A sample of The STEEP Report, Competitive Futures' strategic update service.
For more check out https://www.competitivefutures.com/ and http://www.ericgarland.co
6. Sept 2007 STEEP Report: At a glance The Big Picture Overview 60 Seconds with the CEO Systems Map Timeline The Trends Trend #1: Aging populations leads to mass retirement Trend #2: International competition for talent Trend #3: Increase in knowledge-based industries Trend #4: Generation X & Y taking power, with different values What to do Today Strategic implications Recommendation
7. The Big Picture 60 Seconds with the CEO Overview System Map The Timeline
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10. WILDCARD : Technology: Will robots & IT help any of this? Trend #3: Industries more knowledge-based than ever Trend #1: Aging populations around the world Trend #4: Gen X & Y ascending to management Trend #2: Global demand for talent increasing Alumni relations Demographics Education Recruitment Retention Workforce Development Retirement Gen Y needs work skills in addition to their tech savvy Generation X needs leadership training Boomers demand the new retirement: Half retirement, Late retirement, NO retirement Form consulting relationships with retirees – an alumni network Skyrocketing cost of college and grad school makes young workers more indebted than ever Unprecedented global aging sends millions of experts into retirement New immigration: H1B Visas hard to get Branding & marketing as important for HR as it is customers! Talent poaching may be more important than price wars in the competition of tomorrow Need for a variety of compensation: Money, time, education, lifestyle Outsourcing increases to find scarce talent TALENT CRUNCH 2007 – 2025 A systems view Birthrate insufficient to provide enough workers Immigrants starting to go BACK after working in USA
11. 2009 2013 2017 2020 2027 2007 2007: Business and government begins to take the upcoming talent crunch seriously – Now, what comes next? 2015: Missing 200,000 doctors, 800,000 nurses in the USA alone! 2010: Millions of Boomers discover $50,000 not enough to retire, seek consulting positions 2011: More Latinos returning home to take advantage of booming economy in Mexico, Costa Rico, not to mention good coffee, fresh fruit, good music. YOU, 2020: Did you use the trends you see here to anticipate and profit from what’s next, or did these developments take you by surprise? 2012 :People hiring ANY 26 year old off the street to be director of marketing – gotta have someone, right? TIMELINE: A short history of the future 2020: China needs 1.1 billion workers to operate its economy 2009: Lack of engineers and scientists intensifies In Future Intelligence , we like to see the next 15 years of developments and compare them with what we expect in our own industry. What does your timeline look like?
13. Four major trends are making human resources a strategic issues for the next fifteen years MASS GLOBAL RETIREMENT INTERNATIONAL COMPETITION FOR TALENT INCREASINGLY KNOWLEDGE-based industries Generation x & y take power and have different values
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15. Twenty and thirtysomethings remain hungry to prove themselves, to buy houses, and to pay off recently-acquired student loan debt. So Boomers may stay in the workforce, but they won’t be a replacement for hungry, motivated, (indebted) talent. Let’s take a second away from strategy to deal with a particular psychological blindspot in America. At Competitive Futures, we have heard people try to dismiss the impact of the aging and talent crunch trend, implying that Boomers will be different in their old age. After all, for Boomers it was “Life Begins at 40” then “Fabulous at 50,” and now even – “ 60 is the new 40 .” IT AIN’T. And that’s not because of Boomers, who may in fact be more social, healthy, and active than previous generations of sixty- and seventy-somethings. It’s not about Boomers being different. It’s that 30 is about the same as it ever was. But wait, we’re Boomers and we feel great. Isn’t 60 just the new 40? COMPETITIVE FUTURES NEWSFLASH: 60 IS NOT “ THE NEW 40 .”
