The need to find a new workforce


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"The need to find a new workforce" is part 4 of "Living among wolves", a whitepaper series exploring the four forces driving the uptake of HR outsourcing.

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The need to find a new workforce

  2. 2. 2 | LIVING AMONG WOLVES: THE NEED TO FIND A ‘NEW’ WORKFORCETHE TRADITIONALLY STRONG CORRELATIONbetween labor, work and location is beginning to break down.With obvious exceptions, such as frontline We may know that new technologies haveworkers in mining, construction or made workforce virtualization possible, andmanufacturing, there is a whole slew of work even relatively simple, but here are twothat can now be ‘virtualized’, or moved to reasons why it is also becoming necessary:where the talent is. In a growing knowledgeeconomy, there are fewer limits on the • psychographic changes acrossbreadth and scale to which you can globalize generations means the next workforce hassome functions. different expectations of work, and • demographic shifts mean that talent pools are not where they used to be. Ã Å
  3. 3. 3 | LIVING AMONG WOLVES: THE NEED TO FIND A ‘NEW’ WORKFORCEFLEXIBILITY IS NEEDED TO MEET TALENT SHORTAGES.Finding and holding on to the right people is a growing challenge for mostorganizations. The trend towards more flexible working arrangementsis, at least in part, both a driver and a solution for this challenge.Close to half (44%) of the active workforce in Compared to traditional employees free agents: Adding them to a permanent payroll isthe United States now consider themselves costly, particularly as their skills may only be‘free agents’, compared to 26% in 2008.  • Are better educated, with more than a needed for specific projects or timeframesThis means they are not employed by one third of free agents possessing a Master’sorganization on a permanent basis, degree or higher • Workers across all generations are seekingbut instead engage in freelance, consulting, greater flexibility. Retention strategies now • possess a technical or professional skill set need to include telecommuting and flexitemporary or contract work, or have theirown business. work arrangements to hold on to talented Being able to access this pool of highly individuals qualified and experienced talent is becomingThe growth in free agents is partly due to paramount when we consider that: • Productivity gains and the injection ofthe economic climate and the need to driveefficiency and productivity. But even without new ideas are what many organizations • Maintaining competitive advantage isthis, the data shows that there is a significant recognize they need more of becoming more difficult. Sourcing just-increase in the percentage of workers across in-time talent provides a cost-effective Accessing a new pool of talented workersall generations who are now classifying employment model is now easier than it ever has been thanksthemselves as free agents. to common technologies that are built to • The most talented and experienced facilitate this virtual working style. workers can also be the most expensive. Ã Å
  4. 4. 4 | LIVING AMONG WOLVES: THE NEED TO FIND A ‘NEW’ WORKFORCECLOUD COMPUTING REVOLUTION IS ALREADY HERE.The evidence that cloud computing and virtualization has grown rapidly iseverywhere we look —data shows that job advertisements for cloud computing/virtualization professionals increased by 344% in between 2009 and 2010.Every large, global tech company seems Today, IBM employees’ badges allow themto have cloud computing and virtualization access to numerous locations so they are notsolutions as part of their product suite. anchored to a specific facility. The facilities inThe fact that they themselves use these to each location are there to help them conductmobilize their own workforce should be a business on a nomadic basis. As a result, IBM’sgood indication that their benefits are real. workforce is already in a virtual mode.IBM is an example of a workforce thathas virtualized over the past decade as ithas made the transition from manufacturingto services. Ã Å
