Innovation and the Future Workforce: key trends for the decade ahead
We are currently living in an era of unprecedented change. It’s not just that technology has speeded up business cycles, or connected us into a pulsing 24-7 never-stop global community. It’s not even that stakeholders require instant responses in the midst of turbulent markets and increasingly complex supply chains and business partnerships. It’s more than all that.
We are actually at a point in history where fundamental and deep structural change is happening at multiple levels of society, politics and economics. This could be scary, since we’re in uncharted waters. But it is here that true innovation is possible, and real innovators have the chance to shine. There will be winners and losers, of course. The winners will be those that understand the forces that are driving the changes we sense around us and take advantage of those insights to choose a direction and focus that outsmarts and outplays their competition.
My research team’s particular interest is in the new world of work, and how people will influence and be influenced by it. We have identified a number of key workforce trends that will be key in changing the shape of the world over the next decade. Many of these forces will be both the cause and means of deep change and innovation in the near future. But ask yourself this: to what extent had you already been anticipating these changes?
1. More older workers
People all around the world – not just in developed countries – will be delaying retirement and staying longer in the workforce as they adjust to longer lifespans. In 1900, people spent 1.5 years in retirement. Today this has extended to over 30 years, but it should start reversing as people realize this is both unaffordable and undesirable. This will have three workforce effects: older employees, older entrepreneurs and older consumers. They are a relatively healthy and wealthy group, and most companies would do well to focus on fulfilling their needs and wants.
How many products and services do you have specifically focused on the older age group? Have you thought about what they might want and need as they get older? How many older people do you have in your research team, and what systems do you have in place to listen to and engage with older people in your marketplace?
2. Population growth and migration – more power to the developing world and to cities
The world’s population will reach 7 billion in October 2011, and is destined to reach 8 billion in about 2025. But all around the world, the rate of population growth is declining. Family sizes are decreasing. It’s likely that we’ll peak at a world population of 9 billion people in 2050. In the next decade, 95% of the population growth that does happen will be in developing countries. In fact, about 50% of population growth will come from just a handful of countries, including Mexico, Nigeria, Indonesia, India, China, Ethiopia, Bangladesh, Congo and the USA (mainly Hispanic communities). Except for the USA, these countries are also seeing significant growth in middle class communities, and therefore in consumer demand.
At the same time, there will be increasing movement of people around the world. The migration of talent now plays a much bigger role in shaping the skilled work force, especially for multinational companies and growth industries. Previously, the United States and Western Europe have benefited from skilled workers arriving to work (and thus creating ‘brain drains’ for other countries). But now the global migration of talent is happening in all directions, and the US and EU are not as attractive (or as easy to enter) as they used to be.
In the developing world, migration from rural to urban areas will continue at pace, increasing the power of cities.
Have you developed appropriate talent strategies in order to attract and retain the right skills in the right locations at the right time?
3. More women in the workplace
Canada, the US and Australia have all already passed the tipping point, with more women employed than men. The UK will be there by 2012, with many European nations following suit in this decade. (By the way, in parts of Africa and the developing world this may already be the case if you count informal workers.)
But this decade will see continuing focus on not only bringing more female bodies into the workplace, but actually bringing a feminine influence as well. This might be the biggest change in corporate culture in a century, if more women rise up through the management ranks, and also decide not to ‘play the game’ in a testosterone fueled business world.
It is not just a woman’s issue, though. Men also need to develop an understanding of a feminine approach to leadership, collaboration, product development, marketing and more. Interestingly, research shows that companies with more women in leadership do better than companies dominated by men.
What is your male-female ratio at key leadership levels? What is your plan to support women in moving up through the ranks? Are your female leaders allowed to be feminine, or do they need to act like men to succeed? What other diversity issues should you be considering: religion, culture, language, region, age, sexuality, etc? How do you deliberately incorporate different worldviews into your innovation processes?
