Even before early humans crafted the first wheel, technology has been at the forefront of life. For centuries, civilization has propped itself up on the heels of innovation, whether it was that first wheel, the horse-drawn carriage, the automobile or aeronautics. And along with technological progress have come seismic shifts in the world economy, starting with the nature and role of human work.
Today, technology is at it again, and, unsurprisingly, the effect of the current wave of innovation is transforming the nature of work as we know it. The rise of mobile connectivity and networked technology, automation, artificial intelligence, big data, among others, have both created and eliminated jobs and augmented others. It has spawned new ventures and lowered the barriers of entry to entrepreneurship — but it has also shuttered those windows that are no longer useful or efficient.
Talent Economy editors explore how the latest wave of innovations is poised to transform every industry, the market for skilled talent and the future of business and society.
Automation
Every Industry is a Tech Industry.
On Oct. 7, 1913, workers at Henry Ford’s automobile plant in Highland Park, Michigan, rigged its first rudimentary assembly line. Using a crude, rope-based system, 140 workers stretched across the 150-foot line installed parts on the base frame of a motor vehicle as it dragged across the floor.
The new process revolutionized motor vehicle production, dropping the assembly time for a single vehicle from 12 hours to about 90 minutes. The innovation also propelled the Industrial Revolution to new heights by improving the economics of manufacturing, norms around employee-employer relations and American consumer culture.
In 2016, days after Ford Motor Co. celebrated the 103-year anniversary of the first moving assembly line, 50,000 bottles of Budweiser traveled across Colorado in a self-driving, autonomous truck named “Otto.” Owned by the popular ride-sharing firm Uber Technologies Inc., Otto represents a similar technological innovation poised to disrupt industries and cultural norms for generations.
Just as the impact of the assembly line was felt far beyond motor vehicle manufacturing, today’s modern technology boom has far-reaching implications for every industry. While autonomous vehicles may soon be the norm in the automotive sector — Ford announced plans in August 2016 to have an entirely autonomous ride-sharing fleet by 2021 — the technologies behind the innovation are driving seismic shifts across industries.
Advances in mobile communication and artificial intelligence have made self-driving vehicles possible, but these are just some of the burgeoning technologies that are also upending the wider economy. As a result, executives are shifting course not only in the kinds of products and services their companies aim to produce, but they also are cautiously eyeing how such innovations will influence the market for skilled talent.
Consider how today’s modern tech boom has influenced agriculture, one of the world’s oldest economic sectors. While firms like Uber, Tesla, Google and Toyota, among others, are just now ramping up progress on self-driving vehicles, farmers have used autonomous tractors for nearly two decades, according to Chris Rhodes, director of business development, crop cycle at AGCO Corp., a manufacturer of agriculture equipment based in Duluth, Georgia.
“Farmers are leading-edge folks,” Rhodes said. Nascent agriculture technology focuses on using the data collected by tractors and other tools to help optimize crop yields and other performance metrics. And starting next year, AGCO plans to experiment with hologram-like images and other augmented reality tools to help workers in the manufacturing process, The Wall Street Journal reported in December 2016, further increasing the company’s reliance on emerging technologies. This means firms like AGCO are increasingly recruiting talent equipped with the same skills as those seeking jobs with traditional technology companies.
Cargill Inc. is another century-old agriculture company increasingly reliant on similar technology. When asked what roles will be most critical for the company in the next five years, Mary Kynkor, Cargill’s vice president of talent and organizational effectiveness, said data scientist and cloud computing specialists are near the top of the list. “Technology is playing across all areas of our company,” Kynkor said.
Much of what’s driving today’s technology boom is the enhanced ability to sort through and manipulate complex data sets — a task needed by every industry thanks to the explosion of data provided by mobile and networked technology. Because of this, artificial intelligence is a technology many predict as the basis for the next technological revolution due to its ability to make judgments off complex data sets.
AI, along with its relative, machine learning, will play a heavy hand in the development of things like self-driving automobiles. But the technology is finding powerful use in many other fields, from email marketing to digital publishing, human capital analytics and workforce planning.
