Cutting through Disruption - Part 2: Talent and the impact of AI

As companies navigate the ever-changing business landscape, the need for transformation has become crucial. However, many discussions around transformation overlook two critical aspects: people and technology. In this blog, we will explore the significance of considering both people and tech in any transformative journey, particularly in the context of AI and its impact on employment and talent strategy.

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Thesis 1: People and Tech are the Chicken and Egg of Transformation

In any transformation, people and technology are not only affected; they are also the key enablers. Without considering both from the start, the success of the transformation is at risk. A holistic approach that involves people and tech as key levers is essential. Transformation is done by and to people and tech, making it a circular process.

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Thesis 2: HR Cost Cutting has to be rethought

In past performance and restructuring efforts, HR cost reduction was a key lever. However, with today's labor shortage and constant transformation, saving key skills and maintaining employee morale are equally important. It is no longer a simple cost-cutting exercise but a multivariate optimization that requires qualitative and quantitative considerations.

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Thesis 3: IT Projects and Asset Allocation undergo constant Alignment

IT projects and assets need to be reviewed to align with strategic directions. Rather than solely focusing on efficiency, the goal is to allocate resources effectively to enable the transformation and capture potential. It is about optimizing capacity and adapting to changing needs.

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Thesis 4: Organizational Design Focus shifts from Boxes to Incentives

Organizational structures are becoming more fluid to respond to disruptive environments. Incentives and key performance indicators (KPIs) play a crucial role in keeping teams together and aligned with the transformative journey. Connectivity to the employer brand becomes more significant than rigid belonging to specific organizational units.

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Thesis 5: Perma-Crisis becomes a Paradigm for HR Transformation

Transformation is no longer a one-time event but a constant adaptation process. In the face of stacked crises and long-term transformation, HR must be prepared for ongoing adjustments related to cost, skills, direction setting, training, motivation and communication. All elements require simultaneous attention.

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Thesis 6: Shifting from Performance as a Project to Performance as an Attitude

Traditional approaches of business as usual and intermittent performance improvement phases are no longer effective. Adapting based on past facts and figures leads to systematic delays. In the current perma-crisis reality, performance should be a constant focus, encompassing financial, environmental, social and governance (ESG), and geostrategic considerations.

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Thesis 7: Creating Exceptional Experiences for Excellence

To engage and retain younger talent, companies need to provide exceptional experiences that foster excellence. The focus should shift from rewarding excellent results with experiences to creating an environment that nurtures continuous learning, growth and meaningful connections.

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Thesis 8: Moving to Scalable Learning with AI

AI presents an opportunity to move beyond scalable efficiency and embrace scalable learning. AI-powered technologies can facilitate knowledge acquisition, analysis and decision-making processes, enabling organizations to adapt and learn at a faster pace.

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Thesis 9: Liberating Humans with AI

AI and technology have the potential to automate mundane and repetitive tasks, freeing up human resources to focus on higher-value work that requires creativity, critical thinking and emotional intelligence. This shift allows employees to engage in more fulfilling and impactful roles.

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As the business landscape continues to evolve, organizations must recognize the importance of considering people and technology in their transformative journeys. By embracing AI and leveraging its potential, companies can reimagine employment, foster a culture of continuous learning and create an environment where human potential can flourish. It is through a comprehensive approach that combines talent strategy, technology adoption and constant adaptation that companies will thrive in the future.

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The views reflected in this article are the views of the author and do not necessarily reflect the views of the global EY organization or its member firms.