Drawing insights from the latest releases of Mercer’s Total Remuneration Survey (TRS) and Australian Benefits Review (ABR), this episode highlights a shift in job market dynamics, where salary budgets are stabilising and employers are regaining power as hiring slows and turnover rates decline.
Tune in to hear more about:

• Shifting power dynamics: Why employers are regaining control in the job market and what they are doing to keep their people engaged and motivated.
  
• Salary budget forecasts: Employers plan a 3.6% allocation for merit raises in 2025, down from 3.8% in 2024.
  
• Employee benefits: Flexibility is key, with 89% of organisations offering flexible work arrangements. Some are now being creative in their approach to flexibility.
  
• Incentives for retention: Organisations are focusing on comprehensive compensation packages, including performance-based bonuses.
  
• Upskilling and development: 60% of organisations are now offering learning and development for the entire company. Learn what training topics are trending.

• Mercer 2024 Global Talent Trends
• Mercer 2024 Total Remuneration Survey
  
• Mercer 2024 Australian Benefits Review 

In this episode, Andrew Lafontaine, Partner and Workforce Solutions leader at Mercer, and Shane O'Neill, host of the HR Community Podcast, talk about Andrew’s 25-year career journey from teaching degree graduate to his current role as Partner for Mercer Pacific. The conversation focuses on how the HR industry has evolved, its challenges, opportunities and innovations.

Tune in to learn more about:

• The evolving role of HR: how HR is transitioning from being an administrative function to strategic partners that drive business outcomes.
  
• Human insights matter: the critical role of consultants in providing ethical guidance, cultural insights, and change management expertise that AI cannot replicate.
  
• Why HR professionals must become digital natives, leveraging AI tools to enhance decision-making and improve organisational efficiency.
  
• Strategies for creating tailored employee experiences that address mental health, diversity, and work-life balance in today’s workforce.
  

This conversation was originally published on the HR Community Podcast: https://thehrcommunitypodcast.buzzsprout.com/

The goal of AI is not to replace workers but to create a new constellation of jobs and skills. In this episode, Cynthia and Ravin, discuss the importance of organisations understanding how AI can substitute, augment, and transform work and being intentional in their approach to AI to ensure its ethical implementation.

They highlight the value of designing work in a way that democratises access to AI and allows for the productivity gains from AI to be shared equitably with employees.

By leading with the work, being adaptable and becoming AI fluent, business and HR leaders can navigate the transformative era of AI and create a work environment that harnesses the full potential of employees while prioritising their well-being and growth.

“Leaders should educate themselves and their workforce about AI, its potential, and how it can transform work.”  Ravin Jesuthasan, Global Transformation Leader, Mercer

“As an optimist, I believe in the power of technology to augment human performance. I see AI as a tool that can unlock sustainable performance, with humans at the forefront.” Cynthia Cottrell, Workforce Solutions Leader, Mercer Pacific

Tune in to learn more about:

• The new opportunities and jobs created by AI and the potential talent gaps
• Being proactive in preparing for the future by educating the workforce about AI, experimenting with AI tools within safe zones and incorporating AI into work design
• The role of HR leaders in driving the upskilling and reskilling to efforts to adapt to the changes brought about by AI
• Democratising access to AI and ensuring that the productivity gains are shared equitably.

 

• Mercer 2024 Global Talent Trends
• Tech Council of Australia 
• Woolworths Launches Scan&Go Trolley
• Books by Ravin Jesuthasan

Imagine a company where every employee, regardless of their location, has equal access to learning opportunities, career growth and experiences. A company where the ability to solve client problems and deliver a differentiated service is amplified by the diverse expertise and perspectives of a connected global network of skilled employees.

Join us in this episode as we dive into the world of skills-powered organisations (SPOs) with Amy Baxendale, Global Capability & Workforce Readiness Director at Arcadis. With 36,000 employees in over 30 countries, Arcadis embarked on their journey to become a SPO nearly two years ago. Amy, who is spearheading this transformation, shares the valuable lessons she has learned along the way and the secrets behind their transformation journey.

Insights for HR leaders in this episode

• Importance of skills in the future of work and benefits of skills-powered model
• Key challenges and considerations when implementing a skills-powered approach, such as ensuring privacy and data protection, integrating with existing technology and effectively managing change
• Importance of collaboration between the organisation, technology partners and change management
• Conditions for a successful journey, including strong leadership support and stakeholder engagement
• Test and learn phases and the need for flexibility and continuous adaptation
• Effective strategies for driving change and facilitating communication throughout the transformation process
• Practical suggestions for organisations considering a similar transition.
  
  

Ready to unlock the power of skills in your organisation? Tune in now and take the first step towards your transformation today.

• Mercer 2024 Global Talent Trends
• Skills guide: Strategic Shift - Skills-Powered Organisations in the Age of AI 

In a world where technology is advancing at an unprecedented pace, the demand for skilled talent is reaching critical levels. As HR leaders and practitioners, it's crucial to address these skills shortages and find innovative ways to retain and develop top talent.

In this episode we delve into the career journeys of a former rugby captain and a talented artist. Through their unique experiences and unconventional paths, we uncover valuable insights that will inspire you to reimagine your talent model, skills development program, and employee value proposition.

