Yes, Digital Disruption is real
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1 Work Has Become Digital What It Means for HR September, 2017 Josh Bersin, Principal & Founder, Bersin by Deloitte Yes, Digital Disruption is real 90% of organizations surveyed by MIT and Deloitte anticipate their industries will be totally disrupted by digital trends. 1
2 What appears to be happening Mobile, sensors, AI, cognitive computing, data Access to technology by consumers globally Technology infiltrates home and political life Technology change Rate of change Gap in business performance potential Business productivity Time Productivity is suffering is technology helping? US productivity last ten years i-phone launched 100 million Twitter users 1 billion smartphones 2
3 What is really happening HR s opportunity: help close the gap among technology, individuals, businesses, and society and governments Technology Individuals Rate of change Businesses Public policy 1970s 1980s 1990s 2000s 2010s Today Employees are Overwhelmed The average US worker now spends 25% of their day reading or answering s The average mobile phone user checks their device 150 times a day. More than 80% of all companies rate their business highly complex or complex for employees. 40% of the US population believes it is impossible to succeed at work and have a balanced family life. Fewer than 16% of companies have a program to simplify work or help employees deal with stress. The average US worker works 47 hours and 49% work 50 hours or more per week, with 20% at 60+ hours per week Sources: Deloitte Human Capital Trends 2014 and
4 We Are Working More Hours: The Vacation Crisis Since 2000, American workers have lost an entire week of vacation, dropping average vacation days from 20.3 to 16.2 Americans left 658 million unused vacation days and lost 220 million of them in % of Americans want to be seen as a work martyr yet 86% say it s bad for their family life. 48% of Millennials want to be seen as a work martyr Millennials 50% more likely to forfeit vacation days Millennials: Citizenship On The Rise Millennials Are Concerned about A Threatening and Unfair World 64% expect economic and political conditions to get worse in the coming two years In mature markets, only 64 percent of millennials predict they will be financially worse off than their parents and 69% say they ll be less happier. As a result, 77% of Millennials actively take part in volunteerism and charity work to help their community 88% of Millennials believe business can be a major force for positive social change 4
5 Engagement Remains a Challenge Average 3.21 What are these companies doing? Summer, 2017 Glassdoor Bersin by Deloitte Research Research overview Deloitte s largest and most extensive human capital survey to date 10,000+ business and HR leaders 140 countries Unless otherwise noted, all data referenced in this is from 2017 Deloitte Global Human Capital Trends: Rewriting the rules for the digital age. 5
6 The organization of the future: Arriving now 88% Very important or important 11% believe they understand how to build the organization of the future 94% say agility and collaboration are critical yet 73% experimenting with collaboration tools, however only 8% using organizational network analysis (ONA) 6% are highly agile today Organization design will be challenged everywhere A network of teams B A F A C B D Shared values and culture Transparent goals and projects Free flow of information and feedback C D E E G People rewarded for skills and abilities, not position How things were How things are How things work 6
7 Careers and learning: Real time, all the time 83% Very important or important 83% are moving to open career models The changing nature of the career Length of career Average tenure in a job Half-life of a learned skill 60 to 70 years 4.5 years 5 years Organizations need to deliver learning that is always on and always available over a range of mobile platforms Sources: The 100-Year Life: Living and Working in an Age of Longevity; A New Culture of Learning: Cultivating the Imagination for a World of Constant Change Why skills matter so much Shift to a service and IP-based economy Source: U.S. Bureau of Labor Statistics 7
8 Increased Need for Social, Integrative, Hybrid Skills Talent for survival Essential skills for humans working in the machine age, Deloitte UK, 2016 Skills map, David Deming, Harvard University, , Catch the Wave, Deloitte University Press, Josh Bersin, 2017 The Future Of Work Has Arrived 8
9 Career Models Are In Disruption 58% of companies are redesigning or planning to redesign their career model Deloitte HC Trends % of companies expect to have an open or highly flexible career model within the next 3-5 years Deloitte HC Trends % of companies expect careers to be 3-5 years long 60% expect them to be 10 years or less Only 19% of companies promote vertical career moves, 67% now promote horizontal or project based career progression Learning and career management software has become the #1 fastest growing segment in HR technology (CedarCrestone 2017) What This Means for Digital Learning? E-Learning & Blended Talent Management Continuous Learning Digital Learning Intelligent Learning Formats Philosophy Users Systems Course Catalog Online University Instructional Design Kirkpatrick Self-Study Online Learning LMS as E-Learning Platform Learning Path Career Track Blended Learning Social Learning Career Focused Lots of Topics LMS as Talent Platform Video, Self-Authored Mobile, YouTube Taxonomies Learning On Demand Embedded Learning LMS as Experience Platform Micro + Macro-Learning Video everywhere Design Thinking Learning Experience What You Need Where You Need It LMS invisible Data Driven, Mobile Intelligent, Personalized
