The Future of the Global Workplace Dr Peter Saul www.petersaul.com.au Presentation to  Diversity Council Australia’s  Annu...
Overview <ul><li>How can we most profitably think about the topic? </li></ul><ul><li>Work, workers and workplaces aren’t w...
LOOKING AT THE BIG PICTURE: Probable shapers of the 10-20 year future <ul><li>Polarised distribution of wealth </li></ul><...
10 Consumer Trends for 2006+ <ul><li>ANXIETY   -  expect a boom in escapism and fantasy </li></ul><ul><li>CONNECTEDNESS - ...
Scanning the Environment for Patterns of Weak Signals Sydney households have average net worth 37% higher than rest of Aus...
DIFFERENT FUTURE SCENARIOS REQUIRE  DIFFERENT  AUSTRALIAN WORKFORCES <ul><li>“ FIRST GLOBAL NATION” </li></ul><ul><li>Aust...
Why care about the global workforce? <ul><li>“ The working age population [in Australia] currently grows by 170,000 people...
Overview of Supply and Demand Factors Shaping  the Future Global Workforce Future Workforce Industry  Structure Govt. Poli...
The Future Global Workforce:  A Function of Supply and Demand <ul><li>SUPPLY FORCES </li></ul><ul><li>Population demograph...
Identifying The Relevant Global Workforce Global population of working age Those with desired skills and attributes Those ...
The BRICs are Changing Everything <ul><li>The entry of  B razil,  R ussia,  I ndia and  C hina into the global market econ...
Big picture demographics:  Global population (millions) <ul><li>2004 </li></ul><ul><li>2050 </li></ul>Source:  Population ...
Global population by age (%) <ul><li>under  age 15 </li></ul><ul><li>age 65  and over </li></ul>About 90% of the growth in...
Global population aged 65 and over (%) <ul><li>2007 </li></ul><ul><li>2025 </li></ul><ul><li>2050 </li></ul>Source:  Popul...
Population aged 65 and over Source:  Population Reference Bureau, 2007
Australia’s ageing population (%) <ul><li>2000 </li></ul><ul><li>2025 </li></ul><ul><li>2050 </li></ul>United Nations “Wor...
How to Make Sense of the Changing Workplace? New Retirement Options Two Speed Economy Employability vs. Job Security Multi...
Shifts That Are Re-shaping Organisations and Work <ul><li>FROM </li></ul><ul><li>Local markets, operations  </li></ul><ul>...
The changing locus of employment in Australia Source:  ABS 8155.0, Section 2.1, Data for 2004-05 596,704 8,109,513 2,365,2...
Emerging Organisational Paradigms on “the Edge” <ul><li>STAKEHOLDER BASED CORPORATE GOVERNANCE PROCESSES </li></ul><ul><li...
MIT Scenarios Forecast Emergence of Networks  in 21st Century <ul><li>MIT Initiative on Inventing the Organizations of the...
FUTURE OF ORGANISATIONS: Scenario 1 <ul><li>VIRTUAL COUNTRIES </li></ul><ul><li>Keiretsu-like alliances with operating com...
Virtual Country HR <ul><li>HR almost replaces social welfare, education systems and provides financial management and esta...
FUTURE OF ORGANISATIONS: Scenario 2 <ul><li>SMALL COMPANIES, LARGE NETWORKS </li></ul><ul><li>Autonomous teams of 1-10 peo...
Your Organisation  is  the Network Employees Suppliers, Contractors Unions,  Associations Business  Partners Community Sha...
Small Company, Large Network HR <ul><li>Very specific in scope as far as the project organisation is concerned (e.g. talen...
How are Networks Different? <ul><li>Traditional Organisation </li></ul><ul><li>Formal authority </li></ul><ul><li>Rigid st...
Networks in the Knowledge Economy
The Leadership Challenge <ul><li>The vast majority of the leadership and management literature presumes large, hierarchica...
FUTURE WORKER 2015:  A “maverick” scenario <ul><li>Extreme individualisation of work  </li></ul><ul><li>Multiple expectati...
Future Worker 2015 <ul><li>Key Conclusions </li></ul><ul><ul><li>Future successful companies will have a symbiotic relatio...
Predictions of the Impact of Changes by 2015 <ul><li>High Probability                Low Probability   </li></ul><ul>...
