Chapter 55 (TMH) shares eight trends affecting employee experience at work and which are likely to impact talent management programs.

Briefly describe the organization you work for (you do not have to share the organization name if you don’t want to) and the industry in which it is in. You can use a previous company you worked at if you’re currently not working. If you have not yet worked anywhere, you can use an industry that you would like to be in after you graduate.
Identify and describe four of the eight trends you believe are greatly affecting employee experience at your workplace or in your industry. Share ways in which this is affecting employees in your industry.
How will the talent development be impacted by these trends? How well do you feel your HR function is responding to these trends? How can the HR function help the organization better address these trends?
Eight Trends Shaping the Future of Talent Management Programs
Jacob Morgan, Speaker, Author, and Futurist
THE EMPLOYEE EXPERIENCE IS AN IMPORTANT FORCE THAT WILL SHAPE AN organization’s
approach to talent management. The environment created when an organization focuses on
making itself a place where people want to show up instead of a place where people need to
show up is the basis for the positive employee experience. This shift from “need” to “want” is a
fundamental change for all organizations. At the core of the employee experience is a longterm organizational approach that puts people at the center, meaning core workplace practices
are broken down and rebuilt to create greater mutual commitment between employees and
their organization. Below are eight trends affecting the employee experience. It is important for
talent management professionals to consider how these trends impact their talent
management programs.
1. Challenges with Engagement
Poor results with employee engagement have left many business leaders scratching their heads
wondering what they did wrong. Consider that according to Gallup (Gallup weekly news alert,
October 13, 2013) which has become the global authority on this topic, worldwide employee
engagement is at 13 percent, an incredibly low number. Perhaps what’s more shocking is that
this number has barely budged in years! Interestingly, Aon (Aon 2016 Trends in Global
Employee Engagement) has global employee engagement of 65 percent for 2016, with a 3
percent improvement since 2014. Yes, this is higher than Gallup’s number, but still low. The lack
of results has caused organizations to take a close look at what they are doing and why they are
doing it. Many companies like Accenture and Cisco no longer conduct annual employee
engagement surveys. It’s also interesting that organizations question the value of annual
employee reviews but are okay with measuring employee engagement every year. This makes
no sense. In many cases, employee engagement surveys are simply replacing the annual
reviews and are the very thing that organizations are trying to get rid of. In most models, the
ideal scenario for organizations is to get as many engaged employees as possible.
Unfortunately, many organizations get so stuck focusing on engagement that they forget to
take a step back to understand what causes engagement to begin with let alone understand the
impact that engaged employees have on the organization. This means that engagement just
boils down to a number, and a number without context is quite useless. Employee engagement
has been a wonderful tool for us to think differently about our organizations, but it’s also been
used as a bit of a crutch to justify the existence and importance of human resources (HR) as a
function. We also have to remember that just because you measure something doesn’t mean
you improve it. While there’s nothing wrong with continuing to measure employee
engagement, it’s time for us to look at a new approach for a rapidly changing world that is
focused on the long-term designing of employee experiences that yield an engaged workforce.
The whole point of employee engagement is to unlock the discretionary effort within
employees. This is the amount of effort that employees could put in if they actually wanted to.
But what does that mean? If you think about most of the interactions you have daily with
various brands, you will realize that they are linear and static. There is little differentiation. How
is it that some organizations are able to go above and beyond to deliver customer experiences?
The answer is discretionary effort.
2. Skills Gap and Talent Shortage
A McKinsey Quarterly article by Richard Dobbs, Susan Lund, and Anu Madgavkar titled “Talent
Tensions Ahead: A CEO Briefing” stated that, “new research from the McKinsey Global Institute
(MGI) suggests that by 2020, the world could have 40 million too few college-educated workers
and that developing economies may face a shortfall of 45 million workers with secondaryschool educations and vocational training. In advanced economies, up to 95 million workers
could lack the skills needed for employment.” The most recent ManpowerGroup talent
shortage survey of more than 41,000 hiring managers in 42 countries and territories found that
38 percent of employers are having difficulty filling jobs. There is little agreement on what is
causing this skills gap, what the potential solutions are, and whether the skills gap is even a real
thing. Most of the executives I speak with acknowledge that the skills gap is real. Perhaps what
makes this even more challenging is that we aren’t sure what the jobs of the future will be or
when they will be here. Consider that by the time most people graduate from college, the skills
and the acquired knowledge are mostly rendered obsolete. This means that organizations are
looking to hire employees for jobs that don’t yet exist. Not only do we have a skills gap, but we
also have a skills uncertainty. The number one thing that potential and current employees can
do to succeed in this type of environment is to learn how to learn. Master the ability to learn
new things regularly and apply the things that you learn to new and current situations and
scenarios.
