Pilar Jerico

What lies in store for people management in the coming year? In this post, I’d like to share those ideas which I think will have the greatest impact on human resources management this year. Of course, some of these ideas will be more appropriate for some sectors than for others; and only time will tell if these predictions turn out to be prescient…

1. Leadership 2.0: A new style of people management, more open and less distant, is gradually making headway. The creation of this new culture is being helped by Web 2.0 applications that focus on cooperation, new ways of perceiving value in companies, and the presence of a digitally literate workforce. However, this culture change will not be achieved primarily because of technology, but because of a different conception of managing people; in particular, a more cooperative, transparent and less distant type of leadership. As happened with Internet at the beginning, some companies will be quick to embrace new styles of management facilitated by technological advances, while others will be mere passive observers. When we talk about a 2.0. approach, we do not just mean having a blog (!), but far more profound changes in management style.
2. Change and transformation management: Many companies are embarking on profound changes, and will need to implement a shift in the company culture for a variety of reasons: they are entering the 2.0 world, they will have to keep on downsizing their workforce, or they’re trying to recover after a bad 2009. No one knows what will happen in 2010, but one thing is for sure: we won’t go back to where we were before the crisis. Therefore, the need for change and transformation is inevitable.
3. A NoFear style of management: Many people are feeling dejected because of the crisis, and it will be a real challenge to manage them in such a way that they stay motivated. Unfortunately, fear is on the increase, and many managers who previously nurtured their staff’s talent are now returning to more coercive practices. However, such a management style is incompatible with creativity and with a state of mind which allows people to give the best of themselves.
4. Mentoring: Many less-experienced managers are finding the current exacting circumstances very difficult to negotiate. For this reason, companies such as Banesto are implementing talent development programmes which use more experienced members of staff as guides, or mentors.
5. Informal learning: A few years ago, one of the difficulties of e-learning was the lack of access to Internet, or people’s lack of ability to use it. This problem largely no longer exists, and we now have the opportunity, and the challenge, to provide cooperation-oriented resources which enable people to develop professionally.
6. A client-focused approach: Human resources departments need to fully understand they are at the service of external and internal clients; they should also think about using basic marketing skills in their communications with the rest of the company, as their internal image often leaves much to be desired. All of the foregoing will serve to place the human resource department more in line with the basic aims of the business.
7. 2.0 communication: Social networks are assuming increasing importance in intra-company communication. Indeed, some of the more innovative companies are now replacing intranets with this type of tool. Communication needs to be increasingly horizontal, and in all possible directions, both within the company, and externally.
8. The end of rigid demarcation: Divisions between departments will be gradually diluted thanks to technology and the need to work as a team. As complexity grows, rigidly separated departments make less sense. Detailed lists of functions that are set in stone will gradually become meaningless owing to the rapid pace of change.
9. More performance-related salaries: The percentage of total remuneration which is allocated to meeting objectives may increase, especially in times of crisis like the present. While it is true that companies cannot afford to lose talented people, it is equally true that they are not in a position to pay the salaries offered before.
10. A better work-life balance: An increasingly popular way of improving employee motivation is to implement policies that help staff meet the demands of their professional and personal lives. Such motivation-enhancing policies are all the more important in an environment where salaries may well stagnate.

Twenty-five centuries ago, the Greek dramatist Euripides remarked: “The expected does not happen, it’s the unexpected which comes to pass”. This is indeed often the case, both in the economic and social realm.  All of a sudden, unexpected events occur which radically change our outlook and leave profound consequences.

The writer Nassim Nicholas Taleb calls these events “black swans”. He takes this metaphor from what happened in Europe in 1697. At that time, everyone thought that swans were only white; however, the first explorers to return from Tasmania brought black swans back with them. Thus, the white swan paradigm was consigned to history. Before the appearance of the black variety, nobody, understandably, was able to foresee the existence of swans which were other than white.

