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This Month's HeadlinesClick on any Headline to go to the full story. From Jim and CharlieThis is our personal note welcoming you to the January 2005 issue of Future of Work Agenda and setting our theme for the month. This issue is all about human capital -building it, sustaining it, taking leadership to improve it, and - most importantly - coping with the impending lack of it. We think human capital management is the issue for 2005, and we hope you agree. AnnouncementsOur second annual World Congress on the Future of Work is only four months away. It now has its own website, is open for Delegate registration, and we continue to seek corporate sponsors. We welcome new Future of Work member Lynne Kelley-Lewicki. And we're also pleased to once again offer our readers a special discount to Braintrust's seventh annual Knowledge Management Summit being held in San Francisco in February. The Community CornerWe offer this space to our Future of Work members so they can make personal announcements or ask for assistance. It is also where we periodically print brief "Leadership Profiles" introducing you to our members. This month Elizabeth Albrycht announces a special workshop series on blogging and employee engagement, while Neil Goldberg invites you to consider a membership in his Gate3 workclub. Feature Article: Closing the Talent GapOne more time: mind the gap! We've been predicting a massive talent shortage in the United States for the last two years, and now others are climbing on the bandwagon. This article reviews the data, sounds the alarm, and - believe it or not - offers several specific strategies for coping. Book Review: Lost Knowledge by David DeLongAs we begin a new year, the last thing you need is something more to worry about. But here's an issue you simply cannot ignore: the loss of organizational knowledge as current employees retire or resign. Oh, you say, no problem, we know all about that since employee turnover has been with us forever. Well, think again. Research NotesThis section appears from time to time, as we come across (or write ourselves) new perspectives on what is actually happening (or may happen) in the word of work. These reports are different from "The Future is Already Here" section (which also appears periodically), in that here we report on formal research studies, findings, and data we find valuable, while in "The Future is Already Here" we use "raw" anecdotes, news stories, and case studies about things already going on that we think you should know about. In Our Humble Opinion: Wake Up America!We end each issue of Future of Work Agenda with a personal perspective - our chance to comment on issues and developments in the world of work that we find important and interesting. This is our "editorial" page, where we enjoy offering our opinions and predictions about what's happening (or should be happening) in the world of work. |
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From Jim and CharlieWe wanted to open this issue with a "Happy New Year" to all, but it's hard to feel good when we're inundated with the daily news of the continuing tsunami disaster in the Indian Ocean. There's little any of us can do or say to overcome the incredible loss of life, property, and economic capability that the planet has suffered over the last two weeks. Our thoughts and prayers are with the survivors and the families of the victims and the still-missing. Among those still missing is our friend and colleague Ante Jamtlid of the Interactive Institute in Stockholm, Sweden. Ante was on holiday with his wife, children, and grandchildren at a resort in Khao Lak, about 80 miles north of Phuket, Thailand, when the tsunami struck. All nine of them are still missing as of January 3. We are saddened deeply by this apparent loss and send our heartfelt prayers to Ante's brother and other family members. This personal connection makes the entire catastrophe very real for us. We hope you will join with us in providing humanitarian support through one of the many international relief agencies working so hard to help. On a more positive note, we've focused this issue of the newsletter on the challenges of attracting and retaining talented workers (and their knowledge), a challenge that we believe will dominate the world of work in 2005. Actually, our goal is to sound a warning and encourage all of you who are concerned about human capital to take action now, before it's too late. The problem isn't a new one, but it's becoming far more urgent: the developed economies around the world are facing an impending talent shortage that will make competing for customers seem simple relative to the competition for skilled workers. And it's coming in the midst of a transformation in culture and values that is leading more and more people to reject full-time corporate employment. Our feature article this month, Closing the Talent Gap, offers very tangible and highly tactical suggestions for things you can do right now to get ready for the second half of the decade, which we are convinced will be remembered someday as a time when companies