Episode 156: Rethinking Leadership for the Future of Work (Interview with Heather McGowan)
In this episode of the Digital HR Leaders Podcast, David is joined by Future of Work Strategist and esteemed co-author of the books: The Adaptation Advantage’, and ‘The Empathy Advantage’, Heather McGowan.
Heather is renowned for her expertise in all things related to the future of work, and this conversation promises to be a thought-provoking exploration of the shifting landscape of work and the critical role of empathetic leadership.
Expect to learn more about:
How the pandemic has transformed the way we work and the four significant shifts in leadership that have emerged as a result
The link between empathy and performance
The challenges faced by existing leaders who have been taught that an autocratic leadership style leads to success, and how they can embrace empathy as a transformative approach
The evolving role of HR professionals and the areas they should focus on to drive business value in the future
Practical steps individuals can take to transition and benefit from the 'empathy advantage' in their personal and professional lives
The implications of technological advancements like generative AI on companies and the future of work
Efficient ways of training and developing employees in a rapidly changing skills landscape
Support from this podcast comes from Worklytics. You can learn more about Worklytics by clicking here.
[00:00:04] David Green: For decades, we've been anticipating what the future of work will look like, what kind of skills will be valued most, and how leaders can better prepare their teams for the future. But the reality is that the future of work is already here. With AI and machine learning taking the world by storm, we are in a period of massive change and transformation. And to be successful, leaders will have to start leading differently.
That's why I'm absolutely delighted to introduce our guest today, Heather McGowan. Heather is not only a leading Future of Work strategist, but also the co-author of two remarkable books that provide invaluable insights for navigating this rapidly evolving world of work. Her first book, The Adaptation Advantage: Let Go, Learn Fast, and Thrive in the Future of Work, empowers leaders to embrace change and cultivate a culture of continuous learning. And her new book, also co-authored with Chris Shipley, The Empathy Advantage, Leading the Empowered Workforce, has been widely acclaimed as a gamechanger in management literature and thinking, particularly in the post-COVID era.
So, in our conversation today, Heather will share her profound research findings on the ways the pandemic has transformed the way we work. We'll explore the four pivotal shifts in leadership that have emerged during this time and discuss the increasing importance of empathy in driving organisational performance. I'm confident that today's discussion will inspire you to rethink your approach to leadership and empower you with practical strategies for success in the future of work. So without further ado, let's dive into this enlightening conversation with Heather McGowan, where Heather starts off by telling us a little bit more about herself.
[00:02:03] Heather McGowan: What I call myself is a Future of Work strategist and a keynote speaker and an author. And Chris Shipley and I wrote The Adaptation Advantage, which came out in 2020. The premise of it was, the future work is really learning and we can't have fixed occupational identities or fixed ideas, we have to essentially get adept at adapting, and that came out just prior to the pandemic. And, oh boy, we did not know how much we were going to need to adapt then!
Since then, I've been out on the circuit speaking nonstop, it went virtual to in real life, in and out of phases of that really. And I started noticing some pretty fundamental shifts that were taking place with the acceleration of the pandemic, which led to our most recent book, The Empathy Advantage: Leading the Empowered Workforce.
[00:02:48] David Green: Yeah, I mean fantastic, and obviously that's what we're here to talk about. I mean, it's interesting because a lot of what you were talking about on the show three years ago was exactly what you're saying, the future of work is learning. And we're actually seeing that playing out in a lot of big, big organisations. There's been lots of talk about talent marketplaces, but essentially what these companies seem to be doing is doubling down on helping their employees get access to learning, access to mobility within the organisation, not always through permanent jobs, but actually through getting involved in projects as well; and then having much more flexibility, perhaps, around potentially having to redeploy people within the company, rather than doing what companies usually do, cutting people, hiring others in other parts of the organisation.
So, I think a lot of what you were talking about then is really starting to play out, and I think as you said at the time, had been accelerated by the pandemic as well.
[00:03:42] Heather McGowan: Not only has it played out, it's gone from push to pull. So it used to be the employees pushing employees to learn. Now the Pew's latest survey on why people leave organisations, of course number one is compensation; people jump for more dollars, but that doesn't sustain. But with a net score that was the same, it was learning opportunities, because people realise, "If I'm not learning, I'm not going to be earning in the future". And so they know that's what makes them valuable in the future, and so that's becoming a real pull with employees.
[00:04:11] David Green: And I think it links nicely, that kind of push to pull thing is quite interesting as well, because we obviously want to delve into The Empathy Advantage today, which you co-authored again with Chris Shipley. I was reading through the endorsements, it's been praised as, "The most important book on management in the post-COVID era", which I think is a nice little line to get us started. Could you share a short summary of what the book is about?
