An Integrated Approach to Workforce Ecosystems
foreign for most companies today the workforce is a lot more than just full-time employees includes contractors Freelancers gig workers and more our next speakers have spent the past four years researching what it takes to coordinate and successfully manage that expanded Workforce their new book Workforce ecosystems reaching strategic goals with People Partners and Technologies is available now from MIT press in this session they'll share the highlights of what they've learned so far welcome Liz and David fantastic to be here uh with uh co-author and guest editor and Professor Liz Altman um MIT press published our book a few weeks ago Liz and let's talk about why it's timely and important uh but before we do that let's give a shout out to our other co-authors Jeff Schwartz and Robin Jones uh who made like tremendous contributions to this book as well and was finally great to uh get meet them all together live in person in Dallas a couple weeks ago uh let's start off by providing a little bit of context about what the problem is that we're trying to that we were trying to solve with this research and you have a lovely little story about how you as a strategy Professor uh was brought onto this project well thank you David uh actually maybe I'll go back if you want the quick story on how I was brought onto this project but I appreciate uh being here it's been incredible to be involved with this team over the past few years and so um thank you to SMR and to Deloitte Consulting for uh working together on this work we put together essentially a little Workforce ecosystem as we like to say so uh when you first sent me an email I'm early 2020 and said kind of uh this isn't spam and I know who you are and would you like to join us as guest editor of the future of the workforce I said you know this is really interesting I've looked at your work and it's mostly been focused inside of organizations which is fabulous and it's been really great work but I really tend to think about what happens between organizations and across organizational boundaries I mostly study platforms and ecosystems I'm a strategy professor and so this may not be a great match maybe we shouldn't do this it's been a pleasure speaking with you maybe not such a good idea and you said no no we know what you study and I think very insightfully said we think this conversation should really expand across organizational boundaries and we agreed that if we could do an experiment and really think try to think more about this with an ecosystem lens that this might be a great idea and at the time I think you said look if it goes well maybe we'll write a book and then you know a few weeks ago we launched the book which is just amazing so when we started the project uh we started having these conversations about future of the workforce what exactly are we talking about and we started doing these interviews and really even in those early interviews I realized it made sense to start with a discussion of if I say Workforce what do you mean and we were talking to some very senior people like the head of uh HR for Walmart or the head of the consumer business at Amazon or to Army generals or senior people at Nasa the Mayo Clinic it was an amazing array of people and to a person when I said when you think about Workforce or when I say Workforce what do you think of and I said it hesitantly slightly like that because in the beginning I thought they may think there's a really dumb question uh to the contrary they said that is a great question we've been thinking a lot about it we were just in a meeting about it this morning we should talk more about that and we went on they went on to say look it's clearly employees if you're in the U.S they're W-2 either full or part-time but it's also contractors Freelancers gig workers we started hearing numbers like 30 to 50 percent of the contributing members of our Workforce weren't employees and you'll see that they also um this is an example from Top dial they're very skilled very high level people right so there's some lower level people but they're also higher level people when Amazon decided it wanted to do its um contract and wanted to have its own transportation uh system it didn't hire people it started subcontracting often with Mom and Pops but these people add value to Amazon but don't work for Amazon if we were in a classroom I might say okay how many people have smartphones all hands go up how many people on those phones have only software made by the company that made either the operating system or the phone all hands go down right because phones are not that interesting not that much fun and not that helpful unless they have apps those apps are developed by what we call complementary businesses right or complementers and they are not the primary business and so our question is are they part of the workforce well they're not really vendors they're not employees but but they are part of the workforce similarly when you look at Amazon how many people have purchased something from Amazon that was actually purchased from someone else and the answer will usually be a lot right because Amazon is a middleman and these sellers are contributing to Amazon being able to offer what they're able to offer and finally we ask the question so how many people here have recently maybe argued with a chat bot right you've called some sort of customer service line you've tried to get through you're interacting with the chatbot or more recently how many people have played with chat GPT or Bard or any other generative Ai and can Envision how organizations can use that and the answer is many right and NASA sorry to interrupted but like and NASA had to give employee identification numbers to some some algorithms in order to sort of get get there because they couldn't they couldn't access the only way to get the chat Bots or the bots in that case to access data was by to actually give them employee ID numbers so in that case you say Okay given all of this are they part of a Workforce and we said well if you define the workforce quite broadly if you define it as a Workforce ecosystem then yes right there it's composed not only of employees but also these external contributors and that is how we kind of set out to start thinking about workforces in a much more holistic ecosystem-based way with that I will turn it back to you to help us understand what we found with some of our data thanks Liz what does that all mean when external contributors are considered to be part of an organization's Workforce I mean it means that the boundaries and composition of the workforce are shifting it used to be just employees and used to be internal to the firm and with this Workforce ecosystem orientation it's uh is not just like inside the organization it's outside the organization as well and it's not just employees so that's a non-trivial shift and it's so non-trivial that three-quarters of managers agree that effectively managing these external folks is critical