2024 Predictions for HR: Productivity, Growth, and AI
[Music] hello everybody from all over the world we have a amazingly interesting group of more than 2,400 people at the moment and more joining so there will be lots and lots of interesting things to talk about so what I'm going to do for about 45 minutes is take you through the year ahead and this is an effort I go through every year I've done this about 20 years and it's not just me kind of pontificating on things that I think are going on it's based on all the research we've done over the prior year and the things we see going ahead and you all see a lot of this and so you will recognize some of these ideas but they're going to be in a new context there are three assets here you can get the report you can get the infographic and there is a micro course that's a six session little mini course you can take on these materials and the reason we do this is we really want this to be a tool for you to use to talk about within your companies to talk about within your teams to look at for your own professional development not just a list of predictions so there there's four big themes that we're sitting on right now as we come into the new year the first is we'll talk about labor market we are going to have a difficult hiring Market you'll see more on that the economy is probably going to do reasonably well this year and due to the fertility rate and the Aging of the Baby Boomers and the retirement of baby boomers virtually every country developed country at least is going to have a shortage of Labor we'll talk about that in a minute the second is transformation the PWC 2024 CEO survey 60% of CEOs now believe that their company as it exists will not be around in 10 years that was 49% last year so the rate of change and the pace of transformation has accelerated that has a huge impact on what we do we are a part of responding to that I'll talk about that in terms of the dynamic organization in a minute number three of course is AI I'm going to talk about AI as much as I can you know that we're into this we've spent a lot of time on it we're offering you AI through Galileo and you're going to be very involved in AI in many many ways as is your entire company and then the fourth is a complete completely different mindset for employees the essential change is coming out of the trauma of the pandemic by the way we're still getting covid I mean everybody I know has covid right now people are saying to themselves and this is all ages but primarily younger people you know I don't want to work so hard I may not want to climb the corporate ladder make my life better I'm happy to work on something that's good but if I don't like what I'm doing I'm going to find something else to do and given the job market they're going to quietly quit or leave there are 15 predictions I call them maybe predictions or imperatives in the report and in the report you will also find detailed analysis and research in each one and then at the end there is an action planning guide with a series of questions you can use in your group and your company and your team to walk through how you want to address these issues because not every company is going to focus on all 15 things but I'm going to hit through most of these on the webcast okay so let me start with the labor market Market you've probably all seen us talk about the post-industrial world where we're witnessing it right now you're witnessing it happen before your eyes this is a chart of unemployment and we all believed certainly I did you know prior in earlier parts of my career that unemployment was just cyclical you know when we had a good economy unemployment was low when we had a bad economy unemployment was high no that's not true there is a secular decline in unemployment it's going down it's now at 3.8% it went down as low as 3.4% % this is an effect of the productivity growth that's going on around the world the fertility rate I talked about earlier the retirement of the baby boners and just general demographics in developed countries but while that has happened GDP has gone up if you look at this chart it's actually fascinating the red line is GDP the blue line is unemployment rate and the aqua line is the number of people working and you can see this is us that in the United States we have not really grown the workforce much a little bit each year now the labor participation rate goes up and down but it's a very tiny variation and what this is showing you is increases and increases and increases in productivity productivity is going to be a big theme this year and because this sort of little equation here is going to get worse and the reason this is happening is historic just really good paper I'm really proud of called the post industrial economy that explains this is that companies were originally founded as you know small groups of artisans in The Agrarian age or farmers and they scaled by human scale so if I want to milk twice as many tacow I need twice as many milkers if I'm a a weaver and I want to weave twice as much wool I need twice as many Weavers and then and so we had a linear growth with business growth or GDP by human beings double the number of human beings double the number of growth Along Comes the Industrial Age we have electricity we have Steam engines we have Automation and all of a sudden things scale up and we have machines and automation to improve the scalability of our companies and we designed many many of the HR practices we have today from the Industrial Age I'm going to show you a picture of Jack Welch in a few minutes things like succession management job families career hierarchies pay for performance cascading goals even Balan scorecard stuff that I used to read about when I was first starting in business really comes from this model where we had hierarchical industrial companies and by the way people retired in their 60s during the Industrial Age and so they didn't move around between companies or between Industries very often at all along comes computers Along Comes mainframes PCS and other forms of technology and all of a sudden we realize you know we can make money because of our data and if we're a better information company we can sell more stuff we can understand our supply chain better Erp became big I mean I was at IBM when Erp started and the CIO became sort of the king of the company in one of the most important roles we had a war for skills during that period of time and then as the internet came along we had a war for digital skills and the internet really changed it even more because what happened with the internet was it was very easy to change jobs I graduated from college in 1978 and when I graduated from college you typed a resume on a piece of paper with a typewriter by the way if you made a mistake you Whited it out out you stuck it in an envelope and you mailed it to a company and