The Changing Worker Past Future???
The drivers of increasing workforce diversity <ul><li>Several generations at work as workforce age span increases </li></u...
The moderating role of leadership and culture Diversity  X  Leadership  X  Org. Culture  =  Performance <ul><li>The leader...
In Summary:  A Possible Network Future <ul><li>Most organisations produce or compete on the basis of knowledge and service...
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  • First Global Nation describes a successful Australia which adapts with flair and flexibility to the globalisation of world business and the challenges of an online knowledge economy. Sound the Retre a t sees a world in which geopolitical instability and cultural and social backlash override the benefits of economic globalisation, forcing Australia to revalue its bilateral business relationships as multilateral ones became impossible. Brave Old World is a picture of Australia where our comfortable lifestyles, economic performance, adequate social security systems and laconic approach to the future conceal the need for strategic and concerted effort to make the transition to the global knowledge economy until it is too late. Green is Gold looks at how global agreements on environmental management imperatives play out in Australia for business and the community at large.
  • Therefore Australia will have to look overseas for many more workers to fill new jobs (if the economy keeps growing).
  • Government Policies influence: Industrial Relations Subsidies and tax rates Workforce participation rates Supply of skills Constraints (e.g. bans on uranium mining) Social values influence lifestyle decisions determining where people choose to live and how much they choose to work and the employers of choice. Values also influence what people choose to buy - and from whom. Type of organisation (encompassing technology, culture and org. structure) shapes the nature of jobs, their location and how jobs/people are linked together. Industry structure encompasses industry mix; the nature of competitive forces; and the required skill mix. N.B. Someone is not “in” the workforce in any meaningful way if they do not have skills that are in demand.
  • According to IT and the East: How China and India are Altering the Future o/Technology and Innovation, a book published earlier this year by a couple of US-based analysts, India is expected to add 71 million workers to the global labour pool and China 44 million over the next four years, compared with a projected 10 million additional workers in the US, none in Europe&apos; and a decline of 3 million in Japan. The US Bureau of Labor Statistics has said that 43% of the current US labour force will be eligible to retire before 2012.
  • N.B. Largest growth in Asia/Oceania (ex China and India) category will be in Iraq, Palestinian Territory, Yemen, Afghanistan (all over 100% growth between 2006 and 2050) Other simultaneous trends are: Increasing average affluence but growing rich-poor polarisation Declining fertility rates as affluence increases Urbanisation – in 2008, for the first time, more than half the world’s population will live in cities. Climate change threatens many large coastal cities raising the potential of large-scale migration (estimates are around 100 million people over the remainder of this century) Oceania countries include: Australia, Fiji, New Zealand, Samoa, Tonga, PNG, Solomon Islands, etc Asia (ex China and India) countries include: Israel, Iraq, Iran, Arab states, Brunei, East Timor, Singapore, Thailand, Vietnam, Japan, Korea (North and South), Pakistan, Bangladesh, Indonesia, Philippines, etc
  • More developed countries are (following the UN classification): Europe, North America, Australia, Japan, New Zealand Less developed countries: All other regions and countries Among developed countries, only the US is likely to see significant population growth – a result of higher rates of immigration and a birth rate higher than other developed nations.
  • Japan and Italy already have around 20% of their population over 65 years of age.
  • According to the ABS, in September 07, Australia’s total employment (F/T + P/T) was 10,611,700: 258,700 were aged 65 or more 495,400 were aged 60-64 866,900 were aged 55-59 2,3,983,400 were aged 45-54 …therefore 37.5% of the total number employed are aged 45 or older and will therefore be eligible to retire in the next 15 years.
  • The above list was generated by a group of HR and organisational change consultants in Sydney - August 2001
  • 72.6% of all small businesses had a sole operator (up from 68.5% in 2003); 25.1% had two operators (down from 29.0% in 2003) 67.5% of small businesses are home based (up from 58.3% in 1997). 67.1% of non-agricultural small business operators are full-time operators; of which 65.1% usually work 35-50 hours each week; while the rest work more.
