Here is an excerpt from an article written by Michael Mankins, Eric Garton, and Dan Schwartz for Harvard Business Review and the HBR Blog Network. To read the complete article, check out the wealth of free resources, obtain subscription information, and receive HBR email alerts, please click here.
Credit: Alex Eben Meyer
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Technology was already changing the nature of work before Covid-19 took hold. Innovations were redefining the basis of competition in most industries and, consequently, the talent companies need to win over the long term. The pandemic sidelined the efforts of most companies to address these challenges and close critical capability gaps. Many had to lay off 15% or more of their workforce. Covid-19 required that the search for new talent—with new capabilities—take a back seat to economic survival.
But as businesses rebuild in the aftermath of the global pandemic, those that take the opportunity to remake and future-proof their workforce will pull far ahead of rivals. Even before working from home became widespread, digital technology was transforming how and where work gets done and how many people are needed to do it. Consumer products companies, to take just one example, have traditionally employed hundreds of people to monitor purchases and inventory to ensure that the right products get to the right places at the right time. Predictive analytics—fueled by real-time point-of-sale, manufacturing, and logistics data—is changing that, reducing the number of employees required for the work, changing the skills they need to be successful in their new, technology-enabled roles, and allowing more and more of them to work remotely.
So how should companies rebuild? In the following pages we draw on research by Bain & Company involving more than 300 large companies worldwide and every facet of the global economy, from manufacturing to retail to health care to technology. Half of those companies are headquartered in North America or Western Europe and the rest in South America, Asia Pacific, the Middle East, or Africa. We have identified a select group of the companies that are already building technology-enabled workforces. No matter their sector or geography, they all seem to adhere to six practices in the course of assembling and managing their teams. In the following pages we offer those practices for companies to follow as they regroup and reorganize for the inevitable recovery.
[ Practice 1 ]
Think Ahead When Defining Business-Critical Roles
Not all jobs are equally important. Research by Bain and others indicates that fewer than 5% of an organization’s roles account for more than 95% of its ability to execute on its strategy and deliver results. But which 5%? As we emerge from a pandemic that has challenged assumptions about working productively, companies need to rethink which skills will be most important in an increasingly tech-enabled future, develop them in the current workforce, and actively recruit for them.
Smart companies began to do that even before Covid struck. Woodside Energy, a leading Australian natural gas producer, is one. When the recently retired Peter Coleman became CEO, in 2011, the company was a typical LNG producer with huge, multibillion-dollar projects and complex onshore and offshore operations. Coleman and his team recognized that Woodside’s ability to navigate the challenges of the future would partly depend on enhancing its conventional technologies with data-driven breakthroughs.
To test the impact of big data science and digitization on the company’s strategy and competitiveness, Woodside started with its energy-production operations. Like most other oil and gas producers, it had relied on seasoned engineers to oversee each asset. When issues arose, the engineers developed mitigation plans that were based on their personal experience and informed by the data collected from their sites. They played a business-critical role at Woodside.
The advent of new sensor technology, combined with access to low-cost computing power and big data analytics, meant that the company’s asset operators could make better and faster decisions by using a broader range of more-accessible data sources and data science expertise. Accordingly, Woodside began experimenting with advanced analytics and machine learning across its offshore and onshore operations, using a combination of internally built and market-sourced solutions. The workforce started using AI-enabled tools—incorporating Woodside’s 30-plus years of production experience across all its sites—to identify ways of improving safety and productivity.
More than 60% of a company’s future roles can be filled by current employees, assuming that adequate programs are in place.
Integrating technology into ways of working meant that the definition of “critical skills” at Woodside expanded. Data scientists, along with experienced asset operators and engineers, had become crucial to the company’s success. Starting in 2015, Woodside established a dedicated team of data scientists. The team now focuses on seeding data science and other digital skills throughout the organization using a range of new tools and platforms. The company recruits data scientists from the best Australian and international universities who work with and learn from Woodside’s operationally seasoned team members.
Woodside’s rethinking of business-critical skills has contributed to a growing perception of the company as an innovator in oil and gas. As other companies emerge from the pandemic, they should take a leaf from its book and think about the capabilities that will be critical in tomorrow’s world—not today’s.
[ Practice 2 ]
Redefine What Great Looks Like
Traditional employee-assessment approaches work well when the jobs people will be asked to perform in the future are largely the same as the ones they (or others in the organization) are doing today. But those approaches break down if the nature of that work changes, causing companies to struggle to identify candidates who can take on the new tasks. Like our assumptions about which capabilities are mission-critical, our assumptions about what success looks like must change in the wake of the pandemic.
Fortunately, new tools and techniques that utilize people analytics and behavioral science can help companies define “what great looks like” in a particular role and identify employees who already have the needed skills or could develop them with training. This allows companies to devise talent development and recruiting strategies to help meet their needs.
One such approach was pioneered by the Chemistry Group, a UK-based people analytics organization that helps businesses craft robust job descriptions for new roles—descriptions that include not only basic responsibilities but also the traits, behaviors, and skills each role demands. By rigorously defining what great looks like, companies establish a benchmark against which they can recruit—both internally and externally.
A leading mobile-phone operator has applied Chemistry’s tools and approach with great success. Responding to changes in the smartphone market, the company’s leaders saw that they needed to shift the retail operating model from pushing equipment sales to emphasizing customer intimacy and service. To achieve this transformation they encouraged employees to adopt new mindsets and behaviors through training and coaching.
The mobile operator also created a new role in each of its retail stores focused on enhancing the customer experience. Using behavioral testing and survey data, leaders developed a profile for what great would look like in that role. The company then assessed its 22,000 employees to discover critical capability gaps. The result was a list of employees with the potential to succeed in the job, and training modules were designed to help get them ready quickly.
The company has also developed interactive recruiting tools to screen more than 10,000 job applicants a month for this role without human involvement. Using an online program, candidates respond to a series of scenarios they’d be likely to encounter. Improved recruitment has enabled store managers to spend less time supervising and mentoring, permitting them to serve customers on the floor. These initiatives have helped save more than $7 million in operating costs and have garnered positive feedback from 85% to 93% of customers surveyed.
Coming out of the pandemic, companies will find that what people do and how success is defined must change. They’ll need to recruit people who are comfortable with the new normal. Smart companies will leverage technology now to help them figure out how.
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