Work Different E-Book

Kate Bravery

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 408

Veröffentlichungsjahr: 2023

Beschreibung

An insightful and practical new guide to how sustainable people management works in today's global economy, with guidance on how to transform the way your organization recruits, hires, upskills, and retains its people In Work Different: 10 Truths for Winning in the People Age, a team of business experts and workforce advisors give an incisive take on the staffing challenges facing leaders in the modern global economy. The book reveals how executives and decision makers can adapt their people agenda for shifts in labor models and employee sentiment. You'll look ahead to what's next and learn how to weave sustainability and resilience into your business priorities and make real progress on profits, people, and the planet. You'll also discover: * How generative AI and labor trends will converge to put a premium on agile organizations * How to understand what people really want from the organizations they're employed by: The Lifestyle Contract * How you can build a culture that transcends structures and walls, and places skills at the heart of change * How stakeholder capitalism and ESG are drawing a new roadmap for success An indispensable resource for executives, managers, board members, human resources professionals, and other business leaders, Work Different: 10 Truths for Winning in the People Age is the no-nonsense, hands-on people management blueprint that you've been waiting for.

Leseprobe

WORK DIFFERENT

10 Truths for Winning in the People Age

KATE BRAVERY • ILYA BONIC • KAI ANDERSON

Copyright © 2024 by Mercer (US) Inc. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey.

Published simultaneously in Canada.

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Library of Congress Cataloging‐in‐Publication Data is Available:

ISBN: 9781394181292 (cloth)

ISBN: 9781394181308 (ePub)

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Preface

Ten new truths about work: They were sparked by the pandemic. They have withstood the fraught economic and geopolitical landscapes that have elapsed since. They will define our futures. These truths are more important than ever for leaders to embrace as we prepare to navigate the next seismic change: the emergence of generative artificial intelligence (Gen‐AI). These starkly unique and epochal events—that occurred within the space of just a few years—are demanding a pivot in how we work and how we work together. This book charts the reverberation of these events and discusses the implication for leading and working in the People Age.

Introduction: The Pivot

…And Just Like That, Everything Changed

At the beginning of 2020, we'd shake a stranger's hand without a second thought. We'd go to a restaurant without caring how close we were seated to our fellow diners. We'd go to a movie, unconcerned about whether the person doling out our popcorn had sanitized her hands.

That was the beginning of 2020. Come the end of Q1, it was game over.

We went from on to off.

We became separated from pretty much everybody.

International borders were closed off.

Flights were grounded.

Travel was halted.

The largest cities in the world shut down.

The world's most famous gathering places fell silent. Times Square—empty. Trafalgar Square—empty. Place de la Concorde, Saint Peter's Square, Mecca, Tiananmen Square—empty, empty, empty, empty.

Governments instructed residents to stay home, to minimize social interaction, to cancel scheduled activities, to wear masks, and to isolate. Quickly—virtually overnight—this became the new norm.

This became our lives.

There were whispers about the virus as early as November 2019, so maybe, just maybe we should've been better prepared…but we weren't. All we could do was stare at our televisions and doomscroll on social media, and we watched in horror as the story unfolded.

With the health, safety, and well‐being of people around the globe in jeopardy, healthcare workers quickly mobilized. Despite their heroic efforts, it was an uphill battle. After all, we knew little to nothing about what some called COVID‐19, and others called the coronavirus, and still others flippantly called The 'Rona.

As the virus raged, we in the business world were forced to rethink our priorities. For most companies, the immediate need of securing the safety and well‐being of their people (first) and humankind (second) skyrocketed to the top of the charts. Offices were empty and business districts were ghost towns, but economies had to keep going. As most workers retreated to the safety of their homes, the digital shift began in earnest.

Emergency personnel and the newly named category of critical or essential workers kept the physical economy running (i.e., groceries, retail, shipping, and waste disposal). They put their own safety at risk, in part for the greater good, and in part because they didn't have much of a choice. In sharp contrast, companies that were either nonessential or dependent on close human contact went dark (i.e., construction, hospitality, tourism, entertainment, and professional sports).

