The structure of organisations is changing and we will see more large, interlinked total service companies and more small independent specialists, while companies in the middle will struggle as they will neither have the scale, resource nor agility to compete effectively on either front.
Rather than being self-contained, they will operate more as part of a larger, fluid eco-system, arranged around the work they do, not just fitting the work into inflexible structures, as has been the case in the past. Instead of layered management and rigid departmental siloes that are expensive, slow moving and less responsive to the complex needs of tomorrow, there will be greater cross-functional co-operation, using the mixture of talents within (and outside) the company to solve problems and capitalise on opportunities quickly.
There will be fewer full-time employees in most companies and talent will be imported when it is needed. This will lead to more opportunities for specialist consultancies and individuals hiring themselves out on short-term contracts as higher-level temporary staff. In addition there will be more formal and informal joint ventures – companies teaming up with like-minded organisations for mutual benefit. These will not always be commercial enterprises and we will see universities and colleges aligning themselves with businesses to generate income.
All of these changes will impact on management and work culture. In 1960, Douglas McGregor identified two approaches to management – X and Y. X style management is command and control, top down, bureaucratic, formal and often aggressive. The Y school is more collaborative, based on teamwork and participation. Although dominant in corporate structures of the past, the X approach will seem increasingly outmoded and higher performers, Gen Y and millennials will choose to work where it is the cultural norm as a last resort – simply because it doesn’t fit with their values and aspirations.
Managers will be as, if not more, likely to be ‘she’ as ‘he’ and there will be a shift of values in companies as a result. The attitudes of these more recent entrants into the workforce will be particularly influential. A global CMI study showed that millennials want to work for companies that do something they believe in. And by definition this will extend to management style. This doesn’t mean that work will be a holiday. The pressure to succeed will still be there, but it will be delivered in different ways.
Rather than managing by objectives, companies will increasingly manage by results. At the moment, in many companies, being seen to be doing something is more important than the actual output. In the future, the quality of output will be all and management will need to find new ways of measuring this – productivity will be prized above simply being there and being seen to be doing something. But the problem remains of how this output will be evaluated in a knowledge-based market structure, where creativity and innovation can be subjective terms.
Businesses will need to contend with greater transparency in future. The growth of sites like glassdoor.com will make information about culture, conditions and salaries in companies even more widely available. Customers will demand and get easy access to information about the people that they buy from.
Social media will be a driver and an enabler of this and migrate from being thought of as a purely personal tool to one that is central, not just for B2C but for B2B communication. In the UK, the addresses of the government’s security services are widely known, as is the identity of the Director General – unthinkable a generation ago. Rather than only being recruited through subterfuge, employees are openly sought on the internet – especially hard to reach groups, such as ethnic minorities.
In the US, the CIA markets itself as an employer online in a way no different to how General Motors does. Internal openness and cooperation will be provided by internal social media innovations designed to help people work and communicate more collaboratively, across functions and geographical boundaries. IBM’s Social Blue is probably the leading instance of this.
Key issues:
- With changes in markets, different employee profiles, a new connectivity, new technology, new mobility, an innovation process that is open, accepts risk and is central to how a company does business will not be an option. It will be the difference between success and failure, between survival and extinction
How will companies organise themselves in the future?
In a creative and knowledge-based work environment, access to information will be critical. Speed and accuracy will be competitive advantages, but for most people at work, events, other people and, most importantly, their everyday communication tools, combine to sabotage delivery. We are nowhere as efficient as we think or would like to be.
McKinsey estimates that an average interaction worker spends 2% of the working week managing email and nearly 20% looking for internal information or tracking down colleagues who can help with specific tasks. Work by Fonality in 2012 showed that in the average eight-hour day of an office worker, nearly three and a half hours are spent trying to contact customers or colleagues, trying to find information, duplicating communication, scheduling meetings or dealing with unwanted or irrelevant communication.
Email has been criticised for years for being indiscriminate, unwieldy, visually uninvolving and ambiguous, but no replacement is on the horizon. Twitter’s 140-character limit prevents detailed communications, and Facebook offers businesses little in the way of a secure alternative – or reliable archiving.
A study by Professor Perling of Harvard Business School among Boston Consulting Group Consultants implementing ‘Predictable Time Off’ (turning off email and mobile devices for fixed periods) resulted in participants feeling more motivated, with increased job satisfaction. They also reported that they had become more efficient, effective and collaborative as a team.
