Strategy Execution Management: Talent and the Future of Work
According to a McKinsey study, 30-40% of all workers in developed countries may need to move into new occupations or at least upgrade their skill sets significantly by 2030. Skilled workers in short supply will become even scarcer, prompting many large organizations to invest heavily in developing talent. Amazon pledged $700 million to retrain 100,000 employees for higher-skilled jobs in technology; think a warehouse employee upskilling to a basic data analyst. JPMorgan Chase has made a 5 year $350 million commitment to develop technical skills high in demand. And Walmart has invested more than $2 billion in wages and training programs, including Walmart Pathways.
Adapting to the future of work and the digital age requires organizations to equip themselves with new capabilities through thoughtful strategy execution management. Companies that ignore the need to address their underlying talent needs may fall short of their goals.
Strategy Execution Management in the Digital Age Calls for New Skills
Businesses realize they cannot hire all the new skills they need. They also need to look internally and develop talent. This route is quicker and more financially prudent, as well as good for morale and long-term attractiveness to recruits.
Most leaders see people and resources as the largest barrier to the successful implementation of new strategies, notably those driven by digitization and automation. According to a 2014 study by The Economist, 64% of US executives say companies should take the lead in closing the global skill gap to prepare employees for the future of work. Yet in the same report, only a third of global executives report their organizations have launched any new reskilling programs.
64% of US executives say companies should take the lead in closing the global skill gap to prepare employees for the future of work
Source: The Economist
How to Prepare Your Organization for the Future of Work
For effective planning and execution of strategic initiatives, companies need to build an infrastructure that will support the future of work. Successful transformation involves three phases — scout, shape, and shift.
In the scouting phase, a company develops a single vision of its digital and automation future, as well as the total value of that future. It also identifies the most important skills gaps, looking at future needs versus extrapolating from the past. Then it assesses the organization’s readiness to deliver.
Scouting requires visibility to understand and assess talent gaps and review operational readiness. It’s important to understand the total value of their digital strategy — company leaders must ensure their plan captures the full upside opportunity of automation and new technologies; not just the opportunity to cut costs. This is the difference between strategic digital transformation and a series of localized efficiencies.
Understanding the existing skills and capabilities of the workforce and comparing them with future needs are important steps of the scouting phase. Leaders can look at advanced competitors or disruptive startups to help anticipate talent needs and skills gaps. Often the combination of reskilling and hiring external talent is the answer. This exercise also highlights deficiencies in the employee value proposition, helping leaders recognize when their employees lack sufficient growth opportunities. Understanding the full value at stake and identifying the most important skill gaps are invaluable first steps – which in turn make possible the detailed work-redesign and talent investments that come next.
The shaping phase redesigns work for the demands of a more digital future and creates upskilling programs. The primary driver here is developing the infrastructure of an Enterprise Portfolio Management Office (EPMO) to facilitate the deployment of talent the most important work.
Shaping work requires developing an infrastructure that involves workers in redesigning technology-enabled processes. Understanding existing business processes, with assistance from those executing those processes, is critical. Empowering employees to help define new roles and processes helps eliminate change management fear. Research from Stanford University shows this process of “job crafting” creates stronger skills matches and smoother transitions.
In a digital transformation process, many organizations start with areas of the business that have the most to gain from new technologies. This is an opportunity to score some early wins and influence change using the McKinsey influence model.
The shifting phase moves the organization’s suite of talent-related activities onto a bigger scale. This acknowledges that helping employees adapt to the future of work is just as important as near-term talent priorities.
Redesigning work, however, is about far more than changing existing roles. Digital strategies create entirely new, mission-critical tasks that require rethinking the ways work is performed. For example, many organizations are adopting agile work methodologies and moving more skilled employees into project-based work. Supporting this evolution requires organizations to develop structures to help systemically place the best-fit talent in new roles, preferably by identifying and placing existing internal employees and supplementing with external talent from marketplaces such as Catalant’s.
Strategy Execution Management: How to Deploy Best-fit Talent
Companies are increasingly implementing these structures as Enterprise Portfolio Management Offices. These EPMOs are responsible for both identifying which projects roll up to the organization’s most critical initiatives and which resources are both available and best suited to be deployed on those projects. In this way it can dynamically respond to changing company conditions – projects that no longer align with strategic goals can be axed and resources can be reallocated as project requirements pivot.
In the normal course of strategic planning, the EPMO will monitor project success and employee development. This data will feed back into a learning loop to better understand which future projects drive mission-critical initiatives forward and which employees will be best suited to projects based on new skills acquired.
Having a complete picture of all internal resources also gives EPMOs visibility into what talent gaps exist within the company, and on which projects they need to be addressed. The EPMO can then deploy external resources as needed, cutting down on inefficiencies around reskilling internal employees or hiring expensive consulting firms.
Scale the EPMO Model
Implementation at scale can start once the organization has begun to redesign the work of some business units or functions and has established the link between project success and company objectives. The ultimate goal of the EPMO is to streamline the way in which strategic company objectives are successfully executed via their two main levers: people and projects.
As companies ramp up their efforts they should expect additional challenges. One is offboarding with sensitivity. Not all employees affected by large-scale change will find opportunities in the current company. While some fall short in acquiring the skills needed to transition to new areas of work, others may prefer to seek new employment elsewhere. The scale and pace of workplace transition demand enormous sensitivity. Thoughtful outplacement is both a manifestation of good corporate citizenship and a basic necessity in the war for talent.
Many companies are forming partnerships with new, tech-savvy outplacement firms that help employees prepare for fresh opportunities by encouraging them to acquire skills likely to be useful elsewhere and by activating growth mindsets. Other companies help employees to find the next role more directly – either by making arrangements with other local employers or encouraging people to explore roles at suppliers or vendors.
Amplify the Effect of the EMPO Model
Accelerating the learning engine of the EPMO will amplify its effects throughout the organization. As employees continue to develop new skills and projects be completed successfully the prediction engine will also grow. The EPMO will continue to improve and be refined as data from previous employees and projects moving through is evaluated. These learnings can be applied to subsequent projects to improve their efficiency in being resourced and employees in being staffed most effectively.
CEOs increasingly worry that talent shortages will upend their strategies and that talent decisions may upend the communities where they operate. Yet companies can start putting the right people in the right places and turning the challenges posed by AI and automation into an opportunity rather than a threat.