Top 11 Predictions That We See Impacting HR and Talent For 2017 – Prediction 2

REGISTER NOW

Research Report Bersin by Deloitte


PREDICTION

The topics of culture and engagement will continue to be top priorities, and we can now measure them closely.


Prediction 2: Culture and Engagement Will Remain Top Priorities

In 2017, the topics of culture and engagement will remain top of mind for business and HR leaders around the world; I suggest that the challenge of managing culture will become even harder. If you do not believe me, let me show you some data.

Figure 2 charts the frequency of Google searches on “workplace culture.” You can see that, since the 2008 recession, people have been curious about it more and more each year.

Figure 2- Growth in the importance of Workplace Culture - Source by Bersin by Deloitte, 2016.

Read Prediction 1: TOP 11 PREDICTIONS THAT WE SEE IMPACTING HR AND TALENT FOR 2017 – PREDICTION 1

The Deloitte Human Capital Trends11 research shows that 86 percent of business leaders rate “culture” as one of the more urgent talent issues, yet only 14 percent understand what the “right culture” really is. The problem is not one of “talking about culture”; for 2017, it is time to carefully define your culture, measure it, and find where and how it may be misaligned.

This problem is increasing in urgency. Our latest research on Millennials12 (about one-half of the workforce now) shows that two-thirds of Millennials now state their organization’s “purpose” is the reason they choose an employer. Similar data shows that baby boomers feel the same way. Only 27 percent of Millennials believe a company’s purpose is to make money (down from 35 percent in 2013), while the remainder believe the focus should be on stakeholders and impact.

What exactly is organizational culture? Quite simply, it is the reward systems and implicit behavior that takes place when nobody is looking. In other words, your culture drives all forms of optional and discretionary behavior. Do your employees spend more time with clients? On quality? On safety? On compliance? On cost-cutting? Or perhaps on improving their own careers? Each of these microdecisions we make during the day are driven by the implicit reward systems, examples, and messages conveyed by culture. When “bad” things happen (i.e., misalignment, fraud, unethical behavior, etc.), there is usually a cultural problem underneath.


 

KEY POINT

Study after study have shown that companies with a strong sense of purpose and a clearly defined set of cultural values outperform their peers.


(One study13 found, for example, that “toxic employees” (those who commit fraud or crime) are contagious. People who work on the same floor as they do exhibit similar behaviors. This shows how powerful and possibly dangerous culture can be.)

Part of culture is defining a purpose for your organization. Study after study have shown that companies with a strong sense of purpose and a clearly defined set of cultural values outperform their peers. Our newest research (Bersin by Deloitte High-Impact Leadership14) proves that companies with a leadership culture are nine times more likely to be good at identifying and developing leaders than those lacking a leadership culture.

Many reasons for this trend exist, but I suggest there are three big causes you cannot ignore.

  1. Your culture is now transparent. Thanks to websites like Glassdoor, LinkedIn, Twitter, and Facebook, employees are regularly talking about your company’s culture in a public way. When customers or employees are upset, people find out about it. So your culture has become an integral part of your brand which, in turn, impacts your ability to hire, the type of people who come to work for you, and the brand you convey to customers. A large airline, for example, is now implementing a pulse survey tool designed to assess all of its employees (from flight attendants to baggage handlers) on its new cultural values. A large, well-known technology company has created a culture manifesto, which forms a complete redesign of the company and its job roles. Manufacturers that suffer product defects are reacting faster than ever; companies are raising wages; all over the world, we see businesses reacting to the need to build a focused and aligned culture through business decisions that mean serious investment and focus.
  2.  Culture brings teams together. As your company operates more and more like a network of teams (regardless of what your organizational chart looks like), culture is what brings it all together. Why would a team share its findings with another versus compete for glory? Why would a team loan an expert to another versus hoard experts for themselves? Why would a team focus on customers versus internal promotion? All these behaviors are cultural—and should be reinforced through a strong set of cultural values.If you look at the published best places to work and highest-performing companies on the S&P 500, you commonly find companies with a strong, well-branded culture. Quicken Loans, for example, ranked as one of the best places to work and a company that is continuously disrupting the mortgage loan market, has an entire book designed for culture, called the ISM’s of Quicken Loans15. This cartoon book is filled with examples, stories, and customer behaviors that the company considers its sacrosanct culture. Such a transparent and open environment can only happen when people feel authentic, included, and respected. All of these qualities come from a strong, reinforced, and well-documented culture. Even if your culture is one of “up or out” and “make your numbers or die,” communicating it clearly should bring clarity and freedom to people—and help your managers understand their roles in pushing forward the organization.
  3. Culture creates innovation. When a company has a clearly defined culture (whatever that may be), it offers employees a sense of security and freedom— they know what to expect. Consider a conversation we had with the vice president of talent at a large automobile company. This auto manufacturer studied the most effective innovations over the last decade (and also the biggest failures) and found that the one predictable dimension of the teams which succeeded was that those teams were the most connected people in the organization. In other words, today’s organizations cannot succeed in silos—so people who “fit the culture” and feel comfortable communicating throughout the company also tend to be most effective as individuals.

KEY POINT

As a whole, the entire workforce (from Boomers to Millennials) is becoming more demanding than ever— pushing the topic of culture to ever higher levels of priority.


