Twelve trends show that workforce dynamics are shifting.
By Rachel Permuth
What’s driving efficiency, development, and satisfaction in the workplace? Sodexo’s 2013 Workplace Trends Report offers a unique perspective on what is essential to organizations to help them be productive and grow.
We surveyed top practitioners in human capital solutions, information technology, facilities management, real estate, and hospitality about the issues being considered at the C-Suite level that are key drivers of success and individual and organizational performance. The result: An overarching theme that “people-centric” approaches are yielding positive outcomes and driving value beyond traditional brick and mortar strategies. And, not surprisingly, this approach and the trends that have emerged transcend industry, location, and size.
We have learned that the expectations of the most recent generations entering the workforce are more and more pronounced in this year’s trends. The way in which this generation expects to be recruited, recognized, and retained is reflected in many of the trends. For examples, social media has become the primary method of sourcing talent; establishing buy-in and endorsing ownership is a key component of recognition; and alignment of values, mentoring programs, as well as a culture of inclusion, have all become driving forces in employee satisfaction. All have a significant impact on the holistic well-being of today’s workforce.
Ultimately, our research demonstrates employees’ desire to be aligned with their employer. The impact: Organizations must tangibly demonstrate a holistic level of empathy and commitment to their employees at both a personal and professional level. As one would expect, health and wellness, inspirational workspace design, flexible work arrangements, inclusion, and the overall experience at work round out trends for engaging and retaining the workforce of 2013.
Most importantly, we must underscore that these trends are outcome-driven. Each of the top 12 trends is quantifiable and has been shown to drive business outcomes. And with continuing pressure on companies to be lean and efficient, these trends are not only a direct reflection of today’s new economic reality, but they reflect a global influence that tells us that the only thing constant is change. The workplace as we know it never ceases to evolve, and will continue to do so through 2013 and beyond.
Trend 1: The built environment’s crucial role in organization performance. Employers increasingly recognize the importance of the built environment in promoting better health, quality of life, and work-related engagement among their employees. Sodexo interviewed two leaders in the field about the impact that environmental factors can have on employee health and engagement, and the role these outcomes play in supporting organizational performance. LuAnn Heinen, vice president at National Business Group on Health, shared her insight about the impact that environmental factors can have on employees’ health. Richard Kadzis, vice president of strategic communications at CoreNet, discussed the role of the built environment in promoting—or hindering—employee engagement.
Both of our subject matter experts cite that environmental changes can strongly support employers’ efforts to improve employees’ health behaviors. Specifically, tactics that enhance the physical environment of the workplace, ensure its safety, and provide a wide range of programs that help employees manage the elusive work/life balance have a positive impact on employee health and engagement. These outcomes bring about improved employee performance and effectiveness, which ultimately translates into long-term organizational success.
Trend 2: Superstar recruitment and the power of community. One of the key trends influencing many aspects of the workplace—but especially HR—is the increased use of social media, especially as it relates to recruitment and employment branding. The way we communicate with candidates today is vastly different than it was even just a short five years ago. Today, social media and mobile communications dominate traditional e-mail campaigns. In fact, a recent study released by Jobvite found that 92 percent of U.S. companies used social media networks in 2012 as part of their recruitment efforts. Additionally, 7 out of 10 employers have successfully hired a candidate through social media—up from 58 percent in 2010.
Trend 3: Inspiring a connection to people, community, and brand through corporate social responsibility (CSR). To succeed in today’s marketplace, companies must have the right people on board and know how to inspire their best performance. Yet, the most talented candidates today are often seeking more than a paycheck. They are looking for a values match. Companies are finding that they can attract, motivate, and retain top talent by creating meaningful work environments with their sustainability and CSR strategy.
CSR initiatives represent the passion and commitment of people who choose to live their values through their work. Initiatives include actions to protect the environment, promote health and wellbeing, and support the development of communities where you do business. These strategies have proven to be beneficial to the organization. A 2011 study of Sodexo managers found that positive perceptions of Sodexo’s corporate citizenship were significantly related to job satisfaction, motivation, and intent to remain with the organization.
CSR can also be an important factor in attracting and retaining members of tomorrow’s workforce. One study of new college hires found that 86 percent would consider leaving an employer whose social responsibility values fell short of their expectations. But the values match is not just important to the newest generation of workers. As values have evolved over time, we see the connection with sustainability and CSR as a potential motivating factor for each of the four generations that make up today’s workforce.
Trend 4: The contemporary view of inclusion and its effect on psychological health. Even in today’s challenging economic times and volatile business world, there are elements in the workplace that are just as—or more important to employees—than adequate pay and benefits. Recent research supports the idea that creating a psychologically safe and healthy workplace is absolutely essential for companies aiming to bring about better outcomes for their employees and the organization as a whole. In fact, recognizing the importance of employees’ mental well-being can directly impact performance, and we increasingly see that today’s successful companies excel at creating and sustaining such environments to engage and retain employees.
