It takes a human-centered approach, tailored to your organization and culture, to lead effectively in this era.
59 min
Leaders are leading in a very different world, one for which they were not typically prepared. Watch this webinar replay to discover the moves to make now to lead and deliver lasting transformational change.
Our speakers outline how to lead effectively in this new era, taking a human-centered approach to make transformation happen and how to tailor a leadership system for your organization and culture.
Slides from the webinar are available here. The research report – “Catalysts in Action: Applying the Cultural Levers of Transformation” – that informed this webinar session can be downloaded here.
If you’d like to learn more about how leaders can chart a clear way forward in uncertain times then get in touch with us today.
A Model for Driving Organizational Transformation in Today’s Business Landscape
It’s time to look deeper into your organization’s DNA, mind, body and soul.
Everyone acknowledges that orchestrating organizational change is a crucial component of successful business transformations, so why is it always the Achilles heel?
Business Transformation
Many organizations have struggled to meet the challenges of the modern business landscape, where stakeholder and customer needs and demands continue to change dramatically and new market entrants threaten disruption. Companies need to ask themselves the following:
“What would our organization look like if it had been designed in the last 10 or 20 years?”
“In what different ways might an organization like that create value?”
“What customers would it serve and how?”
“How might you work backwards from that vision to build a roadmap for bringing your digitally transformed organization to life, properly leveraging the assets and value they already have in hand?”
Customer-led Transformation
No matter how digital organizations become, it will still be humans who ultimately run the organization. Many organizations – some digitally native and some not – understand and treat their humans well. But we’ve also observed that some of those companies have lost track of some equally important humans outside of their organization: their customers! The products, services and experiences they are offering are frustrating the very people who will ultimately determine the survival of the business.
These organizations need to change dramatically to continue to have relevance in the marketplace. They need to inculcate a customer-centric mindset and identify if skills gaps are preventing them from creating more relevant products and experiences. They need to understand where and how their operating model might need to change to support the kinds of pivots and adaptations needed to reconnect with customers and other important stakeholders.
Prophet’s Human-Centered Transformation Model
We view all organizations as a macrocosm of the individual: having a collective DNA, Body, Mind and a Soul. An organization’s culture needs to be understood as a holistic ecosystem and successful transformation today requires leaders to think about every aspect of this ecosystem.
DNA
The DNA is comprised of things that provide direction and tend to change infrequently. The elements that define the destination and direction of travel such as the corporate purpose, values, brand, strategy and employee value proposition.
Soul
It is the elements of the Soul which motivate employees to believe in the DNA. Those are the mindsets and the daily behaviors and ways of working those mindsets motivate; and it’s the stories and symbols that are used to signpost what an organization will and will not embrace.
Mind
The skills and capabilities of an organization’s talent are the Mind of the organization and when properly cared for and nurtured, enable goals to be achieved.
Body
The Body is how collective efforts can be directed. It’s the operating model and organizational design, and the governance, processes, systems, and tools which enable it to cohere.
“An organization’s culture needs to be understood as a holistic ecosystem and successful transformation today requires leaders to think about every aspect of this ecosystem.”
Why We Use the Model
Transformations frequently stumble on cultural roadblocks, which is best expressed in the time-honored truism attributed to legendary business theorist Peter Drucker: “Culture eats strategy for breakfast.”
We apply our Human-Centered Transformation Model as a lens for unpacking and refocusing the complexities of organizational and cultural dynamics into specific components that can be more easily digested, explored and understood.
We believe that our model’s holistic nature enables us to look clearly at all the interrelated elements that ultimately manifest in the experience of an organization’s culture. It ensures that our understanding is appropriately layered, helping us to make connections between the explicit and implicit elements that sometimes go undiscussed. Most importantly, it supports nuanced diagnoses of organizational challenges and helps us to design a clear roadmap for change, against which progress can be measured.
If you’d like to discuss taking a human-centred approach to your transformation, then our expert team can help. Contact us today.
The Human-Centered Transformation Model helps us think comprehensively about the vision for a digitally transformed organization, the skills and competencies it requires and how to design an operating model that will bring it to life. It helps us think comprehensively about increasing customer centricity, identifying the capabilities needed to create more relevant products and services and how to design an operating model that will enable increased focus on the marketplace. And our experience is that by failing to address the elements of the model holistically, the transformation will not be sustained, nor deliver the value anticipated.
5 Leadership Traits Needed to Reignite & Reimagine Your Business
This latest disruption is potentially enormous. It also exposes plenty of behavioral white spaces.
Between the global pandemic and widespread protests demanding racial justice, organizational transformation feels more important than ever. But true change requires a new leadership mindset. Building the resilience to navigate these world-altering shifts takes a genuinely human-centered approach.
“While our research validates that these individual leadership traits are important, those who have them are keenly aware that for transformation, individuals matter less than the collective.”
In our 2020 research study, “Catalysts in Action: Applying the Cultural Levers of Transformation,” we spoke to 500 transformation leaders across four regions – the U.S., the U.K., Germany and China – and uncovered that the leaders best prepared to drive transformation share five traits. We also found that the leaders who feel most optimistic about the future are those who cultivate these traits and understand that they are required to build organizations that are human-centered.
Based on our research, here are the five leadership traits needed to reignite and reimagine your business this year:
1. Harnessing Many Voices
Executives tend to see themselves as the primary drivers of change. But in reality, transformation can’t work that way. One of the most crucial leadership behaviors we found across each of the four regions in our study is the ability to harness the “employee voice” of an organization. This leadership trait was revealed when leaders enabled and elevated the ideas, opinions and feedback of everyone at every level of the organization to allow for deep cross-functional collaboration and engagement. The leaders who do this recognize that often, middle managers–not the C-suite–are the key change agents. Encouraging ideas and fueling co-creation has become a key element to enable organizational transformation.
