Many businesses are still reacting and adapting to the widespread disruption and changes brought about by the Covid-19 pandemic. But one this is for sure for operating models, communication and platforms of selling; the future is digital. The companies who will thrive in this digital landscape will do so with business models, operating models and people strategies that have adaptability and flexibility at their core.
This means a fundamental shift in the way firms think about talent and the creation of a workforce that is blended, distributed and agile.
A Blended Workforce
At the end of 2020, Joseph B. Fuller, Professor of Management Practice at Harvard Business School, wrote that the future’s most successful companies would be those with an “on-demand workforce model, one that blends talent sourced externally and employed temporarily with full-time workers. Such a model offers the prospect of achieving every manager’s goal of putting the right talent on the right project at the right time.”
Until recently, ‘blended workforce’ has conjured images of the Uber / Deliveroo-type ‘gig’ industry. However, as we mentioned in our previous article on freelance consulting models, blended workforces have been core to people strategy in management consulting for years. Here, firms have increasingly hired fewer permanent staff, drawing instead on pools of contract consultants and knowledge experts to accommodate spikes in demand.
Since the beginning of the pandemic, many other businesses, unable to hire but with critical projects to deliver, have turned to the rich seam of skills and experience that is the global freelance market. With a blended workforce now nascent in many businesses who would not previously have considered it an option, the next step is their incorporation into strategic plans.
McKinsey suggest a dynamic approach – thinking about planning from a skills-mix perspective and asking the questions: what skills do we need now? what will we need later? ; and, in each instance, should we build, acquire or rent these skills. Building is, in essence, developing capabilities from an existing base – i.e. by retraining / upskilling or restructuring. Acquiring may take the form of hiring or M&A activities. Renting might involve contracting freelancers, outsourcing or leveraging relationships with third parties: essentially developing an ecosystem beyond the organisation whose skills can be leveraged as needed.
A Distributed Workforce
Although physical office space will remain post-pandemic, commuting 5 days a week may be a thing of the past. Forward-looking companies will also be far more open to thinking creatively about where they source talent from, both nationally and globally.
There is already a marked increase in distributed hiring in the freelance space, with contractors winning work based on their skills alone rather than their ability to be present in a particular location. This global reach is likely to become a much greater feature of the permanent market as economies recover, allowing firms to pursue far more diverse talent strategies across the whole span of their blended workforce.
Although a distributed workforce might not be appropriate for all businesses in the short term, as a Forbes Human Resource Council noted in February 2020: “embracing talent from a variety of different backgrounds and cultural affinities makes it easier to drive innovation and creativity... when you stop hiring from just your immediate area, your access to diversity grows exponentially.”
An Agile Workforce
At the start of the pandemic, more digitally mature, agile companies were able to act fast in response to the crisis and will have a head start on the path to recovery. More traditional companies who scrambled to adopt agile approaches out of necessity, may find it hard to maintain changes as the crisis momentum dissipates. However, smarter firms will continue to build on their agile foundations, prioritising transformation at the heart of their business model and cultures.
Although there are many lessons to be learnt from other companies, agile transformation is fundamentally a unique journey and what works for one firm will not necessarily work for another. Successful transformation starts with a process of deep and specific introspection. Leaders have to understand exactly where their business is now in terms of technology, operations and – crucially – culture, in order to devise a clear path of action to where they want to be.
A cultural shift is the toughest part of any agile transformation. A report by McKinsey suggests that in addition to the vital first steps of clear vision, planning and action from leadership, there are three other essential elements to a successful culture shift. An agile approach devolves agency across an organisation, inviting people at all levels to make decisions, take responsibility and own their actions. It is therefore crucial that the process of change mirrors this and a key part of the journey is creating the space for each individual to define, accept and own their personal agile mindset. Technology and operations must be engineered to support behavioural change; and the ‘test-and-learn’ principles core to an agile approach must be reflected in continuous monitoring across all three areas, with success and failure given equal space at the table: as opportunities for celebration and opportunities to learn.
The ideal post-pandemic workforce is blended, distributed and agile. It is strategically designed on every level to make rapid decisions, shift resource where it is needed, access the best global talent on offer and scale up and down smoothly in response to market demands. Many companies are still a long way from this goal and will struggle to achieve it by drawing purely on the knowledge and perspectives within the business. You need the right people asking the right questions - right now.
We're having daily conversations with clients looking for experienced consultants or advisors who can coach, challenge and upskill their leadership and management teams or embed themselves to steer / directly deliver agile change. If you'd like to speak to us about your people strategy / agile transformation programme, reach out to Thom Cunningham Burley, Head of Consulting Projects.