00:09:21 And as many of you know, Spotify is, is profiled extensively in my book, so I really recommend you read it. And they are really pioneers of the agile operating model, the agile work model, the agile career model. And she told me a lot of fascinating things. I'm gonna try to get her to come to our conference next June, so you can all hear from her directly. But one of the things she said that was most interesting is Spotify, like many companies is growing like crazy. They hired approximately 4,000 people in the last year, and she said that despite common belief, people that worked at Google or Facebook don't really work out too well at Spotify. So even though many of the jobs are software engineering jobs, Spotify is different. Spotify has a collective thinking, Swedish style culture, which by the way, so does ikea, who I also met with when I was there.
Speaker 1 00:10:09 And she said, at Spotify, everything is transparent. Everybody can app attend any meeting, they can read any document, they can see whatever any project is going on, and the company moves in a collaborative lockstep fashion or it takes a long time to create consensus, but once they create consensus, they move very, very fast. This is very different from American companies where there's lots of creative innovation and oftentimes inconsistent projects going on in the interest of innovation. And so she said one of the most interesting things she's done over the years, in addition to really focusing on recruiting, is built a very, very extensive onboarding program for multiple months to help people understand how to work and do business in Spotify. And that's something to think about since it's so hard to recruit people and every company's struggling to retain, make sure you've really spent some time getting people on board.
Speaker 1 00:10:58 And I don't mean just filling out their I nine cards and getting their payroll set up, but really learning how to work in your company. By the way, one of the most interesting stories about this I've ever come across is the company Epic, which is the largest provider of medical health systems, recruits all new people into one of only six functional areas. And when you join one of those functional areas, the line leaders in that functional area spend three to six months onboarding you into the business before you get a specific job in that functional area. So you really get to know how the whole company works. These are very high performing companies and these are ideas that you really need to think about. Okay, lots of interesting things going on in Sweden. Workday is of course cranking along at full speed and doing very, very well.
Speaker 1 00:11:46 But I want you to think about the skills issue, and it's not a replication of what you did in competencies. It's a whole different idea. The next thing that happened is we all went to London and we spent several days meeting with almost a hundred clients. I signed my book at a bunch of events. We did some work with Eightfold and Better Up and Fuel 50, and several things came outta those meetings. First of all, the uk, much like the US, is going through very high inflation, higher than us and at very tight labor market like here. And so they are also struggling to hire and retain and engage people in a very significant way. And many of the meetings we had had to do with pay and culture and recruiting. And in the area of recruiting, there's a lot of things to discuss. And let me just talk about a few of them.
Speaker 1 00:12:31 We, by the way, have started a relationship with Alexander Mann, who's a really world class global recruiting outsourcing company and learning a lot in the discussions with them and their clients. And for example, one of the recruiters for a large oil company told me that, of course, I mean a terrible time finding operations people and hourly staff and really wanted to do a better job of recruiting internally for these jobs, but they're not set up for that. And this Kims up over and over again that in a labor market like we're in today, if you're not recruiting inside the company, you're not recruiting at all. And so the question is how do you do that? How do you set that up? You know, our four R model, recruit, retain, re-skilled redesign is really the foundation of the new world of HR is doing things in a systemic way.
Speaker 1 00:13:16 We call this systemic hr. And one of the great ideas that came out of that particular meeting was one of the talent acquisition executives at one of the large companies said, you know, we realized this was a problem. So we retrained and realigned our recruiters to be talent strategists. And what they now do is even more important than maybe what the business partners do is they work with the senior leaders on the workforce plans and they decide, is this a new hire? Is this an internal hire? Is this a job redesign? Or can we move somebody into this role and reskill them at the line unit level? That is a job that recruiters are actually very good at. And I think taking care of and developing and promoting and developing recruiters as our research has shown is a key key thing to recruiting. By the way, another story on that, those lines, we had a long conversation with an airline who outsourced and laid off its entire recruiting process during the pandemic.
