Episode Transcript
Speaker 1 00:00:07 Good morning everyone. We're back from the irresistible 2023 conference last night, and it was spectacular. I have to say it was the best event I have ever put on. And the best event I've ever been to <laugh>, I'm a little bit biased, but not really. And I think the other people who went would agree, and it was really because of the experience we created, the location, the venue, the multitude of really fun activities. And of course the people. It was a very global conference, very senior conference, about 450 people came. And those of you who came know how open and collaborative and fun it was for all of us. So let me give you five things we talked about to consider. And for those of you that are corporate members, you can watch all the videos and essentially participate in the conference through our website.
Speaker 1 00:00:59 Those of you that are not, please join and, and you'll get access to all this stuff. So the first thing that I talked about in the very beginning in the keynote was this idea of organizational ingenuity, which I previewed in the article before the conference. And, and what that's really about is taking the concepts of irresistible, the seven principles and apply them to a world where every employee has ai, every employee is now superhuman and has more information and more tools and more capabilities at their fingertips than they had maybe ever before in an interconnected way. So data, information, education, all are available. And what that means is all of these HR innovations that you guys have been working on, and I really displayed about 60 of them in the keynote. Things like talent marketplaces and skills taxonomies and skills-based hiring and pay equity solutions and hybrid work and onboarding and all, all of those things are now tools to harness the productivity of these SUPERPOWERED workers and employees we have.
Speaker 1 00:02:03 And we really are going to have to learn how to do that because the number of workers in the world is flat to declining because of the fertility rate in all the developed economies. So your ability to create a productive organization, not productive individuals is really your job. And then I talked about the pacesetter research where we proved through, uh, the first three industries we did, the healthcare industry, the banking industry, the consumer packaged goods industry, that the skills that matter the most are not the technical skills of ai. I mean, they matter. Sure, you've gotta, you've gotta get, keep up on the technology and, and all of that. But really the change skills, the change enablement skills, skills, the change management skills, the change readiness skills, the human-centered leadership skills, and actually everybody in the, in the conference agreed with that, that technical skills are going to be a commodity.
Speaker 1 00:02:55 You're always gonna be fighting for them and developing them, but how you use them, them and where you use them is important because a lot of great companies had great technical skills. Xerox did, IBM did digital equipment did. And they got crushed by their competition because their competition could move faster. And that's because of those pace setter skills. So we had a long conversation about that, which led us to culture. Now, believe it or not, culture was a very big topic at the conference. It wasn't intended to me. I I wasn't intending it to be a big culture, but it came up everywhere. And the reason can culture came up is because we had some very large companies. We had U S A A, we had Moderna, we had Air Canada, we had a lot of companies in Europe, L'Oreal, many others. And what they were basically reflecting on in all of their sessions, including the keynotes, was that because the pace of change is so fast driven by technology, innovation, ai, the blending of industries and the skill shortage and people shortage in most places, that we have to rely on our culture to get people aligned, to get them to stay in the company, to hire the right people so we don't lose them and keep them on track.
Speaker 1 00:04:08 And I think the tech industry has been the worst at this. The tech industry does tend to treat workers as if they're replaceable parts. That's why they're having so many layoffs. But the implication of focusing on culture is that you don't have to be a giant company to have a giant business. So one of the things we did on Thursday for the corporate members is we went over to Netflix and we spent, um, the half day and the evening with the Netflix executives talking about their business and their culture. And everybody knows who Netflix is, but you don't realize it's not a very big company. It's about a 10,000 person company. It's competing against companies that are 10 times its size, but it's very, very fast moving, collaborative, hardworking, innovative, creative company. And you've read the, the, the Netflix culture manifesto. Or if you haven't, you should.
Speaker 1 00:04:57 But it's really in some sense, very similar to a lot of the principles in my book. It's about empowerment and teamwork and merit meritocracy, reducing bureaucracy, simplicity, getting the core of the problem, falling in love with the problem, which I've talked about a lot. We talked about the conference quite a bit. So, so culture, culture, culture. I'm not gonna give you a lecture on culture on this podcast, but I will just remind you that whatever you're working on, whatever you're designing, whatever you're buying, whatever you're implementing, if you're not working on the culture, if you're not thinking about it, if you're not aware of it, you're gonna get stuck. Things aren't gonna work. And sometimes culture is driven by reward systems. You know, one of the piece of research that we talked a lot about at the conference, and we had actually the head of compensation from SAP there and some other big companies, was that the most backwards HR practice that we've uncovered in the last 23 years is pay.