Discover how transferable skills can bridge the gap between industries and roles and unlock untapped potential within your organisation. 

Mercer 2024 Global Talent Trends

Organisations in every industry are looking for ways to increase productivity. But rising levels of employee burnout and a decline in trust show the potential cost. Could AI be the answer?

We had over 12,000 C-suite executives, HR directors, employees and investors contribute to our Global Talent Trends 2024 study and we their input helped us uncover four trends that are shaping the people agenda this year:

• Human-centric productivity (3:32)
• Equitable work practices (10:40)
• Ready and resilient workforces (20:55)
• Digital-first culture (30:19)

We explored each of these trends in a recent webinar attended by over 400 HR and business leaders. You can listen to the insights here or watch the replay. 

“To ensure that the Australian workforce truly benefits from the gains of AI, we have to shift the productivity discussion from doing more with less to doing work with less effort.”  Cynthia Cottrell,
Workforce Solutions Leader, Mercer Pacific

• Global Talent Trends Study 2024: Executive Summary – Australia
• Learn more about Mercer’s Global Talent Trends

Do you want to build more confidence around your organisation’s pay decisions? In this episode, Mercer Workforce Solutions leaders discuss the factors contributing to the gender pay gap and share practical interventions to help close it.

They explore an always-on approach to diversity and inclusion which promotes a more inclusive and equitable workplace. The conversation covers:

• Challenging the notion that workforce composition and diversity in senior management positions are the sole solutions to closing pay gaps.
  
• The role of data and workforce analytics in identifying and addressing pay disparities.
• Ongoing monitoring of pay gaps to ensure progress and prevent the gaps from resurfacing.
• Tackling the challenge of rectifying past inequities.
• Leveraging AI to reduce bias and create a fair and equitable environment for all.
• How talent marketplaces can help provide a level playing field for all employees.

Tune in and take a step towards closing the gender pay gap.

• Mercer Global Talent Trends 2024 
• The Workplace Gender Equality Agency, WEGEA 
• Closing gender pay and leadership gaps 

In this episode, Mercer’s Paul Hennessy, Australian Sales Leader and Dean Tulloch, Leadership & Talent Practice Leader discuss the links between effective leadership and organisational success. They explore the leadership behaviours that bring out the best in teams and the need to set clear expectations to build a stable foundation for collaboration.

The discussion also delves into the challenges of succession planning and offers insights into how organisations can plan a smooth transition of leadership. They also cover the importance of having the right people and organisational design to execute strategies successfully.

The conversation further highlights the role of cultivating a culture of transformation and the need for consistency in implementing change initiatives.

These insights will provide valuable guidance for leaders and organisations striving for growth and success.

Topics covered:

• Leadership behaviours that bring out the best in teams;
• The importance of working with diverse teams;
• Addressing the challenges of succession planning;
• The need for the right people and organisational design to execute strategies;
• Culture transformation and the importance of consistency in implementing change.

To end the first season of Making Work ‘Work’, we revisit the question posed in the first episode: How do we make work lovable? Join our podcast host and leader for Mercer Workforce Solutions in the Pacific, Cynthia Cottrell, and Andrew Lafontaine, a Partner in the transformation business as they unpack the year.

They discuss the concept of flexibility in the workplace, the challenges and tensions that come with it, and how to create a positive work experience for all employees. 

They also talk about the impact of the pandemic on work dynamics and the need for organisations to design jobs that work well in a hybrid work set up. The conversation also covers the issue of burnout and disengagement in the workforce, with a focus on the importance of creating a supportive and inclusive work environments.

They conclude by exploring a skills-first approach in creating lovable jobs and career pathways within organisations, highlighting the benefits for both employees and employers in terms of career development and strategic workforce planning.
Tune in to discover ways to make work more enjoyable and fulfilling for your people in 2024.

Creating Lovable Work in 2024 - Reflections from season 1 of Making Work ‘Work’

Resources

• Mercer Australian Benefits review 
• Mercer Marsh Benefits People Risk Report: Pulse Update 2023 
• State of the Global Workplace 2023 - Gallup 
• Fair Work delivers work from home win for bosses - AFR 
• The State of Future Work, The University of Melbourne
  

 

There’s plenty to debate about where the HR agenda is heading. From hybrid work, to culture, total rewards, skills and AI - what will be the key trends for next year? We asked five experts from Mercer’s Workforce Solutions team to place their big bets for 2024. Tune in to our discussion to gain insights that will help you navigate the increasingly complex world of work.

Resources

• Flexibility for all: ideas for solving the flexibility challenge
• Mercer 2022-20233 Global Talent Trends - Australia | New Zealand
• Mercer Australian Salary Outlook 2024
• Mercer Australian Benefits Trends
• Mercer Marsh Benefits 2023 People Risk Report: Pulse Survey

References

• World Economic Forum Skills Report
• ABS - Recent Trends in Australian Productivity
• Employees reveal truth about working from home in survey
• AI in HR: A Guide to Implementing AI in Your HR Organization
• How Many AI Companies Are There? (2023)

In this interview, Cynthia Cottrell welcomes David Guazzarotto, Leader for our Digital HR and Technology Advisory practice, and an authority on digital transformation for the workforce and reimagining HR for the digital age. They discuss the landscape of HR transformation, particularly in the context of generative AI and technology advancements. The conversation centres on the impact and immense potential that technology offers HR and the workforce.