to their organization's success and that's certainly and it's especially true for organizations like Cisco and Novartis and some of these other organizations that have tens of thousands of external contributors uh getting the work done unfortunately and this is where the problem comes in is that only 30 percent of organizations are are green that their organization is uh sufficiently preparing to manage a Workforce that relies on all of these external contributors so trying to think so we found leader after leader struggling with the idea of how to think and act more deliberately and holistically in an integrated way with both the employees and external contributors and what we found is that those who are those leaders who are taking this issue seriously considered it to be a Holy Grail or a potential strategic differentiator for them to figure this problem out so it's not just a matter of fact a semantics of who is in your Workforce it's it has dramatic and far-reaching implications for competitive advantage and uh competitiveness based on that we dove in and uh conducted a bunch of surveys and interviewed more than 100 executives and not just in the U.S not just in the private sector it was across public and private sectors it was uh Global effort we were talking to folks in Asia of all the different continents uh that there are except for Antarctica so many of them had it's like 26 percent were over a billion dollars in Revenue these organizations so it's the research was not just us making up some opinions or talking to a few people about these issues uh we did Global surveys and we talked to a lot of different uh managers and individuals and Liz has a bunch of connections with Generals in the military she went to West Point we're taught at West Point and uh we wound up talking to some some uh military folks and uh they had some really uh interesting perspectives on like because because they live by having an integrated approach to uh uh the military so throughout the the conduct of This research we were publishing a lot of materials I I don't know if the number's up to 10 but uh between publishing articles and research reports and this recent book uh that the infographics it's probably about 10 outputs related to This research we're really excited and we think that this is an important Avenue for organizations to go along in order to really compete effectively and by that I mean like think in an integrated way and conduct themselves in an interview way toward both the employees and their uh extended Workforce so what do we mean by Workforce ecosystem take it Liz thanks David uh so as guest editor I'm straddling this line always balancing between being an academic and a professor but also wanting to come up with ideas and Concepts and present them in a way that's very understandable and practical and so together we came up with this definition of Workforce ecosystem which we think uh is very helpful and we came up with a framework for orchestrating Workforce ecosystems which I will get to in a moment so first of all in terms of a definition you can read it but we've set a structure which is a governance structure it's a way to think about this entity right focused on value creation because in the end it's about creating value for organizations for an organization consists of complementarities and interdependencies I'll come back to that one second and encompasses actors from within an organization and Beyond as we said this is about a lot about external contributors and their individual and Collective goals so if everybody's just working towards the goal of the main player in the ecosystem it will not be sustainable right so the individual actors also have to be meeting their goals complementarity is what we mean is like with apps it's organizations working independently and individuals working independently working together to meet goals and for Mutual customers and interdependencies at its simplest form means they either succeed together or fail together they have to work together and they're dependent upon each other so that's our general working definition we have fun arguing about it but we think it's pretty solid we said okay so for example this hexagon started as a circle and at one point was an octagon however then we made it a hexagon why and it was on its side but then we spun it so this is our favorite hexagon because it is an orc and it's an orchestration framework it represents how we think managers and leaders should think about pulling together all the various parts of their ecosystem and we chose the word orchestrating versus managing particularly because often these entities are individual independent and have their own agency and own goals and objectives so I think we're probably coming towards the end of our time and we need to get to q a so I'll do this very quickly the the hexagons themselves represent our key themes so management practices need to change technology and enablers need to change leadership approaches and integration architectures is basically how you coordinate a Workforce ecosystem each of those hexagons is covered in one of the chapters of the book and we've covered them in different articles because each hexagon represents a whole series of new Concepts and thinking when you take a Workforce ecosystem's perspective on workforces outside the hexagon we've put the key leaders senior leaders and business unit leaders are on the kind of Center axis and essentially the framework can rotate around them there's a top axis human resources and procurement because they are generally responsible for enabling or for actually for getting all of the players together and then I.T and finance and legal are on the second access second horizontal axis because they enable the Technologies and systems that make this happen and we think there are lots of conversations we can have about this framework and so we've used it really as the basis for conversations David back to you so uh thank you Liz uh wonderful quick uh uh uh representation of that framework uh we have questions coming in I want to get to those we both want to get to those uh but just a a reminder uh this is the book feel free to buy it feel compelled to buy it uh and uh and review and uh compliment so um I don't know what we should so we'll just leave this up during the Q a so one of the questions that came in was what makes a uh a Workforce ecosystem a Workforce ecosystem healthier than another and the you know which gets into the question of like how do you measure uh uh Workforce ecosystem qualities and we talk about this in the book is that Workforce ecosystems have like three main characteristics comprehensiveness community and coordination and the threes we call it the three C's and you can have like you can be really strong on like the community one can be you build a community around and for and with uh the external contributors and you blend them together with the uh internal folks um and there are others that we've we've we've that we've seen in organizations that