3. Changing Demographics
According to a report by Robert I. Lerman and Stefanie R. Schmidt, “An Overview of Economic,
Social, and Demographic Trends Affecting the U.S. Labor Market: BLS (Bureau of Labor
Statistics),” projections imply that over the next decade, 40 million people will enter the
workforce, about 25 million will leave the workforce, and 109 million will remain. Millennials
are already the largest demographic, surpassing baby boomers in 2016. By 2020, they are
expected to comprise 50 percent of the workforce, and by 2025 they are expected to be 75
percent of the workforce. We see gen Z (the generation after the millennials) creeping into the
workplace as well, and they currently comprise over 25 million people in the United States. The
labor participation rate in the United States appears to be gradually yet consistently shrinking.
This changing mix of demographics brings new values, attitudes, expectations, and ways of
working. Organizations have always had to adapt to new generations entering the workforce,
but the overall sense is that previous adaptations were gradual and have now become
accelerated.
4. Changing Face of Talent Competition
In the past, organizations competed on levels: skills, employee seniority, or location. This meant
that if you lived in San Francisco, you would compete with other organizations for talent in the
area; if you were Coca-Cola, you would compete with Pepsi, Ford with Toyota, Boeing with
Airbus, or McDonald’s with Burger King. Today, with the exception of certain specialized skills
and roles, everyone is competing with everyone. Coca-Cola is competing with Toyota and
McDonald’s is competing with Airbus. Organizations are also competing on a global scale (see
globalization) in a world facing skills shortages and changes in traditional employment and
business models. This competition also extends to the gig economy (a labor market
characterized by the prevalence of short-term contracts as opposed to permanent jobs).
Talented individuals might decide to drive for Uber or join an online freelance marketplace
instead of working for you.
5. Psychology (and Sociology)
Past and many current employee experiences are influenced by concepts of team building,
motivation, performance, and success based on decades-old studies by psychologists and
sociologists. Organizations are now taking these pursuits more seriously as they try to truly
create environments where people want to show up to work. This is no longer just a challenge
that an organization can overcome with perks, higher pay, or gimmicks. The business world is
turning to the social scientists to help it understand why and how people tick. According to the
U.S. Bureau of Labor Statistics, industrial organizational psychology is one of the fastestgrowing professions. These scientists are influencing how we hire and recruit people, design
office spaces, lead and manage, and even build and run our HR departments. Organizations
such as Johnson & Johnson work with teams of psychologists for these purposes. This also
speaks to the trend toward focusing on longer-term organizational design instead of shorterterm engagement programs.
6. Technology Acceleration
The proliferation of mobile devices with global connectivity allows us to work anywhere and
anytime. Videoconferencing and internal social networks allow us to communicate and
collaborate without any boundaries. On-demand platforms, such as Catalant, Upwork, and
Kaggle, allow organizations to quickly scale their workforce up or down while being able to
access top talent anywhere in the world. Big data (and its analysis) is allowing us to gain new
insight into how we work, why we work, and what we can do to drive performance, experience,
and engagement. Robots and automation are predicted to replace many jobs, leaving a
questionable future of employment. This is why discussions around universal basic income
(UBI) are becoming prevalent. The idea is that if AI and automation replace humans, giving
everyone a guaranteed regular income solves the financial burden of unemployment. UBI is a
widely contested topic that has many questions that need to be answered. The Internet
promises to create a connected world that along with artificial intelligence will yield more
productivity, efficiency, and abundance. Virtual and augmented reality will change the way we
interact with physical and virtual worlds by combining and overlaying the two. The list goes on
and on. Technology is not only enabling us to work more effectively, but it’s also creating new
ways of working in addition to creating new jobs and eliminating many older ones. Technology
will increasingly affect every organization. Before various technologies can be scaled and
adopted, many other things must be considered. Futurists use a framework abbreviated as
STEEPLE (social, technological, economic, environmental, political, legal, and ethical).
