Eight challenges leaders will need to address in the coming decade
The pace of change in modern business is dizzying, and leaders who aren’t prepared for the challenges on the horizon may find themselves leading their organisations into the history books. In 1958, the average lifespan of a company listed on the S&P 500 stock exchange in the U.S. was 61 years. Today that lifespan is just 18 years – and falling. At the current rate of attrition, three quarters of companies currently listed on the index will have changed in the next decade. The story’s the same in stock markets around the world.
Just think of the household names that have been outmanoeuvred, outinnovated, and outplayed since the digital revolution really hit around the turn of the millennium. No more Blockbuster, plenty of Netflix. Move over Kodak and Polaroid, and hello digital cameras then smartphones and Instagram. As the chill winds of ecommerce blow – and familiar names disappear from the high streets and shopping malls of the UK, the US, and Europe – meantime, everyone has Amazon. Where most towns once had an independent or chain record and CD shop, most households have a Spotify, Deezer, or Apple Music subscription. And remember, Google is just 20 whileFacebook is only 15.
The key to surviving, thriving, and growing in the modern, turbulent corporate environment is leaders’ ability to adapt and innovate in the face of the headwinds of disruption. Success is a result of how agile and nimble leaders are at encouraging and empowering their organisations to embrace novelty and influences from the edges, experiment with them, and adapt them for their employees’ and customers’ present and future needs.
In this post, I’m highlighting eight challenges and trends that today’s leaders must face and rise to if they are to survive and thrive in the 2020s. For each one, I’m highlighting the significance of that trend for the workplace. And for each one, I’m suggesting one implication – one simple top tip – that they can start doing today.
ISSUE: Artificial Intelligence and automation. While the aspiration of genuinely human-like intelligence may be an impossible dream, in many fields the advances made in AI and automation are making people less efficient than computers and machines. As robots took over production lines in the previous generations, algorithms are moving into more cognitive tasks today.
IMPLICATION: Work out how you could remove some of the more menial, repetitive tasks from your workflow to enhance and improve productivity – and then develop more meaningful and motivating work for people instead. For instance, is manual, double-entry book-keeping really necessary today?
ISSUE: Millennials and the ageing population. Those reaching young adulthood in the early 21st century don’t have many of the opportunities that their parents’ generation did – no jobs for life, no job security, and a much greater challenge to get onto the housing ladder. They also often have different priorities and values and a different perspective on how companies should behave and why. Meanwhile, those retiring now and in the next decade are predicted to live longer than ever. The balance is shifting from the number of people in work to the number of people retired. Those in work will increasingly be expected to contribute to help care for those no longer working.
IMPLICATION: Ask yourself if you’re embracing all the generations in your team, if they know how best to work with each other, and how you can help both to learn from the other’s perspective.
ISSUE: The real distribution of wealth. Celebrity and social media culture, not to mention cultural myths like the American Dream, suggest that anyone can become wealthy and fast. The lightning-quick success of tech businesses – often bought, sold, or floated for billions in just a couple of years – also convince many of those just entering the workforce that they’re just one smart idea away from Bezos status. The reality is that in most developed countries, wealth is accumulated and held by a very small number of individuals, and the concentration of wealth is getting narrower – more owned by fewer people.
IMPLICATION: Consider whether your corporate structure is fit for the long-term future. Experiment with incentivising all employees by giving them a real and meaningful stake in your business.
ISSUE: The gig economy. The new gig economy promises great flexibility – work when you want, where you want, on your terms. Build your life around your work, not the other way around. The reality for many Deliveroo and Uber drivers and others can be very different. Zero hours contracts are no guarantee of any work, and many gig economy employers are very reluctant to acknowledge or accept union representation. Sick pay and holiday pay are not offered as standard and usually introduced under pressure.
IMPLICATION: Are you sure you’re putting equal weight on all different types and categories of employee? Are you being fair? Can you build social capital into how your company does business?
ISSUE: The techlash. Big tech and Big Data appeared to be a great democratising force, giving many more people a voice and connecting anyone and everyone around the world; the price of admission was just a smartphone and a 4G or WiFi connection. But the truth that “if it’s free, you are the product” has been made crystal clear thanks to a series of recent scandals. These include: YouTube and extremist ads, Facebook and Cambridge Analytica, and the Fyre Festival and influencers on Instagram. Some have deserted the platforms forever, and many have tightened their profile settings.The tech revolution has accelerated ahead without bothering to ask what morality thinks, generating social divisions along the way.
IMPLICATION: How do you use technology to connect with your team? Is the always-on, on-demand approach good their mental health and well-being and for productivity?
ISSUE: Big is not necessarily beautiful. The techlash against the FAANG five – Facebook, Apple, Amazon, Netflix, and Google – is symptomatic of a natural human tendency to work most productively in communities of up to 150. When agriculture first brought us together in villages, archaeology shows us that another would split off when the population reached 100-150. Roman legions were subdivided into units of 100 men –centuries, run by centurions. And the multinational manufacturing company Gore splits its divisions once they pass the hundred mark. The reason is simple. The human brain can only map successful social relationships with communities of about 100 people. The anti-globalisation movement, the techlash, and the gig economy are all manifestations of this innate human belief that big is not necessarily beautiful.
IMPLICATION: Has your organisation become too bloated to function effectively? How and when should you reorganise to re-energise?
ISSUE: Diversity and inclusion. Despite resistance from the old order, it’s clear that the diversity and inclusion drum is getting louder. Many younger workers have grown up in more diverse societies than previous generations and are ready to evaluate and accept colleagues’ contributions on the merit of the strength of their ideas rather than their gender, ethnicity, or sexuality. Bosses are coming around the D&I agenda because the evidence is growing that the more, different influences you’re exposed to, the more agile and innovative you are.
IMPLICATION: Embrace diversity, include everyone, make your team as diverse as you can for the benefit of your team and your organisation. Move beyond your comfortable, established matrix.
ISSUE: Intelligent working. The world-renowned Wellcome Trust has moved to a four-day week without cutting salaries. The London office of ad agency Wieden & Kennedy actively incentivises its employees to ignore email when they’re not in the office and has banned meetings before 10am or after 4pm. The Xerox company has a 30-minute limit for meetings, and they’re often held standing up to prevent them going on too long. All of these organisations have seen increases in productivity.
IMPLICATION: Experiment with new and more human ways of working that establish a genuine life /work balance – and in that order.
Disruption is real, and the pace of change makes many – particularly leaders – feel uncomfortable. Jobs that exist today won’t exist tomorrow. And the seismic shifts in the workplace in the last 20 years are nothing compared with what’s expected to come in just the next ten. Leaders need to be alive to the challenges that threaten to undermine their best intentions and well-conceived plans. Otherwise, they might find themselves sleepwalking into a future they don’t know how to control. Those that lead their businesses into a successful future are those who can adapt with agility.
Leonard Mlodinow (2018). Elastic:Flexible Thinking in a Constantly Changing World, Penguin.