From face masks to ventilators, new priorities emerged, and the smartest, most compassionate businesses were there to meet the most unprecedented demand. Many tech‐savvy companies and individuals were able to adapt overnight.

There was a reason for that.

During the digital evolution of the late 2010s and early 2020s, a new infrastructure emerged and provided us with tools to react quickly to meet global communication needs. Video platforms like Zoom, Slack, and Google Meet became our new conference rooms. Our basements, our extra bedrooms, and our kitchen tables became our offices. The 9‐to‐5 workday became the 7‐to‐10, then the 5‐to‐9 workday. The salient question was: In this new setup, how well could your organization rearrange its work, its workflow and its workers?

As we accepted the fact that the virus would be with us for who‐knows‐how‐long, work truths were rebooted and new work realities set in. The most immediate realization was that—save for such frontline, essential workers as medical personnel, growers, packagers, and deliverers—not all employees needed to be physically present in the workplace to get their work done.

Remote working worked. Small consolation, but a consolation, nonetheless.

The success of remote working represented the first of many business dominos to fall. Short‐term thinking gave way to addressing the bigger picture. Before the pandemic, some executives estimated that about 45% of their workforce could pivot to the future of work.1

They were wrong.

Turns out they wildly underestimated our ability to adapt, as tens upon millions of people changed where they worked, when they worked, and how they worked.

People Get Ready

American business icon Jack Welch passed away at the beginning of March 2020, a loss that gave us business nerds an opportunity to reflect on the evolution of the large corporate CEO mindset as well as the priorities that drove Welch's success.

Dubbed the “Manager of the Century” by Forbes in 1999, the late chairman and CEO of General Electric was driven by shareholder primacy and stock returns as the measure for success. Welch's view was that short‐term focus would cumulatively deliver for the long term. Arguably, his early‐career success and late‐career celebrity made it feel okay for corporate CEOs to use workforce restructuring as a go‐to solution for cost cutting.

Economic cycle after economic cycle—we're talking 1987, 2001, and 2008–2009—business playbooks hammered one point home: Reduce people costs to protect shareholder returns. Overuse of workforce restructuring as a tool to deliver financial results ultimately broke the Loyalty Contract between employer and employee. COVID eventually took the employer/employee relationship full circle, shifting the balance of power, and with a hard punch, it reset the employer/employee deal.

The People Age had arrived.

The People Age isn't a direct consequence of COVID, but COVID accelerated many of the trends associated with the future of work, everything from flexible working to total well‐being, to investments in artificial intelligence (AI) and automation. As global demographics shifted and fortunes diverged, they collided with a pandemic‐induced reset of values.

By most projections, global population growth will peak around 2040. Currently, it's growing at a snail's pace; in parts of the world, death rates are actually outpacing birth rates, meaning some local populations are in the early stages of decline. There are fewer people of working age to support retirees and keep things running, and fewer young people to fuel and renew the workforce. It was no coincidence that most economies around the world entered the COVID era with unemployment rates at record lows. The situation hasn't been helped by the fact that most foreign workers returned to their home countries during the pandemic and stayed there. From then on, immigration restrictions around the globe only exacerbated the situation, an issue that's hurting organizations already short on people and skills.

As a result, many companies' responses to these economic challenges played out differently than traditional management practices would have foretold. A few large and influential employers were quick to break the mold: Rather than reducing their headcount to manage costs, they gave their employees security by assuring them that as long as the pandemic prevailed, their jobs would be safe. Economics and short‐term shareholder returns took a backseat. Empathy became a top priority.

Empathy. Embrace that word. You'll be reading a lot about it here.

It wasn't long before companies like Apple, PepsiCo, Medtronic, and Marsh McLennan preached that the wisest long‐game play was to protect employees (and, for that matter, society) during this unprecedented time. They saw it as necessary to secure the future of their firms.

This was the new thinking.

Here's Your New Reality. So Now What?