Five key takeaways from the interview:

• Opportunities and challenges for HR in the age on generative AI: Nearly 75% of surveyed companies by the World Economic Forum are expected to adopt generative AI. Mercer's global Talent Trend study also highlights that executives' top priorities include redesigning work for agility which will require them to re-design their HR function.
  
  
• Human-centric approach: David emphasises the importance of being "digital" rather than just "doing digital." HR should focus on understanding the needs of employees and aligning technology to enhance their experience and productivity.
  
  
• Redefining work: Around 60% of current jobs didn't exist in the 1940s, showcasing the need for reskilling and adaptation to new roles. HR's role is to lead organisations through this change and identify critical future skills for the digital age.
  
  
• Transformation challenges: Around 80% of HR tech projects fail to achieve intended ROI or solve business problems. David emphasises that organisations should focus on problem-solving rather than adopting technology for its own sake.
  
  
• Strategic intent: David's recommendations for organisations include starting with a people-centric approach, embracing digital transformation as a cultural shift, and taking intentional steps toward technology adoption aligned with the organisation's strategic agenda.

• The future of jobs: 2 experts explain how technology is transforming ‘almost every task’
• Global Talent Trends report 2022-2023

Women continue to be underrepresented in STEM fields. Learn how Techgirls is nurturing your talent and helping bridge the gender gap.

Did you know that in Australia, the number of software engineers outnumbers plumbers, hairdressers, or baristas1? Despite this, only 15% of Australia's STEM skilled workforce are women2, a stark contrast to the nearly 50% female participation in the broader workforce.

Today, we delve into the efforts to bridge this gender gap in STEM fields. Our host, Cynthia Cottrell, shares her experiences as a woman in STEM, reflecting on the challenges she faced as one of the few females in her systems engineering major over 25 years ago. To shed light on empowering the next generation of girls in STEM, Cynthia sits down with Jenine Beekhuyzen, the visionary founder of Tech Girls Foundation. This remarkable organisation is on a mission to inspire young girls to pursue STEM careers through innovative initiatives and programs.

In this captivating conversation, Cynthia and Jenine underscore the importance of female role models and how witnessing successful women solving significant problems in STEM can ignite a spark of inspiration in young girls. They emphasise the need to create a supportive community that nurtures young talent and explore the role organisations play in promoting diversity and inclusion in their workforces so that everyone can achieve their potential, or as Jenine says, bring their 'awesomeness' to work.

Here is a condensed version of the conversation – it’s been edited for clarity and concision. 

Cynthia Cottrell: Today we're going to explore a workforce challenge that is near and dear to my heart, and it represents the life’s work of my guests today. The topic is women in STEM. 

Australia's STEM skilled workforce significantly lacks female representation, with only 15% of women compared to nearly 50% in other industries. This underrepresentation is concerning, especially as tech jobs have grown at a rapid rate since the mid-1980s, comprising a significant portion of the workforce.

On a positive note, there has been a 24% increase in the number of women enrolling in STEM courses at universities between 2015 and 2020, outpacing the 9% increase among men. We are seeing the right trajectory of building the pipeline of females who could go on to take STEM qualified jobs.

But we must ask if this progress will be sufficient to bring about a significant change. As a mother of two girls, I'm particularly invested in seeing more females taking on STEM roles. I am aware that my daughters are fortunate to have both parents with engineering degrees, making STEM discussions normal in our household. Yet, I know this is not the case for many girls, who may find themselves in the minority when it comes to their studies, interests, or hobbies in STEM.

To address this issue, Mercer is working with the Tech Girls Movement Foundation, supporting initiatives and programs that aim to cultivate future female STEM leaders. The Techgirls envisions a society where girls confidently lead in STEM entrepreneurship and contribute to their communities and the economy. Today, we have the privilege of speaking with the founder of the Tech Girls Movement Foundation, Jenine Backhausen. Welcome to the podcast, Jenine.

Jenine Beekhuyzen: Thank you, Cynthia. I love the story about your family, and I'm putting your girls on the list of our recruits for next year. 

Cynthia Cottrell: Please do. I'll let them know. 

Jenine, tell us a bit more about your background. You know what attracted you to the field of STEM careers and what drove you to create the Techgirls Movement 10 years ago? 

Jenine Beekhuyzen: Thanks, Cynthia. You are an incredible role model for your girls. Your girls are fortunate, they can see you doing these incredible things, solving problems that are important. Role models are critical, if you can't see it, you can't be it. 

In my experience, having those role models, having mentors, having people to show pathways that we may not have seen otherwise, is really important. I've had many role models and mentors who paved the way for me to be here, and I wouldn't be here without them. Certainly, I have technical skills, I have abilities to solve problems in our communities and I encourage the community of young people to do the same. But I’m building on the back of other people in front of me who have shaped the world with technology. 

There are so many interesting technologies in the world today, how can we use them for good? That's really what Techgirls is about, using technology for good and finding problems in our community and encouraging young people to be empowered and courageous and solve problems where others haven't done before them. 