2. Embracing Empathy
Empathy per se is not a new concept – it is about understanding how people deal with uncertainty through change. But in times of constant change, transformation leaders must understand their employees’ sentiments towards it and help them cope with it accordingly. In the current context, this means physically protecting people, encouraging remote work, staggering shifts and massive disinfectant efforts. But more important, it means protecting people emotionally, understanding employee feelings and acknowledging the uncertain transition to the other side. Leaders need to bring leadership traits rooted in empathy, certainty and change readiness together to help employees feel confident that they can safely navigate the change, even when change continues to be the new norm.
Demonstrating empathy for employees was particularly heightened among leaders in the U.K., as well as in Germany.
3. Allowing Agility and Curiosity
On its own, agility helps companies pivot in new directions and create value in different ways. But what actually generates the ideas for these new directions requires curiosity. Curiosity is what directs leaders to explore and try new things. While agility allows them to adapt to those new ways of doing things quickly. Taken together, they form a powerful combination.
We expected agility to emerge as especially important in China. COVID-19 was fully present there as we fielded our survey, and it was clear to leaders that they had to find entirely new ways to respond to the devastating illness and frightened, grieving workers. But it appeared as essential in all regions, closely linked to leaders’ self-assessed ability to steer companies through a global crisis.
4. Fostering the Development of Others
Leaders today need to integrate a dedicated approach to agile development across the board, equipping the workforce for the Digital Age, and not leaving anyone behind. This commitment to developing organizational talent came through as one of the top-rated characteristics overall – notably in China and the U.S. Based on the recognition that transformation requires a high degree of personal growth, leaders should look to foster the development of others. They should encourage a “fail-fast & learn” mentality, where experimentation and failure are permitted, as a key leadership trait. Only this will allow employees individually and the organization as a whole to move forward – more meaningful individual contributions will help achieve the company’s ambition better and faster.
5. Staying the Course
The most optimistic leaders have made an impressive commitment to personal growth, with many closely identifying with the “growth mindset” first researched by American educator Carol Dweck. They think they can develop their own talents and abilities through effort, persistence and education–continually improving upon their leadership traits. This is especially pronounced in the U.S. and the U.K. Even in the context of COVID-19, those leaders that acknowledge the interplay between personal growth and optimism in the face of adversity – using the surrounding disruption as a learning opportunity – will emerge from this crisis stronger and better able to find a path forward.
While our research validates that these individual leadership traits are important, those who have them are keenly aware that for transformation, individuals matter less than the collective. These leaders see themselves as well prepared to build the cross-functional collaboration and engagement required for genuine change.
In the post-pandemic world, it’s even more complex–right now, nothing is guaranteed. So, there is a two-speed transformation going on that puts even more pressure on leaders. They are trying to transition to the immediate needs amid disruption and transform for the future at the same time. One would be hard enough–managing two speeds of change is particularly challenging.
That’s why a modern leadership “A” game matters so much now. We believe these leadership traits will only become more relevant in the challenging times ahead.
If you would like to learn more about how leaders can chart a clear way forward in uncertain times then get in contact today.
Clarity about company values provides the only lens needed for fast, effective decisions.
“How did you go bankrupt?” Bill asked. “Two ways,” Mike said. “Gradually and then suddenly.”
This exchange takes place between characters in Hemmingway’s “The Sun Also Rises,” sitting outside a cafe in 1920’s Spain. But it could just as easily describe how large established companies like Toys “R” Us, Nokia and Yahoo! were caught flat-footed in today’s Digital Age. In fact, only 54 companies remain today from the original 1955 Fortune 500 list.
As customer needs evolve at a rapid pace and technology pushes the boundaries of the possible, “organizational agility” is increasingly critical. Organizational agility is the ability to sense and respond to the market quickly. And companies without a finger on the pulse of customer needs will see their businesses suffer – first gradually, then suddenly.
With the global pandemic, economic downturn and social justice movement, organizational agility around your purpose is more relevant than ever before. And there are a number of approaches and frameworks – from SAFe to LeSS – that are helping large organizations become smarter, faster and more responsive at scale. But while they’re helpful, they’re not enough. To transform, companies need more than just an upgrade to their org structures and processes (what we call an organization’s “Body.”) They need to reach deep into their DNA. They need purpose.
Truly agile organizations measure success in terms of their purpose – higher-level goals that are meaningful both to the company and to its customers. Purpose doesn’t just make an appearance in ad campaigns or lobby walls – it’s infused into employees’ day-to-day work. Purpose enables employees to deliver better experiences, attract talent, and create platforms for growth through new products, services and business models. And as a result, it gives these organizations a competitive advantage in the Digital Age.
Using purpose to drive organizational agility
To drive agility, an organization’s purpose needs to be more than just lip service. It needs to play an active role in the business. Prophet’s research report “Becoming Purposeful” found that successful, “purposeful” organizations apply their purpose to everyday operations. This helps create faster, smarter, more nimble enterprises in three important ways:
Purpose can help distributed teams navigate decisions quickly. One of the principal differences of agile methods is a focus on self-organizing, autonomous teams. Spotify, for example, published a two-part overview of how its own “pods and squads” organizational structure works. Unlike traditional command-and-control or hierarchical organization structures, agile teams are empowered to make decisions and take action quickly. This helps them get solutions to market faster by avoiding the game of telephone as information flows up and down the chain of command. Purpose can create a “north star” for decentralized decision-making by clarifying the outcomes and experiences the organization aims to create.