  • Introduction to this and following slides: If we can forecast the evolving nature of organisations and work and develop future scenarios for the global and Australian economies then we may be better placed to forecast the future characteristics of the global and Australian workforce. Additional notes on this slide: Three quarters of the workforce is now in the knowledge and services sector of the economy. Most of the new jobs are being created in small and medium enterprises. These are the norm in the k-economy. Richard Branson’s Virgin Enterprises (and AIM and AHRI) seem to operate a bit like Al-Qaeda with loosely (or moderately) connected cells that contain the intelligence of the whole but operate independently. They develop people from within through the doing of the work. Open source programmers do it for the self-justifying “flow” experience of being involved in something that matters and that joins them with a community of others.
  • Notes: Most transactions are internal to the firm. This form emerges because advantages of scale and control of IP outweigh the cost-efficiencies of external transactions, and the speed, flexibility of small company design. Weak intellectual property legislation may also encourage this type of organisation. It is argued that there would be very little fat in the system because of the open information flows and shared ownership. Employee ownership may be via: pension plans, stock options, participation contracts, partnership structures
  • Notes: In this model most of the transactions are market based and external to the firm. This form is driven by the lower cost and greater efficiency of external transactions. Speed, flexibility outweigh scale advantages. The US Screen Actors Guild levies up to 30% of an actors base pay from movie producers to pay for health and pension benefits. ______________________________________________________ Examples: Prato textile mills (Italy) - in 1990 there were over 15000 small firms averaging &lt;5 people; with state of the art factories and warehouses. Semco - spun off satellite companies that used the corporation’s facilities. The seemingly chaotic environment has only enhanced morale and performance in both the satellites and the core company.
  • Your organisation’s workforce may be better thought of as a network of contributors; e.g. see my article on this at: http://www.petersaul.com.au/org-as-community.pdf
  • Extreme Individualisation of Work - workers will customise the information, tools and resources they use - today&apos;s 45- to 55-year olds (also known as baby boomers) will lead a new wave of entrepreneurship and innovation Multiple Expectations of Work (e.g. Gen X, Gen Y, Baby Boomers) - workers will have multiple expectations; will pursue multiple careers; and will be continuously creative Global Village with Virtual Teams: - skilled workers will meet fewer than 30% of the members of their work community face to face Inventiveness Spreads into Developing Countries - India and China already graduate around 500,000 engineers and scientists per year By 2015, more than 60 percent of jobs will be unique to a company — that is, fluid, nonrepeatable and without comparison - corporate allegiance will decrease - trusted peer networks used to find unconventional work arrangements More Collaboration, Less Alone Time - important to capitalise on social networks
  • Gartner stress tested the prediction of extreme individualisation under two different scenarios: Scenario 1: Government funded benefits go bankrupt by 2015 Most likely outcome: Small business soars: Skilled workers become disillusioned by big corporations and government. They take control of their own financial futures by creating smaller, independent businesses. Small businesses, worker individualism and workplace customization become the next work model (0.7 probability). Scenario 2: Catastrophic health event (e.g. Avian flu) Most likely outcome: Global communities flourish: The need to tap into skills and services drives businesses to initiate investments in globalization and worldwide inventiveness. Individuals reach out to global communities; the lines between corporations and global villages blur. The result is extreme individualism with users driving technology decisions. Virtual centers for innovation are created (0.6 probability). Source: Gartner (March 2006)
  • “ Research” reference (see last point in slide): “ Managing Diversity As a Key Organizational Resource: An Interview with David Thomas” by Kali Saposnick, Leverage Points, Issue 37, at http://www.pegasuscom.com/levpoints/lp37.html US research firm Catalyst in research released in October 2007 found that Fortune 500 companies with the highest representation of women among its directors attained significantly higher financial performance, on average, than those with the lowest representation of women on the board.