went under not for lack of business but for lack of workers. It's going to be a wild ride. And our review of David DeLong's new book, Lost Knowledge, highlights a subtlety in all this - as all those baby boomers retire you won't just lose their bodies, you'll also lose the critical knowledge, important relationships, and even wisdom about how to get things done that your long-term employees have accumulated over the years. Can you believe that NASA in 2005 quite literally doesn't know how to send a manned spacecraft to the moon? DeLong will tell you why, and what you can do to avoid similar problems in your own business. In the Research Notes section we summarize a recent report published by SHRM (Society of Human Resource Professionals) highlighting the top ten issues for HR professionals in 2005. Finally, our monthly rant, Wake Up America! is a strong call for action at all levels to deal with these multiple human capital challenges. Just as we need early warning systems for tsunamis, we're trying to sound our own warnings about the economy and your long-term sustainability. We hope you find these ideas useful. So, on to the rest of the newsletter. Enjoy! And please let us know what you think. - Jim Ware and Charlie Gratham
AnnouncementsWorld Congress on the Future of Work website is up and runningPlease visit http://www.futureofworkcongress.net to learn about the 2005 World Congress. The 2005 World Congress will be held April 26 - 28, 2005, in Philadelphia, hosted and co-sponsored by the General Services Administration. See the website for a detailed schedule of events, including five pre-event Delegates-only teleconference roundtables. We have just enabled our online registration process, so we encourage you to visit the site - and to join us in Philadelphia in April. This incomparable, invitation-only executive forum will bring together more than 120 director and C-level decision-makers in the fields of human resources, IT, and operations/facilities management from the world's leading organizations, all joining together to craft a set of design principles that will enable organizations to make the vision of the future of work real in their organizations. We look forward to an historic meeting venue in our nation's first capital, in the shadow of Independence Hall, and including a tour of one of the GSA's innovative new facilities that make the future come alive right now. Visit the website now: http://www.futureofworkcongress.net. We're also seeking Sponsors for the 2005 World Congress on the Future of WorkWe invite you and your organization to participate as a select partner in the presentation of the second annual World Congress on the Future of Work. If you are interested in becoming a Sponsor partner of Future of Work for the World Congress please download the 2005 Sponsorship Prospectus from our website: 2005 World Congress on the Future of Work Prospectus. We offer several different levels of sponsorship opportunity. Please direct inquiries about Sponsorship of the World Congress to: Darren Eng Future of Work Program Actively Seeks Individual and Small Business MembersFuture of Work now offers several levels of membership that depend on your status and needs: Individual and Small Business, Corporate, and Implementation Partners. We also offer special discounts to nonprofit, educational, and public sector organizations. These membership programs are described in more detail on the Future of Work website, or feel free to contact us directly for more information about fees and benefits. We are very pleased to welcome our newest individual member, Lynne Kelley-Lewicki of Stone Blue, LLC. Lynne recently left Cigna Corporation, where she led the development of Cigna's eWork program, one of the pioneering efforts in developing shared-use facilities and providing support for remote workers. She's now leveraging her knowledge and skill as an independent expert and would welcome your inquiries. Feel free to contact her directly at lynne@stonebluellc.com Please join us in welcoming Lynne to the Future of Work community. All individual members of our community are now listed on the Future of Work website, in the About Us/Members section. We encourage all our readers to consider joining the community. Please visit our website at www.thefutureofwork.net and apply for membership today. Seventh Annual Knowledge Management Summit - Braintrust 2005February 28 - March 2, 2005, in San Francisco, CA Now more than ever, organizations need to be increasingly agile, resilient, adaptive, responsive and innovative. Knowledge management is playing an increasingly important role in enabling organizations to become more action and results-oriented through improving productivity, growth and profits. Braintrust addresses these timely and critical issues and, as a result, is an event no knowledge management practitioner can afford to miss! Special Announcement! 15% discount off the standard fee, courtesy of Future of Work. To Register: Call +1 888 670 8200, email register@iirusa.com, or go online at: To receive the Future of Work discount, be sure to mention your registration priority code: XM1747FOW.