you waited and hoped that you might get a call by the way there was no email in the early days about a job well or you got a letter back well of course now that we had internet recruiting and Linkedin and monster and you know all of those all you could change jobs very quickly so in the information Age We suddenly suffered from retention problems and people started to do job hopping and job hopping was considered to be good not bad and now it's even worse I mean now obviously most young people will have seven 8 nine 10 Employers in their career whereas you know certainly in my early days it was one or two but it's going to get even faster because in this new era what we're entering now we have vast amounts of White Collar Automation in AI not just blue collar Automation and so even the lawyers the analysts the writers the marketing professionals are going to see massive productivity Improv improvements while we have this shortage of workers and what that leads to is this and that is an increasing curve of productivity growth this is the history of productivity measured by GDP per employee by country and you can see during The Agrarian age it was flat didn't grow at all it was sort of a flat line and then as cars and Manufacturing equipment came along it steep steeped up steep up steep too and it's going to go steeper and steeper and steeper and the question you're going to have to answer in your company is where are you on this curve because as I'm going to show you in a minute if your company falls behind in this curve you're not going to see it coming somebody's going to come up your tailpipe and take your business away at a rate you can't really address and the real story here is the super workers is really the Superhuman power that every worker now has the manufacturing worker has machines the office worker has AI the HR professional has AI we'll talk about that too and the company with the fastest ability to take advantage of this technology and use it and obviously understand their customers and have a great culture is going to win now while all that's going on we have a really changed employee base and I think most of you know this but the statistics are just staggering this goes on month after month after month I see the same statistics yesterday I read the new Gallop engagement research they do with you know all over the world employment engagement is down again it went up a little bit during the beginning of the pandemic and it's down and a lot of the issue is people feeling burned out you know remote work is hard I mean it's hard to feel connected to people when you're on the end of a video call people have suffered mental health challenges productivity challenges disconnected people leave companies much more easily and this affects their perception of value of their career interestingly enough for young people they're looking at work differently you know if you look at that chart in the center that 69% of baby boomers believe they go above and beyond the job every day that's me that's my age I mean we kind of went to work with this you know mentality that you know if you don't hustle you're not going to get ahead only 43% of genz agree with that and 52% of genes and Millennials are growing disenchanted with a 9-to-5 lifestyle so things like the 4-day work week are going to come this is going to happen and I'll show you the experimentation on that it's actually pretty cool look at what really people do want in a job it's not as different as you might imagine they want to grow their career 83% of companies believe that is the number more reason they will change their job number two they want a sense of empowerment they want a sense of flexibility they want a sense of autonomy there's this idea of job crafting that you make the job the job doesn't make you you know in the old days you fit yourself to the job now the job fits itself to you and you implement it in the way you want and the third is they want to work in company companies and jobs where they feel like they're having some positive impact and these are not necessarily brand new ideas but they're critical issues in this labor shortage the other thing I'll just say is you know Mark and Terry and the rest of us here we talked to lots and lots of companies you know we're sort of like microeconomists we're hearing stories of of issues in companies you know dozens and dozens of companies per week everybody is facing the same issues I would say these nine things in here I hear in every single organization so this is a commonly understood issue and that's why these Solutions are repeatable from industry to Industry now in the middle of all that we also have a very different way of Designing our companies now this chart comes from actually the 2016 human capital trends when I was at deoe that was seven years ago and at the time it was more of an idea than really a reality and only a few percentage of companies Define themselves on the right today virtually everybody operates in a flattened organization people working on multiple projects cross functional collaboration being critical to success dynamically spinning up new groups shutting down other groups moving people around the organization this is just the way po industrial companies work I'm going to show you an example of one in a minute and the reason of course they do this is we don't make money by scale anymore we make money by time to Market speed to Market closeness to customers product Innovation and if you can't move quickly to take advantage of new technologies or Market changes you know your margins go down your Revenue starts to decline and you can buy other companies but even when you buy other companies you have to go through the same process of integrating them well this new world changes HR a lot it changes the architecture of our systems in the pre-industrial age or in the Industrial Age by the way all the Erp systems workday Oracle sap are designed for the left virtually all of them there's only a few that are designed for the right we had a job which was basically a container and we defined a job we defined the level the title The competencies required for this job supposedly and we slotted people into it and you applied for the job and then we managed the job through our HR systems as the way we ran the company and that actually started to fall apart 10 years ago when all of a sudden people were doing things that we didn't have job titles for because let's face it whatever your job is and it's certainly true in our company it really doesn't matter what the title is because dayto day you're going to do different things and it's going to change over time because of things that go on in the company and new needs and changes in the systems and Technologies and so forth we do so we need a new model and the reason skills are so important is we're moving to a people Centric architecture