  • Examples of network organisations: Motley Fool and Change Wave investment network User groups, consumer groups for products and services Self-organising distribution channels - eBay Professional associations - they recognise success (AHRI awards, film and TV awards) and develop skills and offer financial benefits Political parties and lobby groups Parents and Citizens Associations
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    1. 1. The Future of the Global Workplace Dr Peter Saul www.petersaul.com.au Presentation to Diversity Council Australia’s Annual Conference on Diversity 22 November 2007 Melbourne
    2. 2. Overview <ul><li>How can we most profitably think about the topic? </li></ul><ul><li>Work, workers and workplaces aren’t what they used to be or where they used to be. </li></ul><ul><li>… and things are still changing, so the future will be different again. </li></ul><ul><li>How might the HR function evolve in the light of all these changes? </li></ul><ul><li>What role will diversity play in successful organisations? </li></ul>
    3. 3. LOOKING AT THE BIG PICTURE: Probable shapers of the 10-20 year future <ul><li>Polarised distribution of wealth </li></ul><ul><li>Globalisation </li></ul><ul><li>Diversity, complexity </li></ul><ul><li>New technologies: e.g. genomics, nanotechnology </li></ul><ul><li>Information and communications technology </li></ul><ul><li>Disintermediation </li></ul><ul><li>Legislation </li></ul><ul><li>Corporate governance structures </li></ul><ul><li>Population demographics </li></ul><ul><li>Natural environment; e.g. climate change </li></ul><ul><li>Risk, uncertainty, lack of meaning </li></ul><ul><li>Pandemics; e.g. bird flu </li></ul><ul><li>Wars, terrorism </li></ul><ul><li>Search for simplicity, new values, meaning </li></ul><ul><li>Growth in experience economy </li></ul><ul><li>Questioning of Western capitalism </li></ul><ul><li>Technology </li></ul>
    4. 4. 10 Consumer Trends for 2006+ <ul><li>ANXIETY - expect a boom in escapism and fantasy </li></ul><ul><li>CONNECTEDNESS - faster, smaller, more intelligent world where events will be experienced by more people </li></ul><ul><li>SPEEDING-UP - blurring of work and home; memory loss, increased stress and mental illness </li></ul><ul><li>MOBILITY - people want to access anything , any time, anywhere </li></ul><ul><li>CONVERGENCE - blurring of whole industries, markets and brands </li></ul><ul><li>PRIVACY - potentially a more truthful and trusting society OR people adopt multiple personalities and fake IDs </li></ul><ul><li>NOSTALGIA - escape to the past; increased desire for face-to-face contact </li></ul><ul><li>LOCALISATION - more local trade alliances; the re-emergence of city states; the Balkanisation of Europe </li></ul><ul><li>AUTHENTICITY - growing interest in how things are made; search for real products and experiences </li></ul><ul><li>HAPPINESS - people increasingly value time, well-being and sustainability ahead of more money and materialism </li></ul><ul><li>Source: www.nowandnext.com </li></ul>
    5. 5. Scanning the Environment for Patterns of Weak Signals Sydney households have average net worth 37% higher than rest of Australia Almost a billion new consumers will enter markets in emerging economies 20% of Aust. adult population has downshifted in past 10 years No developed country has fertility rate above replacement level The 33 million university educated young professionals in developing countries is twice that in developed world 30% of net new jobs created between 2005 and 2020 will be in India; 14% in China India’s population will grow by 260 million by 2025; 5 times the increase in the US; and twice that in China Global survey of consumer and retailing companies: greatest threats over next 15 years are low-cost competition; decreasing customer loyalty % Aust. population over age 65 will increase from 13% in 2005 to 24% in 2025 In 2005, one in six countries in the world faced food shortages because of severe droughts due to global warming 65 per cent of young Australians will be overweight or obese by 2020 Social Technical Economic Political Environmental ABS predicts, childless couples will outnumber those with children by 2010