Speaker 1 00:05:54 The way people are paid is rooted in the very old early days of the industrial model with the an annual reviews. And you know, how people's raises are, are computed and all of the, you know, go into pay by bands and so forth. And that creates cultural problems because people don't wanna give up something they've earned or they feel that is entitled to them to do this new thing or this new organizational model that you believe is important. And on the topic of culture, we added a new activity in the irresistible conference on Friday, about 45 of our leaders went to a special simulation learning event where we went through a case study, and it's a case study that we developed in concert with USC that teaches you what would happen in a company if you had management resistance to certain change, what would you do?
Speaker 1 00:06:48 How would you implement mobility? How would you implement new capabilities? How would you implement, um, a new technology strategy? And it was really, really interesting. And we are building out that simulation based training for all of you. We're going to have a series of HR executive education programs for HR leaders and senior HR practitioners, which is really most of you to come to USC and do these programs with us. It's just exceptionally powerful. I I can't tell you how much value people got out of that four or five hour kind of beta program. And we're gonna do a lot more of that. So if you haven't read the Culture Manifesto from Netflix, it's on the internet. I suggest you read it. It's a little bit outta date in a couple of specs cuz they were a very small company when they developed it, but they're now dealing with the culture of a bigger version of themselves.
Speaker 1 00:07:39 And so it's interesting, a lot of the things they're thinking about in their HR department are very similar to things that, you know, a lot of larger companies have been grappling with for many years. How to build a more of a learning experience learning system. You know, what, what is the implications of having a larger team versus a smaller team? Um, how much communication should be shared and how much not so forth. Anyway, Netflix is an amazing company. You can tell they're gonna be around a long, long time when you meet them and you go to their offices. It's quite an exceptional place. Now the third thing that came up, which came up everywhere was ai. And we launched a big study of ai, which I've been working on for the last couple of months, which you'll get access to in the next week or two.
Speaker 1 00:08:21 It's called the deep dive on AI for hr. It's an education report and a summary of what's going on in the market from my interviews with 30 or 35 senior executives and technologists in the industry and in other industries. And of course everybody wanted to ask about it. All the CHROs and a couple of common things came up. We had Keith Soling there, the chairman of the E E O C, who's just an incredible guy and he gave us all sorts of insights under the legal issues. But of course there's the question of will this affect our jobs? Are we gonna lose our jobs? We talked about that a bit, and you probably know my opinion on this. The answer's absolutely not. The only job that's gonna be lost is the person who doesn't use AI or the person who ignores it because you're gonna fall way behind.
Speaker 1 00:09:06 AI is a tool. It's not some evil intelligence out there to get you. You'll see, as you use our co-pilot, which you'll talk about in a minute, it's actually not that intimidating. It's just a very, very, very cool and useful tool that does a lot of things that, you know, were kind of hard to do by hand. So it is very, very powerful. So we talked a lot about that. We talked about the use cases for ai. We had a couple of really great professors from USC talk about the history of AI and some of the work they've been doing on soft skills simulations. You know, there's, there's academic work, which is probably advanced even more beyond the work that's been done by immersion and striver and others in, in the corporate world to understand emotions and facial expressions and voice and determine human interactions and how they can be improved through ai.
Speaker 1 00:09:56 So some of the stuff at USC is really good for soft skills training and it really re made me understand that AI is gonna play a big role in leadership development, in management development in coaching because these tools are pretty good at picking up subtleties that, you know, often time get lost in the rush of our work to get things done. I talked a lot about what I call second generation AI versus first generation ai. And when you get your hands on the paper, which is coming out in a week or two, you'll see a whole checklist for evaluating vendors. And you're gonna hear a lot about this from vendors, but it's a big topic and you can't ignore it. And we are more than happy to walk you through it. We have lots of information, lots of experience, and since we're doing our own AI project, we're, we're learning a lot about it.
Speaker 1 00:10:41 Hands-on. The fourth thing, uh, that came up a lot was many, many, many conversations and meetings and discussions about, I would say talent mobility and performance management. If you look at the emergence of talent marketplace tools, the reason that they're becoming popular is not only do employees want great career opportunities, but we wanna build a skills centric organization where we can find people to work on projects based on their skills. And we want to use them quickly and effectively because it's so hard to hire people. So that gives rise to the need the business need for a better internal mobility strategy. And that's why the talent marketplace tools are important. But it's really hard to do as you really hear about from the companies that have done it. The only companies that have been highly successful at it are companies that already have a really strong internal culture of collaboration and mobility.