in a people Centric architecture you have a much more flattened organization we move people around they work on cross functional projects we promote them and pay them and develop them based on skills not jobs it's very very different way of thinking about it and we have different technology underneath it and if you read the PO Industrial Paper you'll see a little more details on what this differentiation really is we're also in a world where workers are not abundant we can't slot them in and out of jobs the way we did before because it's so hard to to hire them the average time to hire based on the research we did last year is almost 50 days on average and in many cases it's 60 70 80 days so we have to take care of and manage and help every person in the company and think about the organization as a network of people not a network of jobs now the way this manifest itself I'll just take one more minute on this and then we'll get into the predictions is through different organizational structures and what Kathy enderis and I did the last year and we published this in the fall is we wrote a very comprehensive study on this and we looked at the financial performance of the companies that are taking advantage of this more what we call Dynamic organization there's a fair number of companies you can see 7% at the very top 24% up there their outcomes are extraordinarily higher than their peers now we do these charts all the time we do these for all of our major studies where we look at the financial people and Innovation outcomes of the the top two levels in the maturity model versus the bottom two levels in the maturity model usually the top performers are three times higher performance four times higher performance these numbers are another order of magnitude higher so if you're not Dynamic you're going to pay the price and let me give you an example and I just put this together this morning because of Netflix's numbers yesterday we went down and visited Netflix last year last summer or during the our irresistible conference we met with the management team they came to the conference and we talked to them about how they run their company Netflix just added 13 million new subscribers in Q4 their revenue grew by $8.8 billion they are now worth 244 billion dollar their priced earnings ratio is 45 their revenue per employee is almost twice that of Google almost two and a half times that of meta like significantly higher than their Media Company competitions how do they do it well read this page on their website about the culture this is a company that thrives on meritocracy on Mobility on feedback on inclusion on agility on data central decisions and when you meet them you feel it I mean we were there we met them these are hardworking respectful smart people and they are delivering and this is the the kind of thing we're going to have to think about in our organizations throughout the year now let me talk about AI I have been in the technology area since the late 70s and I was around for the Mainframe era the PC era the client server era the it was the web then it was the cloud mobile and now this I think AI is as big as the internet itself I think the implications of this are so massive in our ability to manage data in companies and to do M data management analytics are ability to manage textual information graphical information creative processes decisionmaking and so forth PWC thinks it's 15.7 trillion dollar it's massive and it's going to affect everything it touches every area of HR and the reason it does is because most of what we do in HR and and I know this as well as you guys do is help people make decisions about people where there is no right answer or wrong answer should I promote this person should I promote that person does this person get a level three or level four what is the right development path for this person why is this group underperforming why is this leader successful and that leader is not successful we can debate this stuff all day you can read books on psychology you can have different models and call experts ultimately it's a difficult answer and using AI we can collect more data and we can make more sense than ever before I'm not saying people analytics is going away but people analytics is going to look pretty slow and behind when these things are making decisions based on vast amounts of data and AI based modeling and I know this because I've worked with the talent intelligence vendors and our tool Galileo basically does this and so you can see all the implications it's going to have over the next year now there's also the business side of this virtually every business group in your company is also looking at AI the marketing department the finance department the sales the customer service the go to market people and so on the one hand we're going to spend the year working with them helping them with data management and role design and job design and skills and then we're going to do the same thing for ourselves and and really that's why we pioneered Galileo I started working on Galileo a year ago and I had to really kind of push it through our company to make sure we were doing it and now that we have it and you guys all of those of you that are corporate members are going to get it you're going to see the Revolutionary way AI can help help you manage data answer questions and give information to employees that is very difficult for them to find or for us to deliver in a call center on ourselves now in the HR Tech Market of course it's also having a huge effect all of the vendors are adding AI generative AI modules or features to their systems but the real big part to me is this green area in the middle and that is the big AI platforms the talent intelligence Platforms in many ways most of the HR tools we've bought over the years are transactional systems they're workflow transactional systems they capture data they put it into a screen and you run reports they weren't designed for AI they weren't designed for massive amounts of data at all I mean they just the architecture was not even considered when they were designing that well these systems in the B middle which I'll talk about in a sec which started in recruiting are really becoming the people data systems of companies over time I mean in some sense the Talon intelligence system is like the Google of people for your company who's ready to be promoted what is our pay is our pay Equitable amongst these people what's the career path for this person what are the trending skills in our company versus the trending skills in our competitors this is going to be massive and so all of the HR vendors and you know this you're probably hearing from them are are figuring out how to take advantage of this it's going to affect everything it's going to affect employee experience there's lots and lots of applications there it's going to affect L&D