This people‐first response was an outcome of a multi‐stakeholder alignment model that had already begun to take hold in the boardroom and in society. In 2019, this shift went mainstream—kind of like when Green Day went from playing for six people at punk clubs in San Francisco to selling out Wembley Stadium—and companies became more vocal about putting People and Planet at the heart of their business models. That same year, the Washington‐based nonprofit lobby association the Business Roundtable released an updated “Purpose of a Corporation” statement, expressing a need to move from shareholder primacy to a multi‐stakeholder model of success, one that delivers positive outcomes for society, customers, employees, and shareholders.2

Here, in the second decade of the twenty‐first century—as we write this—the urge for sustainability has emerged as a response to the increasing, existential threats to humankind. Environmental risks were articulated by Fridays for Future activists, and the Black Lives Matter movement called out centuries of passing the buck on social injustice and racial violence.

This all created a business powder keg.

Then COVID‐19 lit the match.

COVID‐19 was the ultimate test and, perhaps unsurprisingly, a number of the Business Roundtable companies failed to meet their pledge once the virus was firmly entrenched in society. Some employees were let go, while others were asked to take a pay cut, all to protect potential dividends to shareholders.

Suddenly, the watchful eye of the public was on businesses worldwide, and one work truth became ever more self‐evident: Companies that demonstrated genuine concern for all of their employees—not just those at the top—stood a better chance of coming through these successive shocks stronger than before.

Where Workers Were and Where Workers Want to Be

As the working world navigated its way through COVID‐19, a new power dynamic emerged between employers and employees. And this time, the rebalancing was not skewed toward the high end of the income scale…for a change.

The pandemic gave people at all levels, from admins to the C‐suite, an opportunity to reflect on their work/life priorities. With that new outlook came empowerment, especially when combined with emerging labor shortages in many industries. Voluntary turnover skyrocketed as employees proactively chose work options that better suited their needs and values. Quitting a seemingly good job became a Thing, and The Great Resignation (or The Great Reassessment) provided a clear blueprint of the new world of work.

Expectations were being redrawn. Big‐time.

For decades up to the pandemic, we all had to go above and beyond to be recognized and promoted. Workers threw aside work/life balance to (hopefully) get to a better financial place. Many eventually realized that their efforts were leading to success for their companies and their bosses.

But not for them.

Leading up to and during the pandemic, a huge number of people learned to stand up for themselves, to call out discriminatory or exploitative behavior, to establish an acceptable work/life balance.

To be respected for who they are as human beings.

They were willing to walk away from undesirable jobs, low pay, and unrelenting supervisors, even in the face of economic uncertainty. And this sentiment is reflected in the emergent values of those first entering the workforce. They don't want to sacrifice a happy today for a (potentially) brighter tomorrow; 75% said they would walk away from an employer who didn't share their values.3

Ch‐Ch‐Changes

There has never been a more impactful, interesting, and challenging time to lead people or to be a part of The People Function.

The pandemic opened the eyes of decision‐makers to the reality that even with the proliferation of technology, people are still the heart and soul of the company. As Morgan Stanley Senior Advisor Jeff Brodsky said, “If the financial crisis was the CFO's crisis, 2020 was the CHRO's crisis”4 And step up they did, with 76% of executives saying HR was the hero of 2021.5

HR as heroes? It's about time!

The immediate focus was to protect people's health under the most challenging of circumstances. Now, the challenge for people managers is to win, retain, and upskill talent in a world that has fundamentally changed. The good news is that trust in organizations is at an all‐time high,6 and employees are eager to partner with their employers and their digital assistants to build a future of work that is less exhausting, more meaningful, and more inspiring. Surely, this is not too much of an ask.

So, what does this all mean?

In a nutshell:

Business has never been more competitive.

The world has never been less predictable.

Talent has never been more in‐demand.

Top talent has never been more difficult to find, attract, and retain.

People have never had more choices about work.

The ChatGPTs of the world are pushing us to realize the unique value that people bring to the table.

That all being the case, The People Age is here to stay.

This begs the question: “Hey, Team Mercer, what the hell is The People Age?”

Excellent question.

The People Age is a brave new world built around human‐centric values, a world full of opportunities and challenges in service of advancing prosperity for all. Navigating uncharted territory requires accepting and adapting to new truths, as many of the old rules and accepted practices no longer apply. Today, business as usual is anything but usual, and that's not a bad thing.

