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Gary Hamel on Workplace Bureaucracy

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The opening keynote speaker at UNLEASH America was Gary Hamel, one of the world’s most influential business thinkers. He is a professor at the London Business School, director of the Management Innovation eXchange and the author of several best-selling books, including “The Future of Management” and “What Matters Now.” Hamel is also the most reprinted author in the history of the Harvard Business Review.

He spoke about the stifling effects of top-down management and how we need less — not more — management. Here are highlights from Hamel’s Q&A session with the media.

Understanding the Effects of Bureaucracy

“Bureaucracy shackles people with rules that prevent them from doing the best thing for the organization, the best thing for customers,” Hamel says.

He doubts that most organizations have tried to measure the costs of bureaucracy — which include insularity (too much time spent on internal issues, politicking, too much energy spent trying to gain power) and friction (too much busy work that slows down the decision-making process). Other costs include bloating (too many management layers), risk aversion (too many barriers against taking risks) and inertia (too hard to proactively change).

“Without having a benchmark there and any cost data around that, you have no idea what it’s actually costing your organization,” Hamel says.

Ten or 15 years ago, not many companies were concerned about the environmental cost of business. But now, that’s a major issue, and companies have environmental reports. Hamel recommends doing the same with bureaucracy. “If I’m an investor and I understand that this top-heavy, rule-driven culture is going to cause the organization to miss opportunities, miss how to allocate resources and misuse their talent, that is something I want solved.” While CEOs vaguely understand these costs, he says, they haven’t actually calculated the costs and decided this is a problem that needs to be solved.

Embracing Change

It’s possible to run a billion-dollar business with virtually no management layers, though Hamel believes the average person can’t conceive of this idea because they’ve never seen it before. “For example, at GE Aviation, they have 400 employees at the plant and one plant supervisor,” he says. He recommends getting out to see these companies and how they operate to understand how they are able to maintain control, discipline and alignment without a superstructure of supervisors.

“And then you have to be able to find a migration path between the present and the future,” Hamel says. Many post-bureaucratic organizations were formed that way, so they didn’t have to “uninstall” bureaucracy and tear down all of their rules and regulations.

This can be more complicated for more traditional companies because bureaucracy does serve a function. “Even though it has a lot of downsides, bureaucracy is the way we get control and coordination and consistency in large organizations.” If you try to destroy that and start all
over, Hamel warns, that will lead to chaos. “That’s why you need to approach it as migration path as you think about such principles as openness, meritocracy, experimentation and other next-generation management principles.”

He recommends challenging long-held organizational assumptions. “You just assume that power trickles down, you assume that you need managers to manage — but none of these things are eternal truths, they’re not principles of physics.”

Using Technology to Change Organizations

Hamel believes that technology can dramatically change how organizations are run: how to find and hire people, how to make capital and strategic decisions. But right now, technology is primarily being used for white collar productivity (sharing documents, sharing schedules, etc.) or to aggregate information and exert more control. “Managers today have an enormous amount of real-time, microscopic information about performance, and the temptation is to have time cards on steroids.” Managers are paid to control, he says, and he thinks they may use technology to disempower rather than empower workers.

Technology has offered much more choice in our lives as consumers, but where is the equivalent empowerment in the workplace? “Why don’t we design our own jobs? Why don’t we pick our own colleagues? Why don’t we choose our own bosses? Why don’t we approve our own expenses?” That might sound crazy, but Hamel says organizations are doing it.

Hiring strategies are moving toward a consensus model, he says. “Historically at Whole Foods … if you wanted to work there, you would work for a couple of weeks with one of their in-store teams, and it took a 70% vote of the in-store team to hire you.”

Even project development is becoming more democratic. Hamel says that at Chinese manufacturer Haier, every new product starts as an online project with customers. “For example, when they want to develop new air conditioners, they go to social media and ask, ‘What do you want in an air conditioner?’ The first time they did this, they received 700,000 comments and had hundreds of thousands of fans following the project.” The company even uses social media to find technical partners. In one instance, they posted a technical challenge and asked who could solve it. The outcome? Dow Chemical responded, “We can build a membrane for that.”