Speaker 1 00:11:37 Most companies don't. Most companies have lots of silos, lots of independent business units, lots of geographic boundaries between different areas. People don't know what's going on in other parts of the company that well, nobody wants to spend that much time getting to know everything that's going on inside of their company. So, so these mobility tools both facilitate that, but they land in a world that's not ready for that. And I'm a big fan of it, of course. And we had lots of people talking about what they were doing with talent marketplaces and skills taxonomies of course, but we also heard a lot of challenges they were running into that were cultural managers not being willing to let people go. Performance management practices that are getting in the way, which by the way, performance management, I'm kind of tired of talking about it after all these years, is still a really big issue.
Speaker 1 00:12:27 And what I've learned for many, many years is we make it too complicated. We make it too methodical. The most important part of performance management is not whether you use a three-point scale or a four point scale or you know, whatever, the processes are important, but it's the philosophy. What does performance mean? How are we gonna evaluate it in a common way so we can be fair and we can have equity in pay and other rewards and growth in the company and we can reinforce our culture. So it gets back to culture and, and that by the way, allows a talent marketplace to work. If I decide I am a, like I am kind of a geeky guy, I wanna do a project, I wanna work on ai, whatever, and there's some group in the company that would like my support and so I wanna spend a day a week working with them, well my manager's gotta approve.
Speaker 1 00:13:15 It's gotta fall into my performance evaluation. I need to know I'm gonna get rewarded for that and not punished for it. Performance management comes up a lot. So it's part of systemic hr, it's part of stitching all these things together that facilitate this new world of a highly mobile, highly agile, highly adaptive organization. Well, you know, the work we're doing on the adaptive organization, which will be coming out later in the fall may, the maturity is low. We looked at 50, 60, 70 practices of mobility and regular ongoing development and how performance management facilitates agile work practices. And the ratings and the evaluations and the maturity levels are extremely low. So this post-industrial organization that we talked a lot about has yet to be implemented in most of your companies. And that doesn't surprise me at all. It takes a while for management to rethink their jobs.
Speaker 1 00:14:11 Listen, I think in many ways what's happened in the last five years, maybe for us in hr, we have become very aware of the new management practices and the new management principles and philosophies that are needed. Our managers have not, they are operating in the older world. I mean, if I look at this cage match thing between Elon Musk and Mark Zuckerberg, the layoffs and the shenanigans at Salesforce, a lot of the things that you read about in the press, even in the banking industry, layoffs and, and sort of draconian demands that people come back to the office because the CEO wants it. That's not enlightened management. And I have nothing against these people. They're doing the best they can. They haven't been living in this world of discovering new work practices like we have in hr. And I think HR has shifted the business and understood and and applied its tools.
Speaker 1 00:15:10 And you guys have in business much more than the other way, much more than the business leaders have gotten to know what we've learned. So my challenge to you coming outta that conference is you have to take the skills and the capabilities and the knowledge and the insights that you have and you have to apply them because the companies need them because the leaders are not as up to speed on the issues that you are in these things like wellbeing and hybrid work and forcing people to come back to the office. And productivity. Most of you have been thinking about this a lot. Certainly if you've been following us, you have, you don't think productivity is just laying a bunch of people off you, you know, it's more sophisticated than that. But, but I don't know that the business people have had enough enlightening yet.
Speaker 1 00:15:53 And if my thesis about organizational ingenuity is correct, small companies are gonna outperform big ones and that's gonna shake some of the principles of management up a little bit and people are gonna think a little bit differently. We're gonna prove that to you in the research we've been doing and the research we have, we are doing and going to do, okay, obviously we talked a lot about skills and skills capabilities and skills taxonomies. We had j and j, we had Schneider, we had Novartis, we had a lot of companies explaining their skills. Taxonomies, this is an unsolved problem. You're not missing anything because you don't think you've done it yet. The learning platforms have not kept up and there's a, I think a reinvention of the learning industry, corporate learning industry taking place slow. But it's happening. And I am still of the opinion that skills taxonomies are important and skills technology is very important.
Speaker 1 00:16:43 Of course it's under the covers of most of the new tools you buy. But if you think you're gonna build one big skills database for your company and it's gonna just sit there and be the source of all truth, that's not the way it's gonna work. And we heard that over and over and over. You have to be much more pragmatic about this and much more operationally savvy about where you're applying this technology and how. And I talked to Stuart Logan from BNY Mellon who's one of the pioneers on this and he told me the same thing there, you know, where they've been doing it now for years and they've been redoing their job architecture around skills and lots of cool stuff. He says it takes time. It's not, it's not an overnight exercise. The final thing I wanna mention is the Josh Berson HR copilot.
