Business will never be the same as a result of COVID-19. We are all being forced to challenge our conventional ideas around work. I’ve written a few articles about this looking at the evolution of work, the evolution of leaders, and the evolution of employees. In this article I specifically want to look at how organizations are evolving.
Jeff Bezos has the “two pizza rule,” meaning that any team should be able to be fed by just two pizzas; if not, then the team is too large. We are seeing a big shift away from large structured centrally located teams to smaller more globally distributed teams which are held together by technology. As long as team members can access to the internet it doesn’t matter where they are located. Organizations need to move quickly!
I may sound like a broken record when I say this, but the future of work is absolutely about breaking down barriers between teams and geographies. Sales should be speaking with product development, marketing should be speaking with customer service and support, and engineering should be speaking solution delivery teams. The traditional model saw only people in the same team or physical location share and collaborate; no more. The organization of the future is a connected organization where information, collaboration and communication happens without boundaries.
There’s a reason why large organizations are stereotyped as being slow-moving, bureaucratic, old-fashioned, and simply outdated…because many of them are. Larger organizations are at a high risk for being disrupted which means they need to learn how to operate like smaller companies. However, a paradox exists. As organizations grow so does their complexity which results in more sluggishness. These same organizations also want more profits which means they have to grow. So, they are stuck with trying to find a way to grow while becoming less complex.
Organizations around the world have been making a various dangerous assumption; assuming that employees would work there because they needed to. Years ago this was definitely the case as there was really only one way to make a living. However as Dan Pink rightly commented when he said, “today talented people need organizations less than organizations need talented people.” This means that organizations have to shift their focus from creating a place where they assume people NEED to work there to creating an environment where people WANT to work there.
Going forward, “late adopter” means “out of business.” Years ago organizations had the luxury of seeing what their competitors were doing and then quickly following on their heels. Today that is no longer true. Organizations must adapt quicker and more aggressively if they wish to thrive in this new rapidly changing business world. COVID-19 has certainly proven that to be the case as organizations not prepared to work or do business in this new world have struggled dramatically (or have disappeared altogether).
Innovation and Ecosystems
Innovation was something that used to be done only by a specific department within an organization. Today we are seeing a completely new model of innovation opening up based on ecosystems which includes employees, customers, partners, the general public, and yes, even competitors. Organizations that create these ecosystems will thrive.
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Cloud vs on-premise
One of the keys that will enable organizations to evolve from a technology perspective is their shift from on-premise to cloud. In fact it’s hard to imagine this shift not becoming the standard over the next few years. Shifting to the cloud allows for benefits such as faster upgrade time, improved flexibility, reduced costs, and increased accessibility and adoption of the technology platforms.
Women in leadership
Today there are approximately 15% of women in executive officer positions in the U.S. which is a shockingly low number. One of the things we can expect to see is an increase in this number. Having more women in leadership sees dramatic positive impacts on organizations such as higher return on equity, sales, and on invested capital.
Change in organizational structure
I’ve spoken with, worked with, and have researched hundreds of organizations over the past few years. I’ve never met an executive or leader who said “we need more hierarchy” or “we need more layers.” In fact the exact opposite is true, organizations are trying to “flatten” their structure to improve communication and collaboration. This means that the traditional strict pyramid hierarchy no longer makes sense for the modern organization and we will be evolving to flatter more nimble structures.
We used to assume that this was only important for attracting customers. However, when it comes to creating a desirable employee experience and one where employees can relate to the company they are working at and align their values; nothing is more powerful than story-telling. Employees must understand WHY the organization exists and then they can help figure out HOW to make the organization successful.
In most organizations around the world today if you want to learn how to do something you usually have to take a class that the company may or may not offer. Oftentimes you travel to another location, listen to a guest speaker, watch some outdated scripted videos, read through a training manual, and maybe do some hands-on exercises. In other words, your entire education and learning is dependent on the organization. However we are seeing this evolve so that any employee can educate or learn from any other employee. This is largely possible through technology such as internal collaboration platforms, social networks, and new online learning tools.
Life-time and long-term loyalty are completely dead as is the notion of job security and pension plans. The average employee tenure today is under 5 years and for millennials it’s under 3 years. Loyalty is becoming more geared towards projects, leaders, or co-workers as opposed to the organization as a whole. Companies must switch from a long-term career mentality to a shorter term project term mentality. As André Calantzopoulos the CEO of Philip Morris International told me, “we’re moving from an era of lifetime employment to lifetime employability.”
From profits to prosperity
Profit is just the financial gain that an organization generates and has always been the primary measure of success. When it comes to the future of work money will no longer be the primary success factor that organizations are measured by. Instead factors such as health and wellness, community involvement, employee happiness, sustainability, world-impact, and the like, will be the new measures of success. Today with COVID-19 we are seeing a which leaders are willing to put their people or their profits first. The former CEO of Volvo, Pehr Gyllenhammar was a champion of this.
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