    6. 6. DIFFERENT FUTURE SCENARIOS REQUIRE DIFFERENT AUSTRALIAN WORKFORCES <ul><li>“ FIRST GLOBAL NATION” </li></ul><ul><li>Australia capitalises on globalisation; promotes its internal diversity and ethnic tolerance; and boosts home-grown innovation and industry capability </li></ul>“ SOUND THE RETREAT!” Globalisation stalls as political and social structures are not ready; trade barriers and nationalism re-emerge; we depend on bilateral national and commercial relationships “ BRAVE OLD WORLD” Complacent, dependent on agriculture, tourism, “new” manufacturing and some biotech; clever people and companies move overseas “ GREEN IS GOLD” We emerge from the growing imperative to protect the natural environment as a leading innovator of global environmental management Source: Australian Business Foundation “Alternative Futures: Scenarios for Business in Australia to the Year 2015” Sept 1999
    7. 7. Why care about the global workforce? <ul><li>“ The working age population [in Australia] currently grows by 170,000 people a year. But trends already in place will see the working age population grow by just 125,000 for the entire decade of the 2020s…” </li></ul><ul><li>“ Population Ageing and the Economy” </li></ul><ul><li>by Access Economics, Jan 2001, p.3 </li></ul>
    8. 8. Overview of Supply and Demand Factors Shaping the Future Global Workforce Future Workforce Industry Structure Govt. Policies Population Demographics Social Values Consumer Preferences Types of Organisation
    9. 9. The Future Global Workforce: A Function of Supply and Demand <ul><li>SUPPLY FORCES </li></ul><ul><li>Population demographics </li></ul><ul><li>Government policies influencing fertility rates </li></ul><ul><li>Education and health policies and infrastructure </li></ul><ul><li>Immigration flows </li></ul><ul><li>Climate change </li></ul><ul><li>DEMAND FORCES </li></ul><ul><li>Social/consumer values </li></ul><ul><li>Rate and nature of economic development </li></ul><ul><li>Income levels (purchasing power) </li></ul><ul><li>Technology </li></ul><ul><li>Nature of work organisation </li></ul>
    10. 10. Identifying The Relevant Global Workforce Global population of working age Those with desired skills and attributes Those attracted to your industry, organisation, location Those able to move (in time) Those reached by recruitment process
    11. 11. The BRICs are Changing Everything <ul><li>The entry of B razil, R ussia, I ndia and C hina into the global market economy has doubled the size of the global workforce and dramatically changed its demographic profile (many more younger workers). </li></ul><ul><li>The halving of the capital/labour ratio increased the power of capital as many more workers competed to work with the world’s capital. </li></ul><ul><li>The level of wealth inequality in these countries has increased dramatically. </li></ul><ul><li>As BRIC firms move up the value chain they will require more highly skilled workers and will become global competitors for the West’s best knowledge workers. Their improving social infrastructure will add to their competitiveness. Their huge foreign reserves will also enable them to acquire skills through corporate acquisitions. </li></ul>
    12. 12. Big picture demographics: Global population (millions) <ul><li>2004 </li></ul><ul><li>2050 </li></ul>Source: Population Reference Bureau, 2004
    13. 13. Global population by age (%) <ul><li>under age 15 </li></ul><ul><li>age 65 and over </li></ul>About 90% of the growth in world population to 2050 will occur in developing countries in Africa and Asia (including China and India) N.B. Data are for 2004
    14. 14. Global population aged 65 and over (%) <ul><li>2007 </li></ul><ul><li>2025 </li></ul><ul><li>2050 </li></ul>Source: Population Reference Bureau, 2007
    15. 15. Population aged 65 and over Source: Population Reference Bureau, 2007
    16. 16. Australia’s ageing population (%) <ul><li>2000 </li></ul><ul><li>2025 </li></ul><ul><li>2050 </li></ul>United Nations “World Population Prospects” (2006) http:// esa.un.org/unpp
    17. 17. How to Make Sense of the Changing Workplace? New Retirement Options Two Speed Economy Employability vs. Job Security Multiple, Self-Directed Careers Distributed Leadership Changing IR Legislation Distance Collaboration 24/7/365 Anytime, anywhere New Technology, New Energy Work/Life Balance Diversity in the Workforce Collaborative Decision Making Multiple, Overlapping Networks Knowledge Workers Valued Information Overload Skills Shortages Youth Workers Employee Engagement Leveraging Intellectual Property Corporate Social Responsibility Global Competition + China, India Outsourcing Changing Expectations: Gen X, Y, 60+ Sustainability Physical & Data Security