Before, during, and after COVID‐19, businesses were forced to pivot, and they'll need to keep pivoting if they want to thrive and remain relevant in the world that lies ahead. The litmus test of resilience will be their ability to read market signals early, then effectively respond to employees' wants and needs. Market‐sensing and employee‐sensing lay at the heart of balancing economics and empathy. Companies that are thriving are already figuring out how to design more human‐centric work models, focusing on how to make the adoption of technology easier, and caring about their employees' work experience. But as economic headwinds bite in the mid‐2020s, it's clear that staying the course on these newfound learnings takes intentional redesign and courageous leadership.

This brave new world is scary, no doubt, but as David Bowie told us, when there are ch‐ch‐changes, you have no choice but to turn and face the strange.

Speaking of facing the strange—just as the worst of COVID‐19 was behind us, along came a chatbot that sounds almost… human. The next colossal change had arrived.

When OpenAI released ChatGPT in November 2022, we witnessed the fastest consumer adoption of any technology ever.7 While it took Uber 70 months to reach 100 million users per month; Spotify, 50 months; and Instagram, 30 months; ChatGPT only took 2 months to reach these user numbers.8 BAM!

ChatGPT was not the first generative artificial intelligence (AI) solution. But it was the easiest for consumers to use. With the most impressive results in content quality and interaction. With ChatGPT, AI had its iPhone moment. And the world of work has reached another historic pivot in the journey we call digitalization.

The enthusiasm is as great as the skepticism. While 75% of companies say they plan to adopt AI technology, many business players are critical about the path it will set us on, with vocal calls from many for greater regulation and governance.9 Bill Gates heralds generative AI (Gen AI) as “revolutionary.”10 Elon Musk calls AI the “greatest risk we face as a civilization,”11 while Warren Buffett and Charlie Munger are cautious about the hype. During the most recent Berkshire Hathaway annual shareholders' gathering, the two high‐ranking executives displayed a certain degree of pessimism when it came to the potential of robotics and AI impacting the stock market and society in general.

Munger, in particular, seemed to dismiss the enthusiasm around AI, favoring instead what he referred to as “old‐fashioned intelligence.”12 To his point, and despite ChatGPT's utility, there's no substitute for decades of real‐world expertise.

While the critical approach to the big change issues of our time is justified, we are reminded of the discussion about flexible working. What was long considered impractical is now rapidly becoming a reality.

And this is where our confrontation with the new realities of the world of work begins.

New Truths Might Set Us Free

This book presents a whole lot of new truths that emerged during this short period (2020–2023). Truths that served as the trigger event for a fundamental shift in how we work, what we work on, and why we even work in the first place.

These truths displace age‐old beliefs about what people want and which organizational cultures and leadership styles help them thrive. Together, they signal a radical one‐eighty from traditional notions of management reality. They demand a pivot in how we strategize, learn, and lead. Because they impact every aspect of work, they require new ways of thinking and demand action from organizations, leaders, and even employees themselves to adapt and stay relevant in a changing world.

This book seeks to deliver a fresh perspective on today's people agenda, a paradigm (see Figure I.1) that recognizes not only the shifts in labor models and employee sentiments, but also looks ahead to how operating models and organizational cultures need to adapt to stay relevant for a new era.

Under this model, we'll look at how the traditional employer/employee relationship has shifted as well as the new paradigms under which people are operating. We'll also touch on the challenges of meeting employees' lifestyle needs in an environment built for a different time; what people fundamentally expect from work today; the fables that can hold everybody back; and how to attract and retain motivated talent.

FIGURE I.1 The people agenda paradigm.

Source: Mercer

We'll underscore the importance of purpose and empathy in delivering an inclusive organization, and how firms can outgrow the legacy traits of command‐and‐control to create an organizational culture that breathes with its people and benefits everyone.

We'll muse as to how AI will impact The People Age. Some folks argue that AI will marginalize the human contribution to work and change our operating models like never before. We'll hold against that and outline the opportunities for individuals and companies alike to amplify their intelligence.

We'll focus on how to manage the most valuable resource in an organization—the people—in a more sustainable way. We'll discuss how to deliver on decent work and embed healthy work habits into a company's DNA. We'll discuss what sustainable people management looks like in practice.

