Winning in the Workforce Revolution

In a world ever in flux, the one constant CEOs can count on is that the best people are always hard to find. Today, that task is further complicated by a growing skills shortage in the U.S., Baby Boomers retiring in droves, the entrée of a new generation into the workforce and technology dramatically reshaping the way people work.

As companies compete for talent, the HR status quo will no longer suffice, agreed participants at Chief Executive’s 2015 CEO Talent Summit in Dallas, Texas, where business leaders discussed challenges and opportunities in the war for talent.

Winning that war starts not with compensation packages, but with creating an outstanding culture that employees want to be part of, and then carefully screening candidates for those who best suit the organization’s culture, said Gary Kelly, CEO of Southwest Airlines, which despite being the nation’s largest carrier, has managed to hold onto the maverick spirit that put it on top. “We have a passion for what we do, and we’re looking for people who share that passion,” he said. “Our mantra is we hire for attitude and train for skill.”

With millennials marching in, attitudes at work can clash. Graham Weston, chairman of Rackspace, noted a fundamental schism between gen X/boomers and millennials: “The boomer wants to be appreciated for years of experience, the blood sweat and tears they put into getting where they are. But millennials won’t do that,” he said. “If your experience leads to a better view, a better way of working, then great, the millennial says, bring it to work. But if not, then what’s the value? That’s the generational divide. Any employer that doesn’t get their head around that will struggle.”

Employers need to get it soon. By the year 2020, 50% of the workforce will be generation Y-ers. By 2025, that figure climbs to 75%. Yet these tech-savvy, adulation-seeking workers have the highest attrition rates of any group. To attract and keep the best of them companies need to invest in social media tools; offer flexible work environments, mentorship and career guidance; and, above all, show a clear path to future growth, said Dan Schawbel, founder of Workplace-Trends.com.

The task of creating a culture that attracts and engages a multigenerational workforce is increasingly being elevated to the c-suite. John Stacey, chief HR officer for Harman International, works very closely with CEO Dinesh Paliwal to ensure that the company’s people strategy addresses strategic business challenges. “It’s open and constant communication. Even over-communication sometimes,” noted Stacey.

But constant communication is critical in a world that moves too fast for annual reviews. Michael Arena, chief talent officer for GM, noted there is no one-size-fits-all solution, particularly when it comes to measuring employee performance. “How you assess someone in operations might be the opposite of how you assess someone driving growth,” said Arena. “We need to be thinking about multiple sets of tools, and different approaches that are driven by data, not just best practices.”

One consensus among CEO panelists was that, given both the expense of turnover and cost of hiring externally, developing internal talent must be a key job of the CEO going forward. Robert Weiss, CEO of the The Cooper Companies, spends more than 50% of his time developing the capabilities of his top people and pushing them beyond their comfort zone. “My job is to look at every one of them, to know them, to figure out where they’ve never been exposed and how they can be the best they can be.”

“When people leave Deloitte, they don’t leave because of money,” added Cathy Engelbert, Deloitte’s CEO. “They leave because they don’t feel valued, they don’t feel inspired. The companies finding ways to inspire employees and have the highest engagement scores, they are going to be out ahead.”