The reality is that despite the likelihood of disaggregation of higher status jobs, what we view as high-level workers are spending a large part of their time on administrative tasks, hunting and processing information about which they are poorly equipped to assess the value until they have seen or read it. But the doing part is time consuming and always has an apparent urgency. So there is an emerging ‘organisational gap’, which will threaten all of the apparent efficiencies that mobility and digital communication are bringing.
Organising people in the office of the future will be far more challenging than it is today. It is fine empowering workers to make their own decisions about work flow and place and pace of work, but ultimately this needs to be managed – especially with the increase in part-time, freelance and outsourcing work.
Resource coordinators will perform a more integral service by composing teams from different departments and outside organisations and blending them together. Their knowledge of the right and best external skills will give companies competitive edge and will add a new dimension to the services offered by recruitment and placement suppliers.
Workflow coordination will become a key function, interacting with clients, allocating projects to the right teams to be dealt with efficiently, managing the relationships between insourced and outsourced workers. In a world where multi-tasking will be the norm and projects are no longer linear, this will require high-level skills and software. And it isn’t just the people who need organising – it is their equipment. The speed of change means that only companies ditching their technology wholesale annually will be sure that everyone is capable of working on a level playing field. The retrieval of information is likely to become harder, not easier, as companies hold storage in ever-greater quantities. Physical storage of paper-based information is falling – from over 10% to perhaps less than 1% of office space.
But something has to take its place. The availability of enough digital data storage is vital. Insufficient space may mean that some items simply are not safely stored. So information will have to be compressed and still remain searchable, retrievable and capable of being easily analysed and manipulated. Digital filing will increasingly be a challenge, as information comes in different digital forms. In future rather than the printed word, we will increasingly be creating, managing and restoring all different formats – from tweets to webinars to filmic materials.
How do you file and retrieve an infographic? Traditional hierarchical filing approaches can lead to the retrieval of irrelevant information, or to none at all, as Jackson and Smith’s 2011 study for Loughborough University shows. Desktop assistant apps to address this type of challenge will grow in popularity – there are already 500 available, but most are simply time management systems that users have to fit themselves into, rather than vice versa.
But just as computers don’t think like us (yet), we don’t think like them. As David Allen, the Getting Things Done guru, told Fast Company magazine: “Could somebody, some system, please embody my intelligence about how I want to have data structured and how I want it to come out?” A fundamental problem is that no storage method is really intuitive. Human brains don’t work like filing cabinets or computer servers. The standard hierarchical structures have logic to them, but most people’s thinking – especially their creative thinking, lacks logic. So the ideal data storage systems of the future will be both logical and intuitive – a bit like a gearbox that we can shift from manual to automatic.
Key issues:
- The time wasted in inefficiencies at work is huge and yet often passes unnoticed
- Companies must beware of devaluing their most valuable people by turning them into their own administrative assistants
- Data retrieval will be key and old approaches to filing must evolve
- The challenge is how to make our information organisation mirror our cognitive structures
The innovation processes that companies need to start implementing now
The lesson for all of us is that on the whole the future doesn’t arrive in one handy lump, it comes in dribs and drabs – hence the unevenness of distribution. Ironically there are benefits in being a laggard. Africa is going through a mobile revolution faster than the rest of the world, precisely because there is so little infrastructure to lose and no legacy costs to be regretted. Apple did not produce the first MP3 player on the market – but it produced the most aesthetically pleasing and the most intuitive.
But organisations in the developed world that sit back and wait for something to happen will find themselves engulfed in a tidal wave of change. If we simply look ten years into the past and realise that Gen Y, the attitudinal driver of change, was still at school, that broadband was only just being introduced and a mobile worker was likely to be someone who drove a bus, we can see how quickly the world has moved.
Now look ahead ten years, bearing in mind that the speed of technology is always accelerating, and we have to recognise that the business world we take for granted now will bear no relation to the one of 2020 and beyond. And unless you intend to retire by then (and remember the half of all US workers who plan to delay retirement) it is a world that you will have to confront.
So we will all have to become more innovative in our orientation – and not just in terms of new products, but in terms of business thinking. We have seen innovation go through a number of phases – by lone boffins, by ‘skunkworks’ in larger companies, by teams of individuals backed by venture capital. The future will lie in holistic business innovation.
Rather than an isolated function, it will have to be something that everyone will be involved in. This goes beyond having a suggestions box (usually empty and ignored), to making sure that forward thinking is in companies’ DNA. Innovation will be more internally collaborative. There are many studies showing that the wider the range of disciplines involved in idea generation, the more powerful the concepts that come out as a result, because people working together in this way approach problems from different angles, not with blinkered thinking.