[00:04:37] Heather McGowan: Yeah, so the book is really divided into three sections. We try to make it very easy for folks to both read and skip around, because I am a short-attention-span person as well, so you should be able to read it on a cross-country flight. It's about 200 pages with about 35 graphics. First part is, meet your new workforce because it's not the one you left in 2019. Second part is, you have to rethink about how you actually organise work, because the maps and the models in the past are not only not helpful, they can actually be dangerous, like driving in the city of Boston, which I'm from, using maps before the big dig, it's just not going to get you anywhere, it's going to get you lost and frustrated. And then the third part is about rethinking your leadership entirely, because here's what we think happened.
Really, there have been two transformations. One is a changed relationship between individuals and organisations. The workforce is now empowered and no economic downturn, soft landing, hard landing, short recession, long recession is going to change that fundamental fact. And that comes from the existential crisis of the pandemic, generational and attitudinal changes in the workforce, and labour shortages, which are going to continue unabated, at least in the developed world anyway, for a decade to two decades, we're going to have to get used to that. So, that's one transformation.
The second transformation is from linear to complex. We've had 15 years of digital disruption, and now organisations, the simplest way I explain it to people is, most people at every level in organisation will or will soon have people reporting to you who have skills and knowledge you don't have. And so that means you can't rely on your individual intelligence as a leader, you have to harness collective intelligence, you have to organise work differently, you have to treat your workers differently.
So, I say there are four shifts that a leader needs to embrace. First is a shift in mindset. You're not managing people and processes any more, you're enabling success. And to be intentionally provocative about it, I say, "You used to think of the people as working for you. Now, you work for them. You enable their success, because you're not going to get anywhere without their success". The second is a shift in culture. We used to, when we had the same skills and knowledge of the leader and the team, and then usually across the team, you could pit people against each other. Forced rankings, all those kind of bad ideas, Hunger Games kind of stuff, that doesn't work anymore. So you've got to shift from peers as competitors to peers as collaborators.
The third shift is a shift in approach, one we should have made when we all read Dan Pink's book, what was it, 12 years ago, from extrinsic to intrinsic motivation. We're never going to get people to learn and adapt at the speed, scale, and scope we need through punishments, threats, and rewards. It's just not going to work, never was a good way to motivate people. And then finally, a shift in behaviour. We used to have our leaders myopically drive productivity at any cost, grinding people to dust, burning people out, didn't matter, with domination, fear, even humiliation, didn't matter. Now we need leaders who can create effectiveness through inspiration, who can create performance through empathy, and we need to look at those leaders, not just based on the performance they're driving today, although that's important, but also the pipeline of talent they're developing for tomorrow, because we've got greater churn in organisations, we have labour shortages, we need succession planning and developing people around us at every term. So that's kind of a fly through the book.
[00:07:59] David Green: That's really helpful, thank you, Heather. These things were happening anyway, weren't they, and I mean there's been a lot of focus around how the pandemic accelerated the change in the way we work, and where we work perhaps as well, but actually what you've really talked about there is, it's changed the way we lead as well, or it should have changed the way we lead, and that adds another layer of complexity.
[00:08:22] Heather McGowan: Absolutely and we're seeing a shift in leadership too. So, when I would go out and speak, and I usually speak to senior level group leaders, the room would be at least half boomer. And now there's a handful of boomer, a lot of Gen X leaders, more millennial leaders and now we're seeing, at least in the US, about 12% to 13% of the workforce is Gen Z. That's going to be 30% by 2030 and they're an entirely different animal. They are going to change work in really fundamental ways that I think are ultimately positive.
[00:08:52] David Green: And definitely, as you've talked about, there's that shift to more empathetic leaders. And so, it would be interesting, because we talked about this a little bit when we spoke last week, I think, what have you discovered, because obviously there's a ton of research in your book, Heather, which I think is really important? They're not just opinions you're putting out there, this is based on deep research, interviews and works with lots of organisations as well. I'd love to understand, what have you discovered about the link between empathy and performance?
[00:09:23] Heather McGowan: Well first, I think we need to dispel the notion that empathy means less, and I didn't really even understand it until I started doing these book tour interviews where people said to me, "Okay, so we've got to be empathetic, we've got to be nice, we've got to make concessions for people, let them do less and expect less". And I thought, "Well, there may be days that's true". Your dad dies, you have to put your dog to sleep, there are days that we have to be human and that's true. But no, that's not what I'm talking about.
I'm talking about empathy as a means of understanding your workforce so you can help them, not only motivate them, but help them become self-propelled. Empathy ultimately drives performance. It's not about lesser performances or about greater performances, it's also about greater balance. Because what's really happened during the pandemic, and I think people get all caught up on where work takes place, you know, home, hybrid office, I really have no opinion on that. What I think has happened is, and everything's pictures, it means I have to draw, is we had a smaller circle in 2019, that was called our personal life. And we had agency over our personal life. And we had a bigger circle that cast a shadow on that smaller circle, and that was our professional life.