The sales industry in particular is one profession that has experienced a transformation using AI. The job of any salesperson is to build connections with other people so as to help each side find value in a transaction. Therefore, it makes sense that most sales relationships are typically built on people’s ability to communicate with one another, whether it is through telephone, fax machine, email or instant messaging. Today, however, salespeople are coming into an age where software programmed with AI can help streamline communication clutter.
Take, for instance, Conversica, a marketing firm that provides users an automated sales assistant. Carl Landers, the Foster City, California-based firm’s chief marketing officer, said Conversica’s software uses AI to email potential clients, read their responses to gauge interest and gather leads. This leaves actual human salespeople with more time to build relationships with customers, which ultimately leads to more sales based on automated work the software has performed for them.
Just because AI does the legwork for a sales staff doesn’t mean the job is easier. Landers said the job often becomes harder because the automated software technology provides people with more sales leads to act on. Most of Conversica’s clients end up having to add to their human sales staff to handle the increased workload, with sales professionals forced to sharpen their skills in some of the more complex areas of the job.
For other companies, advancements in automation technology have allowed them to forgo a sales staff altogether. Such is the case with Atlassian, which sells project management and chat applications without a single salesperson. Thanks to low-cost marketing provided by the company’s website, Atlassian instead relies on internet word-of-mouth to sell its product. Not having to pay a sales force allows Atlassian to invest elsewhere, such as research and development, the company’s president, Jay Simons, told Bloomberg in May 2016.
Thus is the looming threat posed by today’s modern technology boom: the loss of human jobs, or at least a drastic transformation of how people work. Although AI appears unlikely to wipe out the sales industry altogether, there are other sectors that are likely to be more directly influenced by continued advancements in emerging technologies.
Cybersecurity is one such sector that’s emerged with increasing significance thanks to today’s technology boom. Nearly every company now uses complex computer systems to store information like customer credit card numbers, internal employee profiles and proprietary strategic plans. “There’s almost no business left in the country that doesn’t have to start worrying to some extent at least about cybersecurity,” said Daniel Tauritz, associate professor of computer science at Missouri S&T in Rolla. As a result, more companies have built sophisticated teams of specialists to protect against data theft and other vulnerabilities created at the hands of technology
Another is retail. First, e-commerce upended the way in which people shopped, taking a largely in-store, in-person experience and moving it online. Now, robots and automation are disrupting the in-store experience yet again, this time coming at the expense of in-store workers. Amazon Inc., which led the initial e-commerce wave, is at the forefront again with its plan to create an in-store grocery shopping experience with a checkout process devoid of human intervention. Hardware retailer Lowe’s Cos. Inc. is another example. Customers at a Lowe’s store can now stumble upon the LoweBot, which helps them answer questions and find certain products.
Some industries are expected to grow immensely as a result of advancements in these technologies. Pharmaceutical companies now use computer models to better test human reactions to medications, decreasing time to get drugs to market. The textile industry uses computers to mock up and create custom cloth for designers. It also uses body-scanning technology to determine customers’ exact fit. An AI-enabled dress by Marchesa and IBM Watson also hit the red carpet at the 2016 Met Gala.
Finally, just as manufacturing was the beneficiary of the technology boom at the turn of the Industrial Revolution, the sector again is among the core industries likely to change at the hands of modern-day innovations.
Pace Industries Inc., a full-service die-casting manufacturer in Fayetteville, Arkansas, makes molds to produce parts for a variety of industries. When Pace first opened for business in 1970, the firm’s manufacturing process included a traditional assembly process with most of the company’s workers using trial and error, according to Kenneth Sandlin, vice president of health and safety at Pace Industries.
Now, engineers use software to develop more precise computer prototypes, which are then molded using 3-D printers. Nearly every machine at the company’s 21 locations now has a computer on it, Sandlin said, which helps identify gas porosity during filling of the cast and other quality metrics, leading to a more consistent, higher-quality product.
Using this variety of technology requires more technical knowledge from Pace’s employees. “The days of going to any job and not at least having some form of contact with technology, I think are definitely passed,” Sandlin said. Employees now need to program robots and work with software. To find these workers, Pace works with colleges to educate students on these technology skills. Moreover, Sandlin said the firm often has high school students visit its plants to see how technology is used and to explore potential career opportunities. The company also sponsors a robotics team that interns during the summer to learn more about robotics and 3-D printing.
