Early in my role as global managing partner of McKinsey & Company, I made a commitment to meet with at least two CEOs or government leaders every day.
I took this opportunity to ask thousands of leaders around the world to reflect on what they would have taught their younger selves and done differently. I can tell you almost every single one told me they wished they had moved faster on people. They wished they had made faster decisions on top people in key positions – taking people out and moving people up – and spent more time on people, generally.
What does this mean for organizations trying to plan for a future where talent has never been more important and technological innovation is moving at light speed?
It means organizations need to create a talent-centric culture so they can attract and retain the best and the brightest.
Previously, we had multiple generations to adapt to a technological disruption. This time around we’ll have less than one generation to skill and reskill people.
This unprecedented shift is happening at a time when investment in training and people is underemphasized. Automation threatens to disrupt the jobs of 10 million Canadians by 2030. How do we reskill 10 million people? There isn’t time to turn out-of-work factory workers into biotech engineers. These people will be between 38 and 48 years old. They will have mortgages and kids.
Watch Barton explain what the world can learn from Waterloo
Although Canada has a comparatively strong safety net, growing inequality around the world threatens to get much worse. We are living in a world where 62 people have the same wealth as the bottom half of humanity.
In 1881, Otto Von Bismarck, who was then chancellor of Germany, proposed government-run financial support for older people. This was a radical social innovation at the time because, up until then, life expectancy was short and people worked until they died. The idea caught on in Germany and by the early part of the 20th century many businesses were promising retirement pensions for employees.
Pensions were a response to the massive changes of the Industrial Revolution. The disruption we are experiencing today is a result of the massive shifts in global economic power, technological innovation and the aging of our workforce which will require challenging today’s orthodoxies.
The Advisory Council on Economic Growth recommended that Canada invest $15 billion annually for adult skills development to help workers adjust. The creation of an RRSP-type lifelong learning fund would enable workers to accumulate tax-free savings, combined with contributions from both employers and government. This fund could be used to cover the cost of developing new skills midway through a career.
Our world is aging and in five years we will be the oldest human population on Earth ever. What does a career look like if people live until they are 120 years old? The idea that we only educate ourselves up to the time we are 25 years old will be laughable in a decade. With knowledge changing so rapidly, does it make sense for universities to require computer science graduates to requalify every year? Demand for health-care professionals will also make us question why it takes more than 10 years to train a medical doctor.
Disruptions are fundamentally changing how businesses operate
Technology disruptions are fundamentally changing how businesses operate and compete. At McKinsey & Company, 60 per cent of what we do now didn’t exist five years ago. The type of work we do, the type of people we hire and the capabilities we have are changing dramatically. As an economics student 35 years ago, I would have failed if I suggested that a billion-dollar company could exist with virtually no assets. Today, that would be the right answer.
Smart businesses around the world are not just looking outside their walls, they are learning from organizations well outside their sector. I know of an oil engineer who is on secondment at a cancer treatment centre. Pharmaceutical companies can learn from renewable energy firms, financial companies can learn from biotech startups.
On a recent visit to the University of Waterloo I was asked what traits young people should look for in prospective employers. I reflected on that time I spent in conversation with thousands of global leaders around the world and I told the students that, given the reality of disruptions today, they should look for employers that invest in talent.
Beyond a paycheque, does the employer invest in you? Do they invest in training and people? I would also be looking for a place that wants multiple leaders. Is it a performance-driven place that develops leadership skills? Does the company encourage its workers to learn by exploring different geographies or disciplines or functions?
I am very proud to be the chancellor of the University of Waterloo and have no doubt that the students here will go on to lead important organizations with incredible impact. I hope their high ambitions also include building talent-centric places to work and leading the communities, Canada, and the world through this age of disruption.
Watch Barton's full lecture