I'm going to I'm going to show you something I called the autonomous learning platform I think we're going to you know sort of wake up and suddenly realize that a lot of the formal Education and Training we're doing can be done automatically almost like autonomous driving all of these things you can you're going to happen recruiting of course is massive and and recruiting in some sense has been using AI the longest because it has been trying to determine the characteristics of people through social information and analyzing that information for a long long time and their attractiveness and their potential fit into an organization or a job example of this if you saw Walmart I talked to Donna Morris about this a week or two ago Walmart has a very sophisticated it Department I I think most of you would not be able to pull this off as fast as they did but they basically took their HR technology which is very very well put together and they built an generative AI chatbot and she told me which by the way can be used for all sorts of things Galileo is one of these which you'll see and she told me that the call center agents that answer calls for health and benefits tend to answer the calls correctly about 70% of the time what is my benefit for this what are my benefit for this what's my option here ver there she said the AI chatbot is correct 95% of the time so think about just the call center operations we have in companies to deal with employee issues and how that can be radically changed with AI and then it's going to change this whole area of data you know people analytics is a wonderful domain and it's been fascinating to be a part of it and and really contribute to it but that's going to go to AI too and I think you know this idea of running a survey doing an analysis coming back three months later and telling people what you found that's going to happen in near real time through Ai and we have examples of that too what about hybrid work now we've talked about this in the beginning I know a lot of CEOs fought this they tried to force people to come back to work we had mandatory two day a week come back to the office and so forth I mean the real reality of this and all the data shows this is that when it is done well employees love it they love the flexibility they love the fact that they may not have to commute all the time they can work at home and take care of their family things that are going on there and it allows them to manage their lives better but it creates stress it creates distance between you and the team and you and the company it can alienate people there are lots of young people that want to go back to offices again so what are we going to do about it well the big problem we really have and I think this is continuing and I see this in the PWC Story by the way let me tell you one more thing in the PWC survey another just absolutely staggering thing that came out of that was of those two or three th000 CEOs that were surveyed they believe on average that 40% of the work in their company is wasted time is bureaucracy is inefficiencies they believe there's a 40% inefficiency in their companies number one inefficiency is email number two inefficiency is too many meetings number three inefficiency by the way is recruiting number four inefficiency is expense reports number five inefficiency is Performance Management so okay we're responsible for two of those so we've got this issue with CEOs very aware of the rate of change and the bureaucracy in the company not believing people are you know productive yet 87 employees are saying I'm working really hard I'm doing everything you asked I'm delivering on my you know promises and I'm taking on more responsibility this year two-thirds of them said so what is going on here what's going on of course is you can't know what's going on in everybody's life in your company unless you're sitting right next to them and so employees are basically reaching the point because of hybrid work because of the pandemic because of the rate change going on in organizations where they're saying you know if you're not going to listen to me I'm just going to go call that union guy back and so all of a sudden we have more unions and labor strikes than I've ever seen in my career now only 11 or 12% of the United States workforces in unions but it's much much higher in the public sector and this is growing now and this is basically an issue of what we now call employee activation and I want to thank medalia and also Julia Bon who worked with me on this on really coming up with this concept that it is time to think about how we Empower employees and managers and leaders to listen to and accommodate and change the company based on information we're hearing from employees now you've heard me say this before and I'll say it one more time I believe employees are the most committed stakeholders you have in the company customers will not tell you when they go away why they didn't buy your product shareholders can sell sell their stock and go buy somebody else's stock employees are committed to your company and when they're unhappy about something or they see a problem or they think something could be done better they are doing that because they love the company and they want it to be better but we make it hard for managers to do anything about that so you're going to hear a lot about this idea of activating employees and allowing the company to evolve and adapt interestingly enough something like 65 to 70% of employees said in the element trust survey that they believe they individually can change the company they work in and if they can't they are going to go to social media to impact that change so this is really what we're dealing with here now among the many many things going on of course to deal with this there's also the 4-day week and I'll take just one minute on this because you can read the report the 4-day week is not a benefit like you know you get to take Friday off every two weeks till you can go to the dentist this is an in initiative where these companies that have done this have said you know let's look at how we do our work how the schedules of meetings what kinds of bureaucracy and systems we have and let's see if we can eliminate eight hours of work but still do the same amount of work in four days and what these companies found after you know a little bit of work on this and you can you know get our help or there's some Consultants who will help you on this is you can literally take work teams and reduce the work time it's called worktime reduction yet get the same amount accomplished so in a sense this is a productivity initiative and I don't think you guys are going to be immune from this I think many many of you are going to want to try this I think it's going to come out of the stories from other organizations and please call us if you'd like to talk more about it