A similar lack of foresight afflicts economists, entrepreneurs, political leaders or managers when a crisis or a pandemic arises (or Google, or the Internet, or any number of other black swans). As Taleb points out, economists are brilliant at explaining what has already happened, and extremely bad at predicting the future. As a curious sidenote, when Taleb presented his theory at the World Bank, some members of the audience were none too pleased.

Why are we so bad at foreseeing the future? There are many reasons which help to explain this. The first is purely biological: our brain is hardwired for survival, and not for complex decision-making and calculating probabilities. In the distant past, you had a better chance of survival if you ran a mile when you saw a lion than if you stopped to contemplate the various courses of action open to you (basically because the lion wouldn’t wait). Secondly, our educational system is based on committing facts to memory, and not on identifying patterns. Third, we live in an increasingly complex world, which makes it more difficult than ever to predict what will happen in the coming months, let alone years.

So, if a black swan event is capable of shattering all the strategies which we have carefully developed over months and months (as occurred on September 11^th,, and as  tour operators in Mexico are now finding out), we would be well advised to approach decision-making from a different angle.

The first challenge we face is “learning to learn”. By this, I mean that managers need to focus not so much on what they know as on what they don’t know. We need to contemplate scenarios which take us radically out of our comfort zone, and then take these scenarios into account when defining possible strategies.

The second challenge for companies is to increase their chances of producing “positive black swans”, or in more conventional terminology, of bringing about market-changing innovation. (It’s worth noting in passing that Archimedes’ Law, the discovery of penicillin by Fleming, 3M’s Post-its or Pfizer’s Viagra all came about “by chance”.) However, if we want to produce the next “big thing”, we need to create a favourable environment which facilitates such a breakthrough. Google, for example, implements an innovation-friendly policy in the form of the 70/20/10 rule for the use of staff time: 70% of work time devoted to the core areas of the business, 20% to projects related to the business, and 10% to new ideas where “anything goes”.

Last but not least, we need to address fear of failure. It is evident that, in such a complex world as ours, no one can guarantee immediate success. So the key to paving the way for future innovation is to give people the freedom to experiment: to try out new ideas, to be wrong, and to be continuously learning.

Black swans wait for no man (or woman); either we take the initiative, or we disappear.

People sometimes ask me why I decided to write a book about fear. It all goes back to 1998 when I was writing my doctoral thesis about knowledge management (which ended up being about talent management). What really intrigued me at the time was to get to the bottom of why people don’t share everything they know. Back then the buzz words were databases, technology, quality and, yes, people management. But I don’t remember anyone speaking about the barriers to sharing information … except one article in the Harvard Business Review. Gerald Suárez, Director of Presidential Quality at the White House, introduced a relatively new concept: fear. The article he wrote got me thinking about our fears, which we almost always cover up with consummate skill.

I have to say that that article was an exception and it only skirted over the idea of fear. When I had the chance to go to the USA and to have access to the research databases of some universities, I found that there was hardly any mention of fear in the business world. It was -and still is- taboo. It seems as if admitting you are afraid were a sign of weakness, when in reality it’s what helps us survive. Thanks to fear we are cautious, and this is healthy. However, the negative flipside of fear is that it hinders our development and our capacity to take risks. I call this phenomenon “toxic fear” as it undermines our talents.

In the process of writing about and working in the area of talent, I discovered that fear is indeed the negative flipside, and that sometimes it is more productive to work towards people overcoming their fears rather than focussing on the area of motivation. I use this approach in my own seminars and coaching sessions and find that it produces very positive results.

I too was afraid to speak about fear! This may seem somewhat paradoxical. I thought: Are people really going to want to examine their fears when they spend all their lives trying to hide them? But in the end I thought, and still think, that we are all capable of something better, that our barriers to happiness are closely related to our fears and that there is a better way to live and to manage people. That’s why I wrote NoFear -which does not mean not to have fear but not to let fear have mastery over us-  and why I was able to overcome my own fear.