are less Community oriented doesn't mean that they're worse in fact one of the organizations planomatic we just talked about in the book they tried to build a stronger Community around with their external uh contributors but it wasn't something that really got traction and so it just turns out that some sometimes external contributors prefer a more of a transactional relationship with the firm and it's and it's a it's a real there are a whole bunch of trade-offs that happen around the extent to which you try to um impose a transactional or Community oriented way and how much you try to elicit uh or you know adapt to what's there and what anyway so that's just one dimension yes so well in that case I would say they probably do have a very strong Community because they need the community to operate they they've played with how to get the culture right between their internal and external um I I think you've said it well I would go back to meeting strategic goals which we put in the title of the book right so if a Workforce ecosystem is enabling uh organization to hit their goals and also the goals of the contributors then it's doing its job right and yes we can do all kinds of metrics along the way but I think we should stick to remembering that this is fundamentally about value creation and about outcomes I see we have a few am I allowed to pick questions or are we because you you have you have permission we have you've got three three minutes 45 seconds go for it oh I see five minutes 37 seconds okay in any case uh one quick question just to clarify someone says what do you mean by procurement and we mean the organization within a company or a business usually part of supply chain but often they're the ones who are doing the contracts with contractors or with large companies supplying contractors and so that's important because for example if they have a contract and it's bringing in 10 000 software developers then the procurement organization is kind of managing that relationship or a big part of enabling that relationship and that's why we pull procurement into the conversation and the other quick question was um for social media how would users like on Facebook and Instagram fall into this category and I think there's a really interesting question because we get into this question of content creators customers contributors complimenters and each one we can have a conversation about and I guess I would say that again we're trying to take as broad a perspective as possible so particularly if you think about YouTube or Tick Tock or but YouTube definitely um those content creators are contributing to the business in a very meaningful way and enabling the business to go forward so for many platform businesses that rely on contributions from users those users absolutely in my mind are part of the workforce ecosystem and so that's actually very interesting because the relationship between the company and their customers or contributors is a little more complex than it was when a company was just selling a product to customers yeah and when you move beyond the the content creators uh and the relationship between platforms and content creators there are other platforms where there are a host of uh where the the users have uh uh they're they're a bunch of legal and ethical issues that come into play and one of the things we talk about in the in the book is uh Neta uh meta's use of contractors and uh content moderation um and there and then with Uber uh they're you know there's a whole bunch of legal issues going on not only in this country but in countries around the world like are they should should these users be considered employees or not um should they have access to benefits or not or not and these are really important questions well and the third part of the book and I I give credit to you here David um because this was the part that you drove more than others but the third part of the book is about ethics and social responsibilities and corporate social responsibility and so I think you know that's not where this question started but I think it makes sense for us to mention that we're very aware that this structure leads to all kinds of questions and someone in the chat mentioned something about who owns uh intellectual property for example and that is a you know as an ongoing discussion there are different mechanisms for working with it it's not that it hasn't been addressed at all but I think these discussions continue to evolve as Workforce ecosystems become more prevalent yeah sorry go ahead just just one other thing on that is like as someone with a background in ethics one of the one of the really interesting and I think important aspects of what we're doing in this in this book and with this shift to work Workforce ecosystems is there are some really significant implications for social responsibility and overall purpose for an organization and uh you can have Workforce ecosystems that like aren't as aren't as ethical as others or aren't as uh uh uh they they don't promote as much Social good as others and there are a lot of choices for leaders to make around the kind of Workforce ecosystem that they want and um we try to set up some of the questions the key questions for leaders to ask in the book and if I sound like I'm repeating the book too often as I I keep saying I I never wanted to be that author who always said oh it's in the book but I have become that author uh one quick Point here because it's uh again as a strategy Professor somebody said when it comes to Cheryl Estrada said when it comes to strategy and value creation within a Workforce ecosystem does that ultimately fall under the purview of the CEO and CFO and I would say you know one of the things that's been great about this conversation is that we have realized that these discussions move to the c-suite right they are strategic conversations because they're at they get to the heart of how organizations compete how they compete against their competitors in an industry how they develop new products and services how they move into new markets so yes ultimately we think this is a very cross-functional c-level discussion but we also see it going down deep into an organization right someone can be managing a very small department and part of that department will be internal players and part of it will be maybe a contractor and part of it might be relationships with external companies and then also using Technologies so on one hand it's at the c-suite on the other hand we have seen my students and you know lower level and mid-level managers very interested in these Concepts because they're needing to operate in these complex networked interconnected ecosystem types of environments so this is uh we as as you folks can tell we will we can we love this stuff we're excited to talk about it but our time is at an end and I'm going to uh give it over to uh Ally and uh thank you Liz uh this is great and uh uh really excited to see how the book plays with uh great thanks very much
2023-06-22 02:55