    18. 18. Shifts That Are Re-shaping Organisations and Work <ul><li>FROM </li></ul><ul><li>Local markets, operations </li></ul><ul><li>Manufacturing, clerical work </li></ul><ul><li>Hierarchy </li></ul><ul><li>Intermediaries; face-to-face </li></ul><ul><li>Obedience to formal authority </li></ul><ul><li>Stability, efficiency, control </li></ul><ul><li>Full time job </li></ul><ul><li>Shareholder value </li></ul><ul><li>Work done by employees </li></ul><ul><li>Fixed work location </li></ul><ul><li>Management prerogative </li></ul><ul><li>Loyal service </li></ul><ul><li>White, young workforce </li></ul><ul><li>Financial performance </li></ul><ul><li>“ Get a job” </li></ul><ul><li>TO </li></ul><ul><li>Global markets, operations </li></ul><ul><li>Service, knowledge work </li></ul><ul><li>Networks </li></ul><ul><li>Direct access,virtual relationship </li></ul><ul><li>Questioning of formal authority </li></ul><ul><li>Change, creativity, flexibility, order </li></ul><ul><li>Part-time and project work </li></ul><ul><li>Stakeholder value </li></ul><ul><li>Work done by many contributors </li></ul><ul><li>Diverse work locations </li></ul><ul><li>Social licence </li></ul><ul><li>Marketable knowledge, skills </li></ul><ul><li>Diverse, ageing workforce </li></ul><ul><li>Multiple bottom lines </li></ul><ul><li>“ Get a life” </li></ul>
    19. 19. The changing locus of employment in Australia Source: ABS 8155.0, Section 2.1, Data for 2004-05 596,704 8,109,513 2,365,213 TOTAL 62,705 1,360,922 1,551,112 Non-employing 237,462 2,626,428 2,945 Large (200 and over) 126,732 1,780,984 37,202 Medium (20-199) 169,805 2,341,180 773,953 Small (1-19 persons) Industry Value Added ($m) Employment (end June) No. of Businesses (excl. Govt & Finance/Insurance) Business Size
    20. 20. Emerging Organisational Paradigms on “the Edge” <ul><li>STAKEHOLDER BASED CORPORATE GOVERNANCE PROCESSES </li></ul><ul><li>TERRORIST ORGANISATIONS SUCH AS AL-QAEDA </li></ul><ul><li>MULTI-AGENCY NETWORKS EMERGING TO FIGHT GLOBAL HEALTH THREATS SUCH AS SARS </li></ul><ul><li>SELF-ORGANISING COMMUNITIES CREATING OPEN SOURCE SOFTWARE SUCH AS LINUX; AND DATABASES SUCH AS WIKIPEDIA </li></ul><ul><li>GOVERNMENT POLICY MAKING AND DELIVERY IN A WORLD OF INCREASING DEMANDS AND SHRINKING RESOURCES </li></ul><ul><li>IN THE EMERGING “KNOWLEDGE ECONOMY” </li></ul>N.B. The network is the central organisational form in all of these emerging arenas of activity
    21. 21. MIT Scenarios Forecast Emergence of Networks in 21st Century <ul><li>MIT Initiative on Inventing the Organizations of the 21st Century (January 1997) facilitated by Peter Schwartz of the Global Business Network:- </li></ul><ul><li>http://ccs.mit.edu/21c/21CWP001.html </li></ul><ul><li>The scenarios were developed during 1994-1997 by MIT academic and research staff in discussions with hundreds of executives at various MIT Symposia, executive education programs, etc. </li></ul>
    22. 22. FUTURE OF ORGANISATIONS: Scenario 1 <ul><li>VIRTUAL COUNTRIES </li></ul><ul><li>Keiretsu-like alliances with operating companies in every country </li></ul><ul><li>Minimal national allegiance - primary loyalty is to the corporation </li></ul><ul><li>Traditional hierarchy or decentralised divisional structure </li></ul><ul><li>Company is the focus for individual identity </li></ul><ul><li>Company meets employees’ needs from cradle to grave </li></ul><ul><li>Employees own the firm and have right to elect the Board and management </li></ul><ul><li>Open book accounting informs management elections </li></ul><ul><li>Specialist “organisational designers” travel through firm brokering partnerships and fostering cross boundary communication </li></ul><ul><li>Role of governments, industry unions is significantly reduced </li></ul>Examples: Asea Brown Boveri; GE; Johnson & Johnson
    23. 23. Virtual Country HR <ul><li>HR almost replaces social welfare, education systems and provides financial management and estate planning services, etc </li></ul><ul><li>Corporate (strategic) HR </li></ul><ul><ul><li>sets standards and monitors the corporate culture </li></ul></ul><ul><ul><li>helps Marketing build the corporate brand </li></ul></ul><ul><li>Divisional (operational) HR </li></ul><ul><ul><li>total care of employees so they are free to focus on performance </li></ul></ul><ul><li>Actively involved in local communities to reinforce the company culture and image </li></ul><ul><li>Selection emphasises fit with corporate values </li></ul><ul><li>Performance management focuses on results achieved the “XYZ way” and on being a company ambassador in all areas of life </li></ul><ul><li>Reward is via promotion, enhanced status, rights, benefits - and pay </li></ul><ul><li>Development is via corporate colleges and universities in partnership with the world’s best educational institutions </li></ul><ul><li>Innovation is through internal R&D and improvement programs with heavy emphasis on protecting corporate intellectual property </li></ul>