Innovation will be more open. Of course companies will keep proprietary information and much patent development work will be carried out behind closed doors. But at the same time, enlightened organisations will share their thinking at an early stage with their channel partners in the ecosphere. By working synergistically together, companies will be able to exploit mutual strengths in collaborative partnerships.
More and more companies will use open source as a way of developing products and services – using their customers and suppliers as participants. A recent high profile example was the way the UK’s Guardian newspaper drew on its readership to help the rapid analysis of the report on the misuse of MPs’ expenses in the UK, with 170,000 documents reviewed by 20,000 contributors.
Innovation will also be collaborative with customers. Early in 2012 Unilever set up the ‘Sustainable Living Lab’, a 24-hour global online event designed to generate new ideas from customers. This was on the back of a permanent online platform called Open Innovation. As well as generating ideas, this type of initiative delivers a win-win by creating goodwill among people who feel they are making a contribution to how a company does business.
Just as in software development, companies will carry out far more beta testing of ideas. And this whole area will explode when 3D printing becomes more mainstream and limited edition prototyping will be simple. While the focus in the past has been on products – new product development is synonymous with innovation in most people’s minds – business model innovation will become more important and a way for companies to gain competitive advantage.
Where products can often be swiftly copied, the commercialisation of business models can be more bespoke to a company’s values and outlook as another extension of its brand behaviour. Innovation will not be something that companies can dip in and out of. It must be hard wired into the organisation as a systematic capability and championed by senior management, seen as an essential investment, not a cost to be trimmed when the going gets tough.
Companies that are stuck in a rut will suffer. With the growth of the global economy, organisations that are flourishing in developing economies are playing by different rules, taking a zero-based approach, fitting themselves to the emerging world picture rather than hoping that the world will
adapt to them.
Key issues:
- With changes in markets, different employee profiles, a new connectivity, new technology, new mobility, an innovation process that is open, accepts risk and is central to how a company does business will not be an option. It will be the difference between success and failure, between survival and extinction
Does paper have a future in business?
While software companies are eager to predict the death of paper, there is no evidence that anything more than a gradual decline will happen in the near future. Rather, the huge growth of information that we consult and process means that it is paper’s share of information content that is falling rapidly.
The “paperless office” was coined in an article in Business Week in 1975, and nearly 40 years later it is a rare company that works in this way and the average office worker is still estimated to use 10,000 sheets of paper a year – findings are consistent across the US, the UK and Australia (but significantly around 60% of this and growing is recycled).
A survey of 200 companies by the printer supplier Lexmark showed that only 43% of those surveyed believe in the ‘paperless’ office concept, but think it’s unlikely to happen, while a third believe modern operations will prevent the idea being implemented. While three quarters said they were printing off fewer emails, hardly anyone was printing none at all.
So it is likely that both paper and digital will coexist for some time yet, giving new challenges to companies as they look for ways to convert paper documents into electronic files for immediate distribution, processing, indexing, storage or archiving. And for many documents, the look, feel and quality of a paper-based presentation will always outweigh a digital equivalent.
Key issues:
- The place where paper and digital meet is a focal point that few companies are addressing
- The challenge will remain for years to come of how to manage thousands of gigabytes of data and the 10,000 sheets of paper that an office worker produces every year
- Paper may be in gradual decline, but embedded needs and behaviours do not change overnight.
Esselte’s reaction
“We have been working with Andrew Crosthwaite, one of the authors of the white paper, for many years and some of the trends he identifies we are already addressing,” says Arild Olsen, SVP Marketing and R&D at Esselte. “We have recently launched a line of accessories supporting users of mobile devices as we have seen them become regular business tools in the last 18 months.
“In addition, we are exploring products focused on making the modern workplace a much more enjoyable and inspiring place. As the report shows, companies will increasingly need to take care that their employees, especially the millenials and Gen Y, have the right working environment. At the same time more demand will come from an increasing number of freelancers working at least partly from home.
“Another new area we are focusing on is organisation of agendas and files in a digital age. We are planning a new service that combines our Leitz brand with the latest digital thinking.
“Finally, we are learning a lot when it comes to our internal processes, improving the innovation systems, being more flexible, faster and open in connecting external partners to our total eco-system. This will ensure that we have access to the best talent and bring the right products to market faster and with the right level of support.”
These extracts come from a white paper by Esselte on the future of the workplace. You can download the full white paper, called The Future of Work, here