4. Jobless recoveries, unemployment and the paradox of skills deficits
The next decade is going to be a frustrating and confusing one in the job market. On the one hand, we have unemployment. In almost every country that releases age stratified unemployment statistics, right now there are more unemployed young people than ever before. In addition, in many of these countries these young people are burdened with the largest student loans ever recorded. To make things even worse, we’re at a moment in time when computers will start taking over professional jobs (see next trend). Expect more riots and protests!
But, at the same time, key industries are experiencing a lack of skilled people. For example, for many years, the number of engineers has been declining (especially civil and mechanical engineers). Right now, in Brazil, there is a demand for about 30,000 engineering graduates every year, but less than 15,000 actually qualify. India and China are beginning to run out of qualified workers, which will put upward pressure of salaries and remove the wage differential advantage of those countries.
Do you know what skills you will need to deliver your strategy five years from now? What are you doing now to attract and retain the skilled people you will need?
5. Artificial Intelligence and big data
We have just reached a point where computers are powerful enough to deliver on all the promises of automation and artificial intelligence. Increasingly in the next decade we’ll use machines to analyse data and do complex processing work, uncovering patterns and spotting problems amid a mountain of data.
Real-time data collected from transactions, data streams and even sensors on physical objects, will be analysed and used by computers to make decisions about how to maximize the efficiency of fleets, machinery, people and activities.
What data are you collecting? What data could you collect? How are you using that data to impact your strategic insights and feed your innovation processes?
6. Significant entrepreneurial startups and small businesses
Both unemployed young people and an older generation looking for post-career alternative working options will fuel a new wave of startup businesses. Add to this that we expect explosive growth in many emerging markets, with the world experiencing its largest economic growth ever (probably only really kicking off from 2020 to 2030, as global real purchasing power will have quadrupled by 2050). All in all, it’ll be a good time to be a small business in the next decade (as long as banks and governments finally wake up to their specific needs).
Are any of your products and services suitable for small businesses and startups? How do you engage with this community and ensure you learn from them and about them?
7. Blended lifestyles and flexible working arrangements
We will continue to see the breakdown of the ‘traditional’ office, with ‘normal’ office hours. There will be more flexibility and working virtually. But there will also be an increased shift to 24/7 workplaces. In a quest to reach new customers in foreign time zones and to speed up production and services, more and more companies in the future will be open for business around the clock, seven days a week.
In all of this, there is the potential for more than ‘work-life balance’. What people will be doing involves a new way of thinking about how to arrange the puzzle pieces of a typical life. Again, this will be driven by both the young and old workers, who may work for a few months then leave that job to travel or take time off, then return to a different job for a while. They may develop ‘portfolio careers’ or have multiple consulting engagements at a time.
How open are you to flexible and virtual work arrangements? Do you have products and services that can support a workforce that is transitioning towards ‘work life integration’?
8. Generational conflict
For the first time, four generations are working side by side in the workplace. And their attitudes are significantly different on what a ‘normal’ workplace looks like.
In society, generational conflict is likely to grow as young people realise the Baby Boomer generation is mortgaging the future to maintain an unsustainable lifestyle now. This will lead to conflict on issues as wide ranging as environmental concern, pensions and politics. The Social Security systems of most Western nations will be another ongoing issue for the aging work force in the coming years. They are unsustainable – particularly those that are unfunded (i.e. they rely on the income from current workers to pay for the pensions of those currently retired). Young people are going to rebel against this, especially in countries where concessions are made for older workers.
Do you have a mentoring and reverse-mentoring programme in place? What are your systems for capturing and sharing wisdom across the generations of your company? How are you using different generations in your innovation processes?
How should you respond?
There is no ‘one right way’ to respond. Each of these trends, and many others that will shape our world in the next few years, bring both threats and opportunities. They will challenge the status quo, but this is precisely what can feed innovation and change.
It was Peter Drucker, the management author, who said: ‘The greatest danger in times of turbulence is not the turbulence, it is to act with yesterday’s logic.’ The most important first step in responding to – and taking advantage of – these trends, is to change our mindset, and see the opportunities they each provide.
Dr Graeme Codrington is a futurist, author, presenter and expert on the future world of work. He is co-founder of an international research and strategy firm, TomorrowToday, and can be contacted via http://about.me/graemecodrington