Forging a People Strategy for the Digital Age

Ted 1Making sure that a company has the talent to deliver both today and in the future has always been a critical element of the CEO’s job. And these days, the task is tougher than ever. Emerging technologies are driving seismic shifts in the way companies operate. And leaders must find ways to simultaneously attract digitally skilled talent, help existing employees adapt and integrate a multigenerational workforce.

What’s more, all of this is taking place against a backdrop of organizational upheaval as traditional hierarchical corporate structures are gradually replaced by more agile models characterized by faster decision making and wider information sharing. These talent and organizational challenges are intertwined, noted Ted Bililies, managing director of AlixPartners. “If you talk about how to attract, develop and retain talent, people will not be attracted, developed or retained by hierarchical organizations,” he told participants in a roundtable discussion on talent development co-sponsored by AlixPartners. “Good companies are investing time in developing talent and beyond that they’re looking at creating environments that are adaptable, empowered and collaborative.”

Yet the path to a flatter, faster organizational structure is often bumpy. Embarking on a carefully orchestrated effort toward a less hierarchical model nearly derailed Sodexo, recounted Sylvia Metayer, CEO of worldwide corporate services at the food service company. Despite three years of preparation meant to engage employees in the change, “when we flipped the switch, the culture shock was so enormous that for a while I thought the company would go under,” she reported. “For nine months, everything froze. Then it took off again.”

In hindsight, acknowledged Metayer, the senior leaders who made that call underestimated the impact the change would have on middle management. “We should have realized that going from hierarchical to multi-dimensional, collaborative, adaptable and empowered is actually a huge shift, much larger than we imagined,” she said.

Ted 2Alan Masarek, CEO of Vonage, experienced similar pushback when he sought to encourage a move away from top-down management after joining the company in 2014. “I found it difficult enough for my senior leadership team, but the folks who can really kill this are middle management,” he reported. “When you tell them, ‘We have to innovate relentlessly, we have to be customer-first,’ you get a lot of nodding heads. Then, they go back to their desks, where there’s a stack of work to be done, and they go right back to looking at it as, ‘Hey, I’ve got a job to do.’”

While seasoned employees may struggle to let go of established processes and a formal structure, younger workers are not only willing to embrace a collaborative, flatter work environment, they often demand one. “Younger professionals want more recognition more quickly and feedback pretty much continuously,” noted Bililies. “Their managers have to be prepared to give them something verbally or symbolically on more of a regular basis or they will lose interest.”

At the same time, it’s important to look at workforce needs holistically, pointed out Scott Beck, CEO of CHG Healthcare. “Are we overthinking the needs and preferences of one generation as we’re building our companies?” he asked. “Is there too much focus and energy on what’s happening with the ‘young professionals’ and not enough around what your people—all of your people—want?”

Ultimately, companies hoping to excel at developing talent today need to identify ways to cultivate all of the various factions within a multigenerational workforce. “We spend a lot of time talking about segmentation in the consumer population, but we don’t turn that same science to talent and to understanding the millennial [employee] population from the data we have,” says Karen Crone, chief human resources officer at Paycor. “We know they’re the most educated and that only a quarter of them have grown up in families that have a mother, a father and two children. If you can understand talent the same way you have a fanatical understanding of your customer, you can make your culture hum.”

Ted 3“It’s consumerization of HR,” agreed Ken Joel, partner, strategy and transformation at IBM. “As more and more companies start transforming into digital enterprises, we will have very personalized HR programs for the different segments. It will not just be Generation X to Generation Y. It will be single mothers or [however you cut the data]. It will be part of your culture that you can create and develop programs for the populations that are critical to your organization.”