What leaders need to know about the changing nature of the workforce
Are external contributors considered part of your organisation’s workforce? How strategic is your organisation’s approach to integrating external contributors? The?latest research, published last week by Deloitte and MITSloan, shows that as organisations increasingly rely on both internal and external contributors, successful leaders are recognizing the complexity of these workforce ecosystems and adapting their management practices to support these new systems.
Today, some organisations are now composed of more than 50% contingent workers, as they increasingly rely on third parties to deliver some of their most essential services.
According to the research, orchestrating a workforce ecosystem is no mean feat. It requires a multifaceted effort of integration among many business functions. Management practices around how they access, engage, and develop people need to shift, and Leaders need to adopt to a changing workforce where they have more contributors but less control.?
This presents a challenge for Leaders. For example, laws often prevent traditional performance management for contingent workers, and with companies increasingly relying on arms-length contracting for critical services, some leaders have limited management options with a large percentage of their workers.?
Leaders are also often struggling to deal with a range of cultural issues as well: How far should they go to include external contributors in existing corporate culture? To what extent do diversity, equity, and inclusion principles and practices apply to external workers?
The research reveals that:
What are intentional companies doing to anticipate this trend?
This latest research shows that companies that are most intentionally orchestrating their workforce ecosystems have five common characteristics.?
They are far more likely than other organisations to:?
The research underscores the importance of viewing the workforce as an ecosystem: complex, and interconnected. For Leaders, it’s likely that understanding how to manage this changing ecosystem will only become more important.?
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Obstacles to managing complex ecosystems
The research highlights two obstacles in particular: (1) legacy practices and mindsets, and (2) legal and regulatory requirements. The first entails removing any kind of ‘we vs them’ mindset between internal and external collaborators, and shifting behaviours to work as a collective to ensure you’re using all resources optimally. As far as the latter goes, often, because a third party is not an employee, managers are not able to give them feedback on their performance or give them a warning, for example. This makes performance management particularly challenging.
Addressing these issues will require Leaders to take a cross-departmental strategic approach.
Transforming outdated behaviors and decision-making policies and developing and implementing a wide range of new, co-creative systems will be key, as will honing a constant awareness of the changing shape of the workplace ecosystem.?
As the authors of the?research report?note, “Leaders should articulate a vision not only for the future direction of a business, but also for how a workforce ecosystem will enable the execution of that vision.”
Where is your organisation in terms of its workforce ecosystem - and what is your vision for its future?
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We are fast approaching the mid-point of 2022, and for many it’s been a hectic start to the year. While we might be feeling ready to shift to a post-pandemic ‘new normal’, uncertainty and unpredictability remain an ongoing challenge - at work and beyond.
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