Pursuing New Technologies? Focus on the ‘Human Operating System,’ Says Study

When it comes to technology, 2018 has been dubbed: The Year of Disruption. What does this mean exactly? More and more chat bots, artificial intelligence (AI), and other virtual/augmented reality applications that will be changing the way people work and communicate in very innovative ways.

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According to Mercer’s 2018 Global Talent Trends Study–Unlocking Growth in the Human Age, 91% of U.S. companies have innovation on their core agenda this year and 95% are planning organization design changes.

At the same time, employees are seeking control of their personal and professional lives, with more than half asking for more flexible work options. As the ability to change becomes a key differentiator for success in a competitive global climate, the challenge for organizations is to bring their people along on the journey, especially as a top ask from employees is for leaders who set clear direction.

“This year we saw palpable excitement from executives about shifting to the new world of work. They are pursuing an agenda of continuous evolution—rather than episodic transformation—to remain competitive,” said Ilya Bonic, President of Mercer’s Career business. “They recognize that it’s the combination of human skills plus advanced digital technology that will drive their business forward.”

In pursuit of new technologies, executives must focus on the “human operating system” to power their organization. Mercer’s study identified five workforce trends for 2018: Change@Speed, Working with Purpose, Permanent Flexibility, Platform for Talent, and Digital from the Inside Out.

Change@Speed

How companies prepare for the future of work depends on the degree of disruption anticipated. Those expecting the most disruption are working agility into their model and placing bets on flatter, more networked structures (27% are forming more holacratic work teams).

Placing power in the hands of individuals makes it critical to build capacity and readiness early. However, HR leaders feel less prepared to reskill existing employees (51% are confident that they can do this well) than to hire from the outside (72%).

As just more than half (53%) of executives predict at least one in five roles in their organization will cease to exist in the next 5 years, being prepared for job displacement and reskilling is critical for organizational survival. Yet, only 49% of companies are increasing access to online learning courses and even fewer (28%) are actively rotating talent within the business.

Working with Purpose

Three-quarters (76%) of thriving employees, those who feel fulfilled personally and professionally, say their company has a strong sense of purpose. To find purpose, employees crave movement, learning, and experimentation. If not received, they will look for it elsewhere—34% of employees in the U.S. satisfied in their current job still plan to leave due to a perceived lack of career opportunity.

In addition to purpose, the new value proposition includes health and financial wellbeing. Employees on average spend 9 work hours per week worrying about financial matters, yet only 27% of companies have policies in place to address financial health.

Fairness in rewards and succession practices are also top of mind—only 54% of employees say their company ensures equity in pay and promotion decisions. “Organizations that help employees worry less about basic security needs and invest more energy on their career aspirations will be rewarded with a workforce that has more pride, passion, and purpose,” said Bonic.

Permanent Flexibility

Individuals are vocal in their expectations of work arrangements that put them in control of their personal and professional lives. Employees want more flexible work options, and organizations are listening—79% of executives view flexible working as a core part of their value proposition.

Only 3% of HR consider themselves industry leaders when it comes to enabling flexibility and 41% of employees fear that choosing flexible work arrangements will impact their promotion prospects.

“The lack of flexible work arrangements hurts women and older workers disproportionally, leading to absenteeism, lower energy levels, and burnout,” said Bonic. “As the skills gap widens and human competencies become more important, making sure that a diverse pool of talent can participate in the workforce at all life stages is both a business and a societal imperative.”

Platform for Talent

Given 92% of executives in the U.S. expect an increase in the competition for talent, organizations realize they must expand their talent ecosystem and update their HR models for a digital age.

The time is now—almost two in five companies plan to “borrow” more talent in 2018 and 78% of employees would consider working on a freelance basis. “Gaining greater access to talent through a broader ecosystem is part of the solution. Companies also need to deploy talent faster and with precision to unlock the potential of their workforce,” said Kate Bravery, Global Practices Leader in Mercer’s Career business. “Adopting a platform mentality to talent requires a radical mindset shift, embracing the notion that talent can be accessed for the benefit of all rather than ‘owned’ by one manager, department, function, or even organization.”

Executives agree, reporting that improving the ability to move jobs to people and people to jobs is one of the top two talent investments that would have the most impact on business performance this year, alongside enhancing the employee experience.

Digital from the Inside Out

Despite improvement over last year, companies in the U.S. lag on delivering a consumer-grade experience. While scoring the third highest in the study after India and the U.K., still only 23% consider themselves a digital organization today.

While 67% of employees say that state-of-the-art tools are important for success, just 56% say they have the digital tools necessary to do their job and only 43% have digital interactions with HR. Business leaders are confident in HR’s ability to be a strategic partner in setting the course for the future, with 74% of executives reporting that HR aligns people strategy with the strategic priorities of the business.

“In turbulent times there is a tendency to hold on to the rafters. Intuitively, we know success involves riding the crest of change and this requires a healthy risk appetite and a willingness to break and re-make talent models,” said Bravery. “When we are living digitally, working flexibly, and being rewarded uniquely, we will unlock growth in the Human Age.”

Mercer’s study shares insights from over 7,600 senior business executives, HR leaders, and employees from 21 industries and 44 countries around the world. The report assesses the new drivers of the future of work, identifies critical disconnects concerning change, and makes powerful recommendations to capture growth in 2018. For more information or to request the full 2018 Global Talent Trends Study, visit http://www.mercer.com/global-talent-trends.

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