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Getting Started with Building Your Skill-based Approach

The skill-based organization is growing in popularity, with Booking.com, GSK, United Airlines, Emerson, HSBC, and others adopting it. However, less than 20% of companies have been able to implement a skill-based approach.

During this session, you will be joined by Mikael Wornoo from TechWolf in conversation with Christophe Cabrera, Head of IT Talent & Company Reputation at UCB, to explore the practical tips on starting your skill-based approach, plus examples of how leading organizations are putting this into action today.

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I. WORKFORCE TRENDS

2024 talent and workforce priorities and trends, employee sentiment, and views from executives on the future of work.

2024 Talent, Workplace, and HR Priorities Cheat Sheet | Multiple Sources

Every year around this time, I create a one-page cheat sheet consolidating talent and workforce trends reported by various sources for the upcoming year. While some practitioners may not find value in reports on trends and priorities, I find them helpful for gaining insights into external perspectives on prevalent talent and workplace topics. To assist HR practitioners and leaders in distilling these insights, I've started to merge 2024 priorities and trends from a few sources into a single snapshot. Although these sources don't encompass all available reports (as some are yet to be published), they offer a sample from reputable organizations like Gartner, McLean & Company, i4cp, and Glassdoor Economic Research. You can click the company logo to access the source report or learn how to obtain it (a few require you to download the report directly). I will update this cheat sheet with more resources as they become available and then add my typical color-coded format (see 2023 version)—where I show common themes across the different reports. For now, this one-page draft can help you gain directional insights into the various trends and priorities being reported by multiple sources.

Access cheat sheet

2023 - 2024 Inside Employees’ Minds Study | Mercer

This 34-page report shares insights from a study conducted in Q3 2023 of 4,505 full-time employees in the United States working for organizations with more than 250 employees, spanning 1,300 employers. It provides insights into employee sentiments regarding various aspects of their employment and workplace. A few insights include 1) Intention to Stay. The number of employees who are planning to stay with their employer has increased to 68%, compared to 64% in 2022, but remains below 2021 levels of 72%. 2) Drivers of Attraction and Retention. Pay and benefits continue to be the top reason employees are attracted to an organization – and the top reason they stay. 3) Impact of Pay Transparency. Those who believe they are paid fairly were twice as likely to have been provided with pay data from their employer – and were also 85% more engaged and 62% more committed to their organization. 4) Focus on financial security. As shown in the image, many employees have financial concerns as they struggle to recover from inflation stressors. Finances remain the number one concern of employees overall. 5) Office utilization stands at 50%, signaling the prevalence of hybrid work arrangements amid return-to-office mandates. Other findings are discussed.

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Future Workplace Index 2023 Report | Ernst & Young

Ernst & Young (EY) recently released its third annual Future Workplace Index, which tracks executive sentiment and behavioral data around the workplace of the future. One of the topics covered in this 23-page slide deck is remote and hybrid work: 88% of surveyed companies report that they require or encourage 3+ days a week back in the office. Almost 60% of surveyed companies have assigned employees to in-office days—meaning their employees are required to be in the office on specific days of the week. When asked about the reason for bringing employees back into the office, the most commonly cited response was increasing productivity (29%). 

As organizations continue to evaluate their return-to-office mandates, I am resharing this article by Microsoft WorkLab, which discusses the practice of setting “in-person” office expectations based on “moments that matter” instead of enforcing a minimum number of office days. The article highlights research identifying three scenarios where in-person connections offer distinct advantages: 1) Strengthening team cohesion, especially vital in the context of increasingly dispersed organizations. 2) Facilitating effective onboarding for new roles, teams, or companies, as face-to-face interactions foster trust and relationship-building during the initial stages of a new job. 3) Initiating a project, particularly in its early phases, to align team members, stimulate innovation, and share tacit knowledge. What are the moments that matter for in-person interaction in your organization? 

Read E&Y slide deck

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II. AI IN THE WORKPLACE

AI use in scenario planning and talent management, best practices for deploying AI, and AI’s impact on the future of work.