Agile teams thrive on top talent, and purpose plays a critical role. In a recent study of Millennial attitudes by American Express, 74 percent believed that successful businesses in the future would need a genuine purpose that resonates with people. And 62 percent said that they are motivated by making a positive difference in the world. A clearly articulated purpose helps create a more compelling employee value proposition for potential recruits. And it helps retain existing top performers. A study by Indeed found that top performers were 46 percent more likely to be attracted away by a new company’s mission, and at the same time were 10 percent less likely than others to switch for compensation reasons.
Purpose creates agile business models. Simon Sinek’s now famous TED talk “Start with Why” explained how purpose-driven brands transcend boundaries and credibly enter new markets. Patagonia’s commitment to sustainability is central to its brand in the outdoor apparel business. But its purpose has enabled it to extend into an entirely new product category: packaged food. In 2017, the company launched Patagonia Provisions, to “repair the chain” of how humans grow and consume food. It is now one of Patagonia’s fastest growing businesses, in part because its purpose gave it consumer credibility.
Putting purposeful organizational agility into practice
Aligning on a brand’s purpose is hard enough; it takes even more effort to put it into action. Creating purposeful organizational agility requires sustained attention to significant changes at all levels of the organization.
To start, leaders need to be clear about what the organization and its brand stand for. It needs to be authentic, unique and differentiating in the market. It needs to resonate with both customers and employees. Top to bottom, inside to out, internal and external messaging needs to be aligned.
“As customer needs evolve at a rapid pace and technology pushes the boundaries of the possible, “organizational agility” is increasingly critical.”
But purpose can’t just be communicated; it needs to be wired into the operating model. This means a sustained change management effort that looks at organizational structures, roles, policies, processes, incentives, and governance models. For example, restructuring how product teams develop and bring new solutions to market. And these changes need to be adopted by employees so that they become “business as usual.” Digging into the operating model signals that the company is indeed serious about change.
And finally, purposeful agility requires leadership. One might assume autonomous agile teams require less of senior leaders. In fact, it’s the opposite. While there is less day-to-day interaction from senior leaders, agile teams require greater clarity and strategic framing. Senior leaders are the torchbearers for the company’s purpose and strategic direction. This means that senior leaders need to be more visibly active coaches, “spiritual” leaders, and storytellers – and less of order givers and decision-makers.
Businesses new and old are experimenting with organizational agility in exciting ways: some out of necessity, some out of opportunity. In our experience, there is no one-size-fits-all approach to organizational agility. It’s a matter of trying different techniques, with different teams in different contexts, until operating with agility becomes the new way of working. But in all cases, leadership must recommit itself to its purpose and make it the lingua franca of the organization. In this way, teams have a clear North Star when they are traversing unchartered territory, and always know the way home.
“Strategic Workforce Planning in the Digital Age” presented by Prophet & Orgvue
Amid current hiring and retention challenges, it’s time to lean deeper into truly strategic workforce planning.
49 min
Watch the webinar replay for advice on how to advance your talent and capabilities strategy by implementing truly strategic workforce planning. This was a partnered webinar with orgvue, the leading strategic workforce planning solutions firm.
If you’ve had to reset your workforce assumptions and want to learn how to capture competitive advantage from new talent scenarios then our Organization & Culture experts can help. Get in touch.
CEO Perspectives: The 5 Most Pervasive Mistakes in Acquiring a Healthcare Startup
Acquiring small companies can open many doors for healthcare brands. Here’s how you can do it right.
Over the past three decades, acquisitions have shifted from acquiring for scale to acquiring for capabilities – often to accelerate digital transformation efforts. Prophet’s M&A team has noticed an unfortunate pattern of these new “acquisitions-for-capabilities” failing. This topic is often studied from the acquirer side, normally around the deal structure and integration management office (IMO). However, less is understood from the side of the acquiree side, particularly the younger, smaller startups that are quickly picked up by large multi-billion-dollar enterprises.
I sat down with three leading CEOs in the startup space – Taylor McPartland of ScaleHealth, Lakshmi Shenoy of Embarc Collective and Jamey Edwards of Cloudbreak Health – to better understand both sides of a startup acquisition deal.
Based on our discussion, here are some of the more pervasive mistakes in acquiring a healthcare startup:
Mistake #1: Thinking the startup views the acquisition as the finish line
As Jamey puts it, “Most people don’t realize that entrepreneurs view an exit as one chapter ending, and another beginning. But, it’s still the same book.”
Many founders want to see their vision continue to flourish and grow. There is a misperception that founders are in it for a big payday, but that’s not always the case. Particularly in healthcare, where most startups are mission-driven, the acquisition is the beginning of something newer and better for the founder.
Lakshmi added, “Even if you’re not working 24/7 after the acquisition, as a founder, you’re thinking about your startup 24/7. Founders need to consider whether they want to part ways and let someone else be the custodian of their vision.” This is equally important for the acquiring enterprise to understand these intentions as well (beyond the contracted incentives).
Mistake #2: Not being clear on the “why”
“You have a 50/50 chance in creating value from an acquisition,” Jamey explains. “So, the ‘why’ is really important.”
The “why” often gets lost in the contentious negotiating phase, where each side is more focused on the price of the transaction, and little attention is paid toward life afterward. As Taylor puts it, “One of the first pitfalls is that a lot of hope is put on the acquisition, and one way to mitigate that is to have a clear understanding of the purpose of the transaction. Is it for the talent? The culture? Technology? Market access? Either way, the mission and intention of the acquisition need to be kept front-and-center.”
