PD Spotlight: When it comes to workforce strategy, you need the tools for the job

This story is littered with examples of confident, but wrong – sometimes hilariously wrong – predictions. In 1946, the studio head of 20th Century Fox said that television wouldn’t be able to hold any market it captured after six months, because people would get sick of staring at a plywood box every night. Just three years earlier, Thomas Watson, the president of IBM, famously said that there was a world-wide market for “perhaps five computers”. In 1973, Margaret Thatcher was quoted as saying “I don't think there will be a female prime minister in my lifetime”. Before the decade was out, she was elected to that role. In retrospect, it’s easy to see the technological, political and social shifts that rendered these predictions wrong, but it’s harder to see the changes that will prove our current mental models wrong. Many people and organisations continue to make bold and confident predictions about their future today.

There’s no doubt that the pace of change has increased dramatically since Zanuck, Watson and Thatcher made their bold predictions. The web browser is barely 25 years old, and it’s hard to think of an industry that the web hasn’t fundamentally disrupted. Twelve years after the first commercially mainstream smartphone was launched, the way we date, get directions, hitch a ride, communicate, get our news and learn has been transformed. Today, new technologies are being adopted faster than ever before; whereas it took 30 years for 10 per cent of the population to have electricity and 25 years for the telephone, that figure dropped to just seven years for smartphones and 42 days for Pokemon Go.

Against this backdrop of rapid and profound change, however, the process of strategic planning stays the same in many organisations. Strategy, as defined by the World Economic Forum, is a high-level plan to achieve one or more goals under conditions of uncertainty – and it’s that last part, the conditions of uncertainty, that not only often gets neglected but is increasingly critical in today’s world. In the past 15 years, I’ve advised on and studied workforce strategy in a wide range of organisations around the world. Consistently, several common themes emerge for those who are successful in identifying, creating and supporting a futureready workforce.

1. They refine their people practices with data

It’s a well-worn cliché that one size does not fit all. While many ‘best’ practices have evolved over years for good reason, every organisational strategy is unique, which means that not all ‘best practices’ are a good fit for all organisations. When we adopt industry best practice, we’re trying to standardise and be consistent with other organisations. Taken to its logical conclusion, if every organisation is successful at standardising, then no organisation will have an advantage. With corporate strategy, we recognise and embrace the idea that we need to differentiate, with a singularly unique vision and strategy – so why would we strive to be average when it comes to our workforce practices?

Not a cliché, but no less real, is that usually the 'one size' that’s right for you won’t fit you forever. Organisations grow out of their practices as their circumstances change, and it’s important to know when that happens. Effective workforce strategy uses data to provide evidence about where people practices are working the degree to which they are working, and whether that’s changing over time. Having a handle on data, which is after all the language of business, is critical for today’s HR organisation. According to The Economist, as of 2017, data has now overtaken oil as the world’s most valuable asset – and like oil, it needs to be extracted, refined and used to generate value. In the HR toolkit, that value is uncovering insights to improve and evolve our practices.

2. They reframe their people practices in times of change

While data can be incredibly valuable to HR, all the data we have is about the past. Unfortunately, all the decisions we make are about the future. Too much reliance on data can mean optimising for the past, rather than the future. Worldleading organisations also look to possibilities (without being confident enough in the unknown to make predictions). Scenario Planning is a tool that allows organisations to explore a range of plausible future environments in which we’ll need to deliver our organisation’s vision. These scenarios are then used to stress-test a people plan against a range of future environments, ensuring that we maximise our chances of having an effective workforce whatever the future brings. Scenario Planning ensures that the decisions these organisations make today are resilient to a range of possible futures.

3. They explore best-fit practices, with a non-reaction to fads

While many innovative organisations are charting a new course with interesting people initiatives, simply adopting others’ methods and approaches won’t give us the same results. You can put a ball pit and a slide in your office foyer, but that’s not going to make you Google. If you’ve ever tried to adopt holacracy (a complete system for self-organisation) or workforce gamification without doing the work of adapting these concepts to your organisation, you’ve probably learned this lesson the hard way. Many are the organisations that have stopped working from home because Yahoo! did, or stopped annual performance ratings because Deloitte did. The organisations that have developed and refined these approaches have done so in alignment with their own organisations’ vision and circumstances. These organisations have “reframed” what their workforce practices should look like to be the right fit for their strategy. While these case studies can inspire us, we must assess their appropriateness in our own context.

4. They treat workforce strategy as both an art and a science

Almost anything, taken to one extreme or another, is problematic – we’ve probably all worked with someone who never has anything to say; and also someone who always has something say! This applies too when it comes to data-led or foresight-led workforce strategy. Too much data and your workforce strategies can end up optimising for the past, in a business environment that’s rapidly changing. On the other hand, building workforce strategies and initiatives looking only to the future can limit our ability to be evidence-based with our current practices. Effective organisations use both the art of foresight and the science of data analysis to identify and scale opportunities.

5. They align their people practices to their organisations’ vision

Unfortunately, relying solely on ‘best practice’ or current practice and reacting to fads is the sum total of workforce strategy in many organisations – both are poor enablers of our organisations’ unique goals and strategies. Effective workforce strategy enables organisations to move from 'repeating' to 'refining', where we can use data to move Human Resources to a true social science. At the same time, it moves us from 'reacting' to 'reframing', by fully embracing the opportunities in complexity and change – rather than a knee-jerk reaction to fads, instead imagining the new, innovative, and strategically aligned possibilities that change and complexity offer us. Only by having an understanding of the alignment of initiatives to what our organisation is trying to achieve can we develop a coherence suite of innovative enabling and data-supported people initiatives that are true enablers of an organisation's success.

Alex Hagan is the CEO of boutique workforce strategy firm Kienco, and the author of Thriving in Complexity. His methodology blends data analysis and futures thinking to both optimise current operations and position for long-term strategic success, and has been used by a wide range of public and private organisations to identify and build their ideal future workforce. Alex teaches the HRNZ Strategic Workforce Planning and Workforce Analytics professional development programmes.