Cynthia Cottrell: That's awesome, Jenine, and I love that saying “you can't be what you can't see.” I'm going to reveal my age a little bit, but when I was going through my engineering degree more than 25 years ago, I was one of only three in my graduating class in my major in systems engineering. I do remember feeling isolated at times and, certainly not amongst a lot of other females that I could confide in and or discuss how I was feeling as I was going through my studies. But I was able to push on and I did have a wonderful network of family and friends who supported me.

As you talk about the vision of Techgirls and its mission to provide support, encouragement, and confidence, I believe there's a significant emphasis on building confidence, particularly in fields where females are a minority. Jenine, could you elaborate on the specific activities and support that Techgirls offers and share some insights into its impact?.

Jenine Beekhuyzen: Thanks, Cynthia. I think confidence comes from a number of sources, not just awareness of technology and its problem-solving potential, but also having hands-on digital skills. According to the UN, women and girls are lagging behind in terms of digital skills. We urgently need them to be part of shaping future solutions, but for various reasons, they are just not there.

Techgirls aims to tackle this issue by offering girls choices in life and equipping them with digital skills. These skills are as essential as English and math literacy in our daily lives, and we all need them to thrive. Through Techgirls we foster hands-on learning and building confidence. Our goal is to empower everyone, not just girls, to utilise technology in a way that benefits us all.

Cynthia Cottrell: Let's step back a little and just think about why this is so important now? I just talked about what it was like 25 years or so ago and you've talked a bit about your early career in STEM and here we are still talking about this today as an urgent need for the future of the workforce.

I was reading about a study that suggests that if AI was behind a lot of the hiring today, AI, would actually hire more women than if humans were doing the recruitment. A statement like that sounds great but is AI really helping us create a more diverse workforce? What are your thoughts on how this world of AI and those behind building these very powerful platforms will shape the future of the workforce and society? 

Jenine Beekhuyzen: Let's break this down into two parts. For the past 24 years, I have been researching and exploring the underrepresentation of women in technology and STEM fields. In 1997, I was fortunate enough to have a few role models who were academics investigating the gender gap in tech. They were pioneers in this field and identified a lack of women graduating with information technology degrees at Griffith University. Joining their research team allowed me to study this issue ever since. This brings us to today, and surprisingly, not much has changed in almost 25 years in terms of the purpose of why I do what I do and why this is important. 

Back in 1998, as part of my undergraduate degree, I was already studying AI. In some ways, the subject isn't entirely new. Even at that time, there were concerns about the groups being left behind and questions surrounding AI's role in both advancement and marginalisation.

In the AI space, marginalised voices are often further marginalised. I love the study that you mentioned because it challenges the prevailing narrative that algorithms used in human resources systems are based on historical data and perpetuate biases against women. There are studies suggesting that AI has excluded women from recruitment processes. I'd love to explore that further because the evidence so far doesn't fully support that possibility. I think if that's possible, that’s excellent. But that's not what we've seen so far and that’s certainly prompted me to do what I do, because I believe that these technologies can inadvertently exclude certain populations, and that and this lack of diversity hinders the development of genuinely useful digital futures.

Cynthia Cottrell: When we consider how technology and platforms are developed without enough diversity behind the process, I'm reminded of my phone's design. Even today, I can't comfortably hold it in one hand and swipe from left to right, as my finger can't reach across the screen's width. This suggests that the phone's designer likely had much bigger hands than me, and probably bigger than most women who use this device. It makes me wonder how different the world would be if we had more diversity and diverse perspectives involved in designing these platforms, whether it's a phone or the powerful systems responsible for hiring, selecting, and inferring knowledge. The reasons behind the need for diversity seem apparent in our daily experiences, don't they?"

Jenine Beekhuyzen: I love that example and I have another telling instance. When we started using our phones to make videos, the videos would always default to a certain orientation. And that was because it didn't actually cater for left-handed people. This highlights the importance of embracing diversity in so many different levels, not just around gender. There are so many ways that we can tap into all types of diversity. 

Cynthia Cottrell: Coming back to the impact of Techgirls, this is the 10th anniversary of the foundation, so lots of girls have passed through the program. They become they can start the program as early as age six. Is that right? 

Jenine Beekhuyzen: Typically, our program caters to eight-year-olds, but we've even had seven-year-olds asking to join the program. Research tells us that girls opt out of STEM as young as six. To counteract this trend, we conduct workshops targeted at girls from a very young age, aiming to introduce them to the world of technology and its vast potential. By doing so, we hope to open up a world of possibilities for these young minds and inspire their curiosity and interest in technology.

Cynthia Cottrell: Let's talk a little bit about your impact over the years. You have an incredible job, being able to wake up every morning, knowing that you have played a role in shaping how countless young minds perceive STEM and careers. I'm eager to learn more about the programs you run and the impact they have had on individuals and communities alike. 

Jenine Beekhuyzen: Our journey started 10 years ago on International Women’s Day. For me, it meant turning research into practice, understanding the problem, and working towards solutions. We know why we don't have enough women in the technology space and more broadly in STEM. The challenge lies in finding practical ways to change that.

