Emerging capabilities - buy or build?

28 March 2019

I recently attended a CEDA (Committee for Economic Development of Australia) luncheon on the future of work. Yes I know - we all have one of these invites in our email inbox or have recently attended a "futurists" presentation on this topic. These presentations seem to be cropping up everywhere with some varying opinions on what is in store for future generations. 

What made this discussion interesting was that it was supported by cold hard facts - it provided some sobering food for thought when it comes to the future of work when considered from a fact base. A past colleague of mine, Haig Nalbantian, wrote a recent seminal article debunking the myths that generally do the rounds of the speaker circuit but add little by way of evidence to support their claims. Haig’s article is fact based, and questions many of the strongly held beliefs about millennial behaviours in the workplace. It reminded me of the importance of fact based approaches and how on many occasions they can serve to debunk populist views that are mostly based on anecdote. I urge you to read his thought provoking article - I have attached a link for your reference.

The CEDA discussion was thought provoking and evidence based. Much has been said in recent times about the future of work - we need to be flexible, we need to consider emerging capabilities, universities are moving into more micro credentialing and so on. The discussions to date seem to have focused mostly on what individuals need to consider regarding their working careers and to pursue their own development needs.

My experience suggests that organisations investment in development has waned. In some organisations, investment is largely focused on having the right learning and development policies in place, but this isn’t always followed by proactive and managed development of employees. Organisations expect capable employees but don’t always adequately invest in growing their own. Some sectors would appear to underinvest in development and almost reluctantly look to promote from within - opting to recruit from the external market ahead of developing their own. 

Many talented employees find it easier to leave an organisation in order to gain the promotion and recognition they seek. In a tight labour market this can be a costly exercise - there is a very real likelihood that the incoming employee will demand a higher level of pay and the new recruit can take anywhere up to a year before they are fully productive. In a less restricted market an employee exit may be easier and less costly to replace, however the lead time to full productivity still remains. 

So why the reluctance to develop and promote? Is leadership and employee development apathy partly to blame? What I’m seeing is what I like to refer to as “short-term-ism” both from employers and employees alike. We want the quick fix, we are time poor, so we don’t invest because we are too focused on outcomes and the immediate requirements of our jobs. We feel that we don’t have time to invest in development to stay on top of work demands. 

The discussion at the CEDA event spoke of certain workforce groups growing and others declining. Over the five years to May 2023, the Department of Jobs and Small Business projects employment will increase in Health Care & Social Assistance, Construction, Education & Training and Professional, Scientific and Technical Services. Declines in employment are projected for Agriculture, Forestry and Fishing, and Wholesale Trades. These macro trends are common amongst OECD countries. What is often not revealed is the emerging capability gap within these sectors. It would appear that whilst employment growth will continue - the perceived capability gap may take some time to redress. 

The changing nature of work is exacerbating this situation - it’s creating a divide amongst those with the skills and those without. Organisations need to reinvest in development - the gap between the top skilled employees and entry level employees is growing. 

Is it time for a bit of “back to the future?” - anyone remember the training guarantee levy? I’m showing my age here, but despite some shortcomings the levy provided a real focus for organisations to actually develop their employees. We have stopped investing and it’s starting to hurt!

How often do we look at our workforce and think “senior managers these days aren’t what they used to be!”? Typically reflecting a view that we have somehow lost some baseline capability, and that we haven’t invested in developing our leaders appropriately. The gap between those with knowledge and those just starting their working life is growing. What happened to coaching and mentoring being a key responsibility of a leader? When did we as leaders stop valuing this? 

Understanding your workforce from a fact base is a good place to start to determine what is needed and to figure out what is actually happening to the workforce, where the gaps are, what we need to do to build and retain, and whether we should recruit or divest. I believe that developing leaders who develop others is what will help us meet an uncertain future. 

Government also needs to reconsider their role in broader workforce development for the sake of our future generation of workers and leaders.