This smaller circle is what makes our eulogy at the end of the day. This bigger circle is what makes our resume. And when you have an existential crisis, the personal circle grew, the professional circle shrunk a little bit, they became overlapped, we had agency over both. And we started asking, which is why I call it an existential crisis, "Is this what I'm doing with my life? Do I want to work with this jerk? Do I want to do this stuff I don't believe in?" And that's why I think we've seen such a -- the Great Resignation is really five grades. We've seen such an upheaval in what people do. And what I say is, it's not about where we work, it's about where work fits in our lives. And I will argue when it fits in the right place, we will get better performance.
So empathy to me is ultimately, it is a nice thing to do, it's a right thing to do, it's a way of being human. All of those things are a given, but it's also, if you do it right, a performance driver.
[00:11:26] David Green: Yeah, it's important, isn't it? And I guess for leaders who maybe, particularly those that have grown up being led very differently and maybe learned how to lead from people that have led them, it's challenging, I guess.
[00:11:41] Heather McGowan: It's a huge shift and I gave a couple of talks one week to commercial real estate folks and they were all, it was mostly boomers, some Gen X, they were mostly kind of alpha dog folks, more males, one of them was almost all male. It's not gendered though but that was the case in this instance and they were like, "Don't you think we're getting woke, and aren't we getting soft, and aren't we losing our edge?" And I thought, "Oh, I'm not explaining this right, if that's what you're taking away from this".
But I also thought, "I'm telling you to have empathy, but I'm not having empathy for you". And I think that was a huge aha, is that if you were brought up, raised with this, give up your Saturdays, don't go to your kids' soccer game or cricket game, whatever it may be; work comes before everything, maybe get on to your second or third marriage because you've ground all your relationships to dust. That's how you become a leader, and then in order to lead, you've got to have your people be afraid of you and not like you and that that's what you were brought up with. This does seem like, "How could this possibly work?"
You have to have empathy for folks and say, "I know you gave up all those things. I know what you went through frankly sucked. And the people who are coming along now that you're going to be leading are not going to put up with it, it's not going to work. So I need to have empathy and respect for what you went through, but I've got to tell you, if you want to be successful, you are not going to be successful with those tactics".
[00:13:06] David Green: And I think that, I guess one of the challenges for leaders is, we were always told, I mean, I'm male, I'm British, and we're definitely taught not to show vulnerability. Whereas actually, people being led now expect their leaders to show vulnerability and say we haven't got all the answers, and we definitely saw that during the pandemic. We saw certain leaders that showed vulnerability and we saw other leaders that didn't show vulnerability, and the former went down much better with the electorate and seemed to handle the crisis much better than those that didn't as well.
[00:13:40] Heather McGowan: Yeah, those folks who said what they knew and what they didn't know and they empathised with people tended to have fewer deaths than those who pretended that it wasn't happening, yeah. That's probably as close as you and I will get to politics, even though I know we agree on that front!
[00:13:55] David Green: I know, we probably could, but maybe that's maybe over a glass of wine, not on a podcast! But to the leader that's maybe not used to showing vulnerability, what would you say to them as a tip really to help them get more comfortable with that?
[00:14:12] Heather McGowan: Yeah, first of all, let me just empathise with you. I know it's not comfortable. I make all my audience say with me, "Let's all say the four scary words, 'I do not know'", and we say it together. And I say, "And I know you were brought up as leaders not to say those words. But what's happening now is, if you pretend you know and you don't, you could be leading your team down a very dangerous path. You have to acknowledge what you don't know as an opportunity to learn, because the first step of learning is to say, 'I don't know', because if you know, you're not learning".
The best leaders, especially now, are ones that are humble, curious learners; and the best leaders who are inspiring their team members are being human with them. Does that mean you have to show up crying at work, exposing everything about yourself? No, nobody wants that. But they want you to say what you know, what you don't know, try to understand them, but there's still accountability. I mean, employees have to be accountable, or talent, whether they're engaged as employees or not, still have to be accountable. We still have performance metrics, we still have targets to meet, but I think we'll meet them better if we act human at work.
[00:15:16] David Green: Yeah, I mean a lot of the stuff I read about the future of work, it is a different workplace to what it was a few years ago, and it's going to get even more different, I guess, in the future. And one of the things that people like you, people like Lynda Gratton, others, the kind of leading management thinkers are saying, you know, we need to experiment. And if you're experimenting, you don't necessarily know what the answers are going to be out of it. But it's about that transparency, that vulnerability, it's about saying, "We don't know; we're going to try it and see if it works. We're going to talk to you about your experience of this and then we're going to learn and adapt".
[00:15:52] Heather McGowan: And we're going to listen to you. That was one of the greatest things I saw as the pandemic moved more into the endemic stage, and people were calling people back to the office. And people kept asking me to give talks on declaring the audio office was the space everyone needs to work on, or declaring everybody's -- I said, "I'm not making any declarations. What I think is the experiment should begin now".
