People are at the core of every organization, and their decisions and actions determine its success or failure. “If you want your business to succeed, you have to put your people first,” says Darren Burton, Vice Chair Human Resources, KPMG U.S., who adds that CEOs and corporate boards have a critical role to play in workforce development. “Workforce development is a strategic issue that calls for a strategic approach from the highest levels of any corporation. Ultimately, it’s about ensuring the right tools and programs are in place to enable a skilled, capable and engaged workforce that can support your business needs, now and into the future.”
Talent and technology are both key to growth, and in the times of the Fourth Industrial Revolution there can be a push and pull between investing in one or the other. When asked to make a point-blank choice between investing in technology or people, more than two-thirds of executives chose technology. However, CEOs’ attitudes about the role of technology have shifted drastically since last year. In fact, last year U.S. CEOs sounded a bit myopic, with almost four-fifths believing that technology was the only significant disruptor they faced. This year, more than three-fourths acknowledge the importance of disruptors beyond technology.
Thinking specifically about improving your organization's resilience, which of the following investments are you prioritizing?
Source: 2019 Global CEO Outlook, KPMG International.
This openness to more factors of disruption is reflected in their attention to their workforces. For Northrop’s Warden, technology and capabilities are critical, but people are the key ingredient in the recipe. “Both are absolutely essential, but I lean toward people,” she says. “People are the source of innovation—the source for thinking that allows you to apply technology in novel ways to support the company’s underlying business model. For me, investing in talent and ensuring that people’s skills evolve in relevance over time is absolutely critical.”
CEOs agree that modernizing the workforce is the most important strategy to ensure that their organizations are future-ready. They also believe that, overall, technology will be a job creator, and they are willing to upskill their current employees (as opposed to being split on the issue last year). A majority of CEOs are planning to upskill between 40 percent and 60 percent of their employees.
One area where U.S. CEOs are decidedly more optimistic this year is the impact of AI on jobs. Seventy-three percent believe that AI and robotics will create more jobs than they eliminate, compared with 52 percent last year. While a lot of attention has focused on the potential negative impact of automation technologies on jobs, ManpowerGroup’s Prising believes that this detracts from what is actually important: building the skills that companies will need to succeed and drive long-term value in a digitized world. “Too much time is spent on debating the impact of job elimination and not enough time on the need for a skills revolution,” he says.
Employers are understanding that they can build skills, they can buy skills, they can borrow skills. Many more companies are trying to upscale and rescale their workforce.
To be resilient in the face of increasing digital disruption, leaders need a forward-looking strategy for building the talent profile and people skills their organization will need to prosper. “We are seeing that employers are finding it difficult to find the skilled talent that they need on a global basis,” says Prising. A holistic approach that combines both strategic hiring and skills development will be critical to closing that gap. “Employers are understanding that they can build skills, they can buy skills, they can borrow skills. Many more companies are trying to upscale and rescale their workforce.”
KPMG’s Chief Culture Officer, Claudia Saran, believes that properly integrating technology and the human workforce not only helps a company’s financial results, but also can serve to strengthen a company’s culture. For example, 92 percent of U.S. CEOs state that they want their employees to feel empowered to innovate without worrying about negative consequences for them if their initiatives fail. “One of the enablers of an innovative culture is a high comfort level with disruptive technologies. Those same technologies can also be utilized to help the organization learn from its innovation efforts – both successes and failures,” says Saran.
Elanco’s Simmons ties being a purpose-driven company with having an innovative workforce. “If you work for a purpose-driven company, you are highly engaged, and you are so passionate about the work that the freedom to innovate happens naturally. Purpose-driven employees come up with a solution not because of pay or because they’re trying to get promoted, but because of the purpose they pursue,” he says.