Jason Averbook on the Workforce-Experience Mindset

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One of my favorite speakers at UNLEASH America was Jason Averbook. If you’re looking for HR “a-ha!” moments, he’s your guy. He is the CEO and co-founder of the HR consulting firm Leapgen. Jason is an agent for change in HR, and the author of the new book, “The Ultimate Guide to a Digital Workforce Experience.” He spoke about the power of technology to transform how we work, starting with a focus on people and process. Here are highlights from his keynote.

You Need a Workforce Strategy

“You need a digital strategy, and I call it the workforce strategy, not an HR strategy,” Averbook says. And he advises against buying technology until the workforce strategy is in place. If you don’t have a strategy but you’re putting technology in place, Averbook says your chances of being successful are very slim. “It’s like getting on a plane without knowing where it’s going,” he says.

He says we’re placing too much emphasis on technology. Technology vendors can’t make you successful if you don’t have a strategy.

The Equation for HR Success

Looking for a formula for your HR strategy? “The right equation is made up of mindset, people, processing, technology,” he says.

Mindset: Building and creating the vision and strategy. The most successful teams have a full commitment to and acceptance of change, a focus on transparency and empathy, and a plan that’s broader than implementing transactional tools.

People: You need people who understand the vision and the journey ahead, and who appreciate the benefits of using technology and improving processes.

Process: Make sure your business outcomes are defined. Then, design clear processes that focus on the user. Make sure everyone understands how to best leverage technology and adopt new processes.

Technology: Technology comes last in this equation. The tech is designed to support people and processes.

The Workforce-Experience Mindset

Once you understand all of the pieces of the puzzle, you can start to roll out a workforce-experience mindset.

Jack Welch once said, “If the rate of change on the outside exceeds the rate of change on the inside, the end is near.” But changing your organization requires a mindset focused on growth. “I spend 80% of my time speaking to HR leadership teams about how to think differently, getting the bridge for the people to say, ‘Okay, now we’re ready for digital.’”

Then, he pushes leaders’ attention to their people. He asks questions: “What do they feel and how do they feel? How do you want them to feel, from an empathy standpoint?”

Once you’ve focused on your people, you can reimagine your processes so they’re not processes for you in HR, but they’re processes for employees who didn’t get hired to do HR work. He says people don’t want to spend copious amounts of time searching for an old and dated policy, and then have to call a business partner to find it.

When you develop a workforce strategy and a workforce-experience mindset, Averbook says, you’re ready for the technology. “If you start with the mindset and the people and the process, I guarantee your technology deployment is going to be 1000% more successful.”

“Nothing will change unless you change,” he concludes. “People are ready. Processes can be ready. Technology is ready. Are you ready?”

Live from UNLEASH America: Rachel Botsman on Why Trust Matters

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This week, I’ve been in Las Vegas at UNLEASH America, soaking up big ideas about the latest HR tech trends and how technology is changing the way we work.

One of the speakers who knocked my socks off was Rachel Botsman. She is an author and visiting lecturer and researcher at the University of Oxford. Her keynote was all about trust, and why organizations need it to survive and thrive. Her new book is “Who Can You Trust?: How Technology Brought Us Together and Why It Might Drive Us Apart.” Here are the highlights Rachel shared in a conversation with media before her keynote.

How Technology Changes Everything

As technology has taken huge leaps forward, our expectations have taken an enormous leap, too, she says. Instead of just trusting technology to do something, we now have to trust technology to make decisions for us. That means we have to trust that the technology is competent and reliable, and we have to trust its intentions and its integrity. “How on earth do you trust the intentions of an algorithm?” she says. “That’s a huge problem. There’s an idea that we can outsource trust to an algorithm, but when an algorithm makes a decision we don’t agree with, who’s accountable? That’s the danger of outsourcing too much to machines. It becomes an issue of accountability when things go wrong.”

How to Measure Trust

When people consider whether a company is trustworthy, they consider a few key traits, she says:

  • Are they competent? Do they have the skills and the knowledge to do what they say they’re going to do?
  • Are they reliable? Are they consistent over time?
  • Are they benevolent? How much do they really care?
  • Do they have integrity? Do they have my best interests at heart?