We learned a lot in the pandemic, we learned what we were capable of, we were much, much more adaptable than we ever thought; we had very good business continuity in the sectors that didn't have to close down; we trusted our people; we had a taste of that empathy advantage in those years; and we need to figure out how to take that taste forward, where leaders are leading an empowered workforce, they still feel good about their leadership and we experiment with where and when we come together in person, what are the jobs that need to be done together, which ones are tasks really can be done remote, how often do we come together, how do we set the optimal conditions for collaboration, if so much more of our work is going to be collaborative, which it is?
[00:16:53] David Green: Based on your research, Heather, what are the likely costs of ignoring the need for more empathetic leadership for companies?
[00:18:07] Heather McGowan: Well, it depends on how you look at it. If you're not empathiaing with your employees, you're going to have tremendous turnover. Turnover, when you think about it, if you knit together the two books, if you think about how much learning we need to have in work, you're just haemorrhaging your knowledge base because you'll be training your people, trying to close that skills gap, which will never close by the way, and that's okay, but you're bringing your people along and up to speed to operate effectively in your organisation, and then you're losing them and then you've got to start all over again.
So it isn't just acquiring talent, it's that a lot of the talent out there doesn't have the skills; none of them have the skills to do the jobs we need people to do now. It's really learning on the job and you're losing those people. So huge turnover, if you're not empathising with your people, which is high enough as it is. But then if you're not empathising with your customers, you're missing the market entirely. So you need it on both fronts.
[00:18:58] David Green: And I guess it's exacerbated because of what you said earlier about the fact that the labour market in the developed countries, like the US, like the UK, like Germany, like Japan particularly, is shrinking. So, we don't have the people we need to fill the jobs we've got, let alone the fact that the skills are changing quite dramatically as well.
[00:19:22] Heather McGowan: I mean, we can only hope ChatGPT can do all of these things. But I read an article recently that observed, "We will waste a million hours before we will save a million hours", and that's true of products and technology. So, like we sold more TVs and vacuum cleaners when they first came out right around the same time, because we were much more interested in the entertainment aspect of it than the time-saving aspects of it. So, we're all playing around with ChatGPT, but we don't have an actual labour saving use for it yet that's reliable at scale.
[00:19:52] David Green: Yeah, so before we move on to focus on the research that you've done and what the empathy-led approach means for HR professionals and individuals, is there anything else that you'd like to kind of bring forward about the leader part, because I know that's a huge part of the book; is there anything else that you think leaders listening to this, or prospective leaders listening to this, should be aware of?
[00:20:17] Heather McGowan: Well, I mean the other elephant in the room is diversity, equity, inclusion, which is really diversity, equity, inclusion, and belonging, and that's another reason that empathy is so important. As you can hire a bunch of diverse candidates, whether it be racially diverse, neurologically diverse, social mobility, which is I think increasingly one we should be looking at, gender diverse; but if you don't have an empathetic leader who can not only help those folks be successful, but bring out the uniqueness of their perspectives, because that's the real power of diversity, equity, inclusion, and belonging, then you're missing the point of having them entirely. You've "done the right thing", but you the real power and diversity and inclusion of belonging is getting those diverse perspectives that check your blind spots, that meet the market better, that make for a richer, more creative office environment.
[00:21:07] David Green:
Yeah, an important topic, I'm glad you highlighted that. So for this, moving to HR professionals, because most of the people that listen to this podcast are HR professionals, HR has really stepped up in many organisations over the last few years during the pandemic, and that's continuing. And now, I guess there's so many other challenges around, and now we're hearing all these challenges around, we've had the great resignation, we've had people talking about quiet quitting, we've got the whole skills agenda and now we've got this huge technological advance. I think it's been going on but it's also been hyped up a little bit over the last few months with ChatGPT and generative AI.
What should HR professionals be focusing on more; and maybe also, what should they stop focusing on to help drive business value tomorrow?
[00:21:57:] Heather McGowan: We need our HR folks to put on their gas mask before they help anybody else. I'm really concerned. I do a lot of my speaking to HR groups. I am really concerned about the HR profession because there's so much stress on you folks lately, because you've got labour shortages, so that makes your job harder; burnout, makes your job harder; rise in mental illness and challenges, makes your job harder.
The continued pressure on this group, and I have said, I've been saying it for more than a year now, is that we went through the global financial crisis, and your CFO was your MVP; they got you through it. And then when we went into the pandemic lockdowns, your CTO, CIO, depending on how you're structured, was your MVP, because they took you from 10 central offices to 100,000 home offices. Now coming out of the pandemic with an empowered workforce, labour shortages, etc, it's going to be your HR person, your CHRO. And I think with the pressures and focus that we have, sort of flanked with also your Chief Learning Officer and your Chief Diversity Officer, that's the core MVP team that's going to help us get to this next place in work, which I think is a tremendous opportunity.