The Community CornerWe offer this space to our Future of Work members so they can make personal announcements or ask for assistance. It is also where we periodically print brief "Leadership Profiles" introducing you to our members. Using Weblogs, Wiki's and RSS to Enhance Employee EngagementUsing new communication tools such as weblogs will radically change conventional top-down communication models within organizations, and will force significant change and re-alignment in how organizations communicate and share information as they begin to embrace blogs as part of their overall relationship-development activities. This is a major theme underlining the session "Using WebBlogs, Wiki's and RSS to Enhance Employee Engagements" and other sessions at the New Communications Forum 2005 (www.newcommforum.com) in Napa, California, January 26-27 and in Paris, France, February 7-8. Participants will discuss a prediction that, in 2005, blogs other new communication technologies such as RSS and podcasts will rapidly be implemented in organizations, in particular relating to internal use - connecting groups and departments within the same organization in easier, faster, and more effective ways than traditional cumbersome and inflexible tools like intranets or so-called "knowledge portals." New Communications Forum will be a small, focused conference. The Forum will provide an excellent educational opportunity to learn more about new communications tools, while also offering a chance to network with a variety of senior communications professionals, experienced corporate bloggers and journalists in an elegant and relaxed setting. Subscribers to Future of Work Agenda can receive a special discount to this conference by registering at www.newcommforum.com and using the code NCFV150. Gate 3 WorkClubIf your company is exploring how a flexwork program will work for you, and especially if you have San Francisco East Bay employees who spend an inordinate amount of time commuting, Gate 3 WorkClub Emeryville can provide you with a facility designed to help you model these powerful work practices for your company. With Gate 3 you can explore, model, and refine your flexwork program, all with minimal cost and risk. Call Future of Work member - and Gate 3 founder and CEO - Neil Goldberg at +1 510 868 8180 to discuss how your company can use Gate 3 to help build your future of work strategy. Or, to discuss how locating some of your East Bay employees at Gate 3 part-time - or more - can give your company the immediate benefits of improved employee satisfaction and retention. For more information, visit to www.gate-3.com.
The Feature Article: Closing the Talent GapBy now you are probably getting tired of hearing us say that there is an emerging talent gap in the US economy. Without getting into the snake pit of economic prediction, let's just say all the evidence we've seen points to a roughly 10 million-person shortfall of "knowledge workers" within five years. Note: we include in this number skilled workers like machinists, draftsmen, and health care workers. Those are all jobs that in most cases are not really amenable to "off-shoring" (although more and more Americans are discovering that they can get high-quality specialized surgery in India and several other countries for a fraction of the cost here in the United States. Fly to India, get your heart repaired, and take in the Taj Mahal, all for less than a week's stay in a US hospital). Some of our friends in the legal community recently penned an extremely well-researched and documented white paper entitled "Strategic Initiatives in the Changing Workplace". We really like the quote in Gary Mathiason's report, citing another HR expert, that this situation will be "corporately life-threatening." Not to brag, but we've have been saying that for the last two years, and finally the message seems to be sinking in. There are several basic things going on here: an aging workforce and a shortage of new workforce entrants, as well as a lack of infrastructure to meet the employment needs of the future (more on this below in our monthly "rant," In Our Humble Opinion). But first things first. We baby boomers are going to leave the workforce in the not-too-distant future. Sure, a few of us will be enticed to hang on for a few more years, but that is just a "finger in the dike" strategy (although very necessary, as we comment below). In addition, the generation coming along behind us, what Future of Work member Spherion as identified as the "emergent workforce," doesn't have the same intense "career at any cost" mentality that many in our generation had (for details see http://www.spherion.com, or send us a note and we can provide you with more information about Spherion's Emergent Workforce research; also, look to a future issue of this newsletter, when we plan to describe the study in some detail). Thus the labor supply faucet will be turned down at the same time the labor pool develops a severe "leakage" problem, as many of those emergent workers clamor for different working conditions, part-time work, or the option to live wherever they want to without giving up their jobs. Quoting again from the Littler white paper, "Long-term economic and demographic trends make the (last) recession look like a mere blip on the 21st-century labor market's radar screen." We won't belabor that point any more. It's here, it's real and it must be dealt with now! What we really like about Littler's analysis is that it points to many of the employment law challenges this labor shortage will