Mistake #3: Letting process get in the way of problem-solving
Most multi-billion-dollar healthcare enterprises are not digitally native. As a result, their heritage stems from scaling research (pharma), services (health systems) or engineering (med-devices). Hence their DNA is process and mastering and repeating that process.
“Most people don’t realize that entrepreneurs view an exit as one chapter ending, and another beginning. But, it’s still the same book.”
– Jamie Bradley Edwards
Process is often a good thing, but if not viewed with open eyes, it can accidentally become limiting. The intricacies of enterprise decision-making can be very foreign to a startup. As Jamey explains, “There’s a lot of enterprises that have been very successful being focused on the process. If you go from getting decisions made in a week and it now takes a month, that is going to be very frustrating for development teams that are used to working in agile.”
Lakshmi highlights that process -in the worst cases – can push away great talent. “You might have the right tech. You might have the right people. But the messiness occurs within the process. If you are impeding the team’s ability to solve problems – which is what founders of startups do – that is a very fast way to demotivate them.”
Mistake #4: Assuming the acquisition deal is understood throughout the entire organization
It’s important to recognize that a founder is often negotiating with the enterprise’s deal team. Those individuals will often not be the people (s)he interacts with daily after the transaction. More importantly, you’ll have dozens of people that need to gel and work together who are not part of the deal conversations at all.
As Lakshmi puts it, “You must think of the team members who are not in the room when promises are being made, as many did not necessarily join that startup to be part of a giant organization. It can challenge the many motivations as to why they do their job.”
Taylor added, “It can be hard to quantify what culture means but it really is the through-line that made the company attractive to begin with. If you’re not hyperconscious of the new culture you’ve created, you run the risk of alienating team members before you ever realize the value you hoped for.”
Mistake #5: Letting perfect be the enemy of good
It’s important to know that larger enterprises have different risk tolerances than smaller ones. According to Jamey, “Large organizations have existing cash cows that they want to protect that.” And that risk-averse culture often weaves its way into excessive processes. This in-turn begins to work against the agility of the acquired startup, and that agility is often the desired trait that the acquiring company wants to adopt.
He continues, “Founders start by doing a bunch of missionary selling with scrappy individual reach-outs, and over time that begins to morph into more tech, Salesforce CRM, SEO, etc… And we’ve learned, as a startup, that perfect is the enemy of good. Get something out there and continued to learn via continuous improvement.”
Broadly speaking, everything comes down to alignment and empathy throughout both organizations. It appears that when things go wrong, too much emphasis is on the “thing and processes.” And when they go well, there is a strong connection through a shared purpose, an understanding of where each side thrives and a shared ambition around where they are collectively moving next.
How to Effect Culture Change in Financial Services
By dialing up agility, empathy, inclusivity and curiosity, companies can inspire effective transformation.
Financial services companies have been pursuing transformation for years, but the events of 2020 have only underscored the need for these firms to rapidly evolve. In a few months, the world has achieved years of digital progress, shining an unflattering light on the many companies that lag. Many legacy financial services organizations, hierarchical and slow-moving, stand to lose as much as 35% of banking revenues to more tech-savvy rivals. That’s on top of an estimated $1 trillion in losses the sector may give up as a result of COVID-19.
Legacy companies are difficult to change by design. They were built for capital longevity and regulatory compliance, not agility and innovation. But they can’t afford to stand still. The ones that are making the most progress are moving forward at two speeds. First, they’re executing multiple plans at lightning pace to get teams and market positions back to “normal.”
Here we dive deeper into each of these pathways with some industry examples:
Defining the Transformation: Driving Clarity
This step establishes a unifying ambition that is powerful and actionable, and that appeals to all levels of leadership.
We recently ran research with hundreds of leaders to study the cultural levers of transformation, including 100+ from financial services companies, who were more likely than average to say that their initial transformational efforts are proving effective.
But there are still roadblocks. Financial services companies often stumble when developing a transformation mission that is clear and actionable throughout the organization. It’s essential for leaders to get key stakeholders throughout the enterprise on board with the transformation plan in order for it to succeed.
Capital One, for example, has achieved extraordinary success by committing to a clear technology mandate. With a rallying cry of ingenuity, simplicity and humanity, the mission makes as much sense to thousands of software engineers and cloud executives as it does to customer-service representatives. Not only does Capital One excel among its peers, but its recruiting clout is on par with the best tech firms.
Directing the Transformation: Adapting the Operating Model
Financial companies, with their complex hierarchies and sprawling brand portfolios, often find that changing their operating model to support these ambitions is daunting. It involves overhauling governance, processes, roles, systems and tools. But these changes are essential: All parts of the organization need to line up with this leaner, faster thinking.
“Many legacy financial services organizations, hierarchical and slow-moving, stand to lose as much as 35% of banking revenues to more tech-savvy rivals.”
American Express offers an example of successfully directing the transformation. When it decided to shift its operating model away from relying on merchant fees to increasing card use, it re-engineered itself so that all functions could support the company’s new goals. That means decisions can be made quickly and laterally, without hierarchical delays.
But others struggle, in part because once a plan is prepared, executives are reluctant to share those roadmaps throughout the business. Our research finds that financial services companies tend to restrict these blueprints to the C-Suite – only 34% make it visible to the broader organization. That guarded attitude impedes financial-services companies from successfully adapting their operating models. Everyone needs to know where the company is headed in order to direct the transformation
Financial-services companies do have some advantages, though. Compared to other industries, they are more likely to update their roadmaps often, with 42% evaluating progress on a weekly basis compared to 31% in other industries. They’re also better at developing key performance indicators – 78% believe KPIs were well executed and measured transformation progress well.