So I want to acknowledge that; check on each other, make sure you're okay first, because I think there's going to be a tremendous amount of burnout and a lot of turnover probably in the HR profession. And anything we can do to help folks be healthy and well taken care of, that's first and foremost. I think in terms of where we focus, I think we stop focusing on assuming we can acquire the skills, that we can just find what I call a deployable workforce. You're probably not going to find the people that you need at the skills table, because by the time you have acknowledged you have a need in the market, until you have what I call need relief, that need's probably changed. And the skills gap's never really going to close. Because if you look at it, the skills gap forms when a human demonstrates a skill, the market values the skill in excess of supply. That's actually progress.
So, if we can assume that learning is part of work and put learning in HR and put HR in the C-suite, front and centre next to the CEO, I think is the most strategically important thing we need to do right now. Because when you look at where value comes from, it was a recalculation of the S&P 500 and in 1975, 83% of the value, enterprise value, of all the companies on the S&P 500, came from property, plant, and equipment, tangible capital, because we made stuff and other stuff. And in that, that 17% that was intangible capital is really humans. And Milton Friedman came out and said, "The only social responsibility of a company is to return profits to shareholders, full stop. Environment doesn't matter, community doesn't matter, employees don't matter, customers don't matter". And we treated organisations that way for 50 years.
Then the US, and this has been echoed by other thought leaders around the world, came forward, the community roundtable, the top CEOs in the US came forward and said, "It's not working anymore. We're not actually creating real value, we're juicing the market, we're decimating our communities, we're trashing the environment, and our employees have been disengaged for 20-plus years. And now they're increasingly disengaged. We're up two points on disengagement and down two points on engagement in the last two years, each of the last two years, and we've got rising births. It's not working".
Now if you look, in 2020 was the last calculation, 90% of the enterprise value of all the companies on the S&P 500 comes from intangible capital. It's the human value error, that's what I call it, I called the start of that in 2020. That's where we need to think about humans as the most precious assets in our organisation and they're assets to develop, they're assets to protect. And so HR is going to have the role of helping avoid burnout, because the best way to get rid of burnout is to avoid it to begin with, not to wait until you have to treat it because it's very hard to treat.
So HR folks need to help organisations, help the whole C-suite understand that this is a different game. We're going to be acquiring humans into our organisation, we're going to be treating them like the most precious assets, we're not going to see how many hours we can make them work; instead, we're going to see how we can inspire them in ways that we can help them increase their performance, which may include fewer hours in some cases. How do we optimise learning? Those are the kind of things HR folks are going to focus on, so it's very much a humanisation of the workforce.
[00:26:26] David Green: Yeah, it's interesting. I think what you're saying is we kind of transition from that era of profit to the era of people. Obviously, we still want profits, but it's more people-centred now rather than profit-centred, and obviously with people making up most of the cost of an organisation, those intangible assets. And it's interesting, isn't it, because with the business roundtable communication that you talked about, which I think was in 2019, just before the pandemic, where they said, "No longer are we just driven by profit, by shareholders. Now, it's about employees, it's about customers, it's about the communities, it's about society as a whole", which is quite interesting. And it'd be interesting to see how that plays out because with those size of organisations, it will take a few years to actually play out and we start seeing that.
But I guess at the same time, we saw the SEC come out with mandating more disclosure of human capital information by companies, so those that are listed on that exchange, and we've seen that replicated elsewhere in the world. We've seen the EU put a lot of legislation out around companies having to report around equity, DEI, other areas as well. So this is where it's going, which is good from a regulatory perspective, I guess, if you care about people. If companies have to report it, hopefully they will try and do something about it before they report. But I guess it's a huge opportunity for HR to be at the centre of that.
Obviously, the area that I'm in and we're in at Insight222 is very much around the people analytics area, predominantly working in HR, at least over 90% of people analytics teams are within HR, increasingly reporting directly to the CHRO as well, which means that the CHRO is in a position where they can bring data to the conversation just like any other C-suite leader, which is important, I guess, well is important at that level. And if we can start to help educate, if we need to educate other C-suite leaders, that actually if you lead in a more empathetic way, if you think about the people, and as you said, you're trying to prevent burnout rather than just trying to deal with it when it happens, if we're giving opportunities to our people through proper learning pathways, career opportunities within the organisation, it actually helps us be more successful as a company. Then hopefully, and again it's not always going to happen like that, but hopefully that means that we're going to get to that human capital area that you've been talking about.
[00:29:04] Heather McGowan: Yes and I think that's by the way where your book was hugely helpful for folks because it is such a great manual to help people understand the power of HR analytics. I think personally, I think if the organisation -- the problem with what the Business Roundtable did in my opinion is, it went from one focus on shareholders to a focus on everything, and I don't think people can do well when they focus on everything. So I think if organisations, and led by HR, say, "We are in the business of developing human potential and by being in the business of developing human potential, we are going to get greater value", and then you let the forces of better environmental, community, social justice come from the customers, they will do the right thing. You just can't have all the forces going kind of all over the place, it doesn't give people a way to focus.