Rachel says that some organizations are strong in all four areas, but “most organizations wobble around one trait, and when there is a trust crisis you really see that one trait break down.”

Plus, she says, it’s hard to measure trust because it’s extremely contextual. When you say, “I trust Amazon,” do you trust them because they deliver their packages on time? Or do you trust them to pay their taxes? Do you trust them to take care of their people? Any trust score is ultimately contextual, she says.

How to Regain Customers’ Trust

Rachel says companies can regain trust after a crisis. The key elements of a rebound are:

  • Responsiveness – Respond quickly.
  • Empathy – Acknowledge the human consequences of a mistake.
  • Accountability – Take ownership of the problem.
  • Assurance – Show people that the system and the culture has changed to avoid future crises.

“It’s easy to forget is that trust is a human process,” she says. “Technology cannot replace the way humans trust one another, and technology runs the risk of us giving our trust away too easily. The goal for any organization shouldn’t be more trust, it should be better-placed trust.”

What It Takes to Be a Global HR Leader

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In a few weeks, some of the smartest thinkers and HR leaders will come together at UNLEASH America in Las Vegas. I’ve worked with HR teams and senior leaders at organizations around the world, and I’ve seen HR as a function completely transform over the past few years. HR is much more sophisticated and complex than when I first got involved. In 2018, running an HR organization takes a global perspective, a deep understanding of how technology is changing our work, broad experience in many different corporate functions and a focus on people.

A Global Perspective

In my mind, there’s no question — HR leaders need global experience. The best HR people I’ve met come from global backgrounds. That’s because most HR departments are no longer hubs of administrative work. Instead, the HR department has transformed into the talent department, and talent leaders need to know how to work with many different people, potentially spread over different continents.

A Deep Understanding of How Tech Is Changing Work

We’re living in a world of continuous change, and it’s essential that HR has a place in that. HR’s new role, along with culture and happiness, is future-proofing businesses. That means understanding the massive industrial change that’s coming.

We’re in the midst of the fourth industrial revolution. The biggest taxi company in the world is Uber, and it owns no taxis. The biggest real estate company in the world is Airbnb, and it owns no real estate. We see disruption coming through these exponential technologies. HR has to stay very connected to what those exponential technologies are doing to the marketplace.

That will mean re-skilling the workforce. Presently, we’re kind of sleepwalking into disaster: Gallup released a report earlier this year revealing that 77 percent of Americans aren’t worried about losing their jobs to automation. So we need some serious education.

I talk to CHROs who are re-skilling thousands of people. They know their jobs will be gone in five years. I think it’s our responsibility to act now.

Broad Business Experience

I know many smart, savvy HR professionals who have always worked in HR. But I also know a lot incredibly effective HR leaders who worked all throughout organizations — operations, finance, sales, executive leadership — before they landed in HR.

Let me put it this way: The best way to get experience as an HR leader isn’t to take more courses and work on more formal certifications. It’s to get out there in the business, talk to more people and get a better understanding of how different departments work.

Today’s HR leader needs a broad understanding of how a business works, and how business decisions affect people.

They need to know how use HR technology to analyze employee data and create real-time reporting for leadership. They need to be able to use technology to read the pulse of the organization.

A Focus on People

Finally, HR people need to be — it seems crazy to even have to say this — good with people. We’re living in a world where most people are unhappy at work. Americans are working 80 hours a week for the American dream. Employees are looking for a better experience. Only HR representatives who understand people and care deeply about making work better can really make an impact.

Historically, HR would come into a workforce and immediately treat everyone like kids. “You get a 4 out of 5 on your performance review. You were a good boy or girl, so you get a bonus of 1%.”

At so many organizations, work is still a place where people are trapped in the chains of bureaucracy and endless administration. We’re trying to unleash people from all of that.

To continue the conversation about the big changes coming to HR, book your spot at UNLEASH America at the Aria Resort in Las Vegas, May 15-16, 2018. You’ll hear from speakers including:

Register here.

#WorkTrends Recap: Unleashing the Power of Your People

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What’s going on in HR tech around the world? What are global leaders doing to unleash the full potential of their people?