    24. 24. FUTURE OF ORGANISATIONS: Scenario 2 <ul><li>SMALL COMPANIES, LARGE NETWORKS </li></ul><ul><li>Autonomous teams of 1-10 people </li></ul><ul><li>Temporary - task or project based </li></ul><ul><li>Linked by high bandwidth, electronic network </li></ul><ul><li>Venture capital infrastructure identifies promising teams and provides financing </li></ul><ul><li>Independent organisations emerge for social networking, recreation, learning, reputation building and income smoothing </li></ul><ul><ul><li>evolved from professional associations, unions, clubs, university alumnis, neighbourhoods, families, churches </li></ul></ul><ul><ul><li>they are home for our identity as projects come and go </li></ul></ul>Examples: Film industry; Prato Mills (Italy); Nike; Nokia PC Display Division
    25. 25. Your Organisation is the Network Employees Suppliers, Contractors Unions, Associations Business Partners Community Shareholders, Investors Govt Agencies
    26. 26. Small Company, Large Network HR <ul><li>Very specific in scope as far as the project organisation is concerned (e.g. talent scouting/selection, pay, health & safety) </li></ul><ul><li>Outsourced </li></ul><ul><ul><li>agents, brokers, specialist providers </li></ul></ul><ul><ul><li>contract staff organisations handle the HR for their talent as part of their brand and competitive strategy </li></ul></ul><ul><li>Individuals rely on professional associations, “guilds”, managers/agents </li></ul><ul><li>Mutual employment obligations spelled out in project contracts </li></ul><ul><li>Project Manager’s reputation depends on his/her people skills and hence there is a reluctance to delegate to HR specialists </li></ul><ul><li>Selection is via networks, personal references, reputation </li></ul><ul><li>Performance management is via peer pressure and industry/ professional standards </li></ul><ul><li>Rewards are contractual or entrepreneurial (equity based) </li></ul><ul><li>Development is via doing leading edge projects </li></ul><ul><li>Innovation is via brokers, deal makers, agents, sponsors </li></ul>
    27. 27. How are Networks Different? <ul><li>Traditional Organisation </li></ul><ul><li>Formal authority </li></ul><ul><li>Rigid structure - power concentrated at “top” </li></ul><ul><li>Clear boundaries </li></ul><ul><li>Leadership responsible for control </li></ul><ul><li>Focus on contracted performance outputs </li></ul><ul><li>Money, status hold people in the system </li></ul><ul><li>Growth by expansion, acquisition </li></ul><ul><li>Scale gives economic power </li></ul><ul><li>Success measured in financial terms </li></ul><ul><li>Threatened by complexity, change </li></ul><ul><li>Network Organisation </li></ul><ul><li>Expert, relationship, symbolic power </li></ul><ul><li>Fluid structure - distributed power </li></ul><ul><li>Fuzzy boundaries </li></ul><ul><li>Leadership promotes order, linkages, emergent properties </li></ul><ul><li>Focus on commitment, psychological contract </li></ul><ul><li>Members held by values, synergy, higher order goals </li></ul><ul><li>Growth by cell replication and linkages to new cells </li></ul><ul><li>Power derives from symbols, stories, relationships </li></ul><ul><li>Success is resilience, impact, quality of relations </li></ul><ul><li>Nourished by complexity, change </li></ul>
    28. 28. Networks in the Knowledge Economy
    29. 29. The Leadership Challenge <ul><li>The vast majority of the leadership and management literature presumes large, hierarchical organisational structures. Consequently, we know very little about how to lead and manage networks - and yet these are likely to proliferate in the future as large hierarchies consolidate, die out or are transformed. </li></ul>