Talent Management in the Age of AI | Harvard Business Review

AI in the workplace has far-reaching implications for all facets of talent management. This article by LinkedIn's CEO, Ryan Roslansky, outlines three significant shifts that business leaders need to embrace as organizations integrate AI into talent management practices and processes. 1) Redefine jobs as a collection of skills and tasks, not titles; 2) Bring skills and workforce learning to the center of talent management; 3) Embrace AI to focus teams on collaboration. Regarding reconceptualizing jobs as a compilation of skills and tasks, this approach enables organizations to identify tasks vulnerable to AI automation and focus on upskilling employees to handle more complex tasks while emphasizing human-centric skills like communication and collaboration. Although jobs won’t completely go away, deconstructing work from the job level to the task and skill level presents firms with greater flexibility in accomplishing those tasks through different work options (e.g., AI, outsourcing, full-time employees, etc.). For more on this topic, check out John Boudreau and Ravin Jesuthasan's book Work Without Jobs: How to Reboot Your Organization’s Work Operating System. 

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Use GenAI to Improve Scenario Planning | Harvard Business Review 

A recent 28-page report by BCG and WFPMA highlights strategic workforce planning (SWP) as the second most 'urgent' practice— representing a significant gap between the practice’s importance and organizations' capability to implement it effectively. One contributing factor to this gap is the increasing necessity for organizations to integrate scenario planning (SP) into their workforce planning. SP helps organizations envision, describe, and plan for potential alternative futures, yet its complexity has risen due to multiple influential factors and heightened uncertainty in business scenarios. In this new HBR article, the authors propose leveraging GenAI to support three stages of SP: 1) Scenario Creation—rapidly process vast sets of internal business data, global news sources, political developments, industry reports, think tank studies, etc., to assist strategists in comprehensively framing the overall planning exercise. 2) Narrative Exploration—crafting detailed narratives to describe scenarios, including their key challenges, concerns, and limitations. 3) Strategy Generation— utilizing GenAI to propose tailored strategies and actions addressing specific scenario challenges. As noted in the article, “while human judgment remains essential in contingency planning, generative AI allows organizations to generate and consider far more scenarios and strategic factors than people, on their own, could.” As such, it can serve as an effective tool for scenario-based workforce planning.

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Generative AI and the Future of Work | Deloitte AI Institute

This newly released report by the Deloitte AI Institute provides a comprehensive review of the impact of GenAI on the future of work. While there are various insights in this 43-page report, the section beginning on page 20 delves into fundamental distinctions between 'work,' 'jobs,' 'tasks,' and 'skills’ and the interplay between each in the context of GenAI. 1) Work represents the outcome achieved (e.g., achieving sales targets, increasing customer satisfaction) through the utilization of human capabilities and tools. 2) Jobs (e.g., sales representative, account manager) have been the traditional construct to describe the work humans do to achieve the work outcomes. 3) Tasks (e.g., writing a report) are specific activities performed to achieve work. 4) Skills (e.g., problem-solving, data analysis) enable the execution of tasks. In viewing these four components within the realm of GenAI, it's crucial to acknowledge that a) both humans and GenAI have skills that can perform tasks to achieve work outcomes and b) some tasks are best performed by humans, others by GenAI, and some are performed best through a blend of both. To help determine which work tasks can be best delivered through which option, page 23 (image of this post) and page 24 provide practical frameworks.

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Best Practices for AI and Workplace Assessment Technologies | Future of Privacy Forum

Organizations are rapidly integrating AI tools into their hiring and employment strategies to better match candidates with appropriate roles and streamline decisions in recruitment, hiring, and career progression. However, these tools carry inherent risks that, if unaddressed, could adversely affect job candidates and hiring organizations. While regulators continue to provide guidelines for responsible and ethical AI use, a gap remains as practices and knowledge continue to evolve. To help bridge this gap, the Future of Privacy Forum has published this 18-page report outlining Best Practices for the development, implementation, or expansion of AI tools in employment decisions. The report breaks down practices into six crucial areas: (1) non-discrimination, (2) responsible AI governance, (3) transparency, (4) privacy and data security, (5) human oversight, and (6) alternative review procedures. One recommendation regarding transparency is disclosing details to individuals affected by AI tools, including the tool's purpose and how it is used, what it isn’t used for, how the AI learns, and assessments for potential discriminatory bias. Since this report is full of ideas and practices, you will want to review it more deeply to obtain a complete view of practices across the six key areas. As a bonus, here is my playlist of 5 resources that address different considerations for AI-based tools in HR.

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III. TALENT PRACTICES

Skills-based organizations, succession planning, workforce risks, neurodiversity, deconstructing jobs, and leadership development.