And finally, we'll share the blueprint for a successful people strategy that enables all leaders and executives to deliver on their future‐of‐work and sustainability agendas.

Listen, change is never easy, and sometimes our only choices are to opt in or to opt out. The People Age presents an opportunity to adapt or be left behind. For those who embrace these new realities, there is now the chance to innovate further, to be bolder in business and social ambition, and to create a sustainable talent advantage like no other.

Why Us?

These are world‐altering concepts, so why should three members of Team Mercer be the ones to write about it? Well, our experiences—especially during the pandemic—bring different perspectives on the new realities of work around the world, and we are united in our passion for The People Agenda.

Kate, an organizational psychologist, draws from her time living in China and the United Kingdom during the pandemic and working with global firms on their talent strategies. Leading on Mercer’s Insight & Advisory agenda globally, she stays on the pulse of workforce trends, emerging tech. and leading people practices. During this period, she was the incumbent partner of the World Economic Forum (WEF), helping Chief People Officers innovate and respond as the Future of Work agenda reset overnight.

Ilya, an Aussie native who's based in New York, brings a global executive's view. As Mercer's Head of Strategy, he worked with the leadership team to secure Mercer's business continuity response to the pandemic. He is similarly focused on Mercer's business evolution as we adopt various Gen AI tools to augment our own workforce, enhance our business competitiveness and continue to make an ever increasing positive impact for our clients.

And Kai, a seasoned strategist, who, starting with his own company and now leading Workforce Transformation for Mercer, has spent years guiding organizations throughout Europe. His book Digital Human (2017) championed the concept of prioritizing humans in the digital transformation. Amid the pandemic's upheaval, Kai continued his mission, helping clients reimagine their work and navigate decisions in a time of immense pressure and uncertainty.

Diverse experiences, diverse perspectives, but a clear recognition by us all: That once we unfreeze how we have worked for centuries, what lies ahead is a once‐in‐a‐lifetime opportunity to reinvent how we work and to define what it means to win in The People Age.

Notes

1.

Zwile Nkosi, “With more business disruption expected, making organizations ‘Future‐Fit’ is top of mind new study finds,” Mercer, March 14, 2019.

2.

“Business Roundtable redefines the purpose of a corporation to promote ‘an economy that serves all Americans,’” Business Roundtable, August 19, 2019,

https://www.businessroundtable.org/business-roundtable-redefines-the-purpose-of-a-corporation-to-promote-an-economy-that-serves-all-americans

.

3.

Ana Kreacic, John Romeo, Simon Luong, Lucia Uribe, Amy Lasater‐Wille, Elizabeth Costa, Kamal Ahmed, and Jonathan Paterson, “A‐Gen‐Z report: What business needs to know about the generation changing everything,” Oliver Wyman Forum and TheNews Movement (2023): 49,

https://www.oliverwymanforum.com/content/dam/oliver-wyman/ow-forum/template-scripts/a-gen-z/pdf/A-Gen-Z-Report.pdf

.

4.

Blair Jones and Jeff Brodsky, “The CHRO's critical role in times of crisis,” Semler Brossy, November 24, 2021,

https://semlerbrossy.com/insights/the-chros-critical-role-in-times-of-crisis/

.

5.

Kate Bravery, Adrienne Cernigoi, and Joana Silva, “Global Talent Trends 2022: Rise of the relatable organization,”

Mercer

(2022): 80.

6.

Kate Bravery, Adrienne Cernigoi, and Joana Silva, “Global Talent Trends 2022–2023: Rise of the relatable organization,”

Mercer

(2023): 36.

7.

Krystal Hu, “ChatGPT sets record for fastest‐growing user base – analyst note,” Reuters, February 2, 2023,

https://www.reuters.com/technology/chatgpt-sets-record-fastest-growing-user-base-analyst-note-2023-02-01/

.

8.

Katharina Buchholz, “ChatGPT sprints to one million users,”

Statista

, January 24, 2023,

https://www.statista.com/chart/29174/time-to-one-million-users/

.

9.