So I designed a program called Techgirls aimed at tackling the lack of visible female role models in technology and demystifying technology-related professions. Unlike careers like doctors or lawyers, the role of a technologist may not be as widely understood. Even in the tech industry, there's often a lack of awareness about what we do. To bridge this gap, we introduced a campaign called Techgirls Superheroes. It comprises a series of books that portray women in technology as superhero characters who are changing the world. These stories aim to inspire and illustrate the incredible impact women can have in the field of technology.

The challenge for me in STEM and in technology, is about how to engage young people in a place where they don't feel welcome or comfortable. So let's bring your superpower to STEM when you might not feel 100% worthy of being there and let’s use your superpower and give it a try.

When I talk to young people and I ask if they could you do “x” technically, they go, ‘no, no, no, I couldn't do that,’ and I say ‘well if you could do it as a superhero, how would you do it?’ Then they give me 10 ways they could do it. This is what Techgirls is about, engaging young people to find their best selves and realising that STEM is an option for them. 

That's what we do in our program. We've done it through our books and we've done that through our competitions. The competitions encourage the girls to find a problem in the community and solve it. We have mentors working with the girls and helping them understand how they can contribute to the world through STEM.

Cynthia Cottrell: I really enjoyed our work with Techgirls in one of the competitions. What a neat way to bring out the innovation and the ideas and the solving of problems through STEM techniques that these young girls pursue as part of the program. 

I know that when we had a chance to host nearly 100 school age girls in our offices here at Mercer, where we talked about problems from right across the industry, I was absolutely knocked off my feet by the practical, innovative, creative ways that these girls approach the problems that my business thinks about all the time. Sometimes we need to give confidence to these girls so that they can approach these problems in a way that may be very different from the way that we look at them in the corporate sense, or even from the adults’ perspective. I think that those competitions that you run are a really neat way to apply STEM and in a fun way. I mean, who doesn't like to win an award?

Jenine Beekhuyzen: I love the concept of competing and I think in Australia in particular, we like competing, and there's something about when the girls get in the room together at the end for the showcase and they realize there are a whole bunch of other girls like them that are giving STEM a go. I think the competition is a great motivator. It's not about giving awards to everyone, but it's about recognising the most innovative ideas. 

Cynthia Cottrell: Speaking of the impact this program has had on girls, I've got a story from one of your Techgirls alumni that I would like to play for you. So let's roll tape. 

I competed in the Techgirls Competition when I was in year nine. The app I created was Vocabulary Voyages - a gamified studying for the NAPLAN testing. I had absolutely no knowledge of coding or the technology world before the competition.  After I did the competition I decided to study computer science at university and probably without the competition I would not have gone that path. 

Today I’m software engineer at Atlassian. I also run a business on the side with my partner. We create custom websites and technology as well as apps. So I’m still continuing on with my app development journey.

Jenine Beekhuyzen: Kira is one of our many alumni who have shown that, again, if you can't see it, you can’t be it. STEM wasn't a pathway she had considered but the program inspired her to pursue a career as a computer scientist. What didn't come out in the story that she shared was the many awards that she has won as part of her studies and how she's contributed to breast cancer technology and detection and made incredible advances for how we use technology in a place where it's important for women. I think we can all learn so much from Kira. 

Cynthia Cottrell: I expect that we'll be seeing a lot of Kira for years to come. What would be your recommendations to organisations who want to try and hire a Kira or even nurture that spirit of innovation that she exhibited in her time at Techgirls. 

Jenine Beekhuyzen: It's a great question, Cynthia, and I think it comes back to what you were talking about before. It's crucial to empower young people by giving them a voice and recognizing the value of their ideas in shaping our products and services. The misconception that young people, particularly those always on their phones, don't have anything useful to contribute is indeed shortsighted.

Now, when it comes to attracting more women to STEM, the first and essential step for organisa tions is to address the gender pay gap. They have to rectify any disparities and level the playing field. This is an achievable and straightforward measure that can create a more inclusive environment and encourage women to engage more confidently in STEM-related fields.

Another critical aspect is having an open mind about the opportunities where women can contribute. It's common to fall into the trap of stereotypes, assuming that women should primarily be in administrative roles or are not capable of taking on management positions. The key lies in recognising and appreciating the talent and potential that women possess and providing opportunities for growth and advancement.

Cynthia Cottrell: You shared a highly practical tip with me last week that I've already begun implementing at Mercer. It's about 'inviting the opportunity,' and I believe many of today's listeners will find it incredibly useful for their organisations. Could you please elaborate on this concept?

Jenine Beekhuyzen: I attended a conference in China where I had an interesting encounter with a computer science professor from the US. She shared an enlightening observation about her students' motivations for studying computer science. When she asked male students why they chose this field, 80% replied that it was because they were good at it. However, the female students gave a different response - they said they were studying computer science because they were invited to do so. Essentially, they were told they would be good at it, even if it wasn't something they initially considered. And they succeeded. This insight struck me as powerful. Many times women, even today, will have a go at doing things because they were invited or encouraged, not because they thought they were inherently good at them.

As leaders, we should actively seek out individuals in our organisation and provide them with opportunities to shine. Let's give them speaking roles in meetings, invite them to lunches, and explore ways to include them that we may not have considered before. It's crucial to identify those who may have been left behind and give them the spotlight they deserve. 

