HR 2018 Future View

By Ed Frauenheim

Dec. 19, 2008

The concept of “offshoring” will cease to exist. Millennials will redefine jobs, doing work at home and taking home to work. The labor market will look more like eBay than Monster or Yahoo HotJobs. And companies will engage in “crowd sourcing.”

These are among the top predictions from a panel of experts for what human resources will be like in 2018. Overall, the nine thought leaders and HR executives surveyed by Workforce Management envision a quite different workplace and HR profession from those of today. In 2018, work will consist of transient teams made up of internal and external workers, HR officials will assume many more seats on corporate boards, and leaders increasingly will be held accountable for their talent management decisions.

And don’t be surprised if an HR executive becomes CEO of a Fortune 100 firm—our experts put the odds of that happening as high as 100 percent.

Of course, forecasting is always iffy. Workforce Management’s attempt to predict 2008 back in 1998, for example, had mixed results (see story on page 22). But we decided to try again, given the importance of preparing for and benefiting from workforce trends ahead. It also seems like a good time for constructing scenarios for the future, given the global economic upheaval that is forcing firms to wrestle with talent strategies.

Panelist Libby Sartain, former head of HR at Southwest Airlines and Yahoo, thinks the coming decade will differ from the past one when it comes to the pace of change in HR. In other words, hold on to your seats. “The last 10 years moved slower than I thought they would,” she said. “We will be moving faster.”

Creating the lists
   Sartain was joined on the panel by other leading HR practitioners. They included Kevin Kelly, director of the people team for the Americas at professional services firm Ernst & Young, and Nandita Gurjar, vice president of human resources at India-based technology services company Infosys Technologies. Also participating were two HR executives from business software firm SAP: Terry Laudal, senior vice president of human resources for the Americas, Japan and the Asia Pacific region; and Virginia Clark, global head of learning and talent management.

In addition, our panel featured HR experts from the academic world: John Haggerty, managing director of executive education at Cornell University’s Center for Advanced Human Resource Studies; John Boudreau, business professor at the University of Southern California; and Dave Ulrich, business professor at the University of Michigan. Ulrich also participated in our prediction study a decade ago.

Rounding out the group of thought leaders was Susan Meisinger, who recently stepped down as CEO of the Society for Human Resource Management, the HR field’s largest professional organization.

This panel of experts helped us compile predictions in six workforce categories. We first asked participants to provide several predictions in each of the categories. Then we took the composite lists of predictions and fed them back to the panel members, asking them to rank their top 10 in each category. From those rankings, we calculated the top 10 predictions in each category.

The purpose of asking panel members to rank the composite lists was to arrive at something akin to a consensus. We instructed experts to keep in mind how realistic the predictions were as they ranked them, but to focus on the significance of the forecasts in shaping the HR field.

Not surprisingly, the experts didn’t always agree on what’s ahead. For example, one of Haggerty’s initial predictions was “substantially less business travel and fewer expatriate assignments.” But Meisinger said she expected “even more demand for leaders with global experience, creating more demand for ensuring key talent has expatriate experience.”

Haggerty also disagreed with Ulrich over the impact of Generation Y on the workplace. While Ulrich foresaw “Millennials redefining work” and blurring the boundaries of life and work, Haggerty forecast a minimal effect. “Gen Y issues will have had far less impact on business reality than predicted,” he wrote. “Talented people, willing to work very hard, will flourish in most organizational settings.”

Still, we found a fair amount of common ground among panelists.

Key forecasts
In the “Structure of Work” category, experts collectively pointed to collaboration as a key in 2018. The top-ranked prediction was: “There will be an increased focus on infrastructures—such as social networks and wikis—to support building strong relationships and collaboration.” The second-most popular choice predicted novel work arrangements: “The structure of work will become more adaptive, more informal and less focused on formal structure and static design solutions.”

Gurjar, of Infosys, envisions expanded use of virtual teams of employees who communicate extensively through videoconferencing, e-mail and text messaging. Gurjar said people are learning to work well together without much, if any, face-to-face interaction. At Infosys, workers text message despite sitting just a few feet away from one another. “Our communication is so highly dependent on e-mail or SMS [short messaging service, or texting],” she said. “Nobody talks on the phone anymore.”

