Reinventing for Flexibility: A Skills-Based Approach to Talent Management

The Scene: Earth – pre-global pandemic.

The Scenario: A new way of working.

Executive Perspective: 45% think their workforce is ready.

The Workforce Perspective: 78% feel they could do it.

Reality: The workforce was ready to adapt and wanted to reskill, but the reason to do so wasn’t compelling enough. Quite simply, the pandemic accelerated this new way of working and executives are impressed with how adaptable their workforces have been.

Employers that already had a robust way of understanding what skills they had in their workforce, were able to pivot during the crisis and effectively flow the talent to the need. Those that did not, saw the need and started to build the right processes. It is now apparent that to weather future shocks, whatever they may be, organisations need more flexibility to scale up, to scale down, and to manage cost accordingly.

Organisations are attempting to develop their workforces while concurrently dealing with disruption, particularly as more than half of companies have picked up the pace in automating tasks due to the pandemic. Skills are reshaping how we think about jobs—how we assign work and how employees navigate their careers and get rewarded. When this skills based approach is implemented in the right way, we achieve more agility in the workforce. And this increased flexibility will likely deliver higher productivity and efficiency that stakeholders are demanding today.

The Top Five Required Skills

In our recent ChapmanCG Thought Lab, in partnership with Mercer, we asked our attendees what the primary business issue was driving their skills agenda. They told us it was a fundamental change in the business strategy (34%), followed by technological transformation (28%). The forthcoming Mercer 2021 Global Talent Trends Study research examined how the world has changed—the top five skills that have grown in importance in the eyes of HR post-COVID-19 are (in this order):

Prioritisation (48%) – Greater focus on our cognitive abilities to better manage a more blended work and personal life. Many employees now spend eight hours a week or more on zoom calls. It’s increasingly important to prioritise where we focus our energy and effort.

Collaboration (47%) – Distributed working, blended teams and remote working have all magnified the need for better collaboration.

Growth Mindset (44%) – Adaptability and openness to change.

Digital Dexterity (39%) – This was present before but has been accelerated.

Empathetic/Inclusive Management (29%) – Understanding and listening to the workforce.

Overall, this highlights a shift from the more technical priorities we saw emerge over the last few years to the more human areas.

Leadership

Travis Barton, Talent Management & People Analytics Leader at GE, talked about how the current situation has held up a magnifying glass regarding how we think about which leaders would or wouldn’t be successful in this intense environment. It has validated hunches or invalidated preconceptions. GE has had to sharpen the pencil on what is critical in a leader and how to measure it in the right way.

Leadership focus is equally important at Pandora, according to Michelle Wilkinson, Chief Talent Officer. Pandora is re-defining what great leadership is, and what digital and agile means in a leadership context—what are the specific skills we want leaders to be demonstrating and how can we assess this? It is about leading from the top and engaging leaders in areas such as diversity and inclusion. The CEO is creating a straight-talking environment with creative discussions and honesty, engaging his team to help to define what great leadership looks like. It’s not the role of HR, it’s the business leaders driving it.

There is also an increased authenticity coming through. Certain GE leaders are more forthcoming about what they are struggling with at a personal level. In their communications and actions, they are showing vulnerability which is leading to an emotional connectivity with the workforce. People have got to know the person behind the job – “whether it’s seeing cats and dogs crawl over an executive on a zoom call, we have created a more ‘real’ way of working”. In turn, this also makes demands on leaders who haven’t always worked this way and naturally feel less comfortable.

Listening 

Markus Graf, Global Head of Talent at Novartis talked about how the leadership have ‘listened’ to their associates. Novartis has implemented a new policy coined ‘choice and responsibilities’ around flexibility. Employees can choose how, where and when they want to work, while being personally accountable for informing managers and aligning with colleagues for effective collaboration.  

There is certainly more listening going on in progressive organisations, and a change in the way we listen and understand, according to Mercer’s Kate Bravery. Town halls and pulse surveys can be useful tools. By listening to employee viewpoints, we are not just reinventing for flexibility but reinventing for value—what people value from the employer has shifted.

Novartis want to continue with this heightened listening to associates and give them the choice as the pandemic eases next year. Their ultimate aim is to set up employees to make the best contribution to the mission: Reimagining Medicines for Patients.

Break the Habit– How are Companies Responding?

This reinvention can be tough when there is a rigid structure in place. What Mercer found is that if you want to get talent flowing to the problem and get true innovation, you need to have a progressive culture and mindset around an agile way of working. Facilitating talent exchanges/marketplaces and innovation hubs only work when you can break rigid structures. Traditional ways of structuring job descriptions fuel career progression in the vertical rather than generate that breadth of skills required for the future.  It is a huge culture shift that needs to be championed.