Cynthia Cottrell: It sounds so simple, but there is a psychology behind inviting someone as opposed to nominating or recommending them. An invitation, just like to a wedding or a birthday party or to a career, represents a deliberate choice. It means that someone has recognized you, somebody wants you there. So to all women out there, we're eagerly waiting for your response. We want to see more of you in STEM and we can't wait to have you join.

Jenine, thank you though for joining us today. Your experience and insights will surely help many of our listeners today as they work towards making their workforces more diverse, more equitable and certainly more inclusive for the next generation. 

Jenine Beekhuyzen: Thank you so much for the great work you're doing in this space at Mercer and beyond in your family and in your community, and I invite everyone to join the Techgirls community and make a difference. 

Cynthia Cottrell: Thanks, Jenine. 

• TechCouncil Tech Jobs Update - May 2023
• Stem-Qualified occupations
• AI more likely to hire women than humans are: study
• Why aren't smartphones designed for a woman's hand size?
• More women are studying STEM, but there are still stubborn workplace barriers

In this captivating episode, our host Cynthia Cottrell asks Ilya Bonic, the President of Mercer's Workforce Solutions business and Head of Mercer Strategy globally, a thought-provoking question: "Do you think AI will ever replace your job?" This question sets the stage for the conversation as they delve into the challenges and opportunities presented by AI, exploring its impact on the present and future of work.

Their conversation covers:

• HR’s crucial role in integrating AI into business and culture
• Reshaping work to leverage AI for the benefit of organisations and their workforce
• Minimising bias in decision-making with AI
• Embrace the cultural shift in the way we work, as AI complements and enhances our capabilities

This is an insightful episode on the incredible potential that AI holds for our future. Tune in now and be part of the transformation.

• HR consulting in the age of AI
• Chief People Officer’s quick guide to generative artificial intelligence

Step into Mercer’s world of work and discover the secrets behind creating a truly great place to work. In this captivating episode, our host Cynthia Cottrell engages in a thought-provoking conversation with Gaye Morris, Chief People Officer at Mercer Pacific. They delve into the dynamic landscape of modern workplaces and explore the initiatives spearheaded by Gaye, resulting in Mercer's coveted nomination for the prestigious 2023 AFR BOSS Best Places to Work list.

You will discover how Gaye and her team cultivated an exceptional culture of collaboration during the acquisition of BT Super Fund and gain insights into the transformative power of distributed leadership, learning and development, and the importance of creating a relatable organisation.

Are you ready to unlock the secrets of what makes a remarkable workplace? Tune into a stimulating discussion that tackles the pivotal role of Chief Human Resources Officers (CHROs) in today's challenging times.

• 2022-2023 Mercer Global Talent Trends 
• Putting People at the Heart of Sustainability 
• The Good Work Framework 

One of the biggest challenges for organisations has always been how to monitor the skills they have and the skills they will need in the future. But as Cynthia Cottrell, Partner and Workforce Solutions Leader at Mercer Pacific, and Ravin Jesuthasan, Global Transformation Leader for Mercer, discuss in this episode, a new way of looking at work is emerging, one that takes a different approach at building capacity, unlocking potential and managing careers. They describe this new approach as a movement called “skills-powered” and explain that when skills (not jobs) become the currency of work, this not only helps organisations become more agile and resilient in the face of constant change and uncertainty, but helps secure futures – for workers and societies.

Tune in to listen to Mercer’s thought leaders discuss the evolution of work, how companies are using Talent Marketplaces to power their skills journeys, the role of AI and tools like ChatGPT in monitoring and matching supply and demand of skills,  and advice for companies considering or starting their shift towards a skills-powered enterprise.

Learn more about this movement, listen to the podcast now.

• Work Without Jobs - book excerpt
• The Complete Guide to Talent Marketplaces

As businesses grapple with the challenge of ongoing labour and skills shortages, a growing number are adopting a skills-based approach to define the skills they will need in the future, flex their workforce, and purposely drive career development. 

In this episode, our host Cynthia Cottrell, Partner and Workforce Solutions Leader at Mercer Pacific, speaks with Amy Baxendale, Global Capability & Workforce Readiness Director at Arcadis, about their journey towards becoming a Skills-Powered Organisation (SPO). 

Their conversation covers: The business case for change and why now is the time for Arcadis to shift to a skills-based model, why Talent Marketplace technology is critical to enable the transition but culture change is at the heart of this human-centric transformation, HR’s role in this business-led change program, and how to get started with moving from jobs to skills. 

Tune in to learn how an SPO talent model can help your business and hear practical steps to get started.

Cynthia Cottrell: Is work working for your people and organisation? In this podcast, Mercer thought leaders, industry experts, and business visionaries share big ideas and best practices to help you build great workplaces, and a future where work ‘works’ for everyone. Making Work ‘Work’ is a podcast from Mercer Workforce Solutions.

Welcome to Making Work ‘Work’. I'm Cynthia Cottrell. According to the recent Mercer Executive Outlook study, 50% of the nearly 400 CEOs and CFOs that responded stated that they anticipate their organisations will struggle to meet demand with their current talent models as they face into persistent labour, skill shortages, inflation, the prospect of global recession, quiet quitting, and a new one for me, “resenteeism”, which is a buzzword now to describe individuals who are unhappy with their jobs, but can't find alternative work, so they are openly now unhappy at their jobs, and the list goes on. 