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17. Trend #2: Competition for talent is global “ The IT industry in the country could be running out of ‘employable talent,’ especially where new recruitments are concerned.” “ 93% of companies report having trouble finding skilled workers.” “ The rapid growth of our nation’s industries is leaving our companies hurting for skilled labor.” People often think only the United States and Europe are going to be looking for talent Match the talent crisis with the country: India Malaysia Costa Rica
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19. Trend #2: Competition for talent is global Here’s a quick hint about a counter-trend to immigration U.S. and European : Immigrants making money, getting educated in the U.S., then returning HOME. More on this in a future issue of The STEEP Report IT Talent recruiter Ranjit Pradesh: “ Many Americans still believe that that everybody on earth would like to live in America. In fact, many Indians I recruit find American life to be a pain – high stress, expensive, and you have to do your own laundry! Life at home is quite a bit easier.” Washington DC salsa singer Verny Varela: “ Cali, Colombia is probably poorer now than when I left eight years ago, but the life style is still better than the United States. Fresh fruit, good coffee, and you always have time for your family. Many Latinos are saving up money to go home – they don’t want to stay here permanently . ” ESPECIALLY IMPORTANT The future of immigration is changing just as fast as the global labor market is changing. This is a key point: Believe it or not, the whole world is not necessarily scrambling to work in the United States.
25. Strategic implications – why you should care Strengthening human resources is one of the keys to the future of competition Need for immigration will exacerbate ethnic tensions – especially in Europe and Asia Likely, in your career, human resources has been the office that deals with health insurance paperwork and runs the career fair at the college. They are about to be the lynchpin in ALL of your strategic plans. We can talk glibly about talent crossing boundaries, but not every nation is culturally ready to accept new people. Japan and Europe have need of MILLIONS of workers, but they will have to come from other countries. This is going to mean ethnic tensions unprecedented in their history. The United States and Canada may benefit as places that have practical experience bringing in new cultures. Information is headed for the golf course – and must be caught on the way out the door! Chances are, you will never hire and train enough people to make up for the talent getting ready to walk out the door, especially in very technical fields. To make up, you must improve your knowledge management systems, capturing tacit-but-vital knowledge from your talent before they retire
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27. Recommended options: What can you do today? Start an alumni network Long-term relationships are the key to profit Knowledge capture, expert systems Audit your human capital “balance sheet” You study all kinds of risk when you make future plans. Quick – how much is your human capital worth? Where are you lacking? If you don’t know the answer – find out now! By the way, the HR Department may not have a reliable way to give you numbers – it’s still a new field! Part of a long-term approach to relationships is keeping in touch with people after they leave – whether they are 30 or 70. Facebook is already offering social networking for companies. Think of ways to keep people involved after they leave your company. You’ll need access to those brains! We always hear “Oh, there’s no loyalty anymore.” Hey, for years there’s been no loyalty on anything – not in a world where companies are bought, refinanced, downsized, and shipped overseas. But today is a perfect day to start thinking about everything in terms of long-term relationships with people. You future profitability will depend on keeping people and their knowledge over the long term. At the very least, you should attempt to capture the “lessons learned” of your most experienced employees. Some corporations are using “corporate historians” to chronicle these lessons in an organized way. But you may want to go further. Back in the 1970s and 80s, people started experimenting with “expert systems” software-based processes that would mimic the decision making ability of the pilots, surgeons, and other specialists. It didn’t work that well at the time. Tomorrow, there will be new impetus to make up for the lack of expertise – it could work this time around.
28. Recommended options: What can you do today? Make friends with Universities Have multiple “retirement” options for employees We talk about the future of retirement. Have you asked what your employees want? One study showed that 93% of executives surveyed believe aging workers want to remain in the workforce for financial reasons – but a whopping 80% of them have not asked their aging workers about their intentions and their needs! So ask today – and start to design custom retirement options. The American Association of College’s and Employers says one best practice is to forge long-term relationships with the universities and colleges that will be training your next workforce. This may be more than just sponsoring basketball games and coming to the jobs fair. Do you have a network of career professionals at your local universities? What about the people who make the curricula for the professions you need most? Time to forge closer ties. Mentor, mentor, mentor For decades, employers have had their pick of Boomer aged talent – after all, the generation is just so big, there is lots to choose from! This has had an unintended consequence – many companies look around and realize they haven’t planned sufficiently for a succession plan. MENTORING is the answer. Hug a 30 year old today– they are about to get scarce. Pick leaders in your organization while they are young and offer them long-term career ladder. Trust us – Generation X isn’t used to that kind of treatment! Brand yourself as a great place to work over a lifetime Branding – it’s not just for customers anymore. Since you are about to be trying as hard to get talent are you are customers, your branding must serve two roles. You must show your products are great, but just as important, you must show what a great choice you are an employer. After all, young talent is going to get so scarce, they will have their pick of companies. Start branding now.
