Seven characteristics of better people development in times of change.

I’m not trying my hand at evangelism, but I thought I should follow up on my “Gospel of speed” post where I play with some ideas and learnings from the change management process Schibsted has been through during the past few years and offer some thoughts on what all this might mean to the people who are to thrive and perform in an environment of rapid change.

We’re living in a golden age where the internet is completing the first leg of making the world a better place by digitizing information and is now about to embark on the second, in which it will digitize our interaction with the things that surround us. And in the midst of this turmoil we’re supposed to live and deliver. How do we do that? New technology will foster a new kind of competition between companies and will in turn change those companies who engage in that competition. Think of it as if the companies were the members of a nomadic tribe moving to a new environment, where they adapt to the new conditions, and after a while absorb these adaptations into their culture and way of life. Here are my thoughts on these changes, where I attempt to describe what constitutes great organizational development, personal growth and HR management in the years ahead.

1. Selection: The premium on experience will decrease

Erik Haugane, CEO of Siva, an innovation fund, recently said: “Nobody has more than two years of experience. Everything after two years is repetition.” Although he put it rather starkly, I think he’s right about one thing: the faster the environment you operate in changes, the faster the value of your experience will diminish. Experience should be valued most in industries with a high level of stability and least in those with a high pace of change.

The more you believe this, the more it should influence your thinking about hiring and promoting people. Two weeks back I had the fortune of hearing Claudio Fernández-Aráoz, a professor and a partner in Egon Zehnder International, speak about his book It’s not the How or the What, but the Who. He lays out some compelling reasoning where he concludes that it is wiser for an executive to hire based on the potential of the candidates rather than on their past experience or present performance. I’m ready to subscribe to this line of thinking. After all, it makes a lot of sense and Fernández-Aráoz underpins the idea with a lot of persuasive research.

I have one exception to the full endorsement of potential over experience though, and that’s with regards to compassion and relationship building. I’m sure there’s merit to enhancing the focus on potential when thinking of interpersonal skills too, my point being my point being that the value ascribed to these experiences will diminish far less than that ascribed to more specific areas of expertise. After all, people don’t change as much as technology.

Let Haugane’s words be a motivation to seek change. To new recruits it’s a signal to get out there and dare to take on all kinds of roles and responsibilities. Schibsted’s fifteen-year-old trainee program is based on the idea that 20-somethings entering the company should learn more and learn faster when exposed to different jobs. But there’s no reason why this line of thinking should apply only to new recruits. I have been lucky to have had seven different jobs within Schibsted, some of them in parallel, in my ten years of employment. I recommend it, if it can be done in a controlled environment where the value of new experiences can be unlocked without being to the detriment of stability in the organization.

2. Selection: Self-teaching will be more important

Change also means that companies can’t be sure to be ablerely on being able to provide their employees with courses and on-the-job training the way they used to. Employers often won’t know what skills and competencies they need, and even when they do, it might not be something their organization currently possesses. Kind of hard to provide on-the-job training if nobody on the job knows that particular skill, right? That doesn’t mean they should stop trying, but it might mean they should think about changing the setup of their training programs from making sure the employees learn what they’re told to making sure the employees are better equipped to teach themselves.

That will surely be more demanding. The social contract between the company and its workforce will change – no longer can the corporation be relied on to offer us a job for life. But it might be able to give us skills for life.

Self-efficacy and curiosity will come to the forefront. A colleague of mine spent the day before an important management meeting finding and learning an app development tool and used it to publish a fully functional prototype of a new product. When he came to the meeting, that’s what he showed, not the usual PowerPoint deck and a meek plea for resources to do a feasibility study.

To me, this process is illustrative of the power of self-teaching. My colleague creates immediacy and gives his idea more muscle by acquiring a skill to make people believe in what he’s saying. The benefits to a company where this kind of curiosity is widespread are threefold: speedier experimentation, cheaper prototyping, and more widespread mobilization of idea generation than just a narrow R&D unit. Companies where trying, learning, and adjusting are valued will be winners in the future.

3. Recruiting: More frequent external hiring

When technology and the competitive landscape change, it becomes harder to figure out the specific skills the organization will need in the future. It would have been virtually impossible for Schibsted’s managers in 2009 to guess that “head of data science” and “conversion analyst” would be job openings in their own company five years ahead. Back then, “front manager” and “traffic manager” were considered exotic job titles, and the demands on these jobs were very different from what they are today.

When companies like Schibsted become more uncertain about their own future, they should start planning for the likelihood of changes in their recruitment needs. With reference to the point above: companies that have got along fine by hiring graduates and building them up will most likely experience a growing need to hire externally to fill skills gaps in their organizations. Not because they haven’t been doing their job developing their personnel, but because requirements have changed in ways they could not foresee, thus creating a need for external hires.

We’re seeing this in Schibsted today. In a lot of areas where we’re hiring quite heavily, such as data analytics, tech architecture and ad ops; hiring from outside is a precondition to filling all the positions.