When I’m thinking about big-picture questions affecting senior leaders, I know who to turn to: my friend China Gorman. You probably know her as the former COO and interim CEO at SHRM, or as the former CEO of Great Places to Work. These days, China’s spending her days helping smaller companies liberate their power. One of those companies is UNLEASH. UNLEASH puts on the event formerly known as HR Tech World. This year is their second year in Vegas, and as managing director of UNLEASH America, China and the team are in preparations to bring some of the most innovative business leaders in the world together at the Aria on May 15 and 16.

I talked to China and Bri Vellis, chief marketing officer of UNLEASH, about what people-management trends they’re seeing across the world, and how they’re bringing those themes to UNLEASH America in Vegas.

What You Learn from Working at a Global Company

Bri has an up-close view of how people work differently around the world. She recently moved from San Francisco to Budapest, where UNLEASH is based. Plus, when she was in the U.S., she worked for a German company where she could immerse herself in different cultures and conversations about HR tech.

“People get into their geography bubbles,” she says. But everyone can really learn from other cultures — Americans could learn from Brits, Brits could learn from Germans, and so on.

“I always hear how Americans don’t want to work so many hours. Especially in the tech industry. They wish they worked more like Europeans,” she says. “Europeans are just more cognizant of their time. Americans can learn from that.”

China has run global organizations, and she says she’s always struck more by different cultures’ similarities than their differences. “I am always astonished by how alike we are, and how, at the end of the day, people are people. People in organizations have similar wants and needs, and are motivated by similar kinds of things. I am always reassured, I am always motivated, and always reminded that our similarities are always far more than our differences. No matter where you go around the world.”

What’s Happening in HR Tech Around the World

So, what new developments are happening in HR technology, and where are the current centers of innovation in the industry? China is excited by the startups that are popping up to help leaders manage emerging challenges.

“People in HR, and leaders in particular, have lots of challenges in terms of managing different generations in the workplace. In being more global. Having different laws, different customs, different languages.”

The HR tech community is responding with solutions, she says. “The creativity, the focus, and frankly the amount of investment going into the HR tech startup world is astonishing.” She points to regional hotspots like Toronto, Tel Aviv, Budapest and Berlin.

China is encouraged by what she sees. “What I take from this is that, as we head into an organizational world of artificial intelligence and robotics, the focus on people is actually growing, not diminishing.”

While some jobs might be done by robots in the future, China sees organizational leaders who want to get a handle on people talent: How do we get it? Where are the best people? How do we deploy talent? How do we engage and develop them? How do we make sure we have the kinds of people and skills where we need them, when we need them?

The answer, she says, is technology. “Technology becomes sort of the great liberator and educator, and profit enhancer. I really believe this in my heart, that leaders are not making decisions to replace people with technology just because it is cheaper, just because it is new. I talk to leaders not about the price of people, but … how do we use people? How do we unleash the people part of our workforce so that we keep moving forward to a better world?

“I really think leaders and technology are trying to do the same thing. They are trying to make the world a better place, for the greater good.”

Because there’s so much startup activity in HR tech, UNLEASH has added a startup and innovation group as a core element of their upcoming event.

What to Expect from UNLEASH America

“The name change from HR Tech World to UNLEASH is really about expanding the focus from being an HR tech conference — the best one in the world — to really unleashing the power of people and the future of work through technology,” China says. “We are expanding our remit. We are really getting into the heart of the matter, which is, ‘How do we use technology in an HR application to really unleash the potential of our people in an organization?’

“It’s not going to be like any HR tech conference you’ve ever been to,” she says. UNLEASH will bring together not just HR leaders, but leaders of every stripe. China says attendees can expect “real-world stories from real-world leaders, from organizations we all know. This is going to be the event to be at.”

During our conversation, Bri and China announced a major keynote: Mo Gawdat, chief business officer at Google X, will be doing his first public address outside the world of Google X. Other speakers include leaders from Johnson & Johnson, Cisco, GE Digital and Microsoft.

I can’t wait to be a part of all of these interesting conversations! You can find out more about UNLEASH America and how to join us in Vegas by visiting http://www.unleashgroup.io/america/index or following the #UNLEASH18 conversation on Twitter.