Defining future talent - a manager’s pressing dilemma
Technology has revolutionised the way business is done, and is continuing to do so. But what does this mean for managers running an ever-changing workforceGuest blogger Stuart Hall
One good starting point in tackling this issue is to go back in time and examine where we have been, move forward to where we are today and analyse the changes that have taken place to enable us to better project the future.
Solid clues can be found in the jobs sections of daily newspapers.
Thirty years ago few, if any, job advertisements would have involved positions in technology, certainly none in digital technology. In the business context, cutting-edge equipment included electric typewriters and telex machines.
All involved the human touch.
Today, this technology is obsolete and the job adverts reflect that.
Some of the fastest growing occupations today are in computer engineering and support, data analysis, nanotechnology, artificial intelligence and robotics, amongst others.
The growing belief is that if human involvement is not essential (think supermarket self-checkouts and ATM machines), technology can do a more efficient job.
But let’s go back again in time. For over half a century following the end of the Second World War, employment and productivity closely tracked each other.
Increases in employment corresponded with increases in productivity.
In economic terms, productivity – the amount of economic value created for a given unit of input (for example an hour of labour) – was a crucial indicator of growth and wealth creation. It was seen as a measure of progress.
As businesses generated more value from their employees, everyone benefitted.
Countries became richer which, in turn, increased economic activity and created even more jobs.
Around the turn of the second millennium, however, things started to dramatically change. As economies became more dynamic, employment and productivity were no longer mirroring each other.
The gap between the two inexorably widened. Productivity continued to rise strongly but employment levels stagnated.
Many believe that technology is responsible for both the healthy growth in productivity and the weak growth in jobs. Indeed, the findings from a recent World Economic Forum (WEF) survey of 15 economies covering about 65% of the world’s total workforce suggest that around 7 million jobs will be lost and 2 million created by 2020 as a result of developments in genetics, artificial intelligence, robotics and other technological change.
Since 2000, we have witnessed the acceleration of a technological revolution, a radical transformation more comprehensive and more encompassing than anything we have seen before.
Few doubt that the changes we’re experiencing hold great promise, but the patterns of employment, production and consumption resulting from them are also creating major challenges that will require everyone to be very proactive if we are to maintain widespread economic prosperity.
Addressing the employment impact of technology
The discussion surrounding technology doing the jobs traditionally performed by people often relates to robotics and automation, but it runs much deeper than that.
Today we have the Internet of Things, big data, inexpensive data storage, cheap computing power, advanced analytics amongst others.
As Brian Arthur, a former economics professor at Stanford University, aptly put it, we have “digital processes talking to other digital processes and creating new processes.”
This may be enabling organisations to do an increasing number of activities more cost-effectively, but it is resulting in the loss of an increasing number of human jobs, creating even greater costs.
However, despite widespread agreement that technology will make huge advances in the coming decade, the impact on jobs is not universally negative.
People produce technology and since technology becomes obsolete at an ever-increasing rate, it will require skilled people to continue new developments while maintaining existing systems.
So the key issue here is that technology will require new labour forms, not less.
Drivers of Change
In the past, fields such as artificial intelligence and machine learning, robotics and 3D printing were largely disconnected. Now they are developing in a symbiotic way, building on and expanding one another.
Simultaneously, we are also experiencing socioeconomic changes in our work environment (on-demand and remote working) which, coupled with demographic and geopolitical changes, are all contributing to changes in employment trends.
Collectively, these drivers of change – technological, socioeconomic, demographic and geopolitical developments – and the interactions between them all are beginning to disrupt current business models resulting in a generation of new categories of jobs and skill sets.
Even though some industries, such as manufacturing, have, to date, been affected more than others, there is no doubt that every industry and most occupations will undergo a fundamental transformation.
While levels of unemployment are expected to rise, so, too, will the opportunities.
Already we are seeing the challenges of a widening skills gap resulting from staff retirements and the difficulty in recruiting specific talent in certain job categories. This issue is not at all generalised but can clearly be identified by specific industry, region and occupation.
For example, in manufacturing we are seeing labour-substituting technologies, again robotics and 3D printing, coming to the fore, but there is an increasing shortage of talented people capable of driving the business forward with these new technologies.
In the finance sector, many organisations have found their workforce shrinking due, largely, to the lack of career interest in this sector by Millennials. As a result they are having to handle the same, and in some cases increasing, trading volumes simply by leveraging technology.
If technological change is going to result in talent shortages, increasing unemployment, growing inequality and diminishing markets, then it is incumbent on individuals, governments as well as corporations to address this.
Individuals will need to take a proactive approach to their career development through continuous learning. Senior executives will need to establish training programmes that address not only their short- and long-term corporate objectives, but also the career aspirations of their employees.
Governments must create an environment (both through the education system and in employment) that encourages and assists companies and individuals to achieve their objectives.
The WEF report suggests that around 65% of children entering primary school today will progress into jobs that don’t yet exist.
Furthermore, the WEF suggests that five years from now, 35% of the skills considered important in today’s workforce will have changed.
Innovation will become one of the top three skills that workers will need since they will have to become more creative to benefit from the changes driven by new products, new technologies and new ways of working.
Welcome to the Future
We are now experiencing a paradigm shift that is transforming all industries and shaping the future of how things are made and how we live. Global economies are transforming faster, as they become more flexible and more resilient.
While technological progress will result in some jobs and skills becoming displaced and obsolete, it will also create unparalleled opportunities for people to become more creative and entrepreneurial.
Companies will benefit enormously by encouraging an entrepreneurial mindset within their workforce.
The lines between employment and productivity may continue to separate more widely but, fundamentally, the way we live and work (aside from any geopolitical issues) should change for the better.
We simply need to be awake to the technology-driven transformations taking shape and act on them accordingly.
Stuart Hall works for executive search experts Tyzack