Pace also uses digitized visual effects to layout its facilities. By standardizing the layouts and manufacturing processes and storing and tracking this information digitally, Pace is able to improve its efficiency as well as increase workplace safety. Pace was able to save $1.2 million in workers’ compensation costs between 2012 and 2015 as a result of improved workplace safety conditions. Sandlin said that money now goes toward educating current employees as well as toward partnerships with technical schools to develop a pipeline of incoming workers.
“We’re able to take that money and reinvest it into our people, reinvest it into newer technology to keep our advantage over competitors that maybe aren’t grasping technology as quickly as we are,” Sandlin said.
Agility
How Tech Has Reshaped the Skills Market.
The economy’s dramatic reshaping at the hands of modern technological innovation has vast implications for the market for skilled talent.
In particular, with changes afoot in almost every industry, the skills that companies will need now and into the future are likely to require equal emphasis on hard, technical skills and soft, management and leadership expertise.
The manufacturing industry is again among the primary sectors experiencing transformation. For starters, the industry is having difficulty replacing a generation of talent with skills in traditional trade fields, according to Pat Dean, director of recruiting at industrial services company Advanced Technology Services Inc., based in Peoria, Illinois. For example, Dean said interest in tool and die-making — machinists who make jigs, fixtures, dies, molds and other tools used in the manufacturing process — is waning, making it increasingly difficult for companies to find people to do the job, especially among younger generations of workers.
Part of the problem, Dean said, is that the education system hasn’t encouraged students to pursue vocational careers. Instead it is pushing more young people to attend traditional colleges and universities — institutions that typically don’t emphasize education in trade or manufacturing skills.
“Conventional wisdom as always been that these manufacturing facilities are dark, dirty, nasty places,” Dean said. This lack of a pipeline into traditional vocational fields comes amid a wave of innovation in manufacturing technology that has shifted the kinds of skills needed to work in the field. “From our perspective as a service provider to large manufacturing companies, we’re seeing a shift. The factory floor is becoming so much more tech heavy,” Dean said.
As the industry does become more technology-heavy, Dean said one thing it is not doing well is marketing what the jobs are like today.
Nowadays, manufacturers are not just looking for talent with skills in vocational or trade roles; they’re also in need of people with electrical and computer programming skills. Just like the shift in the agriculture industry, manufacturing needs to attract the kind of talent normally seen in traditional technology roles. Although traditional manufacturing jobs are still needed, the industry is experiencing a skills gap in technical jobs, like troubleshooting on the factory floor or the computers that run those machines.
Another profession undergoing a skills transformation thanks to technology is the sales industry. Given the growth of startups in the technology sector, particularly pertaining to software, sales has become among the fastest-growing roles, according to Harrison Horan, founder and CEO of re:work, a Chicago-based firm that trains people without college degrees to sell software.
“Regardless of what people think is going to be done by machines in the near future, sales is something that still requires complex communications and thinking on your feet,” Horan said. And while technology has certainly helped sales professionals, the role is ultimately driven by complex human interaction — an area in which the industry is currently experiencing a lack of skills.
For example, especially among younger workers, salespeople are becoming too “consultative,” Horan said. They’re getting worse at managing uncomfortable conversations around significant areas like pricing and handling objections, which can hurt the business. Another skill Horan said that is in need of improvement in sales is information processing. With the surge of internet content, it’s easy to get distracted, but it’s become more necessary to process new information quickly and deeply.
The consumer products industry is also feeling the skills transformation, not just because of advancements in technology, but because of the global scale with which such enhancements have elevated many businesses. “We need people who can think and act on a global basis, even if their job is focused and regional because, ultimately, it all connects,” said Tom Davin, CEO at 5.11 Tactical, a uniform clothier for law enforcement, military and public safety personnel.
Executives of companies like this should enhance their skills by mastering the complexities of global sales. This entails skills like doing the right market research to comprehend the needs of local consumers in different global markets as well as understanding the nuances of import duties, testing and labeling requirements. These skills don’t just apply to larger firms, either; smaller firms with modest overseas operations need to adhere to them as well.
While some of these skills are specific to the consumer products industry, Davin said there are many skills required to operate in a more globalized business environment that apply to all type of knowledge workers.