The industries that will struggle most, according to our study, include construction, energy, automotive, and manufacturing. The pace of change in the new world of work seems to be moving at breakneck speed. And scary enough, it will never be this slow again. According to LinkedIn's 2023 Workplace Learning Report, skillsets for jobs have changed by around 25% since 2015. By 2027, this number is expected to double. So how should leaders evolve or rethink their talent models in this VUCA (Volatile Uncertain Complex Ambiguous) world that we live in? Today, I'm joined by Amy Baxendale, Global Capability and Workforce Readiness director at Arcadis. Arcadis is a global organisation with 36,000 people in over 70 countries, delivering sustainable design, engineering, digital and consultancy solutions for natural and built assets. Amy and the team at Arcadis have embarked on the journey towards becoming a skills-powered organisation, an important cultural shift for the 135-year-old company. And it is a major reboot for talent models across that industry. Amy, welcome to the podcast. 

Amy Baxendale: It's great to be here, Cynthia. Thanks so much for having me.

Cynthia Cottrell: Amy, you use a really neat term in the conversations we've had in the past that I think you've coined, and it's a way that you've described your career at Arcadis. The term is “squiggly.” Tell us more about what squiggly means to you, and what you're up to and your current role at Arcadis. 

Amy Baxendale: Sure, Cynthia. Thank you. So I first joined Arcadis 18 and a half years ago. And during that time, I've lived and worked in five different cities, in four different countries, and this is now my 14th role, all broadly within the specialisms of people and culture, but also in business transformation as well. I'm also a boomerang employee, so I left for 18 months and came back. But I guess for me, the squiggly career piece is I feel really fortunate that I've had the privilege as a career that's been really personalised and aligned to work that I'm passionate about. And my current role really brings together a number of different experiences and opportunities I've had over that time, and really brings together talent acquisition and capability development very purposefully at global levels, so that as we, as a business, understand more about the skills we need now and in the future, we can make more- informed decisions about whether we build, buy or borrow that talent that we need now and in the future. 

Cynthia Cottrell: That is certainly a “squiggly” career path. And I think it sets us up nicely to talk about this journey that you and Arcadians everywhere are just embarking on. So, before we get into more about that journey, let's just sort of step back and zoom out for a little bit. Why is this shift to skills powered for Arcadis so critical at this time? Why now? 

Amy Baxendale: I think for us at Arcadis, the journey towards becoming a skills-powered organisation really is genuinely considered by the business to be central to our business strategy because we really see it as an enabler to build a workforce that's ready for the future, within the context of what we all know is an ever-evolving world of work. But in order for us to continue to grow and scale globally as a business, it's really critical that we have better insights into the skills that we need now and the skills that we need in the future. So, I guess to bring an example to this, Cynthia, during 2022, we've acquired four organisations. So, we've welcomed 6,000 new Arcadians into the business. If we had been further on our skills transformation journey, then we would've been able to further accelerate our integrations by really quickly understanding more about the talent that's joined our business, and then better identifying opportunities to connect those new skills to immediate or emerging client needs. 

Cynthia Cottrell: It is all in the timing, isn't it? Everyone is talking about skills shortages. We opened with that today, and it is absolutely top of mind for executives everywhere. With that in mind, Amy, it does sound like the time is now, isn't it, for this very critical shift to skills powered? Tell us more. 

Amy Baxendale: Yeah, I mean, you've mentioned a number of the things that keep us as HR professionals up at night, but at Arcadis, we've always believed that our people are our most important asset. So, we think now is the time to shift to a skills-powered organisation for multiple reasons. And I could go on all day, but I guess if I think about the top three, the first one is really around transforming access for our people to enable much more diverse career-pathing. So, moving from majority of people thinking about a really structured, usually quite hierarchical, probably promotion-based roots to development, to really thinking much more about how do we give them access to more career-enhancing experience, and as I discussed earlier, what I fondly call squiggly careers, but really to enable much more personalised development planning and growth paths? So that people can have better growth conversations and access more opportunities and information to better take control of their own careers.

As a business a really important one for us is as part of our ongoing evolution and growth, we are going through digital transformation. And as part of this, we've launched the standardised and automate program. So, this is all about identifying, developing and reaping the benefits from having globally aligned processes, definition and much more harmonised ways of working. So as part of this, we'll start to identify opportunities to substitute, to augment and to reinvent work, which will naturally release our people to then be able to maximise their skills in different ways. Also, for our clients, they really benefit, as we are able to more proactively change the way that work can be delivered for our clients.

So, by having the skills- powered organisation program run alongside this, as we increase the knowledge of our people and their skills, we can then provide opportunities for Arcadians to move their skills to where they're needed, both as a business, but also align to their personalised career ambitions as well. So, for us, part of this journey really importantly is we are also looking to support our people to be able to stay relevant for the long term by re-skilling, upskilling and cross-skilling in line with the in-demand skills. So, I suppose the third one for me is this really does allow us to adopt what we are coining an internal-first approach to talent discovery. So, to truly enable us to leverage our global connectivity and have genuine conversations with our clients about skills they need, and the skills that we have in the business, and then being able to identify and mobilize the right talent to help solve those client problems and deliver on those client commitments.