Attilio Di Battista, Sam Grayling, Elselot Hasselaar, Till Leopold, Ricky Li, Mark Rayner, Saadia Zahidi, “Future of Jobs Report 2023,” World Economic Forum, (2023): 6.

10.

Andrew R. Chow, “Bill Gates believes generative AI will be ‘revolutionary,’”

Time

, March 21, 2023,

https://time.com/6264801/bill-gates-ai/

.

11.

Kelly Kline, “Elon Musk is so worried about the threat of AI, he wants government to regulate it,”

Mashable

, July 16, 2017,

https://mashable.com/article/elon-musk-ai-greatest-risk-to-civilization

.

12.

Grace Kay, “Billionaire investors Warren Buffett and Charlie Munger aren't sold on AI hype: ‘Old‐fashioned intelligence works pretty well,’ ”

Business Insider

, May 10, 2023,

https://www.businessinsider.com/billionaires-warren-buffett-charlie-munger-not-sold-ai-hype-2023-5

.

CHAPTER 1Goodbye Employees, Hello Contributors

Work Different

By the time businesses (kind of) (sort of) figured out how to navigate the pandemic, approximately 50% of the worldwide workforce found itself, as Steve Jobs might have said (with his creative use of grammar), working different.1

For those who had already worked remotely—be it at home, at a café, or in a local park near a router from which WiFi could be easily stolen—it was just a matter of rearranging their schedule. Work‐from‐home newbies, however, had to set up their workspace, upgrade their technology, and figure out how to simultaneously make their daughter a grilled cheese sandwich while leading an international Zoom meeting. The truth was that we humans all learned to be more enterprising, while enterprises started to become more human.

Looking back, this all seemed simple, even quaint.

Back then, not so much.

Those who had to work in an office during the pandemic were faced with challenges of their own. When do I wear a mask? How often should I get tested? How close is too close? If I'm exposed to the virus but I don't have symptoms and I've tested negative multiple times, should I stay home?

Again, today, that all seems relatively simple. Again, at the time, not so much.

But clever companies adapted. (We like to think we adapted well because we like to think we're clever.) Adaptation was not only born out of necessity, but also because there was a real opportunity to innovate and to accelerate our thinking around work and working.

The pandemic forced (clever) business leaders to listen to their employees harder than ever before. The working world became a massive brainstorming session, and no idea was taken off the table, whether it came from the long‐time CFO or the 19‐year‐old in the warehouse, who'd only been with the company for two weeks.

The employees were leading the leaders. Listening, learning, and looking around was happening at an unprecedented scale. It's impossible to quantify if or how well this approach worked, but one thing is certain: It made for a work environment where people felt heard, and executives started to close the chasm in work outlooks that had been building up over the years.

Anecdotally speaking, the mobile workforce at Mercer seemed to appreciate the newfound flexibility. (Folks also enjoyed the fact that the commute from their bed to their desk was about 45 seconds, and their dress code allowed for hoodies.) They were able to create their own work environment and a comfortable schedule. They were able to configure a home work space that allowed for minimal interruptions and offered good lighting, all while remaining a safe distance from that tempting two‐pound bag of chocolate‐covered raisins on the kitchen counter.

But it wasn't a pajama party for everybody. Suddenly the size of your home mattered. For many, remote working was not utopia. People in shared flats had no privacy. Ironing boards made for less‐than‐ideal desks. Access to WiFi and the quality of broadband meant access to employment. The difference between those living in small apartments and those with a spare room to adapt was palpable.

That was the shift experienced in the office world, and probably a disproportionate amount of time and focus has been given to the plight of knowledge workers. Other industries had different challenges that forced a different kind of thinking different. Frontline workers were battling the pandemic around the clock, from healthcare workers to police officers, from teachers to cashiers, from garbage collectors to pizza distributors. They kept our lights on, cleaned our streets, educated our children, and delivered our dinners. And Mercer’s research showed that while knowledge workers became burnt out, skill workers became fed up.2 The voices of the divided were deafening and The Great Resentment was brewing.

