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Seedlink Blog

The Future of Work: A Primer for Business & HR Leaders

Seedlink Nov 14, 2019 10:43:56 PM | 9 min read time

Take one look around you and it is undeniable that the world of work is changing. This is a topic that is of major importance to business leaders, as well as HR practitioners. While the workplace of today is radically different from generations past, what makes the “Future of Work” noteworthy is the rate of rapid change that we have not seen before. But what exactly is the “Future of Work”? 

The conversation regarding the Future of Work revolves around two main themes:

1. The impact of artificial intelligence (AI), machine learning and automation on the world of work

2. The change in demographics and workforce structure in which independent workers and the gig economy are taken into consideration. 

Impact of AI, Machine Learning & Automation on the World of Work

If you are a business leader or HR professional, you have most likely heard of the impending disruptions to businesses and the workforce due to emerging technology.

Advancements in technology, automation and AI are rapidly transforming businesses, the nature of work and the workplace itself. Self-driving cars and customer-service bots running on algorithms are all examples of this phenomenon.

Such technologies can increase productivity and improve our lives, but their implementation in the workplace will inevitably substitute some of the work that humans currently perform. 

Future-of-work-graph (revised)

The fourth industrial revolution will see exponential growth in technological development resulting in rapid changes to business and society.

While the issue of automation and technology taking away work is not new, the conversation has been accelerated due to the rapid advancements and the rise of machine learning. This gave rise to much debate and public concern regarding what the Future of Work will mean for many.

 

Benefits of AI, Machine Learning & Automation

These technologies deliver real value to companies. Retailers can rely on AI-powered robots to run their warehouses and automatically order stock when inventory runs low more efficiently and with fewer errors than humans. Customer service channels can be run by chatbots to answer repeatable, predictable queries or provide information.

And now, with the predictive capabilities of some emerging technologies, companies use AI in their talent acquisition processes to improve efficiency and accuracy to making good hiring decisions.

Adopting such technologies can help save time and money by automating and optimizing routine tasks, freeing up manpower to focus on more important things. With AI and automation, productivity increases, and companies are enabled to make faster business decisions.

Perhaps most important of all, AI and machine learning can help to mine the vast amounts of data generated from businesses. Data is the fuel that powers AI, which can unlock valuable insights that further enhance business decisions.

A McKinsey survey has shown that early adopters who combine strong digital capabilities with proactive strategies tend to have higher profit margins. This widens the gap between digitized early adopters and others. As these firms expand AI adoption and acquire more data, others might find it hard, or impossible to catch up.

 

Transition of Skill Requirements - A note for HR Professionals

That being said, AI is not a magical tool that allows companies to immediately reap the benefits right after adoption. For many, the adoption of AI and automation means accelerating their digital-transformation journey. In order to effectively deploy AI, there needs to be the right structure and skills in place.

The reliance of this rapidly developing technology will require business leaders to determine if they have the workforce needed to manage these systems, and human resources will need to contend with sourcing a talent pool with a new set of skills.

In the Future of Work, even employees at the most basic level will be required to access data and know how to act upon it. To excel, technology skills and digital literacy are key. In line with their digital-transformation, people who work with data and tech-enabled tools or those who are proficient with programming are in high demand as well.

As AI and automation replace repetitive, mundane work, new jobs not related to emerging technology will also require a skill shift in employees as well, namely skills that cannot be automated or digitized. For example, social & emotional skills will see a demand increase following up to 2030.

As job scopes continue to evolve, there lies the question of reskilling and upskilling to meet this demand. For AT&T, the firm had spent $1 billion to retrain, reskill and reshape their workforce to better meet the demands of the future once they realized that half of them did not have the skills necessary for its increasingly digital infrastructure.

Business will have to evaluate their own workforce’s skill set in order to make the decision between reskilling and hiring. For a success story like AT&T’s, there must be a clear strategy on how they should proceed from there.

 

The Future of Work in the Automated Workplace

Not all companies will be willing to retrain and reskill their employees. So, what is the alternative for those employees?

Therein lies the main issue surrounding the conversation about the Future of Work. In 60% of occupations, at least one-third of their activities can be automated, implying significant workplace transformations for all workers. It is important to note that while some tasks are automated, employment may not decline but rather, employees may perform new tasks instead.