I think if we focus on developing people, we'll have spillover impact into communities and there will be secondary impacts there. Environmental impacts will be there as well, but I really think if we focus and say the purpose of our organisation is to develop our people. When we develop our people, we can respond to the known and the unknown opportunities as they unfold, and increasingly more rapidly than they would have ever been prepared for before.
[00:30:18] David Green: I think I entirely agree, Heather. And I think it was interesting you said something about the skills gap as well, and we're going to talk a little bit about skills later. But I guess one of the key things around this is, you said you're never going to completely close the skills gap and we should be comfortable with that. I guess what we're trying to do as an organisation is have a smaller skills gap than our competitors, and that's by being very proactive around learning, around career mobility, around retention, around bringing in external data so we can understand what that skills gap is, and understand supply and demand factors and what's happening out in the wider world as well, and helping direct maybe our location strategy, for example, or our approach in how we're going to fulfill some of those gaps. Is it through permanent employees; is it through contractors; is it through outsourcing; is it through technology, etc? And so I guess that's something that HR really should be at the forefront of.
[00:31:19] Heather McGowan: Yes, and also using predictive analytics wherever it's possible. So instead of saying, "Okay, hello there, Jim, you used to be an accountant. Well, we don't need as many accountants now, so let's see if we can reskill you for a job in data analytics. But we need the person in data analytics today, and it's going to take six months for you to be ready to pivot from accounting data analytics". Do that ten years ahead of time; do that five years ahead of time; there's lots of platforms for predictive analytics.
I interviewed the folks from Faethm, which is now part of Pearson, I know IBM has their in-house version of it, I know AT&T has their in-house version, A lot of companies have their in-house version of it, there are also external platforms you can use. But that's important for two reasons: (1) you get the people ready before you need the skill; but (2) you also get people ready to adapt to a different identity. As much as I've tried to get people saying, "This is what I do for a living", we are sort of attached to that identity. So you've got to give people time to say, "We're going to be sunsetting 60% of these positions, we don't need as many of them anymore, but we need these positions over here. Here's your pivot score". So we're proactively bringing people along in a kind of a constant state of adaptation.
[00:32:29] David Green: Yeah, couldn't agree more. And I guess one other area, I don't know if you've seen this in some of your research, Heather, is HR, people analytics teams, looking at networks within the companies, looking how teams work together, how they collaborate, how they collaborate between teams as well, that kind of understanding, that kind of social, the social part of the organisation as well, because that is so important because that's really how companies work isn't it? It's not the org chart, it's their networks.
[00:32:59] Heather McGowan: Yes, and I remember a study that was done, I think it was like early 2000s or maybe late 1990s, on the UK Healthcare system and they were doing some massive change within it. And they realised that people who had bridging social networks, which means I work in HR but I've got a really good friend in finance and I've got a good friend in marketing, I'm socialising a lot of the things they want to have happen in the organisation by the nature of my social network. But if I have a very concentrated social network, I'm sort of reinforcing the negatives and the positives of that change, as opposed to socialising it across the organisation and making sense of what it means to different functions.
I think those social maps are great. LinkedIn used to have one, which was really cool. They stopped doing it, or maybe I have too many contacts for it to work!
[00:33:46] David Green: Let's turn to the individual. What should individual workers be doing to transition to benefit from the empathy advantage?
[00:34:47] Heather McGowan: Well, this old adage has always been true, but I think it's increasingly true now, because we look so much at why do people leave organisations; why do people stay in organisations; why do people thrive in organisations? And one of the things we're coming down to is it's a connection to a sense of purpose, "This organisation is trying to make the impact in the world that I want to make in the world". In fact, we saw between 2021 and 2022, 50%-odd of the people who've changed jobs, changed industries and functions entirely. So, it's people connecting more to what they want to do, what's their self-expression. We don't think about work as self-expression.
So in that, look for an organisation that shares your values, makes the impact you want to have in the world, but also shares your values in terms of how they operate. Are you formal, informal, flexible? Do you want to work in the office every day dressed up? Do you want to stay home in your jammies three days a week? How do you want to work? How do you want to connect with people? And then, it's the personal relationships that really help things stick. In particular, it's a relationship with your boss. So don't pick a job, pick a boss, pick a leader, pick a manager as a mentor.
I speak to so many organisations and sometimes I speak to general audiences, so it's everybody in the company, and I always get this question, "I completely agree with what you're saying. This is the world I want to work in, but my boss doesn't agree [or] my boss is old school [or] my manager is speaking about the world that used to be". And I say, "Within your sphere of influence, what is your opportunity to change things?" And if there isn't, pick a new boss, leave the company, go to another organisation, people are doing it all the time. But don't just jump for, you know, the paycheque does not last that long. I mean, get paid equitably, be good with your pay, but don't jump at every dollar because you're never really going to be happy with that.
But really pick the people from whom you can learn, whom you can grow, whom you feel psychologically safe, where you feel like you have self-expression; somebody who listens to you and says, "Well, I think you've got some capabilities over here. I want to introduce you to somebody in this other division. I want you to take on this project, people who help will you stretch and grow". Think about yourself as a product in beta and you're putting yourself in these different environments and what are the best environments to help you as a product grow and evolve?