bring about. Most of you have probably never even thought about this implication. For example, post-9/11 public policy has placed a severe limit on immigration as the United States attempts to cope with the "terrorist threat." That policy effectively shuts off a major source of new, young talent for our labor markets. State and federal government health, safety, and nondiscrimination programs also impact the talent shortages - especially in industry sectors such as health care, technology, and scientific employment. It seems we may have shot ourselves in the foot this time. In the interests of brevity, we simply refer you to the white paper referenced earlier for details. Make sure your CEO reads it! Basic economics are operating here. Demand increases, supply diminishes, and the development of more resources has practically disappeared. That thud you just heard is the other shoe falling. While all this is going on we (that is, the US economy) have slowed down our "production" of new talent. There are many indices to look at, but let's focus on just one: the number of college graduates. By 2012 the United States will need about 18 million new graduates but will produce only about12 million. China and India will significantly outstrip the United States in the number of new graduates during this same time frame. And even more shocking is that in the computer science and engineering professions US graduates declined 23% from 2002 to 2003! What to Do?The question then is, clearly, where is the talent we need going to come from? And how can we deal with the predicted shortages? We believe there are four primary talent pools that must be tapped to make up for the shortfall (our emphasis here is on the United States, because that's what we are most familiar with, but we believe this analysis applies equally well to other developed economies facing similar challenges).
Many of these folks live in ex-urban and rural areas because of their personal focus on quality-of-life issues (see our article about micropolises in the October newsletter for more details on the new growth in these communities). We believe that an effective way to reach out and bring these workers into the labor force is through a national network of "third places" that bring the amenities and value of "corporate" offices to small businesses on a cost-effective, shared basis. We've written extensively about that idea - see "Wherever You Go, There You Are" in the July 2004 newsletter, and check out the "Third Place" page of our Future of Work website for an overview and links to other relevant articles and case studies. There's also a related article by our friend Amy Zuckerman discussing who uses "third places'" See http://www.a-zinternational.com/hiddentech/.
The AARP reports that 69% of people over age 45 expect to work beyond the current "normal" retirement age of 65: http://www.microsoft.com/enable/aging/demographics.aspx. Adding Social Security incentives like "bonus points," or benefit increases of up to 8% per year for each year of not applying for social security would be a powerful motivator for delaying retirement. See http://www.ssa.gov/retire2/delayret.htm. There's an important added issue here, in that as the baby boomer generation reaches "normal" retirement age, tons and tons of corporate "knowledge" is going to be walking out the door. Even if you could find enough younger workers to replace the arms and legs you are going to lose, there's no way to replace the gray matter - the accumulated knowledge (and wisdom) about how your business works (especially all the informal components, the workarounds, and that core understanding of how things really get done). Individual organizations really can't afford to wait for changes in social security in the hope that it will keep older workers from retiring. One of the most important things you have to do right now is implement a knowledge retention program in concert with your staff retention efforts. Read our review, below, of David Delong's prescient new book, Lost Knowledge, and start worrying today about how you are going to keep those baby boomers on the payroll.
Current best estimates are that between one and two million jobs are being "outsourced" today. Forrester Research predicts that number will increase to three to five million in the next five to ten years. Thus a projected increase of two million is actually a conservative estimate (See Jeffrey Garten, "Offshoring: You Ain't Seen Nothin' Yet," Business Week, June 21, 2004, p.28). Keep in mind that outsourcing and offshoring are not synonymous; we believe that one of the fundamental shifts going on in the economy is the "focusing" of businesses on what they do best, leaving the rest to specialty subcontractors. That movement is increasing both the agility and the productivity of many large organizations. But it isn't enough; offshoring is also going to grow dramatically because there simply aren't going to be enough workers in the United States to do what must be done.
This is our most volatile action recommendation. Currently Federal and State budgets call for an actual reduction in funding for retraining. We are not optimistic that the public sector will step up to this challenge. Look for the private sector to fill the gap. For example, IBM recently announced a $25 million re-training program for its business partners (http://news.com.com/2100-1011-5167506.html?tag=nl). Got some better ideas of how to close that talent gap? Let us know (research@thefutureofwork.net) and we'll publish your suggestions.
