This is the era when the student trend for couch surfing morphed into the peer-to-peer platform Airbnb, a company whose valuation now exceeds that of global chains like Hyatt and represents an ongoing threat to the hotel and hospitality industry. Consumers are taking control of their personal health with diagnostic testing on their terms, thanks to startups like Austin-based Everlywell, and the decentralized distributed ledger technology known as “blockchain” is influencing not only major banks but also the way the UK government, among others, may deliver services to its citizens.
Such examples of “democratization” are both directly and indirectly impacting business. Directly through the increased power emerging technologies have put in the hands of consumers; indirectly by the way they are forcing companies to rethink their organizational structures to respond to rising demands. At the same time, as Deloitte points out in its Global Human Capital Trends Report 2016, “the entire concept of leadership is being radically redefined.” Because different mindsets and behaviors are now required to manage the fact that the most in-demand talent now has a broader choice of when, where and how to work thanks to online marketplaces such as Upwork, PricewaterhouseCooper’s Talent Exchange and SkillBridge.
March of the Millennials
Today’s trend of treating a job as a roughly two-year commitment is particularly noticeable among the 18- to 35-year-old cohort known as the Millennials. Their tendency to live at home rather than be saddled with a mortgage and other debt means they have more freedom to change jobs than their predecessors. This group has grown up with the unprecedented opportunities provided by the Internet, including many ways to channel their desire for creative expression. They have a need, as one high-tech CEO put it, “to be challenged with a different role and different set of responsibilities.”
Sitting in a cubicle waiting to be told what to do, or forced to attend lengthy meetings after which little seems to get done, is not going to cut it. Plenty of companies have, however, found the sweet spot. One that requires leaders to distinguish between those times when direction is required, and when it’s better to get out of the way and let team members run the show.
Decentralization — the flattening of hierarchies and dismantling of silos and the thinking that accompanies them — is nothing new. Nor are calls to relinquish the old command-and-control model for what’s been referred to as “coordinate-and-cultivate management.” However, again, technology is taking this a step further and speeding up adoption.
The trend for distributed teams, for example, has found favor with Millennials looking to work more flexibly, in an environment where they can call the shots. The business benefits of assembling specialized talent on a project-by-project basis, rather than being restricted to what is available within a particular department, are resulting in faster, smarter and more innovative outcomes. For example, the 104-year old company Steelcase not only produces workplace performance products and tools but empowers its globally distributed teams to collaborate via knowledge sharing platforms. They don’t lose valuable time by having to send insights up one chain of command, then down another.
This shift away from the traditional models of management is not without its challenges. As MIT Sloan professor Thomas W. Malone asks (and answers) in his book, The Future of Work: How the New Order of Business Will Shape Your Organization, Your Management Style and Your Life, what is left to be responsible for, when employees are making more of their own decisions? What’s left to manage?
Plenty. But it takes a different mindset to see and leverage such opportunities.
Friends and Enemies
In addition to shifting gears from being instructional to inspirational, today’s leaders are wise to ditch notions of “win-lose” and “winner takes all.” Indeed, the entire “business as war” vernacular is being overhauled with the increasing popularity of a business model known as “co-opetition,” (a term that combines “cooperation” and “competition”). Similar to a strategic alliance, this involves an arrangement between two separate entities—they just happen to be business rivals.
Companies that have benefited from such collaborative information and resource sharing include Amazon (with Borders, Netflix and Apple for three separate roll-outs), Sony and Samsung, and Tesla Motors and Toyota. The challenge this presents for leaders is arguably similar to what derails many mergers and acquisitions: management on both sides thinking and behaving as though the other is the enemy and ignoring the bigger picture.
Aside from the strategic cost benefits of approaches like co-opetition, there are career advantages for those willing and able to collaborate fairly and effectively, both within the organization and outside of it. Not being replaced by a robot is one of them.
The C-suite is not as safe from automation as some experts have suggested. While entire roles won’t disappear, McKinsey Global research on the future of work shows activities like data collection and processing — even at the management level — at risk of being taken over by machines. Soon most financial tasks may be machine-led, given examples such as the way artificial intelligence (AI) hedge funds consistently outperform those run by humans.
An independent research group, Institute for the Future suggests what will be left for humans to do in its Future Work Skills 2020 report. Of the ten proficiencies they outline, the top four involve higher-level thinking and people skills: sense-making, social intelligence, novel and adaptive thinking, and cross-cultural competency.
If leadership is really the driver of performance performance, involving influence, integrity and emotional intelligence, leaders will need to show they are better at these skills than AI. In the interim, while machines are becoming exponentially smarter, the danger will be in ignoring current trends and sticking with the scientific management practices favored during the 20th century. Practices that have arguably contributed to 87 percent of employees globally saying they are not engaged at work.
Writer William Gibson (the man who coined the term “cyberspace”) once said, “The future is here, just not evenly distributed.” One day, very soon, it will be. Strategic leaders will need to be well prepared, and that means starting from the inside out.
Dr. Liz Alexander is a consulting futurist, speaker and author of 19 books and is based in Austin. The co-founder of Leading Thought (leadingthought.us.com), she helps aspiring thought leaders discover strategically valuable, actionable insights to grow their businesses. Twitter: @DrLizAlexander LinkedIn: https://www.linkedin.com/in/drlizfuturist
Mar 13, 2017 Comments Off on Business Tax Issues for 2017