10 Explosive Growth In MicroLearning Micro-Learning I need help now. Macro-Learning I want to learn something new. 2 minutes or less Topic or problem based Search by asking a question Video or text Indexed and searchable Content rated for quality and utility Several hours or days Definitions, concepts, principles, and practice Exercises graded by others People to talk with, learn from Coaching and support needed Is the content useful and accurate? Videos, articles, code samples, tools Is the author authoritative and educational? Courses, classes, MOOCs, programs How Do We Redesign Learning For Work? Pace of Learning Micro Micro Micro Macro Credential Micro Micro Great Coach Normal Macro Bad New on the Job Seasoned Expert 10
11 Talent acquisition: Enter the cognitive recruiter 81% Very important or important Biggest disruptor in talent acquisition today is experimentation with tech solutions and services excellent at managing talentsharing resources 19% excellent at managing crowdsourcing 8% excellent at using games & simulations to attract and assess potential candidates 6% The employee experience: Culture, engagement, and beyond 79% Very important or important 22% are excellent at building a differentiated employee experience 14% believe their internal processes for collaboration and decision making are working well 23% believe their employees are fully aligned with the corporate purpose 10% are using design thinking as part of crafting the employee experience Deloitte and Facebook, Transitioning to the future of work and the workplace, November
12 Bersin by Deloitte Engagement Model The Simply Irresistible Organization Meaningful Work Hands-On Management Positive Work Environment Autonomy Clear transparent goals Flexible, humane work environment Selection to Fit Coaching & feedback Recognition rich culture Growth Opportunity Facilitated talent mobility Career growth in many paths Trust in Leadership Mission and purpose Investment in people, trust Small Teams Leadership Development Open flexible workspace Self and formal development Transparency and communication Time for Slack Modern Performance Management Inclusive, diverse culture High impact learning culture Inspiration Collaboration and Connection Enterprise Feedback Architecture Annual Survey Anonymous Feedback Tools Pulse Surveys Customer Satisfaction Integrated Reporting & Analytics Sentiment Analysis Network Analysis Social Media Monitoring Employment Brand Exit Interviews Performance Appraisals Performance Check-ins Job Boards & Ads 12
13 Performance management: Play a winning hand 78% Very important or important Capabilities to implement performance management have improved by 10% since 2015 The focus has shifted from talking about people to talking with people in open conversations Agile goal management, check-ins, and continuous feedback are becoming common; new models of evaluation and rewards are next What s Really New? Almost Everything! Vendor A Check-ins Transparent Goals Integrated into Workflow Fundamental Changes Are Working Peer Feedback Feedback to Manager Vendor B The New World of Performance Management Vendor F Mobile App Regular Evaluation Annual Process Manager-Centric Hierarchical Competitive Continuous Team-Centric Multi-Directional Developmental Engagement Survey Vendor C Individual Assessment Vendor D Vendor G Team Assessment Continuous Micro- Learning Vendor E Subjective Secret Single Rating Data-Driven Transparent Richer Rating 13
14 From Wellness to WellBeing to Performance Employee Vitality Medical Benefits Health Monitoring Family Exercise Employee Assistance Sleep Stress Fitness Nutrition Challenges Recognition Self Discovery Career Purpose Drive Skills and Training Work Environment Wellbeing Mindfulness Abundance Mentality Positive Thinking Culture Fit Sustainable Performance Rewards Leadership Management Clear Goals Growth Opportunities Global Wellness market is now $3.7 Trillion and growing at 6.9% YTY Cost Reduction Labor Productivity Retention Productivity Collaboration Team Performance Business Performance Leadership Leadership disrupted: Pushing the boundaries 78% Very important or important feel they have strong digital 5% leaders in place The leadership gap has become larger; organizational capabilities to address leadership dropped by 2% 72% developing new leadership programs focused on digital management Digital leadership required shifts in how leaders must think, how leaders must act, and how leaders must react 14
