An organization’s ability to identify, attract, and plug in the most creative minds precisely when and where they are needed is the foundation for innovation. Therefore, designing and executing a strategy that does this well has become the competitive edge in a digital economy where the speed of innovation trumps all.
According to a recent global study by McKinsey, as digitization accelerates, the U.S. has a huge opportunity to boost productivity growth. Exploring three big areas of potential — online talent platforms, big data analytics, and the Internet of Things — the firm estimates that digitization could add up to $2.2 trillion to annual GDP by 2025. That’s an enormous boon for the economy, but one that won’t be enjoyed equally across industries or organizations because digital frontrunners who can apply innovation to hiring strategy will leapfrog their known (and yet to be identified) competitors and command the lion share of the growth.
Organizations that have embraced digitization as a part of their culture, structure, and strategy are already pulling away from the pack. Amazon has surpassed big box stores. Uber is disrupting transportation. AirBnB is changing the hospitality and travel industry.
Disruption isn’t just for “startups in the tech space” either. From now on, every organization’s ability to compete is directly proportionate to its ability to embrace digitization. But here’s a big distinction: Embracing digitization must not be confused with simply embedding technology — tech is just one piece.
Embracing digitization is about adapting digital strategies in creative ways inside the business to stay responsive and constantly innovate. That creativity could manifest itself anywhere from “leapfrog worthy” R&D to predictive advertising to proactive recruitment marketing. No matter where you find it, that creativity will always start with the same thing — people — which is exactly why talent acquisition leaders need to get focused, right now.
Here are three areas I see forward-thinking hiring organizations focusing on.
Over-invest in Strategy for Critical Roles
Here’s the hard truth: not all roles drive the same value to the business. The lead engineer designing your next product is more critical to the future of the business than the accountant who is tracking the production budget. Both are important, but they do not yield the same value long term. Not coincidentally, the supply of talent to fill that engineering role presents a greater challenge to your talent acquisition team. Why, then, would you design a talent strategy that consumes equal resources?
Competition to attract and hire that engineer is greater than it is for the accountant role. Therefore, an over-investment in the talent acquisition strategy and resources required to fill high-value roles makes good business sense.
If you haven’t already read it, I highly recommend Talent Valuation by Tom McGuire and Linda Brenner, which introduces the concept of over-investing in critical roles. It’s a smarter way to approach the talent acquisition strategy and an instant credibility builder when it comes to speaking “C-suite” (think CFO).
Facilitate the “Liquid Workforce”
Right now, entrepreneurs are standing up businesses with three people (Uber started with two). At a deep level, these digital natives understand the strategic alternatives of build vs. buy (vs. rent), and they know how to leverage a fluid org structure to speed innovation and time to market.
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43 percent of the workforce is expected to freelance by 2020, and a recent Accenture trend report predicts that there will be a Global 2000 company within 10 years that has no full-time employees, save the C-suite. The appeal of the skills economy strengthens — just as the value prop for longer term, full-time employment weakens — every day. Accenture calls this more fluid movement of talent “the liquid workforce.”
As traditional organization structures wane in the face of project-based work, HR leaders must embed process and technology to identify both internal and external skills needed at the project level. Building fluid talent pools to get work done and embedding collaboration and training tools every step of the way will be key to facilitating this new way of work.
Embrace Hyper Automation
Organizations exceeding and pulling away from the competition aren’t just plugging in tech. They are reinventing their processes by combining insight, tools, and technology in new ways to drive huge efficiencies they couldn’t even imagine two years ago.
I love this periodic table of HR Tech from CB Insights. It’s visual proof that there is an opportunity to embed automation into nearly every area of the talent acquisition and talent management process. Through smart applications of digital technology, recruiting leaders can automate repetitive tasks, strengthen decision making, and get some valuable time back to concentrate on the work that requires more human interaction; for example, building relationships with their hiring managers who desperately need talent advisors.
There is no denying that the acceleration of digital is only going to get faster. From the McKinsey report, “Digitization is advancing in a series of accelerating waves that touch more and more participants. As each one builds on and amplifies what has come before, the waves are hitting in faster succession and with greater impact.” For instance, industries such as media, finance and insurance are light years ahead of hospitality and healthcare. Organizations that don’t keep up risk upheaval from innovations in outlier industries that aren’t even on their radar. Consider the impact of driverless cars on fast food. 70 percent of McDonald’s business comes from the drive thru; que the end of impulse eating — riders will binge on entertainment instead.
By over-investing in critical roles, empowering a liquid workforce and continuously looking to automate and reinvent processes by using technology, the digital frontrunners will be those who put people first and expand the gap between winning and losing.