Enabling the Transformation: Building a New Talent Model
None of these changes can take hold if the right people with the right skills aren’t in place. That requires shaking up methods of finding new talent and developing skills and competencies among current employees.
This includes hiring a diverse workforce and learning to listen to what they say. Leaders “who are inherently inclusive and collaborative and encourage good ideas to surface from wherever” are critical, says Mary Ann Villanueva, head of brand culture and engagement at Citi.
Our research finds that financial services companies are somewhat more willing to train and upskill employees than other sectors. One recent home run comes from JP Morgan’s $11 billion annual investment in tech, including an army of 50,000 technologists. That powered it to record results before the pandemic and continues to fuel the company’s exceptionally resilient performance so far this year.
Motivating the Transformation: Inspiring the Change
This aspect of change requires leaders throughout the organization to bring the transformation plan to life. In companies that are successfully transforming, executives don’t just talk about change – they exemplify it in ways that inspire employees to become evangelists for the new ways of working. Above all, they cultivate a tolerance for failure. Missteps are inevitable and failure is where an organization often finds opportunity. When teams fear failure, they seek broad consensus, which slows decision-making.
“We’re trying to enable employees to fail on small things, such as experiments in the innovation lab, to achieve success on the big targets,” Trung Vu Thanh, head of digital banking for MB Bank Vietnam, tells our research team. “We’re trying to push to the limit and use innovation, as more ideas will help.”
It’s hard to find a better example than USAA in this realm. USAA is best known for its intense focus on families and pride in military service. But its commitment to customer-centricity is so deeply ingrained into the test-and-learn culture that employees submit more than 10,000 customer-experience improvement ideas each year. Almost 900 are so good they’re patented. (And 25 of them came from a security guard, who – like all employees – is also a customer.) It’s an organization that draws its strength and energy from trying to find new ways to excel.
Taken together, these four pathways – harnessing curiosity, agility, inclusivity and empathy – can help financial services companies navigate their transformation. They build deep cross-functional engagement and collaboration. When combined with a shared sense of purpose, they can follow the transformative path to uncommon growth.
If you want to learn more about how our expert team can help your company accelerate change by transforming from the inside out then contact us today.
Rarely have organizations been forced to tackle volatility in so many areas all at once until the global coronavirus pandemic, demanding many to evolve in ways they hadn’t previously considered plausible, or possible to accomplish in such short timeframes. With the right approach, however, the gravity of the current situation can become an opportunity, a slingshot to accelerate transformation and speed an organization’s course to a more resilient future.
From witnessing the lightspeed changes being made in organizations around the world over the past few months, the latest report from our Organization & Culture experts – The Slingshot Effect – lays out the specific shifts organizations need to make now. With the right processes, commitment, workforce and mindset, others can learn how to ‘slingshot’ their organizations’ transformation, build the flexibility to thrive on change and the agility to respond to any future shocks faster.
In this report you will learn:
Why taking a human-centered approach remains a key element in any successful transformation
How to determine the most relevant shift in order to build resilience where your organization needs it most
Where to prioritize action and guidance on what to do next
Examples of how other companies are moving forward
The Future of Work Demands a New Approach to Learning and Development
Our research shows that learning and development can slow the Great Resignation.
Much has been written about the new capabilities required for companies to thrive in the future of work. These needs add to the already significant demands on organizations to upskill their employees in the face of ongoing technological shifts related to digital transformation.
Prophet’s 2021 global research study “Fit for Change: Driving Growth and Transformation in the New Future of Work” showed that companies recognize the importance of equipping employees with the skills demanded by an ever-changing landscape. In our global survey, 81% of leaders noted that “our organization has increased investments in upskilling and reskilling our employees to thrive in the future of work.” Additionally, Fast Company recently reported that companies spent $165 billion on learning and development in 2020, yet 70% of employees say that they aren’t taught the skills needed to do their jobs.
“High-quality, relevant learning and development help reconnect employees to their organizations by creating visibility and access to the skills needed to succeed.”
So, how might organizations ensure that learning investments pay off in terms of achieving their business ambition and engaging and empowering employees? The answer: by taking an intentional, modern approach to designing, delivering and governing learning and development experiences that go beyond transactional training to continuous skills-building and growth.
Learning and Development is at a Tipping Point
Learning and development opportunities have increasingly been a key factor in employment decisions – and even more so now in this period of the Great Resignation of 2021. High-quality, relevant learning and development help reconnect employees to their organizations by creating visibility and access to the skills needed to succeed. It also allows employees to demonstrate commitment to long-term career paths.
Meeting the accelerated demand for modern skills development and relevant learning experiences has elevated the important role played by learning functions and departments. The time is now to ensure that employees receive real value through engaging learning and development content that can be applied and translated to day-to-day work and drive measurable business impact.
Four Steps To an Enhanced Learning Model
At Prophet, we’ve synthesized adult and transformative learning theory to develop our AR2 model for designing and delivering compelling learning and development experiences. The four steps of this model (Absorb-Recall-Apply-Reinforce) are designed to ensure learning experiences support both thinking (synthesis) and doing (application).
Below we walk through each of these four steps, to help you on your way to enabling transformation in the “Mind” of your organization:
1. Absorb
Initially, what is being communicated is still just information, not knowledge; the key is making the information something that the recipients will want to convert to knowledge. First, define clear learning objectives to ensure the information presented is targeted and relevant. Then, consider varying how recipients will consume the information to sustain engagement and stimulate different mental muscles. How might you deliver information in a way that requires recipients to alternately read, see, listen to and feel this content?