Book Review: "Lost Knowledge"by David DeLong (Oxford University Press, 2004, copyright David DeLong) Reviewed by Jim Ware As we begin a new year, the last thing you need is something more to worry about. But here's an issue you simply cannot ignore: the loss of organizational knowledge as current employees retire or resign. Oh, you say, no problem, we know all about that since employee turnover has been with us forever. Well, think again. Consider the following example, which David DeLong documents very thoroughly in this outstanding book: by 2006 fully 50% of NASA employees will be eligible for retirement. Senior NASA officials are, at least, already well aware of the impact on the organization's capabilities if all those employees do in fact retire as scheduled. But they haven't yet developed a complete replacement program. And - here's where DeLong's insights are profound - even if they could find enough younger scientists to replace the bodies that are retiring, there's no way they can replace, or even substitute for, the experiences of those retirees, or their knowledge of how things get done, or their relationships (personal and professional) with key subcontractors, peer agencies, and congressional representatives. In fact, DeLong begins the book by pointing out that NASA's knowledge retention problem is so severe that the organization - literally - does not know how to send a manned spacecraft to the moon anymore. Take a moment to let that sink in - not even NASA knows how to go the moon! The hard reality is that engineers and project managers who performed so well in the 1960's and 1970's have already retired or gone on to other jobs, and the processes and procedures they knew in their bones were not well-documented - that knowledge is essentially lost forever. DeLong's fundamental insight, in my humble opinion, is that employee retention and knowledge retention, while clearly related, are not the same thing. And with the baby boomer generation fast approaching retirement (as we've said so many times you're probably sick of it), the amount of knowledge and experience about to disappear from the economy is positively staggering. This is another "must read" book if you care at all about your organization's long-term sustainability. The first 50-plus pages focus on the lost-knowledge challenge, but the rest of the book is devoted to telling you how to analyze your knowledge retention needs and what to do to avoid a NASA-like problem. DeLong suggests that there are four distinct types of knowledge that are important for organizations, and that the loss of any one of them can be devastating:
Most of the book is then devoted to case examples and principles for acquiring, storing, distributing, retrieving, and retaining knowledge. And while IT-based knowledge management systems do play an important part in the equation, DeLong emphasizes HR practices more than anything else. In fact, he argues that a comprehensive (and effective) knowledge retention strategy is composed of four critical components, but HR Practices are first and most important. The other three are Knowledge Transfer Practices, IT Systems, and Knowledge Recovery Initiatives. Within the HR arena there are five areas to pay attention to:
These all sound obvious on the surface, but one thing that's clear is how few organizations manage even one of those things well, let alone all five. You will be well-advised to read DeLong's analysis carefully and heed his advice diligently. Your organizational future depends directly on how well you understand just how vulnerable you are to losing your core knowledge. Lost Knowledge is available online at Amazon.com at this link.
Research NotesTen Things HR Professionals Have to Worry About in 2005The Society for Human Resource Management (www.shrm.org) has just published it's 2005 "Workplace Forecast: A Strategic Outlook." The data were collected from a random sample of 4,000 human resource professionals selected from among SHRM's 185,000 members. We have reported many of similar demographic trends and security issues in some detail in this and past issues of the newsletter. Here we take a moment to reflect directly on their implications for the HR professionals (and general managers) among our readers. The top ten employment issues discussed in the SHRM report are:
Overall all these concerns fall under our focus on the changing nature of the implicit contract between workers and their employers. Simply put, the way in which human resources are managed is shifting from tactical ("let's make sure all the paperwork is done right") to something strategic (focusing on getting and keeping key talent). And the picture of the future of work is coming into focus: it looks very distributed, customized, and flexible. So much for any certainty and stability going forward!