Speaker 1 00:14:11 And I just wanted to say that that's a very bad idea. It may seem like a way to save money, but the IP and culture that's built in the recruiting department is so important to your company. You should never think of laying it off. If you work with a partner like AMS or another vendor to work with you, they should be making the process even more strategic to you, not outsourcing it and getting rid of it. Recruiting is not a tactical operations job. It is a strategic role, and it is the most strategic thing you do in hr, believe it or not. And our research proves that. In fact, I told one of the talent acquisition leaders there that we have statistical data that will prove to you that improving recruiting is five times more important than anything else in hr, five times more important.
Speaker 1 00:14:56 And I'll be happy to share that with anybody who'd like to talk about it. Okay. So anyway, we did all that. Then. I had one of the most interesting and fascinating periods of my life. I traveled to Amsterdam, met with some more clients, and then I attended and gave a keynote at the symposium on the future of work at the Royal Palace in Amsterdam with King Willam and Queen Maxima from the Netherlands. And this was an absolutely life changing event for me. And I wanna share what I learned. I just talked briefly about it in the article I wrote today. Now, the Netherlands is a small but very, very powerful country. The Netherlands is not big, but it's the 17th largest economy, but the 70th largest population. So they hit way over their weight in terms of productivity and economic activity per worker, per human being, per citizen, very highly engaged workforce, a very open culture.
Speaker 1 00:15:53 The Dutch have a wonderful culture of discussing and debating and talking about things in an open way. And so as we met with the king and the queen, what they basically said, and they built this symposium, is we wanna talk about the future of work and we wanna change the game. And so with the help of ya, Janine Voss, the c o of Rabobank, who is a really amazing human being, they put together a consortium of 150 senior policy makers, business leaders, entrepreneurs, social entrepreneurs, young people, and government officials to talk about the future of work. We had three presentations. Linda Gratton talked about the future of work in terms of aging and demographics. I talked about the employer strategies and the five employer issues in the future of work. And then a very renowned policy maker by the name of Kim Putters talked about the really big game changing needs.
Speaker 1 00:16:45 And what I wanna talk about just for a few minutes is what happened, the essential finding after about seven hours of meetings and conversations, this is the future of work is not a pithy book or some weird picture of gig work or technology or robots. It's a series of decisions about the society we wanna live in. Do we want people to get fair pay? Do we want people to advance and progress in their careers? What do we wanna do about unemployment? What do we wanna do about underemployment and people without educational degrees? What do we wanna do about people who have disabilities or they may be illiterate? What are we gonna do about children moving into the workforce and aged people who live and work longer and longer in their careers? What are we gonna do about the constant need to re-skill? How are we gonna create diversity and inclusion in the entire labor market, not just one company so that anybody of any nationality who might be an immigrant can find a job?
Speaker 1 00:17:41 What are we gonna do about the fact that education is a barrier to work? And that if you don't have the right degree, you may never be able to get the job that you wanted, which is silly and not gone yet. What are we gonna do about the fact that many of the policy makers come from a particularly unique group and may not understand the needs of disaffected people in the economy? What are we gonna do about careers when 45% of workers change industries now to find new jobs? How do we bring industries together to share talent between them? Should there be mandatory civil service to encourage people to move to social entrepreneurism and social roles before they go to work? What are we gonna do about childcare when 55 to 60% of women are working and they also have to take care of children, and many countries don't have government sponsored childcare?
Speaker 1 00:18:32 What are we gonna do about healthcare when employers can't afford it anymore? I mean, you just take the list and add about 20 more things to it. All of those things came up. And for me, not only are these things I do think about constantly, it really taught me that those of you in HR and business and senior leadership roles must think about all of these issues because as the queen and I discussed, and the king upwards of 70 to 80% of the decisions that need to be made will be made by the private sector. The government will not create the future of work. It can't. It's not in the right position to do so. It will enable it, it will remove blockers, it will create opportunities, but the opportunities are really built and manifested by us. And so all of the things we've talked about during the pandemic pay, equity, wellbeing, fairness, flexibility, work at home, human centered leadership, everything we've learned for the last three or four years and many years before, many of which I've written about in my book, irresistible, are fundamental to the future of work.