For example, Prophet worked with a large global appliance manufacturer, which needed to broadly upskill its marketing organization to enable digital transformation. We designed a full learning curriculum, in which one key module was focused on helping marketers truly understand and embrace their target consumer segments. The segmentation data was translated in a way that brought these consumers to life, versus treating them as data points on a page.
Also, an immersive exhibit allowed the marketers to “choose their own adventure” in terms of when and how they consumed information. Rich material within the exhibit included visuals that invited participants into the kitchens of these individuals and they were actively engaged through the use of an augmented reality app, which allowed them to hear the voice of the consumer first-hand through the unlocking of quotes and videos.
2. Recall
The Recall step is where learners “try” the content in preparation for its application in context. Studies show that every time a memory is retrieved, that memory becomes more accessible in the future. So, Recall focuses on retrieval and continual practice. Today’s virtual learning platforms offer plenty of functionality to find creative ways to aid recall. Real-time quizzes and visualization of results through tools like Mentimeter help drive instant engagement, while the breakout function offered within Zoom enables small groups to consider a thought-provoking question and how it links to what they’ve learned.
For example, with this global appliance manufacturer, our learning curriculum included designing two-week gamified online “Expeditions” around key topics related to digital transformation. After first absorbing the information, participants were engaged through quick quizzes, with points awarded for correct answers. Participants could also earn points and badges for posing questions, commenting and sharing related information, all ways of driving recall as well as a sense of community and competitive spirit.
3. Apply
Within the Apply step, learners must be guided to do something with the knowledge they’ve gained in the context of their job. Adult learning is most successful when knowledge is made clearly relevant to the learners and their lives. In fact, organizations can’t afford to not drive toward application within their learning and development programs.
The Apply step is where knowledge is connected to meeting key business objectives. Applying knowledge in a simulated and supported environment ensures individuals are equipped to apply this knowledge again when they’re faced with a similar situation in their day-to-day work. Tools such as templates, action plans and job aids (like checklists) both support and drive successful applications.
For example, a capstone of the learning curriculum for the global appliance manufacturer was a three-day summit for their top marketing leaders. Action planning often gets crammed into the final module of a session, but an “apply as we go” approach was taken instead. Time was carved out each day to iteratively build action plans, applying the knowledge gained each day to build and refine the thinking. Teams for action planning were carefully constructed to mirror typical working teams. This was, to ensure the action plan was relevant to real objectives, versus a theoretical learning exercise. Finally, the summit incorporated mechanisms to drive accountability, such as sharing action plans with peers and inviting feedback.
4. Reinforce
The fourth and final step is to Reinforce. This means both creating incentives to sustain new behaviors related to the knowledge gained, as well as developing long-term opportunities for reinforcement (to ensure knowledge is not forgotten over time). Simple incentives, such as social kudos or visible symbols (e.g., a custom notebook, with a checklist insert), are fun and effective. The most powerful incentives, however, are ultimately those that are incorporated into development objectives and performance management, to help embed the learning within day-to-day work and expectations.
For example, the learning curriculum for the global appliance manufacturer paved the way for a more expansive effort to transform and embed digital capability within the marketing function. The skills taught throughout the learning curriculum became core to job expectations for the company’s marketers and each marketer was expected to apply the knowledge gained to help the company evolve toward world-class, consumer-led marketing.
Relevant, compelling learning experiences – designed through approaches such as the AR2 model – are necessary to help companies make the leap in leveling up their workforces around critical new skills. Executed as part of a comprehensive learning and development curriculum, these learning experiences create greater employee capability, engagement and ownership in the new future of work.
If you’re looking to pursue an upskilling/reskilling agenda and want to understand how to adapt employees’ skills and roles to the future of work, then our Organization & Culture experts can help – get in touch today.
Is Your Employee Value Proposition Ready for the Future of Work?
Serving diverse audiences requires multiple perspectives, harnessing the contribution of many voices.
Every employer has a value proposition to deliver on to its people, which includes looking after both personal and professional growth and wellbeing. That has taken on new dimensions in 2020, as employers find themselves needing to be their employees’ friend, therapist, safety supervisor, community builder and megaphone for social justice. That’s a lot of hats to wear, and yet it’s clear these and more will be part of the new baseline expectations employees have.
Companies are finding they must make sometimes large transitions to play these roles, and are doing so amidst a background of significant tensions. The current economic climate is forcing a contraction of the workforce at the exact moment employers are being called on to deepen their commitment to their employee base. Financial concerns are ever more urgent but are often at odds with being a good world citizen. And digital transformation is accelerating faster than ever before, at a moment when people are desperately seeking more humanity. Let’s take a closer look at what to keep in mind as your organization begins developing an employee value proposition for the future.
The facts of developing an employee value proposition for the future
The pressure to be on the right side of history in such a cataclysmic moment is very intense, and historic efforts haven’t always threaded the needle of these tensions successfully. We’ve all seen companies that have made big statements on purpose, culture, social responsibility and diversity—but in an effort to prioritize customers and shareholders, many have not delivered on them. 2020 has served as a fresh reminder that businesses can’t pick and choose amongst stakeholders anymore—the survivors of this crisis will prioritize customers, shareholders and employees, as well as communities and society, to truly be good corporate citizens.
“The survivors of this crisis will prioritize customers, shareholders and employees, as well as communities and society, to truly be good corporate citizens.”
This moment demands that employers strike a new deal with their employees.
Serving customers means serving teams. Customer centricity is critical, but your teams can’t be customer-centric if they are themselves drowning. Taking care of employees’ health, wellbeing and work-life balance need to be an explicit part of any go-forward plan. In fact, 64% of employers believe that COVID will have an outsized impact on employee wellbeing and many are already expanding their efforts to respond.