Speaker 1 00:17:23 We have previewed, we haven't launched it. We've previewed our AI large language model solution and it's really mind blowing. As I may have told you before, we took 23 years of research, all of our maturity models, all of our frameworks, all of our case studies, all of our vendor information, all of our articles. And we put them into a big large language model. And you can ask it and it's based on open AI technology and you can ask it lots and lots of questions. You can ask it to define things, you can ask it for case studies, you can ask it to recommend vendors, you can ask it to write job descriptions, you can ask it to write implementation plans. It'll actually create roadmaps or checklists of how to build an onboarding program or leadership development program. And it builds that knowledge from our research.
Speaker 1 00:18:13 So while there's lots of sources for some of this information, the reason that I think this is unique is there's no advertising, no marketing, no vendor promotion, nothing in here. It's all pure research by us. And of course, as you know, our research is very neutral and, and uh, fact and example based. So there's nothing in here that would lead you in the wrong direction. It will educate you and it will give you a super search tool to access, um, for hundreds and hundreds of reports in a second, which frankly we've had a hard time doing in our website. It just has been a challenge for years. So we previewed that. Everybody was very excited about it. We're not gonna tell you too much about it until you join. The membership members are gonna get a preview access to it and we'll do some more formal rollouts later in the summer.
Speaker 1 00:19:01 And then the last thing I just wanna say about the conference was not only do I love you guys because it's so much fun to get together, but your skills and your capabilities are really the core of these business transformations that are taking place. And I'm not here just to promote our academy, but that's part of why I'm saying this. But it came up to me, bill made a comment that when he was at Deloitte, the average training on a Deloitte consultant was about $1,700 per year. The average training for HR was $75 per year. Well if you buy into what I've been just saying for the last 25, 20 minutes, your skills are absolutely essential to your company's success. And as the pace setter research pointed out, technical skills are not as important as change enablement skills, which is a lot of what we do in HR training, enablement alignment, creating performance and valuation and goal programs that help the company grow.
Speaker 1 00:20:05 Teaching leaders how to be, you know, human-centered leaders and so forth. So we talked a lot about that and I really made a big point, many of the panels that you guys have more capability than you realize and you need to hone it and sharpen it and get it together as an organization. And I can guarantee you we have research that proves that when you have a higher percentage of your HR professionals that have world-class skills or top ranked skills in our five level model, your company grows faster. We've seen that. We have statistical proof of that. Even though you're not salespeople and you guys aren't building products and services, your ability to help people do that is directly correlated to your skills, your capabilities, and your understanding of systemic hr, which is how all the other pieces fit together. And that came out so strong in this conference.
Speaker 1 00:21:00 And let me add you another point. I know everybody's busy. I know you wanna take a summer vacation. I know you have a lot of projects at work. I know people are over committed. I've seen the data. I've seen the data from Gallup that employee burnout and stress is at an all time high. Well that's no excuse for not taking a couple of days a year, maybe a week a year, and honing your own skills, sharpening your own saw on what you know and you understand about hr. You can go to a conference like ours, you can sign up for our academy, which is absolutely the best thing going, which we'd love you to do. You can read our research, but do it because every minute that you spend learning something about this domain is going to make the rest of your work more productive and more impactful.
Speaker 1 00:21:52 And I just saw that face to face with the people that came and I had this interesting perspective that it seemed to me almost a third of the people that came were from outside the United States. For some reason. I feel like folks in in Europe and other countries are just more interested in taking care of their own skills. I don't know why that is. There's something about the United States that holds us back. Maybe it's our kind of doggy doish culture, but, but I'll leave you with that. It was a really great conference. Next year we have a pre-conference signup discount. You'll be seeing we can't support more than 450 people. So next year if you want to come, you gotta sign up early. We're going to have team programs next year where we're gonna ask CHROs to bring their senior teams because it's such a great team development experience.
Speaker 1 00:22:41 We're gonna have some even more exciting things we've already talked about for next year in terms of external visits and other things that'll happen. But anyway, it was a really, really wonderful experience. I wanna thank all of you who came, everybody who participated, a lot of the senior execs who came, obviously took several days out of their year to join us and I hope they all found it worth it. We really appreciate your support and it was just so enlightening and exciting. I just wanted to reflect on it and we'll get back to more, you know, normal topics in the podcast next week. Thanks a lot.