By the way, the challenges of managing culture are getting harder. Not only is culture a major issue when companies grow or merge, but Millennials are now becoming even more demanding. Our research shows that this enormous cohort of workers is now having children, demanding more work-life balance, and expecting to be rewarded for their leadership roles. (Forty-one percent of Millennials now have four or more direct reports; most refuse to adopt the “incumbent style” of the existing CEO simply because he / she is there). Only one-third of Millennials believe they are being truly used to their full potential at work and 41 percent now say that their work performance is impacted by the company’s family assistance benefits. As a whole, the entire workforce (from Boomers to Millennials) is becoming more demanding than ever—pushing the topic of culture to ever higher levels of priority.16 

In 2017, we believe it will be urgent for you as an HR leader to work with your CEO and top business executives to define your culture (in a small set of cultural values), then identify tools to measure the culture in every possible way. You can now measure culture through tools like Deloitte CulturePath and others, which focus on an organizational view of culture.

What about the Topic of Engagement?

Employee engagement, which is an individual employee’s reaction to your work culture, is more of a challenge than ever. Hundreds of studies have shown that highly engaged employees are more productive, deliver better customer service, are more innovative, and are more likely to stay at your organization. In today’s dynamic, always-on world of work, how do we keep engagement high?

Our research17 shows that this is a complex problem, and one that warrants close attention and lots of monitoring. Figure 3 identifies 20 key drivers of engagement today. You have to think about all of them—and monitor and listen for feedback to stay vigilant of problems.

Figure 3- Bersin by Deloitte Simply Irresistible Model - Source by Bersin by Deloitte, 2016.

Generally speaking, this problem is not getting better. Figure 4, compiled from Glassdoor data (would you recommend your company as a place to work), shows almost no change from the last three years. So, while many companies focus on the issue of engagement, it remains a challenge for all but the “best” companies in the world.

Figure 4- Engagement Is Critical to Success - Source by Bersin by Deloitte, 2016.

If this is a priority for the coming year, what can we learn from the companies on the right of Figure 4? Well, after analyzing this data for many months, we found that no particular dimension predicts high-engagement companies—they are not small or large, not in a particular industry, or of a particular age.

What is unique about these companies on the right is their leadership. These companies place “employees first”—and their leaders and managers think hard every day about what they can do to make their employees more productive and rewarded at work.

The biggest trend in 2017 is not that engagement is an issue—but rather how we are dealing with it. Today, like never before, companies are adopting “always-on” listening tools to monitor engagement. These include pulse surveys, exit interviews, stay interviews, and open anonymous networking tools. Leaders are sharing feedback after every major company change and they are conducting open meetings to encourage people to speak up.

My research shows that most employees feel “committed” to their companies— and they all have opinions, feedback, and gripes for you to hear. If you give the organization the right “listening culture,” then you can unleash this information and drive up engagement.

For 2017, an entire industry of new feedback tools has been created. We predict that most companies will likely adopt or experiment with these tools, usually with amazingly positive effects. Figure 5 gives a sample listing of some of the vendors in these feedback tool categories.

Figure 5- Feedback Tools - Source by Bersin by Deloitte, 2016.

As you build a “feedback-rich culture,” you not only enhance engagement but your entire performance management process can become better. Modern performance management (which I discuss later) is built on regular and continuous feedback— and new feedback tools are now becoming embedded into most HR platforms, performance management systems, and real-time analytics systems.

Where Are We Today?

We know people are making progress on this; in 2016, our research18 showed slow but steady growth in maturity.

When asked how well companies are adapting their management practices to the demands of the modern, multigenerational workforce, we saw a slow but steady improvement (see Figure 6).19

Figure 6- How Well Companies Are Adapting to the multigenerational Workforce by Bersin by Deloitte, 2016.

When asked “how frequently do you measure your employee’s engagement,” we found progress, but still plenty of work to do. Sixty-four percent of companies measure engagement once per year, 11 percent once per quarter, and 7 percent more frequently than once per quarter—but 18 percent never measure engagement at all, so the market still has a way to go. (Surprisingly, only 4 percent of companies measure social media to understand their employees’ sentiment, a number which is far too low.)20


 

Other Prediction:

Prediction 1: Organizational Design Will Be Challenged Everywhere
Prediction 3: Real-Time Feedback and Analytics Will Explode in Maturity
Prediction 4: A New Generation of Performance Management Tools Will Emerge
Prediction 5: A Focus on “Human Performance” and Wellbeing Will Become a Critical Part of HR, Talent, and Leadership 
Prediction 6: Focus on Employee Experience Will Overcome Process Design in HR
Prediction 7: Digital HR and Learning Will Help Us to Reinvent L&D and HR Systems
Prediction 8: The Leadership Market Will Start a Steady Process of Reinvention
Prediction 9: Diversity, Inclusion, and Unconscious Bias Will Become a Top Priority
Prediction 10: The L&D Function Will Continue to Struggle
Prediction 11: The Future of Work Is Here and HR Is in the Hot Seat

Reference:

  • Bersin by Deloitte High-Impact Leadership research, 2016.

Print Friendly
REGISTER NOW

Leave a Reply

Your email address will not be published.

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Subscribe to Our Newsletter

Join Our Newsletter