Serving diverse audiencesrequires having multiple perspectives in the conversation. Supporting a diverse network starts by harnessing the contribution of all voices within an organization. A business that makes diversity and inclusivity part of its business strategy now will see this investment pay off when it acquires better, more relevant work and when its position is elevated as a desirable place for top talent to build careers. Interesting that in our own recent research into successfully managing transformation, “harnessing many voices” was seen at the top attribute required by leaders at global organizations.
Serving employees’ hearts and minds means serving the world. Corporate Social Responsibility is fast becoming a thing of the past as companies are being called into Corporate Social Justice. The calls for social justice made in 2020 are only solidifying the existing trend toward employee-employer shared values. The workforce of tomorrow will only work where they see their employer not only aligning with their values but also making non-optical external commitments to advancing a better world.
Deals go both ways – employers also need new things from their teams:
Flexibility and agility. Agile is not a new concept. Events of 2020 have demonstrated the need for workforces that are able to “embrace the unknown” and pivot on a dime.
Learning at the speed of change. With the increased acceleration to automation, companies are imagining fewer and new types of roles. The moment of “meet your new colleagues, they’re robots” is coming to us all. Not just keeping pace but learning ahead of and outside of one’s current job will be critical to success.
Resilience. If this year has taught us anything, it’s to expect the unexpected. Employers will value team members that are not just able to change, but willing to lean into what’s next—even when the future is still shrouded in ambiguity.
3 Steps to Future Proof Your Employee-Employer Relationship
To successfully achieve this new contract, employers will need to go beyond standing up one-off efforts to the side of their central business strategy. Serving employees and the world cannot be done with an “initiative,” because it needs to show up at many levels every day and must include many voices to be relevant. The annual planning season is upon us! So what can your company be doing right now to future-proof your employee relationship?
1) Take stock of your entire employee value proposition.
Identify the current deal you offer to your employees and set a vision for what you will offer and expect from your workforce tomorrow. Go well beyond traditional mechanisms like salary and benefits to think about long-term progression, social impact, education and community.
2) Prioritize building an employee data strategy.
Data will be central to this story. You’ve likely spent years building up your customer data strategy, but most companies either have poor workforce data or are not set up to use it well. Workforce data will be crucial for responding to real-time dynamics and quantifying your impact on people.
3) Seek an active relationship with your employees.
Look to move from a passive relationship with employees to more active, dynamic participation. Just as companies have now practiced maintaining ongoing relevance with customers in a changing world, they must look to build their employee relationships in the same way. They must truly get to know them as individuals not just numbers.
Successfully setting this new deal will bring us closer to hiring, retaining and building the workforce we desire to achieve our business and social goals. And we’ll probably see happier and more productive employees too.
Examples of Brand Purpose in Action: When It’s Needed Most
Stakeholders are calling brands out on hypocrisy, mixed messages and failed efforts. Not all will survive.
Sixty-two percent of global consumers say their country will not make it through the current crises if companies don’t step up. Customers and employees are looking to their favorite brands to help solve problems, creating an enormous opportunity for companies that are purpose-driven.
But while purpose is essential for any brand today, just having one is not enough: Brands are on trial. Stakeholders are calling brands out on hypocrisy, mixed messages and failed initiatives. Even companies that thought they had a clear purpose need to prove they are investing in substantial change and not just “woke washing.”
Defining and living your organization’s purpose is hard. It’s messy. And it’s never-ending. But the most successful companies in these trying times will derive their purpose from shared human values, stay true to what they do and be relevant to what their stakeholders need. And they’ll act on it every day.
“Make sure your purpose is grounded in shared human values–including employees–and take responsibility when things go wrong.”
These four companies are using purpose in powerful ways, and working hard to live it in challenging times:
Citi: Inspiring growth and progress
Citi’s purpose–to provide financial services that “enable growth and progress”–took on electrifying new meaning as the economic impact of the pandemic shook its employees, customers and neighborhoods. Citi went beyond what most banks did – loan forgiveness and mortgage relief– to not just delay devastation but truly deliver on that purpose. “Citi’s mission and purpose have long been rooted in enabling growth and progress. As the world continues to search for solutions to address the global pandemic, racism, and more, at Citi we know that our role is to identify issues to stand for and influence in order to enable relevant and meaningful progress for our clients, colleagues and communities,” said Mary Ann Villanueva, Director of Citi’s Brand Culture and Engagement.
Efforts included committing $100 million in support aimed directly at that promise of progress, launching Restarting Together to encourage startups supporting society through the crisis, helping customers secure PPP loans, and helping those most impacted by the pandemic including the World Central Kitchen and National Disability Institute and many more. Citi has also expanded beyond financial progress to support racial equality through recent campaigns and commitments to the Black Lives Matter movement, including investing in Community Development Financial Institutions, which play a vital role in low-income communities and communities of color.
Airbnb: Deepening authenticity
When a company’s purpose ties directly to what it does, brands feel more authentic. This becomes even more important during times of change. Airbnb exists to “create a world where you can belong anywhere.” With sweeping travel restrictions and lockdowns, the company had to pivot quickly to find new ways to express hospitality. Open Homes for COVID-19 frontline workers gave hosts an immediate way to help. And it began creating online experiences that allow guests to learn new activities and meet people from around the world. By enabling people to connect, even while stuck at home, Airbnb is finding new ways to stay relevant.
Glossier: Listening builds a shared community
Shared purposes are not just relevant to one audience, they are felt deeply by each–employees, customers and communities. That calls for genuine listening to make sure that actions, products and services align with the values and beliefs of those stakeholders. Glossier’s purpose is “to give voice through beauty” by “leveraging the power of the personal narrative.” Throughout the COVID-19 crisis, Glossier’s most frequent request was for a product to help with increased irritated skin from repeated handwashing. Inspired by stories and comments, Glossier quickly developed a hand cream, donating thousands of units to first responders.