[00:37:00] David Green: Yeah, some great advice there. So moving on, we've kind of talked about it a little bit, moving on to the topic of AI. Along with the shift in leadership and management style since the pandemic, there's also been more acceleration in technological advancement, such as generative AI. And obviously, I know this is something you study, as a Future of Work strategist, you're looking several years into the future. Love to gather your thoughts on what this means for companies as we move into the future; and again, what it means for companies, maybe what it means for workers, but again, I guess, what it means for HR as well.
[00:37:39] Heather McGowan: Well, first and foremost we should stop with the hysteria. The hysteria is almost always misplaced, and I use the example of the ATM. The ATM came out I think it's 50 years ago, 40-odd years ago, I really thought every bank teller was going to go away. But actually what happened is we increased our bank tellers, because what we did is we decided we needed a smaller bank presence footprint and we needed more of them and we needed more bank tellers. And so sometimes the technology can reduce the number of jobs, sometimes it can grow the number of jobs.
It's kind of a parlour trick on guessing whether generative AI is going to kill jobs or create jobs. It's going to do both. What it's going to do is extend our potential. I mean, look, Riverside is the name of the platform we're on today. We weren't on these platforms ten years ago. We took them to them like a fish to water. Zoom had been around for ten years when we shut down in 2020, and everybody went on Zoom and acted like it was a new thing, and it had been around for a decade. So, we have a lot of tools around us that allow us to connect, allow us to extend our potential, but just know that you're going to have to, as soon as you can't save anything off the technology, you're going to reach up and have to learn something new. It's a constant cycle, and so there's going to be changes.
HR, I spoke to some accounting groups who have this data. It used to take 500 hours to audit an excise company; now it's five hours, and the process automation works. So, we need fewer accountants, we need more data analysts. It changed the function but it didn't actually make humans obsolete and that's not going to take place here either. It's going to be slower than we think, it's probably going to be at a place we're not looking at, but what we need to be ready to do is say, "How does this help me be more human, be better at my job, serve my customers better, work better with my other employees or talent in collaboration?" That's how we have to look at it. We have this fear that some piece of technology is just going to suddenly replace us all. And that has not been the case if you look back over the last 40, 50 years when we've had technology creeping in all over the place.
[00:39:51] David Green: And it's not even if you go way back to the Industrial Revolution as well. I mean, we obviously had the original Luddites in the UK, the weavers in Manchester and places. But yes, obviously as you said, it does eliminate some tasks, but it creates new tasks. But I guess that then increases the uncertainty, the complexity, the need to acquire new skills and back to your book, The Adaptation Advantage, the need for continuous learning. It's really interesting.
This reminds me, I think, I don't know if it was 2017, 2018, probably when I was at IBM, every conference I went to was lots of hype about AI and HR. That died down for a while, and now it's coming back. Now, some of this technology does look particularly impressive. But I guess what it will hopefully do is remove some of those repetitive tasks that maybe we don't really enjoy doing, so it hopefully might make us more productive, might help us do stuff that's more interesting.
[00:40:56] Heather McGowan: Yeah, I hope we're smart about it. And one of the analogies I use when I speak to folks is, if you've ever had to call customer service and they have you enter your account number and then you push one and you push two and you push three and then somebody answers the phone and asks you the same information again, there's a use of technology that does not remove friction, it just increases your level of frustration. That's what we don't want to do with these tools.
What we do want to do is something like using a restaurant reservation thing, like OpenTable, where I go on, I say, "Hey, by the way, I know it's table number 248, this is the person who waited on me", I click and I've made a reservation. I get there and they say, "Oh, we have this new bottle of wine we think you'll like [or] there's a new thing on the menu we think you'll like". They increase the human experience and remove the friction of trying to call the restaurant in between meetings to try to make a reservation. Places where we can seamlessly use technology to remove friction and increase the experience, not increase friction and add frustration, that's our opportunity.
[00:41:56] David Green: Yeah, that's it. And I guess that leads nicely to the next question. So, we've been talking about this throughout a little bit actually. So, one big opportunity as we talked about the advancement of technology is the introduction of new skills. But again, going back to previous research, going back to university or college, learning skills is time consuming and actually by the time you've learnt them, they may be a bit out of date as well. So, what would you say is the most efficient way, thinking here, we've got learning professionals, we've got HR professionals listening to this; what would you say is the most efficient way of training and developing your employees?
[00:42:34] Heather McGowan: Well, that's a pretty big, broad question, so it depends --
[00:42:37] David Green: It is!