A few of these skills are critical thinking, collaboration and communication. The globalized workplace has created an environment in which people whose skills are rooted in creative fields need to learn to be more technical and vice versa. People with more creative jobs, for instance, are also now expected to understand the analytical side to their work and be able to use certain tools to improve their performance. Conversely, people in more technical-heavy roles are expected to adopt more soft skills.
Communication is a skill that has experienced especially broad transformation thanks to technology, as the prevalence of electronic platforms has decreased instances of face-to-face human interaction and long-form written correspondence. Davin said this has hurt people’s overall ability to communicate and has put a premium on talent with strong skills in these areas.
Bob Schultz, general manager of Smarter Workforce at IBM, the company’s human resources software division, echoed the importance of communication skills in today’s economy. He said talent with a holistic profile made up of both strong technical backgrounds and softer skills like communication and collaboration will stand out among recruiters. This is especially important since most companies, IBM included, now use personality assessment technology in the recruitment process. “It’s not about matching the resume to the key word search,” Schultz said.
The level to which the modern technology boom has transformed business has brought about a need for leaders to change their skill palette as well. One major skill needed in this modern environment is the ability to adapt to change. Not only has modern technology upended traditional industry norms and the skills required to operate in today’s economy, but it has also sped up the pace of change.
“Things are so fast,” said Yvette Cameron, global vice president of strategy at SAP SuccessFactors, a cloud-based human capital management software firm. “It’s not enough to respond to change and then relax. You have to build the agility to handle constant change.”
James Cross, director of learning product strategy at Workday Inc., an HR management software provider, echoed the point. “More than anything, we need people who know how to go with the flow, learn new skills and adapt to a changing world,” Cross said.
On an organizational level, companies can foster an adaptable talent pool by focusing on building stronger learning and development functions, Cross said. That starts with leaders making sure that their organizations are adequately funding learning and development, especially programs around leadership development.
SAP’s Cameron cited a Leaders 2020 study the company recently conducted with Oxford Economics showing that most corporate leaders are ill-prepared to operate in today’s digital economy. The study, which surveyed thousands of executives from companies around the world, found that barely half of them think their senior leadership is proficient enough using technology. It also suggests that, as a result of this deficiency, many companies are approaching a “leadership cliff,” where they don’t have enough ready-now leaders in their talent pipelines.
For companies to thrive in today’s modern economy by attracting, developing and retaining talent with the right skills, leaders need to be more hands-on in evaluating how technology is continuing to transform the talent economy. Above all, that includes spending more time understanding how each generation is developing their skills along with technology so leaders can adapt their companies’ cultures as a result.
“Leaders have historically been clandestine about what the next step is in people’s careers,” Advanced Technology Services’ Dean said. “It’ll have to be a more open environment in the future, [with leaders] talking to employees about the type of things they have to do to get to the next role in their career.”
Foresight
Technology and the Future of Work.
Technology’s impact on long-held industry norms and the market for skilled talent is just the start of a wider conversation about the role it will play in society going forward. But for leaders to fully comprehend the ways in which their organizations will need to adjust to this new environment, it is first important to understand the extent of the change these emergent technologies might bring.
As early as 2013, researchers from the McKinsey Global Institute had identified 12 disruptive technologies with the potential to reshape the future of how humans live and work. They are: mobile internet; automation of knowledge work; Internet of Things; cloud; advanced robotics; autonomous and near-autonomous vehicles; next-generation genomics; energy storage; 3-D printing; advanced materials; advanced oil and gas exploration and recovery; and renewable energy.
Taken together, application of these technologies could have a potential economic impact between $14 trillion and $33 trillion a year by 2025, according to McKinsey.
While all of these technologies are poised to influence how businesses operate, there are a few in particular that appear bound to have a more profound effect on the future of the talent economy.
First, the mobile internet has already had the most overwhelming impact on the talent economy in recent memory. Thanks to increasingly inexpensive access to mobile computing and internet connectivity, workers have not only become more productive but they are now better equipped to start new and unforeseen ventures.