Under the “Global Business” heading, panelists focused on making corporate principles clear to workers in all locations. “Companies will need to balance the need for a unified global culture with local strategic and cultural differences and make core global values locally relevant and easily understandable for all employees,” the top prediction stated.

The corporate social responsibility movement will grow stronger, experts said in the category of “Work and Society.” Their No. 1 prediction was: “Societies throughout the world will focus on work as a more important crucible for social progress and values. The memory of today’s financial crisis will leave a legacy of greater scrutiny and regulation of issues such as fairness, pay differentials and ethics, particularly in traditional Western economies.”

At the same time, decisions about hiring and training will be tied more carefully to the bottom line, panelists predicted. The top forecast in the field of “Recruiting and Workforce Development” was: “Recruitment and development will increasingly be seen as part of an integrated workforce-supply optimization process. Both will become virtual, global and just-in-time, but they will also be transformed through an increasing emphasis on optimization, differentiation and return on investment.”

Another top forecast in this category was that leadership development will be critical. SAP’s Clark sees a continued shift away from a pure “command and control” leadership style to a more “matrixed, collaborative” approach. This puts the onus on an organization to develop different types of capabilities in their leaders.

“I really think that leadership development is going to be one of the areas on top of the corporate agenda,” Clark said. Panelists suggested that HR executives will face tough scrutiny of the way they recruit, manage and retain people. The top prediction for the “Strategic Role of HR” was: “The strategic role of decisions about talent and how it is organized will increasingly be recognized as pivotal to sustainable strategic success. Leaders will be held accountable for the quality of those decisions.”

And the benefits world of the future will be customized and creative, with offerings that could include elder care, pet care and concierge services, according to the panel. “Companies will need to offer tailored benefits to meet diverse needs and attract talent,” the experts predicted in their top choice.

Other emerging trends
Apart from asking panel members to make and rank predictions in the six categories, we also asked several specific questions about HR a decade from now. Among these was how much a data-driven “decision science”—similar to the disciplines of finance or supply chain management—will emerge in HR by 2018.

USC’s Boudreau, who is among the leading voices calling for HR to develop a decision science, is optimistic. “A decision science for talent markets will advance significantly by 2018,” he said, “and will increasingly be seen as equally important for business leadership as finance, marketing and supply chain.”

Meisinger suggested some caveats. “Those that have a business degree as well as HR certification will be very comfortable with a decision-science approach,” she wrote. “It is much more likely to be present in larger companies than small, since smaller companies have fewer resources.”

Ulrich agreed there will be more data to crunch, but he also said, “It is hard to make a science out of talent and organizational issues.”

Panelists generally gave good odds that an HR executive will advance to become CEO of a Fortune 100 firm by 2018. Boudreau put the chances at 100 percent. Sartain also said it was likely. “With many HR people moving to operations or from operations and having strong business acumen, this will happen more often,” she said.

Asked what the most important workforce management issue will be in 10 years, Clark and Laudal said continued labor shortages, particularly in leadership positions. Gurjar cited the need for constant learning and updating of skills.

Haggerty predicted: “Talent management, same as 2008.”

Another thing he doesn’t see changing is what the profession calls itself. Terms such as “talent management” and “human capital management” have been bandied about, but Haggerty doesn’t see them sticking.

” ‘HR’ will still be the name,” he predicted. “Fads with fancy titles will fade.”

Kelly, of Ernst & Young, begged to differ. A 27-year veteran of the profession, he already sports an unusual title as director of people for North and South America, and Israel. Just as terms such as “personnel” and “employee relations” gave way to more modern labels, he expects the name “HR” will be “outdated and old-fashioned” in a decade.

After all, he said, the field is starting to race forward, thanks to such factors as globalization, increased attention to talent and a greater focus on inclusive workplaces. “In my last five years, the rate of change is greater than in the first 22,” he said.

A still faster pace is ahead, he predicted. “I wish it wasn’t so,” he said with a chuckle, “because I’m trying to catch my breath.”

Workforce Management, December 2008, p. 1, 18-23  — Subscribe Now!

Ed Frauenheim is a former Associate Editorial Director at Human Capital Media and currently works as Senior Director of Content at Great Place to Work. He is a co-author of A Great Place to Work For All.

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