[00:42:38] Heather McGowan: -- in what and for what. So, you need your employees to come with the expectation that whatever they know now is okay for today or probably more likely yesterday; it's the context in which they can put new information; it's their ability to add and delete skills, just like we add and delete applications on our phone when we run out of memory. We need that mindset. Some tasks are best done on the job, learning with a mentor and going through the process. Some other ones are, "Take this quick class so you understand these things". There are some platforms that push it right out to the front line so you have that information on your phone at the ready, so you can look something up and you can respond to something in real time. So, it really depends on what the type of learning is and what the type of need for that learning is as well.
[00:43:34] David Green: Yeah, some good advice there. So, this is the question that we're asking -- this is the last question actually, I can't believe we've already got to the end; this is the question we're asking every guest on this series of the podcast. What steps can HR leaders take within their organisation to humanise the work experience; and how can they measure it as well?
[00:43:58] Heather McGowan: Yeah. First and foremost is, acknowledge that this is your greatest path to power and performance. It's not going to come from diminishing the human, it's going to be coming from unleashing that potential in the human. And so, not only does the HR professional have to, it has to be believed across the entire organisation, leadership team, especially the C-suite if you're an organisation large enough to have a C-suite. They have to understand that humans are what's driving the value in every single organisation and not just the cost, they are the value, they are the source of the value, 90%-plus of source of value.
In order to do that, we have to meet people where they are and say, "Okay I know, CEO, you grew up in this environment and you're used to just driving performance metrics, nut let's just look at how that's gone". That's one of the things I say to the audiences, "How are we doing?" "Not great". We have been driving people into dust for decades now, and we seem to be doubling down on it at times when you look at opportunities, you look at how well we did in the pandemic. That's what I keep reminding folks of. That was a flying-blind situation that nobody knew what was going to happen week-to-week. We sent our people home, we shipped them computers if they didn't already have one, we checked in on them, we sent them meals, we sent them gift packages, we said, are you okay? It gave them agency and autonomy and they performed. Actually we had a 1% increase in engagement in that first year.
Now, of course, that got pulled into burnout because people were working too many hours, but look at the power of trusting your people and providing psychological safety and giving them autonomy and letting them feel that agency. That should be what we're all looking to do without the stress of a pandemic. And that's the only real good data I have on that at that scale, but we really did well. When you look back, we really did well.
[00:45:55] David Green: Yeah, agreed. And I guess that a challenge for HR, or an opportunity for HR, is to scale this approach across the people managers within the organisation, because as you rightly said, HR can only do so much, but it's how do we get this out to people managers that actually this is the way to drive success for the organisation, but also success for the people that you're managing as well.
[00:46:21] Heather McGowan: Yeah, and that's one of the things we need is we need a large scale rethinking of leadership, and HR can be part of that as well. And particularly in some organisations, it's really the middle management where they get stuck, because they're used to being unquestioned experts and subject matter experts. And now they're finding they're not and they're finding it overnight sometimes, and they're frustrated and so they're doubling down on demand sometimes. That's when they might really need their HR partner to say, "Hey, wait a minute, let's think about how you're leading your team, let's think about your approach right now. Is it really getting the results that you want? How can I help you rethink this so you really unleash the potential of the collective intelligence you have across your team now, which is more diverse than it was a year or two ago?"
[00:47:05] David Green: It's an exciting time. It's challenging, I guess, as well for many people. Change is always hard, isn't it, at the end of the day? Heather, thank you so much for being a guest on the Digital HR Leaders podcast and I wish you and Chris all the best with The Empathy Advantage. I suspect it will be, or it is probably being very successful; I suspect it will be very successful and I'm interested in what you'll do next as well. So you've had The Adaptation Advantage, The Empathy Advantage and how can listeners find you on social media, find out more about your work, and find out more about the book as well?
[00:47:42] Heather McGowan: Sure, so first, David, I hope we get to meet up again in Paris because that was really fun. That's where we originally met, at a conference in Paris. You can find out and connect and engage with me on LinkedIn, that's where my learning community is. So, if you listen to this and say, "Absolutely I disagree with something", that's the greatest source of my learning when you don't agree with me, shoot me a note on LinkedIn, my network's open and say, "Hey, listen, here's how I see it and why"; I would appreciate that.
Join my community, I post stuff all day long, this is what I'm reading, this is what I think about it, this is something else somebody posted me in, so it's a really powerful learning network for me. My website is heathermcgowan.com, that tells you all my speaking topics and showreels and all that information; you can get in touch with my team there. I'm not on Twitter these days, so those are my two primary vehicles. But reach out, I'd love to learn from you, especially if I'm wrong, which is always a good place to start when you're learning.
[00:48:40] David Green: Great, so you're showing some vulnerability there as well, because none of us are ever right, are we, all the time? It will be impossible. And yes, I do hope that we see each other in Paris at some point. There's a big conference coming out in Paris in October, so you never know. And certainly hope to see you in person as well, because we had, I think you, me, Peter Hinson, and a few others, quite a good chat, didn't we, when we were all in Paris together? So that's really good. Thank you so much for being on the show. And yeah, as I said, look forward to seeing you again soon.
[00:49:15] Heather McGowan: Thanks so much.