29. Find Out More The Talent Crunch is a complex topic and means different things to different organizations. We hope you’ll use this briefing as just the beginning of this subject. For more, check out the references included below.
30. Find out more: Books Lost Knowledge: Confronting the Threat of an Aging Workforce by David Delong Doing Nothing is NOT an Option!: Facing the Imminent Labor Crisis, Robert Critchley The 2010 Meltdown: Solving the Impending Jobs Crisis By Edward Gordon Bridging the Generation Gap: How to Get Radio Babies, Boomers, Gen Xers, And Gen Yers to Work Together And Achieve More by Linda Gravett and Robin Throckmorton … And many other titles.
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32. Addendum: Talent Crunch - By the Numbers Corporate Voices for Working Families: 2006 http://www.cvworkingfamilies.org/downloads/TalentDebate.pdf?CFID=22487671&CFTOKEN=60403015 93% of surveyed employers believe older workers want to work longer for financial reasons; 80% of those surveyed have not bothered to ask their older workers about their intentions The McKinsey Quarterly: 2007 http://www.mckinseyquarterly.com/article_abstract_visitor.aspx?ar =1998&pagenum=1 78% of respondents say that ‘increasingly global talent and labor markets are important/very important’ but only 48% of companies are taking action on that trend. Manpower White Paper: 2007 http://www.age-platform.org/EN/IMG/pdf_OlderWorkforce_Global_US_Letter.pdf Between 2025 and 2030, 12 million people a year will be exiting the global workforce The Economist . “How to manage an aging workforce.” 18 February 2006 Japan expects its workforce to shrink by 16% (some 10 million people) over the next 25 years. Source Figure Fortune, Sept 25, 2006 http:// www.fortune.com /whatever 50% of top execs at Fortune 500 ready to retire within five years Office of Personnel Management: May 5, 2007 www.fcw.com/article102606-05-07-07 Federal government losing people en masse: 60% of total federal workforce, 90% of senior executive staff in next ten years USA Today , March 2, 2005 http://www.usatoday.com/news/health/2005-03-02-doctor-shortage_x.htm Healthcare workforce: Short 200,000 doctors, 800,000 nurses by 2020
33. Addendum: Talent Crunch - By the Numbers AARP http://www.aarp.org/money/careers/employerresourcecenter/trends/business_case_for_workers_age_50_key_findings.html According to AARP, 69% of workers plan to work in some capacity in their retirement years – or not retire at all. Watson Wyatt Worldwide http://www.watsonwyatt.com/research/resrender.asp?id=w-731&page=1 Nearly two-thirds of workers over 50 hope to scale down their hours or work in a flexible environment before retiring completely. US News & World Report, June 5, 2005 http://www.usnews.com/usnews/biztech/articles/050613/13squeeze.htm 55% of boomers aged 45-54 have less than $50,000 saved for retirement; 2/3 have less than $100,000 saved. Worldwide ERC http://www.erc.org/news_events/Press_Releases/03-05-07_newhire.shtml 90% of companies surveyed in a March 2007 study by ERC reported having difficulty finding the talent they needed; 20% considered the problem severe. Source Figure Robert Half Financial Services Group http://www.accountemps.net/Site/showpage.jsp?s=RHB_UKE&p=PRESS_DETAIL&prid=449 According to research from the International Workforce Survey of May 2007, 68% of companies worldwide do not have an employer brand strategy. The Hindu , February 2, 2006. www.thehindu.com/2006/02/02/stories/2006020206230400.htm Only 25% of technical graduates and 10-15% of general graduates are suitable for employment in offshore IT/BPO industries in India. Deloitte LLC, May 19, 2005 http://www.deloitte.com/dtt/press_release/0,1014,sid%253D2834%2526cid%253D94680,00.html 69% of surveyed HR practitioners said that attracting new talent posed the greatest threat to competitiveness.
34. Coming next month in: The slow collapse of the American healthcare system
35. Contact For more information or to discuss what this means for you , contact: [email_address] (202) 508-1496