    30. 30. FUTURE WORKER 2015: A “maverick” scenario <ul><li>Extreme individualisation of work </li></ul><ul><li>Multiple expectations of work (e.g. Gen X, Gen Y, Baby Boomers, Migrants) </li></ul><ul><li>Global village with virtual teams </li></ul><ul><li>Inventiveness spreads into developing countries </li></ul><ul><li>More than 60 percent of jobs will be unique to a company </li></ul><ul><li>More collaboration, less alone time </li></ul><ul><li>Source: Gartner Research paper “Future Worker 2015: Extreme Individualization” 27 March 2006 </li></ul>
    31. 31. Future Worker 2015 <ul><li>Key Conclusions </li></ul><ul><ul><li>Future successful companies will have a symbiotic relationship with the future individualized workers, as opposed to an authoritarian relationship. </li></ul></ul><ul><ul><li>Companies that operate as if they own and control people will become obsolete. </li></ul></ul><ul><ul><li>No company will build or sustain a competitive advantage unless it capitalizes on the combined power of individualized workers and social dynamics. </li></ul></ul><ul><li>Source: Gartner Research paper “Future Worker 2015: Extreme Individualization” 27 March 2006 </li></ul>
    32. 32. Predictions of the Impact of Changes by 2015 <ul><li>High Probability     Low Probability  </li></ul><ul><li>Companies will have to completely revise their hiring and benefits practices.     </li></ul><ul><li>The average tenure at one job for skilled workers will be 18 months.    </li></ul><ul><li>Skilled workers will drive 80 percent of the technology acquisition decisions for their workplace.    </li></ul><ul><li>In highly developed countries, employees will see their managers face-to-face three times on average.   </li></ul><ul><li>A new breed of universities will perfect the concept of agile curriculum development.   </li></ul><ul><li>Seventy-five percent of corporate IT workers will be focused on supporting and enhancing cross-business processes.   </li></ul><ul><li>A new international legal definition of a business entity will include virtual employees, capital and a structure of accountability to replace a board of directors.   </li></ul><ul><li>Source: Gartner (March 2006) </li></ul>
    33. 33. The Changing Worker Past Future???
    34. 34. The drivers of increasing workforce diversity <ul><li>Several generations at work as workforce age span increases </li></ul><ul><li>Increasing cultural and ethnic diversity as immigration fills skill gaps; and knowledge workers chase global opportunities </li></ul><ul><li>Attitudes of Gen Y and the retiring baby boomers – they both want work that fits their chosen lifestyles; and because of skill shortages they have market power </li></ul><ul><li>Companies must foster innovation to compete – and innovation is nurtured by diversity of ideas, knowledge, professional networks, perceptual and learning styles, problem solving styles, etc </li></ul><ul><li>But research highlights the critical moderating role of leadership, organisational culture and HR policies </li></ul>
    35. 35. The moderating role of leadership and culture Diversity X Leadership X Org. Culture = Performance <ul><li>The leader must: </li></ul><ul><li>Allocate diverse team members appropriately </li></ul><ul><li>Educate the team about the important roles to be played by different skills, attitudes, knowledge, etc </li></ul><ul><li>Develop processes for positively managing tensions </li></ul><ul><li>And organisational culture and HR policies must: </li></ul><ul><li>Recruit, train and reward diversity </li></ul><ul><li>Develop leaders who manage diversity constructively </li></ul>
    36. 36. In Summary: A Possible Network Future <ul><li>Most organisations produce or compete on the basis of knowledge and services (not things). </li></ul><ul><li>Most “organisations” are networks of teams and/or SMEs and encompass the entire community of stakeholders. </li></ul><ul><li>People skills, innovation and knowledge management skills are taught at schools and universities (these are taken for granted in the workplace). </li></ul><ul><li>People management systems become necessary (and invisible) organisational infrastructure; e.g. learning, change/transition management and diversity management become “real work”. </li></ul><ul><li>Leaders nurture networks and foster emergent order throughout the system (this is created by bottom-up action). Leader as ecologist vs. engineer or combat commander. </li></ul><ul><li>Work teams, informal self-help networks and formal professional associations take over much of the old HR role (e.g. in finding jobs; sharing knowledge; recognising success). </li></ul>
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