Managing tomorrow’s people

PwC (2007). Managing tomorrow’s people. 36 p.

The Blue World

Big company capitalism rules as organisations continue to grow bigger and individual preferences trump beliefs about social responsibility.

  • This strategy has led to an increase in staff retention rates as people policies seek to lock in talent, but the top talent is still hard to attract and retain, many senior executives use personal agents to seek out the best deals.
  • Leadership teams now have a high focus on the evolution of the corporate culture with rigorous recruitment processes to ensure new employees fit the corporate ideal. Existing staff are subject to compulsory corporate culture learning and development programmes.
  • Huge people costs drive the need for robust metrics and analysis. Employee engagement, performance and productivity are all measured systematically. Leadership can access people data on a daily basis. This also provides an early warning signal of non-corporate behaviour or below standard performance.

Who leads people strategy?

The Chief People Officer.

  • Metrics and data are used to drive business performance through complex staff segmentation strategies which identify thousands of skills sets – creating precision around sourcing the right candidates for the right tasks as well as on the job performance measurement and assessment.
  • The science of human capital has developed to such a degree that the connection between people and performance is explicitly demonstrated by the CPO.
  • Those responsible for people management increasingly need financial, analytical, marketing and risk management skills to measure the impact of the human capital in their organisation and to attract and retain the best talent.

Organisational challenges

  • Organisations must develop models and systems designed and run by HR professionals which enable individuals and their agents to negotiate the value of their human capital based on employees’personal investment strategies.

The Green World

Social responsibility dominates the corporate agenda with concerns about demographic changes, climate and sustainability becoming the key drivers of business

Who leads people strategy?

The CEO.

  • People in the organisation and their behaviours and role in society have adirect link to the organisation’s success or failure.

Employee profile

  • Because organisations adopt a more holistic approach to developing their people, including personal development and measuring the impact they have on the wider world, employees are more engaged and as a result are often likely to have a job for life.

The Orange World

Companies begin to breakdown into collaborative networks of smaller organisations; specialisation dominated the world economy.

  • In a tightening labour market individuals develop portfolio careers, working on a short-term, contractual basis. They join craft guilds which manage career opportunities, provide training and development opportunities.
  • Organisations recognise that their employees and the relationships they have across their networks are the foundation of company success. Companies seek to promote and sustain people networks. This is achieved through incentivising employees around achieving connectivity goals and collaborative behaviours.
  • Workers are categorised and rewarded for having specialist expertise; this has created increased demand for workers to have a personal stake in the organisation’s success with direct ownership share schemes and project delivery-related bonuses becoming the norm.

Organisational challenges

  • Organisations are heavily reliant on their external networks to deliver what they need, and a combination of watertight contractual agreements combined with a healthy degree of business trust is imperative.

Employee profile

  • The responsibility for skills development shifts wholesale toindividuals.
  • People are more likely to see themselves as members of a particular skill or professional network than as an employee of a particular company.
  • Employees rely on achieving high scoring ‘eBay’ style ratings of past job performance to land the next contract.
  • Specialisation is highly prized and workers seek to develop the most sought after specialist skills to command the biggest reward package.

In short

Blue world Green world Orange world
Resourcing and succession Long careers and career planning. Succession plans for key performers. Holistic whole company approach to manpower planning. Short-term careers. Lots of contracting. HR strongly focused on filling fixed-term vacancies.
Talent management Strong performance focus across all levels. Top talent have personal agents. Broad definition of talent. Competencies focus. Minimal – key players in the central ‘core’ only, but liaison with external agents crucial
Employee engagement Engagement around performance and performance metrics. Heavy promotion of corporate culture attributes and behaviours. Engagement around work-life balance and social responsibility. Short-term engagement around projects.
Reward and performance Strongly performance-related. Pay for performance. Highly structured according to role segmentation. Focus on total reward over career life-time. Contract based-pay for projects. Individual stake in projects as incentive for contractors.
Learning and development Begins at school. Focus on skills for the job – metrics driven. Holistic approach to learning– much provided in-house. But secondments and paid sabbaticals for worthy causes are common Minimal provision in house. Skills training via new crafts guilds.

What is coming?

We believe it is highly plausible that all three organisational models described in this report will feature in tomorrow’s world, sometime or somewhere and to some extent.

The world of work is going to become even more complex.

Our message is: take a long hard look at your organisation models and current people management strategies; how are you addressing reward, international mobility, employee engagement, development and learning?

We believe there is a significant opportunity for the HR function to really own the people management agenda within organisations, to truly drive strategy and have the tools and information to become one of the most powerful and influential parts of the business operation.

A failure by HR to take the lead could result in the function being outsourced almost entirely, or absorbed by line managers or into other functions such as finance or marketing.

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