Many companies are starting to identify future critical skills and in a segmented way, according to Mercer’s forthcoming 2021 research. They have identified which skills are important for their future and in which specific parts of the business (53% of companies surveyed). 46% of companies are expanding and democratising their talent and learning ecosystems to embrace this. Those doing this well are telling people what skills they want their employees to develop and what the reward will look like and then enabling them. This is instilling more confidence that it will lead to career progression and making the linkage tighter. 45% are embracing this to help move talent around. Doing that in the crisis was effective but having that more sustainably can help manage talent costs in the future and provide thriving careers for their people. 34% are still gathering information on what skills they have in the current workforce. 31% are ramping up mentoring to support skills development and guidance and only 8% said reskilling is not their current focus.

Technology

Novartis like many organisations is investing in technology in HR as a key part of this journey. They are overhauling their HCM system to introduce a consumer-grade AI talent marketplace and learning experiences. Without the right technology it is impossible to match talent with opportunities at scale. AI-powered technology can help facilitate this—there are more opportunities to tap into data to inform the decision making. Data on skills is now more widely available. It is easier to predict which skills are going up and down—this was not readily available a year ago.

Building this consumer-driven experience to personalise and nudge employees into more of a skills focus will increase their marketability and mobility. HCMs are providing ways to look at these skills more closely and build effective talent marketplaces. GE has also embraced AI in succession planning. The AI is based on data on both historical employees and incumbents and can help them effectively with this at the senior levels.

Overlaying the Diversity and Inclusion Lens

Diversity, Equity and Inclusion (DE&I) has been a pressing focus for organisations during 2020. Being inclusive is a differentiator in terms of attracting and retaining employees but also now impacting the choices made by consumers. DE&I is therefore increasingly being infused into talent management strategies. GE is heavily focused on understanding where in its metrics there could be bottlenecks in the talent flow. The company is identifying the red areas and tying diversity issues in with the skills conversation. As demand and supply gaps are addressed, the organisation is considering how to combine skills discussions with the diverse talent piece. GE is also assessing where it needs to modify tools that unintentionally introduce bias. It’s like peeling an onion – analysing the tools leads to additional conclusions which can be further be explored and adapted.

Novartis has introduced a democratised approach to talent management driving more transparency which will ultimately level the D&I playing field. Succession planning is reserved for the top 1% but for the rest of the organisation they have increased transparency around equal opportunities and access to these opportunities.  

Courage

What became apparent through our panel discussion was that jobs are not going away. Pandora has continued to push on with hiring despite turbulence in the industry. Pandora leaders have bravely ‘leaned into the fear’ because they have realised the need to upgrade certain talent regardless. Many of Pandora’s competitors have not done this and the company believes that it links back to courage and thinking about the future versus dwelling on the ‘here and now’. While the leadership need to create stability, they are also looking at the potential growth knowing the new world is not going away. They need to marry this with how Pandora can become more relevant and connect with consumers in a different way.  There is a laser focus on what their critical capabilities are and what they want to shine the spotlight on. For example, what are the critical roles to drive the business forward, such as digital and e-commerce retail excellence.

It is important to reflect on company culture and values and ask whether it is setting the organisation up for success in the future given the challenges we are facing. Courage is required to go and have that conversation and push the boundaries. It’s not about what has been before.

The Future

During difficult times in the past, it was important for many organisations to balance economic realities with empathetic decision making. The most successful companies maintained the right balance in the workforce so they could come out stronger.

Skills-based talent practices facilitate talent sharing and enable the identification of strategic skills gaps, and subsequently help organisations see which skillsets are trending up to enable them to make informed ‘build – borrow – buy – bot’ decisions.   

Achieving the above is tough and most organisations are still on the journey. 34% said they were restricted by the lack of technology and data—not knowing what they have. The culture of being pegged to jobs also came up—it takes courage to move beyond this.

According to Mercer, the top five reasons that prohibited the move to more of a skills-based approach were more linked to the current climate. 47% felt there were simply too many things going on. 45% cited exhaustion of the workforce as a barrier to change. Previously the lack of workforce capabilities was the top reason. This sparks bigger questions for HR namely, how do HR functions pace the transformation to skills-based talent practices and how do they create the necessary culture of trust to embed it once that herculean launch stage has happened?

Across the board, business executives are asking HR to ‘step in and step up’ to deliver the business results. Skills are critical to innovate and the right capabilities are necessary to deliver on an organisation’s mission. The opportunity is now for HR to be bold and build momentum!  

Click here to download the presentation by Kate Bravery from Mercer.

ChapmanCG and Mercer Thought Lab video in full