  5. 5. 5 | LIVING AMONG WOLVES: THE NEED TO FIND A ‘NEW’ WORKFORCEDEMOGRAPHIC SHIFTS MEAN TALENT ISN’TWHERE IT USED TO BE. Employees’ desires for more flexibilityat work, as well as the economic benefits of that approach are now clear.Yet, there is another, perhaps ultimately more powerful imperative tolook seriously at work virtualization as a key to business sustainability.When we examine the global trends emerging Skip forward to today and the trend ofin workforce demographics, the news is not reducing workforces has spread out widelygood. The changes are rapid and the impact across Europe. Central and Eastern Europeis not clearly understood. What is understood remain the only real sectors of positiveis that these demographic changes will workforce growth in the region.provide significant challenges with respectto accessing talent and executing in the Looking at the projections for 2020, themarketplace. situation is indeed dire right across Europe. Turkey remains the only significant region withIn 2000, GeoLabour data showed that a positively expanding workforce.across Europe, more people were enteringthe workforce than are leaving it. Individual And it is this unstoppable workforce evolutioncountries such as Italy and Germany bucked that is the driver for HR outsourcing.the trend and were already at below No longer just a cost-reduction tool, HRreplacement rate, but on the whole, Europe outsourcing has emerged as a core strategyhad a sustainable workforce. for major companies operating in this new workforce reality. Ã Å
  6. 6. 6 | LIVING AMONG WOLVES: THE NEED TO FIND A ‘NEW’ WORKFORCEUNDERSTANDING HOW AND WHYGENERATIONS ARE DIFFERENT. Twenty-plus yearsago, when you asked someone what they did for a living, they toldyou where they worked. Today, they tell you what they do.The next generation of employee is wired, Generation Xers talk about work-life balance. Employee-employer loyalty is waning, and continuous connection and conversation intoconnected, plugged in and empowered, Millenials see work and life as one thing—the it can be tempting for Baby Boomers and an opportunity. Younger generations seeand this psychographic change across a line is blurred and if company culture does even Gen Xers to see younger employees as technology use as something that definesgeneration has significant implications for not enable this meeting of two worlds, the demanding and fickle. who they are, not just as products they use.recruitment. For younger generations –Gen X Gen Y/Millenial employee will leave and go To harness the power of these always-multi-and much more so for Gen Y or Millenials: to the next opportunity—quickly. When we For older generations of managers who’ve tasking employees, who see work and life as consider that Millenials will make up around lived repeatedly through restructures, one interconnected way of being, company• the attachment of skills to employers is 40% of new hires by 2015, something has to outsourcing and downsizing, it can feel as culture must adapt. weakening give if the right talent to run an organization though less experienced Gen Y’s/Millenials is to be secured. ‘expect’ rather than ‘earn’ the freedom,• gaining knowledge and broad autonomy and influence they demand. experience is more important than salary You want what? When discussing the and security impact of these psychographic changes But the burning debate here must not be across the generations, it is easy to focus on about whether access to Facebook at work• company culture must support bottom- will damage productivity, it must center the negatives. up decision-making power around turning the Millenials’ mindset of à Å
  7. 7. 7 | LIVING AMONG WOLVES: THE NEED TO FIND A ‘NEW’ WORKFORCEA NEW APPROACH TO DECISION-MAKING.Perhaps one of the greatest opportunities that the new generationalpsyche brings to the workplace, is that of distributed decision-making.Even the largest of global businesses are The Pepsico’s of the world know that whentoday exploring heavily with models to today’s college graduates assess you as aoperate as a ‘distributed idea engine’, where potential employer, they want to see howleadership emerges organically, unfettered by they will fit into your company’s culture.central command. Demonstrating flexibility, collaboration and distributed decision-making will make orPepsico is fully engaged in its digital and break the ability to attract and retain this newsocial recruiting strategies. A short visit to workforce.their site shows that theyare intent on connecting and engaging withtheir current and future workforce on theMillenials’ terms – open, two-way dialogue. Ã Å
  8. 8. “IF YOU LIVE AMONGWOLVES, YOU NEED TOHOWL LIKE A WOLF”RUSSIAN PROVERBTHIS IS PART 4 OF LIVING AMONG WOLVES, A WHITEPAPER SERIES EXPLORINGTHE FOUR FORCES DRIVING THE UPTAKE OF HR OUTSOURCING.ABOUT THE AUTHORROLF E. KLEINER is the Senior Vice-President and General Manager of KellyOutsourcing & Consulting Group. In this role he is responsible for the strategicand structural development of the global business practice of KellyOCG.ABOUT KELLYKelly Services, Inc. (NASDAQ:  KELYA, KELYB) is a leader in providing workforce solutions.Kelly® offers a comprehensive array of outsourcing and consulting services as well as world-classstaffing on a temporary, temporary-to-hire and direct-hire basis.  Serving clients around the globe,Kelly provides employment to more than 530,000 employees annually.  Revenue in 2010 was$5 billion.  Visit and connect with us on Facebook®, LinkedIn®, and Twitter®. Ã EXIT