The rise of the gig economy is a prime example of how mobile technologies have created a new tool for entrepreneurs and new market for talent. As of June 2016, about 0.9 percent of adults in the U.S. labor force actively earned income from these platforms, according to a November 2016 report from JPMorgan Chase & Co. This not only includes platforms like Uber, in which people with cars log into an app to give people rides, but others like Airbnb, eBay and Etsy — platforms that allow users to leverage mobile connectivity to sell goods (eBay, Etsy) or earn passive income from acquired capital (Airbnb).
Second is the automation of knowledge work. According to a 2013 Oxford University study, close to half of the 700 occupations its researchers examined are at risk of being overtaken by robots in the coming decades. But, as the researchers at McKinsey point out, the automation of knowledge work extends beyond the emergence of robots. It includes using AI and machine learning technology to allow software to complete certain routine tasks formerly completed by a human. And according to the McKinsey Global Institute study, the additional labor productivity of automation could soon equal the output of 110-140 million full-time workers.
For instance, technology such as Robotic Process Automation, or RPA, software helps companies move information from one system to another with limited human intervention. The legal sector uses similar technology in the discovery process, where automation software wades through piles of legal documents to help attorneys find relevant information. Finally, as evidenced by companies like Conversica, automation can be used in sales and marketing to streamline communication and other administrative busywork so sales professionals have more time to make the kind of complex human connections required in today’s business environment.
The third is the advancement of robotics. Even as studies continue to point out the potentially jobs-killing role robots could bring to the talent economy, many experts remain bullish on the technology as a supplement, not a replacement, for vast amounts of human knowledge work.
According to the McKinsey study, the key applications for the future of robotics technology appear concentrated to the industrial/manufacturing and service sectors. Food preparation, cleaning and maintenance, robotic surgery, human augmentation and personal home robots are among the core applications the advisory firm considers most relevant to the future of the technology.
Pat Geary, chief marketing officer at Blue Prism, an automation software firm with offices in London and the U.S., said his vision on how robotics will influence the future of work is one where these technologies don’t entirely displace humans but frees them up to take on more complex problem-solving and other strategic initiatives. “You can immediately focus a whole bunch of digital workers on a completely new task,” Geary said.
Still, even as robots have the potential to make human work more strategic, leaders should remain cautious in how they integrate the technology, said Mary Lacity, a professor of information systems at the University of Missouri-St. Louis who has studied how companies have used robots and automation technology at work.
“There are companies that will come in and say, ‘I’m going to use RPA to slash my headcount,’ ” Lacity said. “They may end up with employee sabotage; they may end up with it not working.”
Robotics’ inevitable rise will force many to learn new skills entirely. This will put a tremendous burden on companies’ human resources functions, write the authors of a 2016 report from research and advisory firm Accenture, The Promise of Artificial Intelligence: Redefining Management in the Workforce of the Future.
Those who fail to learn new skills to complement the impending robotic boom will be included among the job churn. This is especially the case for lower-skilled workers with little access to education or the ability to learn complex skills quickly, according to Ian Barkin, a co-founder of Symphony Ventures, a business automation consulting service headquartered in the U.K.
“I would imagine it would be a challenge to take someone whose primary job is one of transaction processing and turn them into a data scientist,” Barkin said. “It’s just not what those particular folks went to school for or know how to do.”
The onus, therefore, falls on executives to prepare their organizations for this quickly approaching workforce transformation. The first step, according to Mike Cook, human resources services research director at HfS Research, is for leaders to be wholly accepting and adaptable to change. He also said leaders should open up communications channels within their organizations.
Breaking down too many bureaucratic layers and encouraging more open communication can improve processes and worker efficiency. Cook said executives should also engage with their industry peers in conversations on how to adapt and take advantage of the changes to come with the future workforce.
Finally, even as robots and automation threaten the future of human work, Cook said leaders must continue to focus on an employee-centric workforce model. Human talent remains the most powerful driver for any organization. Therefore, for leaders to fully embrace the changes likely to come with emerging technologies, it’s important for them to remain invested in developing and retaining human talent.
“Talent really defines businesses right now,” Cook said, “and I think it’s absolutely archaic that we see so many C-suite executives who still see their workforce as a cost. It’s ridiculous in today’s age. That mindset is changing.”
This first appeared in the Talent Economy Winter 2017 Quarterly Journal. Click here to read the entire digital edition of the issue.