But like any great period of change, it was also a time of rapid advancement in thinking and technological adoption. We learned that one teacher could educate a group remotely, with parents as intermediaries. We realized phone calls from doctors could be far more convenient than trips to their offices. We saw how a health system in crisis could be alleviated as pharmacists and care workers took on responsibilities previously held by other experts. We watched in awe as digital payment and automated delivery mechanisms exploded, challenging our assumptions around which tasks needed in‐person interactions.

While we may never want a bot to tell us that we have a terminal illness, we might not need a face‐to‐face chat with a doctor to receive other test results. We started to realize the work that rests within jobs today could be done in different and new ways. We could deconstruct a job and reconstruct it differently to solve problems of scale, talent shortage and efficiency, and to build learning in for potential successors. These new ways of working prompted a rethink about jobs, who does those jobs, and what parts of those jobs are truly valued. As we began to see jobs in terms of what really adds value to the firm, we also discovered that not all jobs are created equal. Not all jobs are good jobs.

Contracted Contributors

It was clear to everyone that times they were a‐changing. These new realities were getting everyone thinking about what might come next regarding work. For folks in the people business, like us, it was clear that we would need unprecedented amounts of empathy to understand the vast diversity of experiences within these new realities. It was clear that employees' health and well‐being was now part of the employment equation. And it was clear that as we sought to figure out what was next, the employer‐employee relationship was already being reset.

In the traditional employment contract, employers typically control where, when, and how work is done, and in return, the worker is paid to execute the role according to these parameters. Clarity of job description, clearly allocated tasks, and non‐negotiable ways of working were hallmarks of a good employment contract. However, at the end of this period of working different, after this period of intense innovation and employee introspection, workers started to value different things at work.

During this period, workers and their bosses worked in partnership (no one had more knowledge than the other about the virus, about the future), and they were galvanized behind a common purpose, that is, fighting the pandemic, keeping the lights on, learning and innovating together. This set a new tone for how people wanted to work. People wanted to be viewed as true partners. They made a conscious choice to give their time, skills, and knowledge, and they wanted it to count beyond just a paycheck. And a buoyant labor market gave voice to this ask.

Call them associates, affiliates, colleagues, collaborators—contributing to a firm emerged as the new mental model for how employees and contractors viewed the relationship with those who write their respective paycheck.

Contributors are not just part of the process; they're invested in the outcome. Instead of counting down the hours until end of the workday, contributors are busy figuring out what they can achieve before they end their day.

While contributors may be performing the same tasks as the employees before them, they expect more autonomy in how they do said tasks. Their input is heard—and, more often than not, taken to heart—which results in new levels of self‐motivation.

Leading companies get this.

Those who were already on this path before the pandemic fared best. Take the global pharmaceutical firm Novartis, which, prior to the crises, had instigated a campaign to build an “un‐bossed culture,” a paradigm that essentially flipped the traditional employment model. Centered around “servant leadership” principles, this approach was based on enhancing leaders' ability to be inclusive and empower their workforce. Managers were to support their teams, rather than the other way around. Empathy was critical to making this work.3 When Novartis needed to ramp up innovation and production of vaccines, it already had a culture based on curiosity, outside‐in thinking, and innovation with its talent—or associates, as it calls its employees—ready to up their contributions and help solve the pandemic crisis.

Setting the Table

Team Mercer loves tables. All consultants do.

Figure 1.1 is one we particularly like, which shows 10 dichotomies between employees and contributors that we hear from our people and our clients.

Working in Partnership Is about Hearing, Not Listening

The buoyant labor market post‐pandemic—and the job switching it sparked—certainly encouraged leaders to listen more; digital focus groups, pulse surveys, and workforce sentiment analyses all burst onto the scene in response. As the data came in, it was clear that many employees felt their companies didn't respect their lives outside of work, failing to appreciate the sweat, angst, and safety risks that workers endured through the pandemic. As the workforce made way for the next generation—one that really got digital working, breathed equity and inclusion, and learned at school to call out the bullies—it was clear that the old working habits and mindsets were no longer fit for purpose.

We needed to operate under a new paradigm. Welcome to The People Age!