we've got lots of examples to share so this issue of hybrid work is real I wouldn't say it's solved yet but there's lots and lots of best practices now on what to do next topic is leadership now I could talk about leadership till I'm blue in the face every year we it seems to be another issue this year things are different and I want to just give you a quick highlight on this first of all if you look at what we do in HR and how it affects companies what kind of impact it has we've looked at data from our Global capability project and those of you that are either corporate members or in the jba you've probably taken this capability assessment and so we've had about I don't know 11 or 12, HR professionals take it and if you look at the organizations with the you know that are the highest growth companies when we have that data in the assessment and also in other sources what are the HR capabilities that these companies are good at well it turns out the top three HR capabilities for the highest performing companies are developing leaders and managers number one change managing Communications number two and understanding and applying organization design that's the reason by the way we built a super class on organiz ation design because organization design is very very important in this evolving changing World well so impacting leaders is number one of course it is because the leaders are running the company and if we can impact them then all of our great ideas are going to stick and have more impact and we also know that if you go back in time and I'm going to show you a little bit about the Jack Welch era that where we've now landed in leadership is what we call human- centered leadership and this is based on some research we did during the pandemic and there's a Playbook called the H the human- centered leadership Playbook it's part of the big reset by the way that Mark talked about earlier and what it basically shows is that for every single business situation a good one a bad one a complex one and uncertain one there is a business way of thinking about it as a leader and there is a human way of thinking about it as a leader and where we are today given the stress and the job market and the number of opportunities people have we really have to move to the right now the proof of that is you know kind of what we found now the historical context I was just thinking I just put this chart together yesterday you know when I entered this industry in the uh early 2000s every company I talked to asked me the same question how does GE do X you know I would talk about you know learning or training or succession whatever they say how does GE do it how does GE do it how does GE do it well because at that point in time and this was you know 5 years ago we were running the industrial model in our companies and you can see on the left all of those artifacts or practices or ideas that were written about in Harvard Business Review that we implemented during those years today things are different we've got all these issues of agility and change and skill shortages and people being able to move between companies and gig work we have to work on the things on the right and so this is a PO industrial mindset for for leadership by the way you know this book I'm very proud of it we would love you guys to read it it really is a great way to get your head wrapped around these new issues what we found though in the research we just did last year was that there were three things that really characterized great companies leadership development practices number one is that leaders have to be able to energize change it isn't enough to just be running the group you have to know how to change the group because every group and every team and every function in every organization in every company is going to be impacted by AI they're going to be impacted by labor shortages skills changes Etc so if you as a leader can't lead change and facilitate change and create energy out of change you're not going to end up keeping up number two is we've got to relook at our model the reason to relook at the Leadership Model is not because it's a fun project but it gives you a chance to come together as a leadership team with the business group not just in HR and talk about what is really working in our company now what do we keep from our past and what's new most companies have lots and lots of important practices to keep but some things that have changed the third of course is to lead through behaviors you know what we found in this study is it is not necessarily what skills you have or what courses you went to or what books you've re read or how much you understand the industry but what do you do every day how do you behave how do you react do you listen do you mimic or reinforce the behaviors we want in others so there's lots of things to think about unfortunately you know the thing that disappointed me last year is the maturity of leadership development programs is still staggeringly low only 16% of companies believe they're spending enough money in this area we discovered you know from our research that the amount of money spent on leadership development is down significantly and you can see you know all these things are relatively low so so there's lots of interesting things to do here and I'll just leave that up to you to talk about in your teams and decide uh what changes you want to make next thing I want to talk about is skills so there's been a massive focus on skills skills technology skills skills based this skills based that skills based learning skills based Talent Mobility skills based recruiting skills-based pay is coming let me tell you where we're at so there was a lot of excitement about this in the beginning of it when we talked about LX p s and skills-based sourcing and talent marketplaces and then everybody said oh no we're going to put the skills stuff in the Erp we're going to stick it in the workday skills Cloud we're going to stick it in work you know sap success factor we're to stick it in Oracle and everything came to a grinding halt because those systems weren't designed to be AI systems those are basically Legacy in a sense skills databases and so what we really discovered and now we're coming out of that trough really starting now and we're looking at much more applications the basic issue with skills is it's everywhere the technolog is everywhere I mean there isn't one vendor that has a better skills infen in everybody else they're all working on it and all doing it in different ways the real issue is not centralizing it and sitting around and trying to design a global taxonomy which probably is not worth the effort it's really applying it to the problem and this is something we talk about all the time with clients fall in love with the problem not the solution skills is a solution to something what is the thing that you're working