In Our Humble Opinion: Wake Up America!Commentary by Charlie Grantham and Jim Ware Please stay tuned, we are experiencing technical difficulties.... "Wake up America!" - Earl Pitts of radio fame We hope that by the time you get to this part of the newsletter you have figured out where we're going. That is, unless you are so twisted that you start here and read backwards (that's probably what we'd do, but please don't use us as role models). Well, surprise, surprise, surprise. We tried looking into the crystal ball for the coming year and saw a train wreck headed our way. No people for all the new jobs that our finally-thriving economy is going to be creating. What if you held a hiring open house and no one showed up except those who need to be back inside by sundown? We're not going to harp on demographics, different generational attitudes, immigration laws, retention programs, or any of that stuff you have come to expect from this little corner of the universe. Nope, we're going straight for the core this time. The way we (the two of us) see it, the "simple" fact is that we (all of us as a society) haven't been investing adequately in building what we (the two of us again) call social capital for a long time. And it's about to bite us right where the sun don't shine. Social capital is a somewhat fancy way of saying education, high quality of life, decent medical care, general sociability, and trust and respect for one's neighbors. It's that web of experiences that helps everyone become more capable of living a good life and helping others get there as well. Social capital starts with prenatal care and childcare, and ends with elder care. There are two schools of political thought here. One says building social capital is the responsibility of each citizen him- or herself. The other holds that it is the prime responsibility of governance structures to make sure that happens. Actually, it doesn't much matter where you stand on this issue - our point is that it isn't happening, really, on either side of that coin. It's easy to say simply that our social institutions have failed us. Well, sure, we agree with that, but all the "woe is me" in the world won't solve the problem. OK, OK, we are making one big assumption here - that anyone really cares about increasing the capacity of our society to meet new challenges, become smarter, live better, and get along with each other a tad better than people inside basketball arenas. Inside every optimist there is a cynic trying to get out. Given that, where do we go, what can we do? Our prediction is that building social capital will ultimately become the responsibility of local communities: something bigger than self-serving individuals and something more understandable and more manageable than amorphous, self-perpetuating "governments" thousands of miles away from the problem. And just what does this have to do with the future of work? Well, if communities don't focus on building social capital then there won't be a future of work where you live. Get it? The equation is simple: no capability (in people and towns), no work. No work, no taxes; no taxes, no social infrastructure. And there's your classic vicious downward spiral. We're not exactly historians (at least not trained in that tradition) but we suspect that if you dig deep enough into the collapse of, say, Rome, the British Empire, the Mayan Empire, or whomever, that you'd find the deterioration of social capital as a root cause. Now we probably have you ready to consume vast quantities of commercially available dangerous painkillers (sorry couldn't help ourselves, trying to "alleviate" the stress of the moment). However, there are some hopeful signs on the horizon. Start with this month's issue of Fast Company (that would be January, by the way; they publish a little sooner than we do). Hey, we are only the guides; you have to read the map yourself. The issue highlights twenty-five outstanding individuals with their Social Capitalists Awards. (see http://www.fastcompany.com/homepage/index.html). And no, they didn't pay us for the plug! Good God, do you think we would sink to that low level of crass commercialism? Hold on, don't answer that question.... Check it out: twenty-five shining examples of how people can do well and do good at the same time. Wake up America! It's time to become your own social capitalist and build more capability in your own backyard. Don't wait for someone else to do it, because they won't. Get involved. If you're a corporate executive, sponsor a strategic educational program in your community to develop the workers you'll need in ten years. If you're an individual, pick an issue that you have a passion for and get out there and start something. We find it very interesting that the folks mentioned in Fast Company all just went out and started something new. They didn't try to get inside an existing organization and re-focus it's efforts. Big learning there, Maynard. It's usually a whole lot easier to start something new than it is to change something old. Ok, so that's the kickoff rant for the new year. 2005 has to be about this social capital thing. It's probably the best strategy we (all of us) have to weasel our way out of that impending labor shortage we (the two of us again) started out talking about several months (or was it years?) ago. And, in our humble opinion, it's probably the best way to build a sustainable society. Please direct your comments to comments@thefutureofwork.net. We'd love to publish your reactions and suggestions.
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