When looking into the future of work and businesses, the only certainty is change.
Automation is both eliminating and creating jobs. The rise of different jobs requires different skills in the workforce, technical and social. New forms of business, unheard of a decade ago, are now becoming mainstream.
Common themes emerging from recent research on the future of work and firms can help us understand and tool up for change. These themes are:
- The success of business enterprises is likely to rely on a structure that is less traditional managerial ‘command and control’ business units, and more collaborative, open and entrepreneurial teams inside and outside the firm.
- Jobs for the future will be those where interpersonal relationships, not merely transactions, are essential, and those that demand high levels of judgement, flexibility and critical thinking– all reliant not on explicit rules, but on tacit knowledge and intuition.
- The aspirations of different generations of employees and their expectations of what constitutes an ‘employer of choice’ presents managers and organisations with new challenges in recruiting and retaining talent.
- Digital technology is profoundly affecting where, when and how employees get work done, and how business executives harness a common culture and purpose and manage an enterprise’s operations and performance sustainably.
- The importance of advanced technologies and the complexity of today’s business problems makes it imperative for organisations to have the right mix of deep specialist knowledge, especially in science, technology, engineering and maths, and proficiency in social and behavioural disciplines for creative problem-solving and relationship-building.
These observations are drawn from analyses by Bain & Company, Deloitte, and The Strategy Group, among others. These analysts also share their insights about how firms and their workforces can best adapt and take action in the face of such broad-ranging change.
Here are a few of the most potent insights.
Reset for the end of the ‘shareholder primacy’ era
Bain & Company in a briefing to the Australian Institute of Company Directors postulated that shareholder primacy is breaking down, i.e. the premise that firms exist first and foremost to deliver returns on their shareholders’ capital. This is due to the adverse effects of extreme short-termism; increasing business complexity; the changing workforce; and new diverse ownership, investment and business models that open the firm up to other stakeholders, partners and wider community interests.
In short, the firm is not alone, but is interdependent with other allies and actors for its success – a collaborative ecosystem. The implications are that what has made firms successful in the past will not do so in the future, so a reset is needed.
Chief among business responses is to get to know and nurture the distributed ecosystem in which the firm operates and collaborates in order to adapt and grow its business. This is reinforced by Deloitte’s Future of Work survey of C-level executives, with two-thirds of respondents saying it is a strategic objective to transform their organisation’s culture to achieve increased connectivity, communication and collaboration.
Build networks, not hierarchies
The Deloitte survey responses also point to a shift in how workplaces will operate in the future – from ‘top-down’ to ‘side-by-side’. Executives expect to place more focus on facilitating the exchange of ideas, enabling the flow of conversations across their organisation, and providing greater autonomy for teams and individuals.
Bain & Company extends this further by highlighting the benefits available to firms that deliberately create communities of expertise both within their organisation and within their ecosystem.
Bain & Company says less focus on professional managers and more on mission-critical roles in the firm for fulfilling the promise to current and prospective customers. Key new tasks for professional managers are: to support and resource mission-critical roles; to create and facilitate agile talented teams working on successive business projects; and to develop the next generation of leaders for the business.
The Strategy Group says that future executive teams will need a permanent seat for a Chief Entrepreneur. This Chief Entrepreneur may ultimately displace the position of Chief Executive Officer as the top job. The skills of the CEO are well-suited to the continuing implementation of known business models. But more vital for the future is the need to pioneer new innovative business models, which is the realm of the Chief Entrepreneur and of leadership based on boldness of vision, creativity, and the nerve to experiment and push the boundaries.
Invest equally in core business and innovative business
Managing the present while simultaneously adapting for the future is the high priority challenge for business leaders. Bain & Company refer to ‘Engine 1’ as core business and ‘Engine 2’ as more innovative emergent business, and recommend that firms create a specific ‘Engine 2’ incubator, so the present does not drown out the future.
‘Engine 2’ is aimed at seeing around corners, spotting trends before they are well-formed, and mobilising resources rapidly to create new business from changing customer needs, different competitors and new ways to earn revenues and profits.
Taking these insights as a whole, we see glimpses of the future of work and firms and signals for how to anticipate and navigate the change ahead.
Bain & Company’s 5 forces shaping the firm of the future, Australian Institute of Company Directors, Membership Update, 28th June 2017.
Deloitte, Adapting to the Future of Work, Wall Street Journal, 9th May 2017.
Jemma Parsons, The C-Suite of the Future, The Strategy Group, 25th July 2017.