on is it an underperforming operation if so then you're going to want to look at the skills of the high performers and you're going to design your skill solution to uncover the gaps and fill those gaps is it a skills Gap where we actually don't know something and we're behind then we're going to have to bring Outsiders and we're going to have to you know bring thirdparty data into the skills system to figure out what skills we don't know we don't even know what the skills are that are missing you know oil companies are going through this tech companies are through this or is it the third one where we just did a merger or moving into new industry and we're just not set up for it and there's a whole bunch of stuff we have to deal with what we find is the most successful skills projects are pragmatic they are solution oriented projects chevron's doing skills analysis to understand the future roles of energy Engineers Starbucks doing skills analysis to find a better pool of leaders and supervisors and district managers Master cards using skills to do a better job of talent mobility and internal development Intel is using skills to figure out how to build better chips and and Advance their manufacturing New York Presbyterian is trying to use skills to rapidly increase their pipeline of clinical professionals Baker Hughes is using skills to try to figure out a move from their Oil Business to their chemical business that doesn't require sitting around for 10 years is trying to build a corporate taxonomy those are pragmatic projects and that's really you know the story there and you can read more about it and talk to us if you'd like some help recruiting now recruiting is very complex we have a client we're working with right now that has uh something like 42 recruiting Tools in their stack they're a pretty big company but you know what this is like I mean there's dozens and dozens of tools and companies and vendors on this we really have to spend some time this year simplifying the technology and modernizing it applicant tracking systems as interesting as they were back in the early 2000s are really just a commodity at this point it's really what level of AI do you have what is your assessment strategy can you speed the candidate experience can you reduce the time it takes to get somebody scheduled into an interview can you better Source people these are more complex problems and I think a lot of you that work in bigger companies are dealing with the Legacy applications that you have we also know that it's getting harder we just published this we're going to be doing this on a regular basis working with AMS the time to hire went up by almost two days last year the number of applicants applying is going up because applicants are using AI tools to spray their applications to hundreds of companies at the same time see got a flood of applicants longer time to get people through the process it still takes people on average five minutes just to apply for a job with filling out the forms creating an account doing all that kind of stuff tools like Paradox and other AI tools are going to revolutionize this and so there's lots of work to do here and of course then there's the implementation of the talent Marketplace Talent Marketplace technology has turned out to be exceptionally successful I think all of you are going to want to do this this is the link between recruiting and learning and internal development and career and succession management to tell you the truth and so where this fits this is going to be a big theme for next year it's going to affect recruiting it's going to affect internal development it's going to affect L&D and it's going to affect careers so lots and lots of things going on in recruiting and then there's the issue of talent intelligence now we have a talent intelligence primer you can download from our website this is really a new idea that's only about five years old that's really sweeping across the market and this is the AI layer that I showed you earlier where you have vast amounts of data at your fingertips to look at the characteristics of all the people in your company and hundreds of millions to billions of people outside your company to better see what you could be doing differently and where the skills gaps or capability gaps may be between you and the rest of the market and your competitors and this is generally a technology that starts in recruiting and then expands and moves to different areas of HR so this is continuing to be bigger and bigger and bigger in 2024 okay let me talk about L&D now L&D is where I started in HR you know back in the early 2000s so I've been involved in it for a long time you know we've been through a lot of eras we were in the sort of Blended learning era and then the LMS ERA with t driven learning and and competency modeling then we were in the digital era where we kind of stuck everything on YouTube and created a lot of videos and did Collaborative Learning and crowdsource learning and internal development and sharing of knowledge then we're now we're in the world of learning in the flow of Works microlearning in fact we have a microlearning course I'm going to show you in a minute that you're going to be able to take yourself and all the work that happened with L XPS and Microsoft entering the market and now we're entering Ai and believe it or not I actually kind of think this part of HR is going to be as transformed as recruiting Because of AI and the reason for that is learning is fundamentally a Content business you try to figure out what the problem is you look for all the content that describes the capabilities and skills and processes that are needed and you try to build a course that teaches people how to do that stuff better by the way that's what AI does if you look at all the information you have in your process documentation and your LMS if you put that into an AI system like Galileo and we've been doing that people can just ask it questions it can understand what they're looking for and give them an answer and point them to a video or Point them to a course instantaneously and you don't even have to author that content because the system will do that for you now the tools to do this are coming and they're not all out there yet but I think this is going to be a massive change and so those of you that are in L &d are going to have a lot of fun over the next couple of months dking on this and I like to think of this as autonomous learning the reason I put this chart together is there's a five level model for autonomous driving and if you look at the autonomous driving maturity levels that the nist uses to basically measure car companies it's not that different from what's been going on in learning and you guys know those of you that have been with me all these years these five history Pro processes actually have happened and so your L&D teams are