The company is also recognizing that obsession with that external community has a downside, leading it to prioritize the needs of customers over that of its own workers, especially people of color. When shoppers engage in racist behavior, for example, the company’s “the customer is always right” stance gets toxic. Glossier isn’t running away from that dissonance but trying to learn. The lesson? Make sure your purpose is grounded in shared human values–including employees–and take responsibility when things go wrong.
Walmart: So actionable, it’s indispensable
The final dimension emerges when companies demonstrate that purpose is not just an empty promise. If companies can’t deliver, it doesn’t matter how inspiring or authentic they are. People pay attention to what brands do, not what they say. Walmart has long struggled with negative perceptions. But it continues to make progress through finding new ways to act on “saving people money so they can live better.”
Because of its vast size, it pays great attention to subtleties and the importance of multiple actions. Among the steady drumbeats that help all people “live better”? In addition to cash bonuses for employees, it’s closing all locations this Thanksgiving to show gratitude. It introduced Express delivery so customers can avoid crowds. It turned parking lots into drive-in theaters, showing movies for free. And in requiring all employees and shoppers to wear masks and supporting expanded testing efforts, it’s helping everyone.
Just as people look to friends, family, and government during hard times, they are holding a magnifying glass up to businesses. Customers expect companies to treat people well, engage the community and evolve to meet a changing world. Workers are questioning employee value propositions. They want businesses to put people over profit. Words and actions matter.
Does your purpose…
Make the world better? Even companies with a pragmatic purpose can inspire others.
Create believers? When businesses connect purpose to the way they earn money, it’s authentic and makes perfect sense.
Apply to all audiences? The right purpose resonates with employees, customers, communities and investors.
Translate into action? If an organization can’t deliver on promises, everything else is pointless. Enabled by leaders, companies constantly need to bring their purpose to life.
Our diagnostic helps companies find a North Star that inspires loyalty and growth.
Businesses have been leaning into purpose-driven strategies for years, but recent events have tested them as never before. Whether responding to the worldwide pandemic, new ways of working, racial protests or political polarization, we’ve seen that companies with a purpose centered on shared human values rather than business goals are the ones more capable of acting swiftly and effectively. Purpose doesn’t just help these businesses decide what to do, it guides them in the best ways to do it.
This purpose is the North Star that steers actions and decision-making on a day-to-day basis. And it guides all elements of the company’s DNA, including its brands, strategy and employee value proposition.
And those without a well-articulated and actionable purpose? They’re struggling. When companies shout out hollow words on social media, customers abandon them, and brands lose their relevance. When we surveyed consumers in April, 58 percent said that in order to earn or keep their trust, it was very-to-extremely important for a brand to offer a relevant set of beliefs and values. By June, this number had jumped to 69 percent.
“When companies shout out hollow words on social media, customers abandon them, and brands lose their relevance.”
Prophet developed a diagnostic to assess how durable your company’s purpose is across four key dimensions (authentic, inspiring, shared, actionable). The custom analysis produces results that let you know where you may have a weak spot and where you might take your purpose next.
Our diagnostic will help you make brand purpose more powerful and tell you what to do if your company’s purpose isn’t…
Inspiring
It’s likely your mission isn’t ambitious enough or has been defined too narrowly. Brands like Disney, NPR and Spotify are endlessly uplifting because their purpose speaks to shared human values; they know how their products and services make a difference in the world and in people’s lives. But even companies with a fairly pragmatic purpose can be more aspirational.
To be more inspiring:
Look for cultural symbols and rituals among stakeholder groups
Find signature stories that are so compelling they make people question, reflect and want to share them with others
Authentic
When companies connect their purpose to the way they earn money, it makes perfect sense. Google, for instance, exists to “organize the world’s information,” which clicks with anyone who’s ever used a search engine. But when an oil and gas company misses the mark completely by saying its focus is protecting the environment, or a soft-drink brand claims to be committed to health, there’s an immediate disconnect.
To be more authentic:
Realign the business model, or find a purpose that fits
Isolate the organization’s unique assets to solve a challenge, not easily copied by a competitor
Shared
The right purpose feels true and important with every audience–employees, customers and communities. It must be understood and pervasive, felt by every stakeholder. And it contributes to the overall betterment of society. For Patagonia, nothing matters more than fiercely protecting the environment. At Nike, the commitment to racial injustice, which connects so deeply with its customers and athlete spokespeople, is more believable. If your company’s purpose doesn’t feel urgent to each group you’re targeting, it’s likely the wrong ambition.
To find a genuinely shared purpose:
Sharpen listening skills. What are customers and employees really saying?
Explore the intersections of our stakeholder groups, finding new ways to ask, “What shared human value is most relevant?”
Actionable
Of the four traits, this is the last mile. If your organization can’t deliver on its purpose–no matter how inspiring or authentic–everything else is pointless. Purpose needs to be enabled by leaders: Their actions and decisions serves as the role-model to the entire organization.
Recent months have shown what happens when purpose is just an empty promise. Those include companies parroting “We’re in this together” messages, only to be called out for endangering employees, or jumping on “Black Lives Matters” platforms, even while actively discriminating against employees and customers.
Find new ways to measure and improve employee behaviors. Everyone who works for the company should understand the purpose, and how they help it show up in the world
Implement and audit performance metrics throughout stakeholder groups
Take action in-market that brings the purpose to life
Take our diagnostic today to see how your purpose is and isn’t working for your brand today.