The result is that Schibsted now has several alumni from online giants such as Google or LinkedIn. This was a rarity two years back.

4. Recruitment: Take even better care of the talent you already have

The point above might repulse the talent you have on the inside. After all, why waste your time in a company that’s moving in a different direction than what you’ve been training and working for? A colleague recently compared this kind of situation with a football (soccer) team that gets bought up by a Russian billionaire: “It’s great for the team that we’re able to fill the lineup with expensive and brilliant players, but where does this leave those of us who worked hard to get the club to where it is now?”

Sure, that situation can be motivationally tough. At the same time, the uncertainty about future requirements means it becomes increasingly important to maintain, motivate, and retain the talent you’re most sure will fit future needs. In the war for talent, defending the talent you already possess is your first objective.

5. Diversity: The handicap of intolerance

Any handicap an employer creates for himself due to intolerance in recruiting or promoting won’t be sustainable. Buzzfeed’s diversity hiring policy makes the point very well: it’s an ethical necessity, it’s essential for them to reach the maximum number of readers, it’s important for the performance of every person in the organization, and it’s a prerequisite for being able to hire the best people. Not hiring in an open-minded manner cuts you off from these four well-defined goals. Who would want that, and who could hope to keep up by giving themselves such a handicap? Well, Twitter and Facebook, apparently, who have only 30 per cent women among their employees. Schibsted, my employer, whom I’ve lauded on many other accounts, still has a precarious imbalance in diversity in gender, ethnicity, nationality, and age in the higher echelons. That won’t work in the long run. To follow Buzzfeed on this one: we the workforce won’t believe in the attitudes of our employers, won’t reach the maximum amount of readers, won’t work at our best or work with the best unless we unburden ourselves of skewed practices.

6. Management: New demands

When organizations move away from being hierarchical factories (think of manufacturing) towards being ecosystems of talent (think of open source coding or the multi-layered processes in advertising), the executives lose their ability to control their workers’ every move. They become reliant on a mutual relationship of trust with their employees to be able to create movement in a given direction. Trust is also a major catalyst in bringing out the creative talent of numerous stakeholders in an ecosystem.

I admire traditional TV channels for actually being quite advanced in this regard. Around any broadcaster a whole family of production companies, agencies and startups work together in a rather loosely coordinated community to develop and create the concepts we get to see on screen.

I think a lot of media companies can and should take their cue from this way of working, especially when it comes to commercialization of traffic and the development of new consumer services. In periods of strength you may spin off concepts that have more potential than what you can exploit internally – as TV2 in Norway has done with a host of companies (Vizrt, Mosart, Wolftech, StormGeo, etc) – and in times of stretched resources, management should work to attract and build stakeholdership and alliances with an ecosystem of providers. But then managers must be able to replace the control that ownership provides with: a) a clear idea of where the partnership is supposed to go, and b) a level of trust that makes up for lack of formal mechanisms.

7. Organization: Accelerate the fast movers

Those who work in fast-paced organizations, who thrive with experimentation and change, and who have leaders who trust them will demand a different way of making decisions. They won’t tolerate “Let’s look at that later.” They won’t put up with “Hmmm… why don’t you fill in a spreadsheet with a business plan before giving the idea any more thought?”

More often than not, my experience is that the routines that have been put in place to safeguard business planning, risk management, and resource allocation end up doing the very opposite of what they were designed to do. Over-focusing on business case-modeling diverts attention away from product development and thereby reduces the likelihood of a product’s success. And what’s the use of all that scenario-building then? Vast efforts to map out and reduce risk end up creating risk because managers feel they control their risky environment, when maybe their eyes are set on the risks they know rather than on the big unknowns. In a fast-changing environment, what do you think is more risky: known risks or unknown risks? Resource allocation processes end up consuming more funds than they contribute to optimizing, because in creative businesses so much idea building now requires such modest means (i.e. freeware, crowdsourcing, etc) that you may allow some level of spending before it makes sense to constrain and guide it to its theoretically optimal use.

These were just three examples of a type of conflict I experience more and more often; one between what I was taught was right in business school and management training on the one hand and what I see will benefit fast product development on the other. These should not be diametric opposites, but a lot of traditional businesses need to change if they are to be reconciled.

We don’t have time for politics. We can’t afford constraining budgets. We risk turning away the fastest moving, most talented people we have, if all that the organization surrounding them can provide is restrictions on their ideas. And if we turn those people away, they’ll be back to disrupt us.

Andreas E. Thorsheim has worked in Schibsted for ten years in various positions, notably as CEO of Bergens Tidende, CFO/COO of Schibsted Norway and Director of Projects for Media Norge. Thorsheim holds the degree of cand.oecon from the Norwegian School of Economics and Business Administration (NHH) and a CEMS master’s degree in international management from NHH and the London School of Economics.

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