Redefining a Skills-Based Organization | Korn Ferry

Numerous organizations are embracing skills-based talent practices (SBTP), where they prioritize individual skills over job titles, academic credentials, or years of experience. However, as highlighted in this 10-page Korn Ferry paper, embracing SBTP demands more than merely centering strategies around skills or establishing a skills database. This paper proposes insights for transitioning to a skill-based organization (SBO), outlining the 6 Pillars crucial for an SBO. As talent practitioners think through the various aspects of this transition, I have curated 10 Q&As from various reports, such as Deloitte’s 101-page report, Building Tomorrow’s Skills-based Organization: Jobs Aren’t Working Anymore. The 10 Q&As address questions such as: How many organizations have successfully transitioned to being a SBO? How effectively are organizations classifying and organizing skills into a skills taxonomy or framework? Which areas are organizations starting with when introducing skills-based talent practices? Access the 10 Q&As HERE.

Read Korn Ferry paper

Case Study: Verizon’s Data-Driven Succession Planning | CNBC WEC Summit

On November 13 and 14, 2023, the WEC— a council of human resource executives assembled by CNBC—hosted its WEC Summit event in New York. One session featured a 20-minute discussion involving Christina Schelling, Verizon's SVP and Chief Talent and Diversity Officer, focusing on Verizon's strategic use of data science and talent intelligence over the past 12 months to revamp succession planning and executive development for its top 300 VP+ level executives. A few points from the discussion:

1. Movement in top roles. In the past year, 7 out of 9 of the direct reports to the CEO have changed positions due to retirements, rotations, promotions, and external hires for critical capabilities.

2. Reevaluation of succession plans. Movement within executive roles indicated that it was time to replenish the succession pool and determine whether the internal candidates on succession slates were viable candidates (e.g., would we really put this person in the role if the position became open?).

3. Expanding the succession pool: a) consider external candidates from other industries to bring in new capabilities (e.g., telecom isn’t known for great customer service, so consider talent in other industries and organizations known for high customer service levels, such as The Ritz-Carlton); b) Drop unnecessary qualifications in selection criteria (e.g., 90% of Verizon jobs now do not require an academic degree).

Other ideas are discussed on how Verizon partnered with an external provider to use data-based talent intelligence to achieve these and other goals.

Watch and listen

4 Resources for Identifying and Managing Talent and Workforce Risks  

Many organizations invest considerable effort in crafting a talent and workforce strategy to support business objectives and deliver stakeholder value. Yet, they often give less attention to the various talent risks that could impede the execution of such strategies. Against this backdrop, here are four resources aimed at raising awareness of different talent and workforce risks— helping practitioners identify and mitigate risk within their organizations.

1. MercerMarsh Benefits' 85-page report, "25 People Risks," organizes ideas around 25 people-related risks into five pillars, offering a broader perspective on less apparent workforce risks.

2. A one-page Critical Position Risk template I've developed helps assess four key risks in critical positions: incumbent risk, internal bench risk, development risk, and external talent risk. 

3. Deloitte's article, "Managing Workforce Risk in An Era of Unpredictability and Disruption," delves into strategies utilized by leading organizations (termed Pioneer firms) to mitigate workforce risks in challenging times.

4. Employee Retention Risk Template, which includes 13 indicators known as the 'cues of turnover scale' to help managers evaluate and strategize ways to mitigate retention risk in crucial areas.

How does your organization plan to identify and mitigate talent and workforce risks in 2024?

Access web version

The End of Jobs: Paradoxes of Job Deconstruction in Organizations | Academy of Management Perspectives (forthcoming)

This forthcoming manuscript, slated for publication in the 2024 issue of the Journal of Academy of Management Perspectives, covers the emerging concept of "job deconstruction," which involves breaking down roles into tasks and projects to match workers based on their skill sets. The article addresses several challenges (and paradoxes) in deconstructing jobs into tasks and examines how organizations can navigate these challenges. While there are numerous insights to point out from this 44-page manuscript, one point raised is that job deconstruction exists on a continuum, as evidenced by companies such as Zappos, Unilever, Schneider Electric, and Seagate Technologies. For instance, Zappos operates without fixed jobs, emphasizing temporary functional roles based on projects and tasks rather than hierarchy or job descriptions, while Unilever's U-Work Program blends the flexibility of contract roles with the security of permanent positions; individuals work varying assignments and are paid a monthly retainer and get benefits whether they’re working on an assignment or not. Page 32 summarizes the four company examples. As a supplement to the academic paper, here is also a shorter version that was just published in Forbes and based on the Academy of Management Perspectives version.