Well-planned and implemented engagement and inclusion strategies can create an environment where issues that negatively affect psychological health are the exception, not the norm. An example of such an issue which has gained increased attention in recent years is workplace bullying, since the difference between a “good” place to work and a “not-so-good” one often comes down to the relationships workers have with their bosses and peers. This issue is one of the most explosive trends that has gained momentum in the past decade.
According to the Workplace Bullying Institute, 35 percent of the U.S. workforce report being bullied at work, defined as repeated, harassing behavior that is deliberately intended to cause harm to individuals and prevent them from excelling at work. This type of behavior represents the antithesis of a healthy work environment, and is the diametric opposite of inclusion. As this issue is brought to the forefront of HR, we will see more people speak out about bullying, how it is related to the mental health of the workplace, and how it can truly hurt a company’s bottom line.
Trend 5: 21st Century mentoring. A November 2011 Accenture Skill Gaps Study found that 55 percent of workers in the U.S. reported they are under pressure to develop additional skills to be successful in their current and future jobs, but only 21 percent said they have acquired new skills through company-provided formal training during the past five years.
One way companies are addressing this skills gap is with a new form of mentoring that is emerging. Modern mentoring uses technology to create knowledge sharing connections among colleagues at all levels, in all areas, and at all locations within a company. Today’s definition of mentoring allows for a richer experience and more utility than mentoring of the past, and it looks vastly different than mentoring of even 10 years ago.
Virtual relationships and multi-participant engagements form the basis for modern mentoring, which incorporates a more inclusive mindset about who should participate, a broader scope for making meaningful learning connections, and an open flow of knowledge among participants. No longer just about one-to-one relationships between senior leaders and potential successors, today’s mentoring is focused on removing the barriers between people and engaging them in rich learning and teaching opportunities in a broad, networked manner so that knowledge can flow to the point of need.
Trend 6: Thriving in the cloud. The cloud is like a virtual public utility for computing power, enabling us to use software virtually to share ideas, collaborate, and build knowledge. The industry is less than a decade old, but more than eight in 10 companies currently use some form of cloud solution, and more than half plan to increase cloud investments by 10 percent or more this year. The research firm International Data Corporation (IDC) calls cloud computing the foundation for the technology industry’s next 20 years of growth, saying, “it is nothing less than the complete transformation of the industry’s core offering and business models.”
The significance of the trend toward cloud computing is that it moves communications from the desktop to a virtual environment, making everything available on an on-demand basis. Need extra storage capacity? It’s there on the cloud on demand. Need access to sophisticated software programs for a one and done project? You can rent access on the cloud rather than having to buy expensive programs that you many never use again. Need to collaborate with colleagues on a project? Cloud services are available.
The cloud makes access to information available from anywhere at anytime, so that workers are no longer hostage to desktops or networked devices. The cloud truly is transforming industries, and will have a profound and positive impact on the way we live, shop, interact, and work in the near future.
Trend 7: Ushering in the new era of recognition. It’s no secret that achieving buy-in and ownership are essential to the success of any incentive and recognition program. Both can be seen as measures of commitment that will ultimately determine the dedication of necessary resources from management, as well as the acceptance and enthusiastic participation of the workforce.
Buy-in and ownership can be achieved through a strategy of planned involvement. This strategy is based on the knowledge that the more people feel included in the formative stages of your incentive and reward program, the higher the degree of their involvement and the more likely they are to support the final program.
Think of buy-in and ownership as a continuum in which the immediate goal is to establish buy-in though a strategy of involvement. Once buy-in has been achieved, choose appropriate ways to strengthen that support through ongoing communications, reviews, peer-to-peer dialogue, and status meetings. And always remember that ownership is most easily achieved when people feel they have taken an active part in the process and believe that the outcome reflects at least some of their own ideas and efforts.
Trend 8: Facilities management (FM) as a strategy, not a tactic. There have been many assertions, over many years, that FM should be more strategic. Recent research provides evidence that FM can have a strategic impact, and should play a strategic role in the enterprise, but whether it will achieve that level of influence in any particular organization depends entirely on the actions taken by senior FM executives.
A survey of almost 400 professionals across six continents was conducted in order to review the current state of the practice of FM. The research focused on how FM is currently organized, governed, and measured, as well as on how FM professionals interact with their peers in other infrastructure disciplines. Our insights were enriched by direct conversations with a selection of senior FM and corporate real estate (CRE) executives, as well as with thought leaders from academia and international professional associations.
To be effective, FM leaders must change their behaviors, and indeed their very identity. FM is not about managing facilities per se; rather, it is about enabling the workforce to be productive and engaged, and to produce value for the organization. In our view, and in the view of leading FM executives, the workplace is nothing more (or less) than a tool for supporting work, for shaping the experiences of the workforce, and for producing competitive advantage.