going to have some really interesting opportunities to re-engineer and probably replace a lot of those old Technologies as this Market starts to pick up speed and I'm very very convinced this is happening okay and that'll really simplify this huge stack we have of L&D technology one more thing and I'm sure a lot of you are dealing with this right right now I'm sure somebody has come to you and said hey would you build a course on AI for the rest of the company what I mean come on AI is not a topic for everybody there's AI for sales there's AI for marketing there's AI for engineering there's AI for it there's trust issues that affect the legal organization this is the other thing that you have to think about now is building what we call a capability Academy for AI and we're happy to help you with that because we've been through this process now in many many other domains couple more topics and I'll wrap up Dei so as you know there's all sorts of political and societal issues fighting the Dei initiatives for years the number of postings for Dei Chief diversity officers dropped by 48% last year I mean that is just staggering more than 40 40 lawsuits have been filed against companies the educational industry is is getting attacked by right-wing people and various other groups that that believe Dei is a waste of money but despite that the research that we have talking to most of you is that this is not going away it remains vital to the successive organizations and it's going to continue but I think it's going to happen this year and you can read about it in this article and also in the research is we're going to have to sort of shrink the size of the Dei police Poli force or whatever you think about as your Dei group and get it embedded in the business because the investments in Dei and where we go over the top and and try to teach people about oppression or slavery or whatever it may be that you think is the history of all this isn't really sticking well right now with people so so I'm not convinced that this is going to go away I think we're going to see more and more focus on in fact there's an article in the Wall Street Journal just yesterday that's very much in keeping with my thinking but we're going to have to be sensitive to it because those of you that are in Dei jobs are going to hear a lot of noise one more thing pay and performance now Performance Management is too complicated for me to talk about it's it's a NeverEnding discussion but the area that I think we're going to have to think more about in 2024 is pay pay Equity as you can read about in our research and Kathy anderas has done just a masterful job of talking about this and teaching people about it it is isn't an issue of how much you pay you make it's how fairly you're paid when we did this research we found that it is 31 times more important to have a pay Equity strategy than it is to pay people more money of course people want want more money everybody wants more money but they really want it to be done in a fair way and we don't know if we're paying people fairly if we have years of old performance reviews raises that were you know distributed unequally based on the you know the politics of Performance Management and so the discipline for this year and going forward is to do pay Equity audits look at the statistical correlation and really take this problem seriously and as you can see in our research there's lots of ways to do this and yet the level of maturity remains low so so that's another one that I think to think about this year then the final thing before I talk about the report is HR and you know a lot of you know we we introduced our systemic HR research around November December and the reason we did that is everybody was telling us about all these projects and initiatives and tools and systems and things they were trying to do in HR and we realized that operating model just isn't what it used to be and just yesterday or earlier this week I was on the phone with MasterCard and we're walking through how they've changed their operating model the history of HR is of of course functional we really built the HR profession around lots of individual specialist jobs that grew over time this is like a tree I think of it as a tree where you know in the early days of HR it was mostly payroll and benefits and then it was legal and then it was safety and then it was operations and you can see if you go around this tree sure enough you know all of these domains kind of popped into the world of HR over time well where we are now of course is that the problems we're dealing with are very interconnected we can't think of these as a specialist for this special this most of the problems we have require many or all of those disciplines together so we have to think about the HR function as a almost a Professional Services Group with a set of products and offerings and a set of services for employees and that's dramatically different from where we are we call that that systemic HR we also know by the way that when you do that and when you improve the capability of the HR Professionals in the company the revenue goes up this is a statistical correlation of four categories of companies high growth companies medium low growth and no- growth companies relative to their HR capabilities green is good to excellent and our capability model blue is world class and you can see the fast growth companies are twice as likely to have highly skilled HR people and that's not an accident that's because a lot of these decisions on who to hire and who to promote and how to pay people and how to reward people and how to create a great culture and org design are really done through the skills and expertise that you guys have so so so this remains a continued issue this year to say nothing of all the work we have to do to learn about AI so how do do you get this stuff essentially there are four real deliverables here there's the report which includes a 2024 planning checklist it's about 40 pages long it is available to members of our Academy and corporate members there is the infographic which all of you can get for free which is available through a link you'll see at the end of this report and then there was a course we built we built a microlearning course that is a fascinating relatively easy lift you can take on your PC it's free you can scan this OR you know type this in your phone you can run it on your phone under SMS or on WhatsApp for those of you that are not members of the jba I'm not telling you to join the jba just to get this report there's way more in the jba the jba as you can see here has 25 certificate courses we put a lot of our research in here it has 90 primers on various parts of HR tools ideas there have more than 60 or 70,000 HR professionals that have come through here so I encourage you to check it out as part of thinking about the predictions because