8.4 trillion dollars.
That's how Jean-Marc Laouchez quantified the impact of the talent crunch on today's organizations. Laouchez leads the Korn Ferry Institute and the Korn Ferry Academy, and recently delivered the opening keynote at Degreed’s annual innovator’s conference, LENS.
So how best to make sense of such a staggering figure?
Insight #1: People are your number 1 capital.
In his welcome message at LENS, Degreed CEO Chris McCarthy reminded leaders that "technology and products can always move faster than organizational change."
There is still a disconnect between what learning and development (L&D) leaders communicate as a top priority to the CEO (investing in people) and what the board/shareholders prioritize (investing in technology). [4] That there is disparity between how these two stakeholder groups view strategic priorities is unsurprising. In fact, even in high-performing companies, it's estimated that less than 30% of employees correctly identify organizational strategy. [5]
The advantage of clearly communicating to all audiences that "people are the #1 asset" is that this clarity empowers employees to move quickly and confidently in alignment with goals. In their book, Talent Wins, Charan et al. go further to emphasize that executives and boards must recognize that talent, even more than strategy, is what generates value. [1] Laouchez laid out a clear plan of action that challenges organizations to pursue change by understanding how to "maximize internal talent to capture future value." [4]
Insight #2: Define and develop the right skills, for the right jobs, for the right talent.
Laouchez shared a study that Korn Ferry conducted with the World's Most Admired Companies (WMACs), where less than half of those organizations felt their talent had the right skills and capabilities to execute strategy. [3] This finding aligns with PwC's 21st Century CEO Survey where "80% of CEOs say they’re worried and 38% are extremely concerned about availability of digital skills in their country." [9] The conversation around the skills gap is complicated by the argument that employers should focus on increased wages—oversimplifying the problem to one of supply-and-demand driven primarily by the price of labor. Gartner's Marcus Chiu explains that for the many employers who are already willing to pay more, this solution is fraught with diminishing returns. [2]
So what happens when there's a high supply of workers? The LinkedIn Workforce Report for September 2018 analyzes migration trends between major U.S. cities and which cities present the largest skill gaps. Interestingly, although Austin, TX gained the most workers in September 2018, this city also ranked among the top 10 cities with the largest skill shortages. [6] This suggests that an influx of workers is not always enough to solve the mismatch between the skills workers have and the skills employers need.
It is worth noting that "more than one-half of employees rated opportunities to use their skills and abilities at work as a very important contributor to their job satisfaction." [10] This signals a shared value: Both workers and employers want to match skills to roles. Everyone now has access to the millions of courses, books, articles, videos, apps, podcasts, social networks, and other learning content. Key to building the skills needed to win is for employers to connect that content to skills, and then connect those skills to jobs.
Insight #3: Make learning work by balancing outcomes, capabilities, and purpose.
Culture—this is what ties it all together. A digital learning strategy that connects content to skills and skills to jobs must be anchored in a strong culture. If the digital building blocks for a highly-skilled workforce are firmly set on the cornerstone of a talent-first agenda, the organizational culture can thrive. [1] A culture of continuous learning is a competitive advantage, and is key to attracting talent—especially Millennials. [8] Laouchez outlined a three-point framework for how employers can drive a strong learning culture [4]:
● Purpose: Come and work with us, and be who you are.
● Capabilities: Do what you are good at, or do what you like, and master it.
● Outcomes: We are going to put the needed resources behind you to achieve the desired results.
Technology alone is not the magic bullet. In this paradigm, technology is an enabler—one that helps drive a disproportionate return on talent. This framework is also about nurturing trust between the organization and its talent to capture future value. Shane O'Leary references Daniel Coyle to explain that organizations like IDEO, Google, and Pixar integrate purpose and profit because they "build a common purpose, share vulnerability, and create psychological safety." [3] [7] Another way to build trust is to reward the talent that generates outsize value for the organization. Developing a roster of top-skilled talent is not just about the talent at the top. Further, those value creators can be many positions distanced from the CEO. [1] A flash of genius almost never sparks in alignment with organization hierarchies, but instead comes "from a volume of random ideas by lots of different people with different perspectives." [3]
Want to learn more? Check out this pathway that includes the sources cited throughout the post.
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- Charan, R., Barton, D., & Carey, D. C. (2018). Talent wins: The new playbook for putting people first. Boston, MA: Harvard Business Review Press.
- Chiu, M. (2018, June 4). Can US Employers Close the Skills Gap With Higher Wages Alone? Probably Not. Retrieved from https://www.cebglobal.com/talentdaily/can-us-employers-close-the-skills-gap-with-higher-wages-alone/
- COYLE, D. (2017). CULTURE CODE: The hidden language of highly successful groups. S.l.: BANTAM.
- Laouchez, J. (2018, October 4). L&D Strategy: How to Win the Battle Between People and Profits. Keynote speech presented at LENS 2018 in New York, New York.
- Leppert, J., & Kotter, J. (2014, June 9). When CEOs Talk Strategy, 70% Of The Company Doesn't Get It. Retrieved from https://www.forbes.com/sites/johnkotter/2013/07/09/heres-why-ceo-strategies-fall-on-deaf-ears/#240067ed3663LinkedIn. (2018, September 11).
- LinkedIn Workforce Report | Atlanta | September 2018. Retrieved from https://economicgraph.linkedin.com/resources/linkedin-workforce-report-september-2018
- O'Leary, S. (2018, July 8). The surprising reason why IDEO, Pixar & Google prioritise 'psychological safety' to win the battle for better ideas... Retrieved from https://www.linkedin.com/pulse/surprising-reason-why-ideo-pixar-google-prioritise-safety-o-leary/?lipi=urn:li:page:d_flagship3_profile_view_base_recent_activity_details_all;sdxb2rg3S8mRhNOmIoT35A==&licu=urn:li:control:d_flagship3_profile_view_base_recent_activity_details_all-link
- Palmer, K., & Blake, D. (2018). The expertise economy: How the smartest companies use learning to engage, compete, and succeed. Boston, MA: Nicholas Brealey Publishing.
- PricewaterhouseCoopers. (2018, January 22). Key findings on talent: 21st CEO Survey. Retrieved from https://www.pwc.com/gx/en/ceo-agenda/ceosurvey/2018/gx/deep-dives/talent.html
- SHRM. (2016, November 16). 2016 Employee Job Satisfaction and Engagement: Revitalizing a Changing Workforce. Retrieved from https://www.shrm.org/hr-today/trends-and-forecasting/research-and-surveys/pages/job-satisfaction-and-engagement-report-revitalizing-changing-workforce.aspx
