Managing tomorrow’s people* The future of work to 2020 *connectedthinking Contents Introduction 02 Small is beautiful: welcome to the Orange World 18 2020: where three worlds co-exist 04 The journey to Orange 18 Life in the Orange World: the main themes 19 Corporate is king: welcome to the Blue World 06 Work in the Orange World: the people challenges 21 The journey to Blue 06 The Orange HR business model 22 Life in the Blue World: the main themes 07 Work in the Blue World: the people challenges 09 Are you ready for tomorrow’s world? 25 The Blue HR business model 10 Appendix 27 Companies care: Definitions: Scenarios, Millenials 27 welcome to the Green World 12 Our methodology 28 The journey to Green 12 Global forces 29 Life in the Green World: the main themes 13 PwC Graduate Survey findings 30 Work in the Green World: the people challenges 15 Contacts 32 The Green HR business model 16 Foreword 01 The journey to 2020 about the future of people management. Our team has At the beginning of 2007, a team from identified three possible ‘worlds’ PricewaterhouseCoopers gathered to explore the – plausible futures to provide a future of people management. Our thinking was context in which to examine the sparked by the rising profile of people issues on way organisations might operate the business agenda – the talent crisis, an ageing in the future. In addition we surveyed almost 3,000 workforce in the western world, the increase in MillennialsA1 – new graduates from the US, China global worker mobility and the organisational and and the UK who represent a generation just joining Foreword cultural issues emerging from the dramatic pace of the workforce, to test their views and expectations business change in the past decade. We wanted on the future of work. to explore how these issues might evolve and how organisations need to adapt to stay successful. We hope you will help us to encourage debate Many studies have attempted to capture a vision around this critical topic. It is said that the future is of the workplace of the future, but we set out to not a place we go to, but one which we create. And while things happen that we cannot predict, we can understand the people challenges that will impact people Managing tomorrow’s organisations and consequently the implications still be prepared. this will have on the HR function as we know it. Few business thinkers have proposed that the marketing or finance functions might cease to exist in their present forms, but some are starting to say this about HR. Michael Rendell With the help of the James Martin Institute for Partner and leader of Human Resource Services Science and Civilisation at the Said Business PricewaterhouseCoopers LLP School in Oxford, we used ScenariosA1 to think A1 – Appendix 1, see appendix page 27 02 Introduction 2,739 When we started our research we had some • large corporates turning into mini-states and preconceived ideas about tomorrow’s world. Many taking on a prominent role in society studies have been undertaken to explore the future In July 2007, 2,739 graduates • specialisation creating the rise of collaborative of society, the environment, business and even the from China, the US and the UK networks told us about their workplace. Our challenge was to focus explicitly expectations of work. They had on the business context and the impact on people • the environmental agenda forcing fundamental all been offered jobs with PwC and work. changes to business strategy. but had yet to start. Some of While we cannot claim to have identified all the the key findings are highlighted possibilities, several strong themes have emerged: 2. People management will present one throughout this report of the greatest business challenges While some of the findings 1. Business models will change Businesses currently grapple with the realities of seem to confirm current dramatically skills shortages, managing people through change received thinking about the and creating an effective workforce. By 2020, the The pace of change in the next decade will be future of work, a number of radical change in business models will mean even more fundamental. Technology, globalisation, themes defy conventional companies facing issues such as: thinking. demographics and other factors will influence organisational structures and cultures. Our • the boundary between work and home life PwC is the biggest recruiter scenarios outline three organisational models of the disappearing as companies assume greater of graduates in the UK and future: responsibility for the social welfare of their a leading global recruiter employees of graduates. A3 A3 – Appendix 3, see appendix for a full breakdown of the findings page 30 03 3. The role of HR will undergo “HR needs to fundamental change ensure it is fit for HR has been perceived by many as a passive, purpose in order service oriented function, but given the context of tomorrow’s workplace and business environment, to be proactive we believe HR is at a crossroads and will go one of and maintain or three ways: develop its • with a proactive mindset and focused on influence in the Introduction business strategy, HR will become the heart of the organisation taking on a new wider people future.” remit incorporating and influencing many other Keith Murdoch, aspects of the business Remuneration and • the function will become the driver of the Benefits Manager, corporate social responsibility agenda within the British American Tobacco Managing tomorrow’s people Managing tomorrow’s organisation • stringent people measurement techniques to control and monitor productivity and • the function will be seen as transactional and performance almost entirely outsourced. In this scenario, HR will exist in a new form outside the organisation • the rise in importance of social capital and and in house HR will be predominantly focused relationships as the drivers of business success. on people sourcing. 04 2020: Where three worlds co-exist We believe it We identified a number of global forces that will have significant influenceA2, and of those we felt is possible that all that individualism versus collectivism and corporate three worlds will integration versus fragmentation would be the most co-exist in some significant. From this axis we identified three worlds and business models for the future. form, perhaps (See figure 1 opposite.) distinct by We tried to capture the events and trends which geographic region, draw a picture of life in tomorrow’s world and the or industry sector people management challenges that might prevail. The forecasting timelines and world descriptions for example. are not intended to be taken literally as complete visions of alternative futures. They are designed to present ideas and illustrate the more important points around the people management challenges. We believe it is likely that all three worlds will co-exist in some form, perhaps distinct by geographic region, or industry sector for example. As you read this document think about how your own organisation might be positioned within these scenarios and what implications this has upon your current people management strategy. A2 – Appendix 2, see appendix page 28 2020: three worlds 05 Introduction Managing tomorrow’s people Managing tomorrow’s Figure 1 Corporate is king: the Blue world Where big company capitalism reigns supreme In a nutshell: The globalisers take centre stage, consumer preference dominates, a corporate career separates the haves from the have nots. 2011 2012 2013 2014 2020 The Indian World’s biggest The brain-drain of A decade of M&A Global warming economy expands search engine and Eastern European consolidation changes the dramatically as largest technology workers starts to across industry climate of Europe; it goes through company merge reverse as workers sectors peaks as the snow on the a new wave of return home Alps melts, skiers cross-border to set up and head to the US acquisition sprees lead corporates, and becomes a building on global leader in expertise gained several industry in several sectors sectors 07 90% Corporates divide the haves and “Our search for have nots talent is now a of Chinese respondents expect The power of corporations means that a much global search. they will use a language at work greater divide has opened up between those The competition other than their mother tongue working for global corporations and those working in smaller enterprises. Employees of for talent will only mega-corporations have everything they need laid increase further.” Size matters on. Those working for smaller businesses remain at Blue World the whim of housing markets and basic statutory Hanspeter Horsch The sheer size of corporations in 2020 means entitlements, needing to self-supplement Associate Director, that a significant number now operate with annual educational support, health and insurance Human Resources turnovers that far exceed the GDP of many coverage, what remains of the public health Samsung Semiconductor individual countries, particularly in the developing system, and so on. Europe GmbH world. With echoes of the business models promoted by companies like General Motors in the middle of the last century, many companies now Welcome to the technology age people Managing tomorrow’s provide the equivalent of the welfare state for their Technology is all pervasive, entire cities in the employees to ensure they lock the best talent into US, Japan and the UK operate with ubiquitous their organisations. Internally managed service high-speed wireless networks that allow all centres are sophisticated and highly efficient – commercial transactions, entertainment and using processes perfected by the outsourcers of communications to be handled by every individual the ‘nineties. People metrics become an essential on credit card-sized devices. Pinpointing exactly part of everyday life to keep track of individual what you want and being shown where it is performance and productivity.
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