Trend 9: Data reporting out; predictive modeling in. Organizations are complex systems that operate using connected sets of physical, financial, and social structures. Policies, procedures, and programs in each aspect of a business can affect behaviors and outcomes in other areas and have specific impact on human capital job performance.
Until recently, companies seeking to manage human capital risk have focused on silos of data and attempted to develop interventions solely from analyzing data independently within these silos. Given that interventions developed in this manner have not produced the desired cost savings, many innovative organizations have turned to a big-picture approach in an attempt to understand the interrelatedness between the silos and the business policies that ultimately determine human capital performance.
A big-picture approach to human capital risk management focuses on strategic connections among critical data elements that comprise an organization’s human capital management efforts, with specific focus on those connections that influence job performance. This approach provides decision makers with actionable information that they can use to integrate human capital management activities and optimize their overarching human capital management strategy. Only through this big-picture integration approach can a broad array of seemingly disparate human capital data elements interconnect in a meaningful, actionable manner resulting in true human capital management changes and improved business performance.
Trend 10: International design and construction is a shifting paradigm. The downturn in the U.S. economy that began in early 2008 has had serious repercussions for the design profession. However, globalization strategies crafted during the recession were the saving grace for some firms, and still provide opportunities for those that are interested in testing the waters abroad. Overall, approximately 13 percent of U.S. architecture firms reported overseas work between 2009 and 2011.
Of firms that have not had any international projects in the last three years, approximately one-quarter are interested in overseas work. Global opportunities are driving more interest in international work, as only 18 percent of firms were actively pursuing or considering pursuit of international projects in 2008.
International projects will require more due diligence and research. Understanding the local culture is the factor that the largest share of firms takes into account when they are preparing to enter a foreign business market. Many firms also take into account relationship dynamics, such as having clients, friends, and colleagues in the market as well as the ability to work with local consultants, architects, and engineers. Regulatory factors are also important to take into account, including understanding the local monetary system, tax regulations, and revenue repatriation.
Trend 11: The changing office…literally. In 2013, there will be a new awareness of office design, one that emphasizes how offices must adapt to fit the way people work instead of the other way around. Companies see today’s offices as customized tools for working and living better. While those designs are as varied as their inhabitants, some common characteristics stand out.
Today’s offices are brighter, with artificial light taking a backseat to daylight that fills the space, an emphasis that affects the design of everything from floor plans to the building’s façade. Technology and the means to accommodate it are so pervasive that a workstation is anywhere networks can be accessed wirelessly. Workspaces are more versatile to suit not only the work performed but also the personal preferences of the individual doing it. Because companies are looking for ways to engage their employees and create a sense of community, common spaces get the lion’s share of money and attention, with more real estate devoted to these areas than ever before; administrative and filing spaces are the losers in this exchange. Individual offices aren’t disappearing, but they are shrinking in size, sometimes even in number. And in an era when no sharp line can be drawn between home and work, offices are borrowing traits from houses to offer more amenities and to reflect the same destinations found in any residence: kitchen, pantry, living room, and family room.
Meanwhile, sustainability—an office feature once considered special—has become standard. Whether for reasons of economics, environmental consciousness, or both, the must-have lists of clients, even those with no interest in green building, routinely include recycled products (including buildings), locally sourced and sustainable materials, energy-efficient HVAC systems, and better indoor air quality. The result is a pronounced shift toward offices designed to attract and retain top talent while emphasizing productivity over cost savings and comfort over square footage.
Trend 12: Integration as the solution. As organizations grapple with boardroom issues such as talent cliffs, financial uncertainty, image value, and the ability to make quick and decisive moves in their own markets, it is the CRE and FM executive’s responsibility to identify and deliver solutions that deliver real organizational value, aligned with these issues. Enter integration 2.0.
Integrated solutions work best when complex problems have been clearly defined. Today, the complex problems we refer to involve the ability to meet unique human centric needs. The needs of today’s working generation are more complex and dynamic than ever, and creating efficient, effective, and flexible work environments that take into account total well-being has become critical.
Progressive organizations are beginning to understand and solve for human needs when designing workplace services and solutions by redefining integration to mean having the skills and resources to expand its capabilities on four specific fronts:
- Viewing individuals and organizations holistically and dynamically.
- Translating these needs to create new and more effective operational/business models.
- Designing strategic life/work ecosystems (interventions) that synergize insight and solutions from multiple functional areas within the organization.
- Evaluating the impact of these ecosystems on improved service effectiveness, people effectiveness and well-being.
At the intersection of each of these expanded capabilities is the moment where integration becomes the solution: human needs are met resulting in heightened organizational performance, top-line revenue generation, bottom-line profitability, and increased image value for the organization.
Rachel Permuth, Ph.D, is principal researcher and behavioral scientist at Sodexo.