Technology is just one of the seven aspects to be considered. Consider the autonomous vehicle.
There is little doubt that the technology exists today to produce a fully functioning self-driving
car. How long will it take for us to see this at scale and how long before these vehicles will
displace all the human drivers? Insurance, infrastructure, rules and regulations, ownership,
security, production, and so on must be considered. What about the comfort level of people
getting into an autonomous vehicle or the ethical challenges that can be faced? For example,
how does a self-driving car decide between an unavoidable accident where it will either risk the
life of the passenger or of a bystander? Technology is a powerful disruptor but it must be
placed in the context of factors to scale and have an impact.
7. People Analytics Gain Importance
A core foundation for creating employee experiences is people analytics. Ranjan Dutta is the
director of people analytics at Pricewaterhouse-Coopers. He leads a team of hundreds of
leaders who work with organizations around the world on their people analytics strategies. He
believes that organizations have three things that essentially make up their business: money,
material, and people. Another company can replicate your business model, the goods you
produce, or the services you offer. The one thing that cannot be copied is your people. People
are your greatest competitive advantage. So how do organizations get the very best out of their
people? People analytics give organizations the data and the insight they need to make peoplerelated decisions. People analytics also empower organizations to test ideas and run
experiments. According to Ranjan, marketing has gone through this evolution. Decades ago
marketing wasn’t data-driven. It was based on ideas and intuition. Today marketing is based on
data. Organizations are doing customer segmentation, journey mapping, and competitor
analysis, and they are measuring and testing every aspect of how people interact with brands
and their products. Amazon tests its home page many times a day. The home page I see may be
different from the home page you see. Amazon uses data to make decisions about what
content their visitors visitors should see. The concept of scientific management was once based
on the idea of using metrics and measurement to improve how employees work. Employees
were literally timed with stopwatches to shave seconds off their tasks. Today HR
organizations—and others—are staffed with data scientists and analysts to help make sense of
all the data they have on their employees and to figure out what other data can be collected.
This is a new and emerging area of practice. Many large organizations have yet to build
advanced capabilities around it, but they are all planning to. Organizations today have lots of
data about their employees, including salary, tenure, satisfaction, ratings and reviews,
performance, and much more. The trouble is that few organizations have a way of putting all of
this information together to understand their employees. Ultimately, organizations will need to
become their own research firm. Prasad Setty, vice president of people analytics and
compensation at Google, says, “All people decisions at Google are based on data and analytics.”
8. Transparency
If you were to rewind the clock 10 to 15 years ago and you worked for an organization that
wasn’t treating people well, what could you do? There wasn’t much transparency in the
workplace, and employees didn’t have much of a voice. This means that most organizations
could treat employees however they wanted. These organizations had cash, and they had
brand power that translated into being able to attract the best talent. Brand power today isn’t
what it used to be. You don’t automatically want to work for a company like Starbucks, Disney,
or Ford just because of the name. These organizations have to try harder to get the people they
need and want. Today’s world is very different. Not only do we see enormous business
turbulence, competition, and rapid pace of change, but also employees have a voice and they
are using it! Hundreds of websites rank organizations on everything from being a best place to
work to being a diverse organization to offering great flexibility to having an environment with
the least amount of stress. Combine this with social media sites and transparent career sites
like Glassdoor, and the world can and will know everything about your organization without
speaking with anyone who works there. This includes salary information, benefits packages,
what your corporate culture is like, questions asked during the interview process, and so forth.
When most people go shopping at a big-box retailer, they already know what they want and
how much they should pay for it. That’s because they have already done the research and know
exactly what they want. This same logic applies to the world of people and organizations.
Berger, Lance A.. The Talent Management Handbook, Third Edition: Making Culture a
Competitive Advantage by Acquiring, Identifying, Developing, and Promoting the Best People
(pp. 646-668). McGraw-Hill Education. Kindle Edition.

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