From the employees’ perspective, some may be skeptical about automation and AI and are wary about the long-term impact of technological innovation on workers.

In pursuing digital transformation, it is important for businesses to manage these negative sentiments and factor it into their workforce strategy.

 

Change in Workforce Structure

Along with the aforementioned technological advancements, there will be changes in workforce demographics, leading to an expansion of the workforce.

 

Demographic Changes

In 2015, Millennials had surpassed Baby Boomers as a majority in the workforce. By 2025, they will account for 75% of the global workforce. Additionally, about 61 million Gen Z job seekers are about to enter the workforce, bringing with them completely different priorities, values and needs.

There is a major ideological divide between older generations in the workforce, and that of the younger Millennials and Gen Z. The Future of Work is one that is dominated by the latter, which means that companies will have to adapt to retain and extract maximum value from them.

The workforce itself is undergoing a fundamental shift, with millennials and Gen Z leading the reformation.

 

Digital Ecosystems

One of the ways in which they are reshaping the workforce is their increased preference and acceptance for remote working. With rapid technological advancements, it is now easier to create digital ecosystems where people work from wherever and whenever, allowing for collaborative work on a global level.

If properly implemented, this will benefit employers, with more engaged employees, higher productivity and cost savings.

With Millennials placing an emphasis on flexibility in the workplace, it comes with the natural expansion of the workforce with the inclusion of independent contractors and of course, the gig economy.

The concepts of freelancers and the gig-economy are not new. But with the development of new technologies and online platforms that connected people to specific types of work, the barriers to entry for individual workers are being lowered. These independent gig workers can earn money on their own schedules, which allows them to pursue their interests and improve productivity.

For businesses, they are given access to a wide pool of diverse talent. They don’t have to worry about employee benefits or long-term fit while reducing recruitment costs as well.

The gig economy does pose its own challenges, but for companies, it would be highly beneficial to make full use of the freelance economy as part of its workforce strategy and embracing the technology and platforms that grant access to and unlock the potential of these workforce segments.

 

Shift in Employee-Employer Relationships

With the internet and rise of online social networks, information is always readily available, and employees know it too. Employer review platforms such as Glassdoor enable jobseekers to evaluate a companies’ working culture beyond what the companies are branding themselves to be.

Now, talent is more “consumer-like” than ever. This breeds the need for companies to take work-place ethos and culture seriously. Hence driving functions like HR to implement culture and values fit assessments as part of their recruiting efforts.

Increasingly, candidates prefer diverse and entrepreneurial opportunities with the safety of stable employment and will remain loyal to a company if they can offer this – otherwise, they are not afraid to leave for greener pastures.

Especially for Gen Z, they want an empowering work culture with consistent feedback, but also, they want to work for a company that aligns with their social compass and values. They form opinions of a company based not just on the quality of their products and service, but on their ethics, practices and social impact as well.

Future-of-work-genz (revised)

Gen Z. Photo by Callum Shaw on Unsplash.

The war for top talent is fierce, and professional networking platforms like Linkedin has made recruiting passive candidates even easier. In order to enhance talent acquisition and retention in the Future of Work, it is important for businesses to keep in mind what candidates are looking out for, and constantly evaluate their current working environment.

 

What does this all mean?

The future with automation and AI is exciting but challenging with many different factors to consider. The world of work is set to be vastly different, requiring new skills and far greater adaptability from the workforce.

In the Future of Work, these changes are inevitable. Rather than focusing on the fear surrounding AI and automation, businesses need to embrace these new technologies and adapt to changes in workforce structure in order to remain relevant and competitive.

For Further Reading:

Beheshti, Naz. “New Millennial Survey Finds A "Generation Disrupted": How Business Leaders Can Respond” Forbes

Bughins, Jacques, et al. “How artificial intelligence can deliver real value to companies.” McKinsey & Company

Bughins, Jacques, et al. “Skill shift: Automation and the future of the workforce” McKinsey & Company

Dixon, Lauren. “How Companies Can Deal With Online Employer Reviews” chieflearningofficer.com

Stahl, Ashley. “How Generation-Z Will Revolutionize The Workplace” Forbes

Topics: Business Leaders, Industry 4.0, Future of Work, HR Leaders, HR Tech