15 The Digital Organization Continuously Innovating Real Time & On-Demand Ongoing Shifts in Decision Rights and Power Modulating Risk & Security Boundaries Like human DNA, Digital DNA carries the 23 underlying instructions, development, functioning, and replication for being digital. These are expressed as digital traits and characteristics. They are present in all areas of the organization: business models, operating models, customer interaction, organization structure, talent, technology, cyber-security, culture, etc. There are four levels of Digital Maturity: Exploring, Doing, Becoming, and Being. Deloitte Consulting LLP Fluidity Geography Agnostic Morphing Team Structures Intentionally Collaborative Dynamic Skill Requirements Changing Nature and Typology of Work Constant Disruption Increased Customer Involvement Democratizing Information Multi-Modal Operations Uneven Velocity between Digital & Legacy Productive Mobility (non-traditional workspace options) Changing Mix of Traditional & Non-traditional Stakeholders Flattening and Changing Hierarchy Agility Continuous Ecosystem Disruption Constantly Changing Decision Criteria Fail Early, Fail Fast, Learn Faster Iterative Inclusion, bias, diversity go mainstream Inclusive Talent Practices Drive Financial Results Level 4 Inclusive Talent System Talent strategies integrated with inclusion, diversity, and culture 10% Level 3 Managed Talent Relationships Workforce planning, development planning, leadership development integrated into talent strategy 19% Level 2 Critical Talent Growth Critical talent segments, focus on hiring, training, performance 59% Bersin by Deloitte Level 1 Essential Talent Activities Standalone disconnected staffing, training, and performance practices 12% Source: Bersin by Deloitte, Deloitte Consulting LLP,
16 Diversity and inclusion: The reality gap 69% Very important or important 78% believe diversity and inclusion is a competitive advantage 38% report the CEO is the primary sponsor of diversity and inclusion program Traits of an inclusive leader: commitment, courage, cognizance of bias, curiosity, cultural intelligence, collaboration Digital HR: Platforms, people, and work 73% Very important or important HR is being asked to help lead the digital transformation in 3 areas: Digital workforce Digital workplace Digital HR 56% are redesigning their HR programs to leverage digital and mobile tools 33% are using some form of artificial intelligence (AI) technology to deliver HR solutions 16
17 7 key findings: 2017 High-Impact HR Study Designs engaging worker experiences rather than top-down programs and processes Tests and applies advanced technologies to redesign, not just automate, work activities Leads digital transformation, instead of waiting for it to happen Supports dynamic organization model, expert in teams and change rather than hierarchy Shapes a culture of trust, inclusion, and accountability, not compliance and control Breaks down silos within HR and integrates deeply with the business Regenerates its operating model and develops capabilities continuously Source: Seven High-Impact Research Findings to Redefine HR, Bersin, Deloitte Consulting LLP, 2017 Financial Impact of High-Impact HR High-maturity organizations Low-maturity organizations Difference Year-over-year change in revenue 6.9% -0.6% 7.6% High-impact HR is a driver of growth and innovation Profit per employee $ $ % High-impact HR improves work productivity 3 YR AVG 17
18 Convergence of HR Systems Ahead Mobile Feedback Pulse Survey Surveys Engagement Tools Engagement Feedback Customer Feedback Engagement Analytics Fitness Monitoring Diet Wellness Travel Time Management Fitness Challenges Health Behavior Change Well Being & Work Management Goal Management Feedback Personality Assessment Check Ins Performance Performance Review Video Learning Gamified Onboarding Career Video Sharing Planning Training and Certification Learning and Career Social Recognition Customer based Recognition Anniversaries Work Events Community Circles Affinity Groups Recognition Rewards People analytics: Recalculating the route 71% Very important or important 15% have broadly deployed HR and talent scorecards for line managers New tools are emerging and analytics are shifting from push to pull 8% report they have usable data 9% have a good understanding of which talent dimensions drive performance 18
19 2017: Where People Analytics Is Going Interesting Experiments, Models, and Studies Practical, Useful Dashboard and Tools Projects Based on Problems and Strategies Embedded Applications That Drive and Inform Work Progress Steady and Accelerating Percent Change in Companies Excellent or Good, % Change Plan Correlate Predict Performing multi-year workforce planning Correlating people data to business performance Using people data to predict business performance + 23% + 56% + 50% Deloitte Global Human Capital Trends, 2016 and
20 Emergence of Relationship Analytics Organizational Network Analysis (ONA) Teams Organizations The Enterprise Digital Future of Work: HR Must Get Involved 63% Very important or important 17% report being ready to manage a workforce with people, robots, and AI working side by side 41% have fully implemented or made significant progress in adopting cognitive and AI technologies 66% believe their use of off-balance sheet talent will grow significantly in the next 3 5 years, but 49% are not able to manage contingent labor well 20
21 What Should HR Teams Do? Four Imperatives for Focus on the employee experience with focus on feedback and design thinking, not programs and processes 3 Become digital: systems, architecture, process, experiments, data recruiting, learning, and employee services 2 Rethink the organization and jobs model, leadership, careers, mobility, and performance management 4 Act as One: redefine your identity, develop HR teams, standardize, and empower local HR staff Rewrite the rules About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms. Please see for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting. Copyright 2017 Deloitte Development LLC. All rights reserved 21
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