Introduction: How We Managed People in the Past Will Not Work in the Future

Why Are We Still Using Management Methods Created During the Roman Empire?

Many roads and buildings in Europe can be traced to the Roman Empire. In some cases, people literally walk on stones placed more than 2,000 years ago. Many other inventions created by the Romans also continue to shape our lives. Some endured because they still work, such as crop rotation in farming. Others are still used because they are familiar, even if they are not very effective. Hierarchical organization structures and the associated "org charts" used by companies belong in this category (see Figure I.1). Org charts categorize workforces based on how they are connected via higher level leadership positions. If the person in the role of "Governor of Imperial Provinces" on the left of Figure I.1 had an issue with the "Administrator of Rome and Italy" on the right they would first go to their leader the "Amici Caesaris," who would talk to the "Proco. Imp. Maius," who would then communicate to the "Consilium Semestre," who would finally tell the "Admin of Rome and Italy." This top-down method for workforce management has been familiar to leaders since the Roman Empire, but it has significant limitations when applied to the modern workforce.

Hierarchical organizational structures were created to manage workforces during a time when work was largely defined by geography. Prior to the 21st century, where people physically lived heavily influenced the work they did and whom they worked with. Team members all worked in the same building with their immediate leaders. Org charts usually mirrored how the workforce was structured geographically.

The rise of the internet economy has created a split among people's location, roles, and work relationships. Teams are no longer constrained by geography. It is common for people to work in one city, report to a manager in another city, and collaborate with people across the world. Org charts might accurately reflect how a company reports financial numbers, but they contain little information about the roles, social interactions, and relationships that drive profit and loss. Where an employee is placed on an org chart, it may tell little about what they do or who they work with. The continued use of org charts also reflects a top-down leadership style that is antithetical to the cross-functional nature of most modern organizations. It implies that decision-making authority resides in roles higher up the chart, which disempowers frontline employees to act quickly. Because org charts often provide little insight into what people actually do or how they work together, using org charts to guide workforce decisions can also result in inadvertently firing the wrong people and disrupting team relationships that are critical to a company's performance. I have known multiple companies that let employees go based on their positions on an org chart, only to discover these people were doing work that was critical to the company's performance. In several cases, they had to rehire the people as contractors at much higher pay rates with much lower levels of organizational commitment.

FIGURE I.1 Roman hierarchical organizational leadership structure.1

Source: The Government of the Roman Empire Under early Principate. (n.d.). [Gif]. Fordham University. https://sourcebooks.fordham.edu/ancient/spqr-under-augustus.gif

Innovations in technology have created tools that are far superior to org charts for capturing information about the employee roles, skills, and relationships that make a company function.2 Relatively few companies have adopted these tools largely because it would require leaders to change how they make decisions. At some point, leaders will stop clinging to their love of org charts. When that day comes, employees will rejoice in seeing org charts jettisoned to join bronze swords, lead plumbing, and other things from the Romans that were once useful but are now at best inefficient and at worst harmful.

The purpose of this book is to help organizations build workforces for a future that is very different from the past. It discusses how the twin "talent tectonic" forces of digitalization and demographics are changing the nature and purpose of work. It explains the psychology of employee experience and why it is critical to building adaptable organizations that can thrive in a world of accelerating change and frequent skill shortages. It discusses how to integrate business strategy, psychology, and technology to create more nimble companies. And it explains why we must move beyond ineffective workforce management methods based on outdated technology such as hierarchical org charts.

This book discusses the future, but its focus is on the present, identifying things companies can do now to attract talent and create resilient organizations. It also talks about the one thing about work that is not changing: the psychology of the people who work in organizations and how employee experience influences their engagement, performance, and adaptability. This book looks at these topics from the perspective of an industrial-organizational psychologist who has helped thousands of companies around the world use technology to build effective workforces. Few people have viewed the future of work from this particular angle. The book is based on engagements with organizations spanning virtually every industry.i It also incorporates a range of research from industrial-organizational psychology, management science, socioeconomics, and related fields. The book is a product of extensive experience working at the intersection of people, technology, and work. My goal as an author is to draw on this experience to share business insights you may not have considered and practical psychological knowledge you may not have encountered. The book includes fairly extensive citations if you wish to dive more deeply into the science and data underlying many of these concepts and observations.

The book provides guidance on how to attract, retain, develop, engage, and manage people for a new world of work, keeping in mind there is no one best way to manage workforces. My career involves working with companies over multiple years and I have seen how workforce management techniques play out over time. Theoretically well-designed processes often fail in application. Methods that work in one company fail in others, and methods that worked in one company at one time may not work later based on changing technologies, leadership characteristics, and company resources. It is critical to determine what solutions are appropriate for an organization given its unique culture, business needs, and resource constraints. Each chapter in the book ends with a set of questions to discuss with company leaders, managers, and/or employees to determine what makes sense for the organizations you work with. A goal of this book is to help you understand why these questions matter, when they are important to discuss, and what to consider when answering them.

Content Overview

The book is meant to be read from front to back. However, each chapter stands on its own for readers who are interested in specific topics. The first three chapters address changes reshaping work and workforce management. The remaining chapters provide guidance on how to respond to these changes. The content of the chapters is summarized next.

Forces Reshaping Work and Workforces (Chapter 1). The phrase talent tectonics describes fundamental shifts reshaping work and organizations. The two biggest shifts are the accelerating pace of change caused by digitalization and the reshaping of labor markets caused by demographic changes in birth rates and life spans.

• Digitalization. As technological innovation expands into every facet of life it increases the speed of change. This affects multiple aspects of corporate life including company survival. The life span of companies is growing shorter while the acquisition rate of companies has steadily increased.3 Companies are restructuring faster than ever before. Industries are being altered with changes in one industry creating changes in another. For example, the shift to electric cars is transforming the automotive industry but also has massive implications for the energy, transportation, mining, oil and gas, and manufacturing industries.4 This level of change is also playing out at the level of individual jobs. Automation is eliminating long-standing tasks while creating new types of work.5 Even enduring professions such as land surveying, which dates back to the ancient Egyptians, are being completely altered by inventions such as satellite and drone technology. Whatever a company or job looks like now, it will almost certainly be different in three years.
• Demographics. People are living longer and having fewer children, and not just by a small amount. The life expectancy in the US has increased by 38 years since 1910.6 The generation of workers currently entering the economy can expect to live about one-third longer than their great-grandparents. At the same time, the global birth rate has declined by 51% since 1950.7 In many countries more people are leaving the labor market than entering it.8 Barring catastrophic events such as wars, this has never happened in modern history. It is creating growing labor shortages and redefining job markets. Companies are already struggling to find...