Australian CEOs rank talent risk as the most significant threat to their business’ growth. They have the opportunity to get on the front foot to ensure they create work and workplaces that attract and retain the talent they need for the future.
In KPMG’s Global CEO Outlook 2020: COVID-19 Special Edition – Australia survey, talent risk was identified as the number one risk factor to long term business growth by Australian CEOs, moving from its 11th position in January. At the same time, the survey identified that COVID-19 has forced many organisations to experiment with how and where work is done.
Many businesses pivoted to virtual working literally overnight, and as a result, many CEOs have had a greater focus on supporting employees working virtually, ensuring employees feel connected to the organisation’s purpose, and are engaged and productive. Of the surveyed CEOs, 72 percent said staff communication had improved during the pandemic.
The key challenge now, as we consider the longer-term operational ability, is how organisations maximise their ability to attract and retain talent in the post-COVID-19 world. Implicit in this challenge is identifying and embedding the new ways of working that have been part of the pandemic experience.
To address this challenge, organisations need to consider six inter-related areas of their business.
The nature of work and our workforce
The nature of work was already changing well before COVID-19, and it has only accelerated this shift. As well as the almost overnight successful shift to remote working, most Australian CEOs believe that the pandemic has accelerated progress on digital transformation by a matter of months or years, with 84 percent believing that the pandemic has accelerated the digitisation of operations and 60 percent identifying it has accelerated the creation of new workforce models with human workers augmented by automation and artificial intelligence. The future of work is upon us.
New jobs and organisational designs
Careful strategic workforce planning and organisational design can help to identify aspects of work that can be done differently, for example, through automation or part automation, remotely from different geographies or even work that has been shown to add little value and therefore no longer required. It will be important to consider work as a collection of tasks, creating an atomised view of jobs so that new roles can be created by putting tasks into different structures. New organisational designs can be created that allow for automation and for remote working.
Reskilling and sourcing
Deliberate and planned reskilling opportunities for existing staff will help to shift capabilities to meet the new jobs and organisational structures. Understanding proximate skills between existing and new jobs will allow learning pathways to be designed to support staff to retrain for the new world of work. Significant shifts in learning technologies will enable workers to access retraining opportunities remotely, at their own pace, in their own time. Encouragingly we saw 40 percent of CEOs agreeing that they will place more capital investment in developing their workforce’s skills and capabilities. Organisations can concurrently consider market data to understand recruitment options for any capability gaps.
Businesses need to consider managing the workplace relations impacts of a changing workplace to ensure that the whole process of transition is managed in a way that takes into account employment instruments that may be outdated and don’t necessarily suit the new ways of working. Workplace laws may determine what you can and can’t do in response to the desired changes, and industrial agreements (e.g. awards and enterprise agreements) typically set out rules about how you need to consult and what flexibility might be available to you to adapt. You also need to be aware of what obligations you have committed to in your employees’ contracts of employment. Specialist advice to navigate the complexity of the workplace relations landscape may be needed.
Culture and employee experience
The survey also showed that 75 percent agree that the shift to remote working has caused businesses to make significant changes to policies to nurture workplace culture. As we all move to working remotely more often, and change the way we work, organisations need to be deliberate in capturing the elements that have worked well during COVID-19 shutdowns and embedding these.
Organisations need focus on working hard to create a culture that retains talent in remote working situations. While it’s possible to undertake most activities using remote technology and 77 percent of CEOs agree that they will continue to build on their use of digital collaboration and communication tools, some activities, which require high levels of trust, such as leadership development, strategy development and creative problem solving, benefit from face-to-face interaction.
Our employee value proposition
The external perception of an organisation’s culture – the organisation’s employee value proposition – must also be addressed. There is an opportunity to extend the value proposition to those who would not normally have been in consideration – those in different geographies who can work virtually. Of the Australian CEOs surveyed, 70 percent said widespread flexible/home working had widened their potential talent pool. While it’s still to play out, we anticipate that the intangible aspects of why individuals choose to work for an organisation will have changed. Take for example, the social nature of graduate programs, the celebration dinners, the informal interaction in the office – all of these will need rethinking. And adjustments to employee satisfaction surveys will be needed to track these changes.
Time to reimagine
To achieve their future business strategies, digitised operating models and the new ways of working that this might require, leadership teams are working to deliberately reframe the future purpose and strategy of their organisations for a post-COVID-19 world. Central to this discussion is identifying the workforce and culture they want to create. This is an opportunity to reimagine work and to generate the culture and employee value proposition that will lead to minimising the talent risks that are now on the minds of so many CEOs.
How KPMG can help