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Building the Neurodiversity Talent Pipeline for the Future of Work | MIT Sloan Management Review

This article addresses an under-discussed facet of diversity, equity, inclusion, and belonging (DEIB) — neurodiversity. Neurodivergent individuals, whose brain functions differ from the neurotypical, encompass conditions such as dyslexia, ADHD, dyscalculia, and autism spectrum disorders, to name a few. The article explores the intersection of the labor market shortage and the high unemployment rates among neurodivergent individuals—highlighting how an estimated 30% to 40% of neurodivergent adults are currently unemployed. The authors note that: “Harnessing the potential of neurodivergent individuals could help employers build a more future-ready workforce. Creativity, lateral (or nonlinear) thinking, reverse engineering to solve problems, complex visual-spatial skills, systems thinking, intuitive insights, hyperfocus, and multisensory pattern recognition — distinct areas in which neurodivergent candidates might excel — all stand to become increasingly important as artificial intelligence embeds itself into our daily lives. The authors suggest that community colleges could be pivotal in bridging this gap, as a significant number of neurodivergent individuals start their higher education journey there. Collaboration between community colleges, employers, and local economic development organizations is proposed to create neurodiversity-friendly pathways to employment. As a bonus, this Deloitte Insights article shares ideas for building a neuro-inclusive workplace.

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Leadership Development Is Failing Us. Here’s How to Fix It | MIT Sloan Management Review

According to a report by DDI, nearly 50% of externally hired executives and 35% of internally promoted leaders fall short of performance expectations when transitioning to a new role. One way (there are many others) organizations prepare leaders for their roles is through leadership development (LD) programs. However, this article highlights the limitations of current LD programs and underscores the need for a more evidence-based and results-focused approach. The authors emphasize the necessity for buyers of LD programs (or developers of in-house programs) to ask better questions when determining the program's vision, learning, and impact. The image of this post shows examples of what organizations are probably asking versus what they should be asking. The article delves into each of these questions in more detail. As a bonus, this article by Heidrick & Struggles offers five key success factors for an evidence-based approach to measuring the impact of LD and learning programs. The second factor— defining success in tangible terms—suggests starting with questions such as: What business problem(s) are we trying to address? How can learning assist? What business outcome(s) are we seeking to achieve? Which business key performance indicators (KPIs) should we target? When can we expect to see significant movement in these KPIs?

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2023 JOB CUTS AND LAYOFF TRACKER

Here is my tracker, which includes announcements from a segment of organizations that have announced job cuts and layoffs since the start of 2023.

A few firms that announced job cuts in December include:

• Hasbro. (NASDAQ: HAS). The toy and entertainment giant is cutting roughly 1,110 jobs, or nearly 17% of its workforce, citing a softer market for toys. The layoffs follow a reduction of 800 jobs at the company earlier this year.

• Intel (NASDAQ: INTC). Will be laying off roughly 235 employees. This marks the fifth round of job cuts for the chipmaker this year. The Intel layoffs come as part of a $10 billion cost-cutting effort for the company.

• Nike (NYSE: NKE). Has been conducting layoffs over the past few weeks in several of its divisions, including HR, recruitment, sourcing, brand, engineering, digital products, and innovation. No numbers have been provided.

• Spotify (NYSE: SPOT). Will lay off around 1,500 employees to reduce costs in a third round of job cuts this year. The company, which employs more than 9,000 people, laid off more than 500 employees in January and, in June, cut 200 employees from its podcasting unit.

• VF Corp. (NYSE: VFC). The global apparel and footwear company has laid off 500 salaried employees across the company. The job cuts come weeks after an activist investor demanded the conglomerate slash $300 million in expenses. 

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CHIEF HR OFFICER HIRE OF THE MONTH

​Duke Energy (CHARLOTTE, NORTH CAROLINA) [NYSE: DUK]—one of America’s largest energy holding companies— has announced the promotion of Cameron McDonald to the role of SVP and Chief Human Resources Officer, effective Jan. 1, 2024. She will succeed Ron Reising, who will retire at the end of the first quarter after an 18-year career with the organization and its predecessor companies. In her current role with Duke Energy as Vice President of Talent Acquisition and Talent Management, McDonald is responsible for talent acquisition, leadership and employee development, succession planning, and employee engagement. She has been with Duke Energy for 22 years.

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