As jobs became more complex and new technology tested everyone's adaptive capacity (and sometimes their patience), it was clear that knowledge was no longer residing at the top of the house. Traditional decision‐making structures threatened to stymie corporate agility. To survive, organizations would need to operate as sensing organisms rather than hierarchical institutions. It was clear that organizations needed less directive leadership and less siloed working to keep up with the demands of a faster‐paced working world born out of crises. At the same time, workers also needed clarity on direction, more accountable teams, and leadership that was centered around enablement. The prevailing sense was: Yes, we survived the Pandemic Apocalypse, now give us a roadmap to Utopia.

FIGURE 1.1 Ten dichotomies between employee and contributor mindsets.

Source: Work Different: Bravery, Anderson, Bonic

By way of example, as contributors showed interest in fully flexible work schedules, compressed work weeks, job‐sharing programs, or various hybrid options, many companies listened and empowered their workers to make it happen. And that empowerment was huge because if contributors didn't believe their asks were being taken to heart, there would have been a heck of a lot less contributing.

At Mercer, we sought to listen, and our colleagues seemed happier and more productive with work‐from‐home options. But being a partner is not only about meeting employees on their terms—it's about working together for a shared outcome and about being honest as to which jobs lend themselves to different work models, all while being open to considering new ways to deliver results. An unexpected benefit of this listening practice and discussion of flex working was that it drove more conscious thought about where we spend our time, who we spend our time with, and an examination of how we work together asynchronously across temporal and physical boundaries.

But it was hard. Great cultures don't just emerge, they're intentionally designed, and they only stick with shared values and multiple discussions around ways of working and interacting. Like any good relationship, it takes work to go the distance. People who felt their companies were lagging on these new a‐ha's sought to take their skills elsewhere, and those who stayed voiced their dissatisfaction. Employers around the world realized they'd better change things up and, if they hadn't already, become vastly more employee‐friendly. They needed to take the lessons in empathy honed during the pandemic and give them solid form (metaphysically speaking) with more effective partnering skills for every people leader.

While we needed greater partnership and design thinking to solve problems at the height of the pandemic, we had differing views on how we should partner in the aftermath. Take the much‐talked‐about chasm in expectations around flexible working. In 2022, 66% of executives globally believed that work essentially gets done in the office, with 78% concerned about employees' ability to build solid interpersonal relations if these new practices remained.4

Employees, however, saw it differently, with 74% globally believing their organizations were more successful with remote/hybrid working, and 80% confirming that their teams collaborated well with a mix of remote and onsite contributors.5

Many leaders recognized this disconnect in outlooks immediately, while others sat on their hands…and the hand‐sitters got burned. Look at what happened in the United States: According to the U.S. Bureau of Labor Statistics, the average employee turnover rate in 2021 was a staggering 47%, which included both voluntary and involuntary turnover.6 In 2022, the cost of voluntary turnover set businesses back over $1 trillion.7 And guess which industries were most impacted globally? According to LinkedIn data, it was Professional Services, so we at Mercer had a vested interest in figuring out a new way to partner.8

Don't get us wrong, we are not naïve work‐from‐anywhere advocates; we are champions of dialogue and testers of the art of the possible. Amid the economic headwinds in late 2023, the pendulum swung back again, and many organizations started bringing their people back into their work sites. The effects of large‐scale virtual work are complex and not necessarily positive—cultural, learning, and engagement issues all sprung forth. The question is how leaders tackle these issues and preserve the opportunity that flexible work models can deliver for contributors, for organizational agility, and for companies' diversity and inclusion ambitions. The genie is already out of the bottle, and when digital‐first workers combine with digital‐first businesses, the true cost of turning our backs on this opportunity to work different will become more evident

Dancing to a Different Tune

Leading up to 2020, the working world was evolving in a more contributor‐centric direction, albeit slowly. Social media ensured that accountability for bad practices went viral, and younger candidates asked questions about culture, diversity and skill development in their interviews. But the pandemic forced everyone to shift into high gear or be left in the dust.

We all learned through on‐the‐job training what was possible regarding new ways of working. It wasn't just employees' views that changed, executives also developed a more positive approach to their organizations' ability to adapt. The majority of workers thrived within this new paradigm, one defined by collaboration, empathy, and of course, pajamas.