Speaker 1 00:19:36 Countries like Japan are aging and have working populations that are not replacing themselves. Their cost of maintaining the health of older citizens is going up and up and up. And most countries like the United States, the UK, and the Nordics are all going through the same problems. So we have to think about this in a holistic way. Now, one way to think about this as a business person, and we talked a lot about this, is it's not just conscious capitalism. It's what I call corporate citizenship. And yes, sustainability is one way to think about it, but I think it's something even bigger than that. And this is a conversation I had with IKEA many years ago. Those of you who work in companies, small, medium, large, you are creating in a sense a society within your company. Your company itself has all the issues of a city or a country or a society, fairness, relationships, relat opportunity pay, standards of living, et cetera.
Speaker 1 00:20:34 And you are also creating a society for communities that you do business, the cities where you put offices, the supply chain partners you work with, and of course the governments that you do business with and work with. And so if we're going to have a positive future of work, which I believe we will, I really think 99.9% of human beings want the world to be better despite what's going on in politics. You need to think about your company as a citizen. Not only do we take care of the citizens inside of the company, but we are global citizens. And everything we do as small or big as it may seem, has an impact on the society and the future of work for your communities, your cities, your countries, and your stakeholders. And that's really what came out of this seven hour meeting, is the fact that none of these issues, including labor laws, by the way, we had some labor leaders there, can possibly solve any of these problems alone.
Speaker 1 00:21:32 But the bulk of the energy and money and responsibility falls on employers. And I firmly believe that we as employers, as HR leaders, are in many ways the most important creators of the future of work. If you treat your employees poorly and you lay them off, irrespective of fairness, I won't mention any names of who I'm thinking about, you're creating a sense of fear in your workforce. That sense of fear will infiltrate into the communities in which those people live. You know, there's an interesting psychological study that came out I read about a month ago, and I think I told a couple of you this upwards of 40 to 45% of workers go to work frightened. They're worried about their boss, about not saying the right thing in a meeting, about falling behind on their projects. I mean, that is a really sad state of affairs.
Speaker 1 00:22:23 For those of us in human capital and hr. We have to think about our role in the future of work as citizens, as leaders, as designers and creators. And you know, many of the things, you know as an HR people are very, very sophisticated things that most average people don't think about like we do. And so my big takeaway from my time in Amsterdam, including meeting some really fascinating, very thoughtful people, is that we have to think bigger. We have to think more holistically. We have to think about the systems, the societies, and the cities in which we operate. And I know most of you think about this, and you may or may not have the opportunity to do it, but remember, every individual issue you deal with at one employee at a time has an impact on that. And so the future of work is all about the society we want to live, and every decision we make has an impact on that future.
Speaker 1 00:23:18 And I was just so honored to be at this event and to be part of this. I really just want to thank the country and the royalty of the Netherlands for putting together this meeting. I hope every country around the world does this. I'm sure many of them do. And just remember that everyone on this podcast, everyone listening to this podcast, can be part of a positive future of work. So it was kind of a long podcast for today. We're gonna be back in action for the rest of the year. A lot of exciting research is coming out. We're gonna be launching our new research on human capital systems in the next week, followed soon by our banking industry study. And then early next year, you're gonna see our new research on new models of leadership and later in the year, systemic hr and lots of lots of other things coming. We are of course, a membership organization. We would love to talk to any one of you about joining us. And of course, for those that are of you that are individuals and you wanna get access to a small slice of what we do, please join the Josh Berson Academy. There's just an enormous amount of content and information and people in there to learn from. Thank you.