you know in addition to reading about the predictions and sort of grappling with all this stuff you might want to learn about it and see what other people are saying and and if you're not a corporate member the jba is a really simple easy affordable way for you to get into this information so I think we are in for a very very exciting important year ahead I think the role of HR is going to be escalated and elevated even further and I couldn't be more thankful and excited that so many of you joined us today we're going to be going to virtually every conference around the world we we always like to talk to you and you know I really want to thank you for coming and paying attention Terry let's go back to you and tell me what kind of question questions people have okay thank you Josh we have had an amazing amount of energy in the chat we are using the Q&A function so the first question that has been upvoted from Caroline Clark is are we seeing any differences globally related to burnout as an example is it more prevalent in the US versus Germany for instance or is this across the globe it is worse in the US and Asia than it is in a in Europe believe it or not I think the reason for that is the European countries are more mature and older there's more Social Services there's more unions there's more understanding of the balance between work and economic life you know we're I feel like the United States is like a teenager just keep pushing all the time to go a little bit harder and we're a little bit hard on ourselves with it but I think it varies by company I think the bigger variation is not the global issue it's the companies there's a body of research we have called the healthy organization that walks through the issues in mental health and well-being and basically what it shows is that you know a lot of the issues in wellbe have to do management culture you know are the goals do we have too many stretch goals are we listening to people is it inclusive company those are much bigger factors than the geography great thank you Josh okay the next question how do you recommend that we train leaders to effectively manage in this environment as many of their skills need to be developed or improved well you know you saw the research and you can read more on that I think there's two very simple things number one is leaders need need to take care of themselves leaders are under even more stress than employees because the leaders are thinking about the job they have plus taking care of all the people around on them so so I think you need programs for leader support leader development the second is connecting leaders together I think what happens in most companies and this is true in my career is the problem that you're facing in your group your department your store whatever it is is actually not that different than the guy down the road who's got the same group you do in a different department and so bringing leaders together at the same level peers to talk to each other is another really simple way to give leaders the perspective on how to deal with some of these you know human centered issues that everybody's facing and then there's thousands and thousands of courses and I won't mention all of them but those are the two biggest things I'd recommend right okay how do you see the increasing number of War conflicts impacting World Companies and people functions in particular War conflicts we had some guys from Ukraine at the conference last year obviously if you're doing business in Israel or Ukraine or you know parts of Palestine you have huge issues you have employees that are under attack you have people that don't have homes you have people that don't have food you have people that are worried you need to take care of that first you know those human life or death survival issues are at the bottom of maso's pyramid and honestly that's not stuff a lot of HR people were designed to do but we have to do it you know I talked to the chro of Oracle last year and she said I asked her what are you guys working on she said the number one thing I did was worry about Ukraine because we had a lot of business in Russia and we had to shut it down we had employees there we had engineering teams there you know so so that's that's the main thing and then there's the issue of sort of the social stress that people have debating them and I don't I don't think you know most Business Leaders want to take a position on Israel versus Palestinians and so forth but they need to you know reflect and sort of tell people that look I know this is a big topic you can talk about it in your ergs we as an organization may or may not take a position on it but we understand that there are differences and we want you to be nice and inclusive to each other as we discuss these issues because there are no Rights and Wrongs here you know even though you know you may be on one side of the other yes it's very complex uh environment we're operating in I think we've got time for one more question as AI advances could it reach a point where it surpasses human intelligence and HR decision making okay I was just listening to you know Zuckerberg is talking about it again and all the AI guys by the way you know I have a list of podcasts for those of you want to know what the podcasts are Listen to I don't think AI is going to be smarter than humans that's my own personal opinion I mean I know how it works I know what it does it's very fast at assimilating and analyzing and predicting information you have to really remember that we are actually emotional beings I mean our emotions actually rule us most of us are not that logical I mean we have logical moments but under the covers of the logical is how do I feel about this do I like this person is this a threat is this good is this bad am I in a good mood did I get enough sleep did I not get enough sleep and that's what makes us what we are I don't think AI is going to build you know the world's best art the world's best movies I mean you know you look at you know I was just listening to the founder of um Pixar who was in a uh podcast he said look he said AI is going to make all these characters easy to build we're going to build animations and cartoons it's going to be great but we need Stories the AI doesn't come up with the stories we come up with the stories and the stories are human stories and that goes by the way for sales for marketing for product design I mean there are huge sort of human nature things that happen in organizations that I don't think AI is gonna do so I'm not worried about that myself great we are at time so thank you everybody for your engaging questions Q&A um as mentioned in the chat you will be receiving the recording and um and the infographic in the next few days um and with that I wish you a very successful 2024 thank you all thank you Terry bye [Music] everybody [Music]
2024-02-09 02:56