So really, for us, it's about our people, it's about the business and it's about our clients. And I guess just as a business, we're really excited about the opportunity to potentially democratise learning and access to role opportunities across the whole business. To quote Jacqueline, our Chief People Officer, we really see this as an equaliser for all of our people globally because it will help us to have more objective, transparent, and bias-free internal talent processes across the board.

Cynthia Cottrell: Amy, that is so exciting. It is very clear to me, based on the way that you and the organisation have thought about skills, that you have a strong strategic vision for the future of skills, not jobs, as you embark on this journey. Can you just tell us a bit more about how you are thinking about this journey? I mean, how do you get started on something like this?

Amy Baxendale: Yeah, so as we evolved our understanding of the opportunities and the possibilities of a skills-powered organisation and we work with the business to better understand the potential impact, we started to recognise that it was really important to start with our immediate pain points that are impacting our business right now. But to truly become a skills-powered organisation over time, we needed to start the journey with an ultimate vision. And you've just said it there, Cynthia, that vision first skills, not jobs, to underpin all talent processes around the employee lifecycle. So to really make sure that skills become the currency of the business. I think I probably stole that from Mercer, actually. I think that's one of the things you said to me in the past.

But really, how we make sure skills around the whole lifecycle of the employee experience, so that ultimately we attract, grow, and connect talent globally. So, we've really purposefully designed this as a multi- year, multi-horizon strategy, and that's so we can truly embed that skills philosophy in all we do in the business, but really importantly by ensuring we do it in a timely and manageable way in terms of business impact. This is a huge cultural shift for, as you said earlier, a 135-year-old business, that we really will change the way we work and the way we learn at Arcadis. So, it's enabled by the implementation of talent intelligence and talent marketplace technology, but fundamentally it's a cultural shift to our business.

Cynthia Cottrell: You've really hit on an important point I think for everyone listening, and certainly for me, which is treating this journey towards becoming skills-powered as a cultural shift more than anything else, more than the technology implementation and all of the process and things that will have to go into this. You've mentioned as well and recognise that this is a multi- year journey. And I think like all good journeys, it'd be fascinating for us to fast-forward into what does that feel like and what comprises this journey for Arcadis? Can you tell us a little bit about this approach you're taking? Because it feels a bit like a test-and-learn approach as you go through these next few years with the organisation.

Amy Baxendale: Yeah, absolutely. And I'm very conscious of where we're starting now and what we think now will no doubt evolve as we go through this as well. But at this stage, we've set out a five- horizon strategy. So, we're starting with horizon zero, during which we will co-create this full skills transformation roadmap and strategy with the business. And we really want to take that opportunity to establish a clear Arcadis-specific proof of concept. There's lots in the market about people further on the journey. We've got to make it really specific to us at Arcadis. And therefore, the business case with the benefits and the ROI across all the horizons is really a central part of horizon zero, and critical to the point we've talked about, in terms of the focus of change is that our change management strategy and plan is really central to this first phase as we really start to think about the cultural change needed to support the implementation of the full strategy. Each then horizon as we move forward then focuses on the evolution of different talent processes around the employee life cycle. So we go through each one at different horizon points. But really importantly, at each horizon we'll have what we're calling pause, or reflect, or move moments, to really test assumptions on the priorities and ensure that as a business we are still ready to take that next stage. 

I think for me, one of the things we've talked about a lot, Cynthia, is that a massive driver for us that I've not mentioned already, I'm going to steal a bit of Deloitte's Human Capital Trends Report here because they articulate it so well. Employees now really want, need, and expect increased agency, choice and influence over the way they work, and also over the organisation for which they work. So therefore, really central to our strategy and approach will be making sure that we've continuously got opportunities for Arcadians to contribute and be part of the design and the evolution of what the future of work at Arcadis will look like. 

So really critical for us therefore is conducting pilots, so that we're getting those proof points specific to our business and really utilising those to test and learn as you say and adjust our approach as needed. And also bring success stories that we can then take for a wider global rollout. I think one thing for me that's been really, really critical is saying from the start and being really committed to the start about having a cross-business steering committee. So, this is really central and really critical because we've got what we call business change sponsors. They're representatives of the global business areas, the leadership teams in our business, and so they're part of the skills- powered organisation team and responsible for really designing, building, and implementing the change needed in the business.

Cynthia Cottrell: I think what is clear to me is that the integration with the business and co-creating with the business is essential to the transformation and the roadmap that you've laid out. But as you mentioned as well, there are numerous talent processes that are impacted by this new way of thinking. Skills, not jobs, right? And so what is the role that HR plays in all of this from a transformation perspective?

Amy Baxendale: Yeah, great question, Cynthia. And it's something we've been very purposefully thinking about from the start. I mean, members of the people team are involved throughout the skills-powered organisation structure, but I will say it's very purposefully a business-led change program, to which the expertise of the people team play a critical role, but alongside and with colleagues from the business. So to bring it to life for you in terms of how this plays out for us at Arcadis, so Jacqueline, I mentioned earlier, our Chief People Officer, she's a joint executive sponsor of the program, along with our Chief Operating Officer. I'm then the senior responsible owner of the project overall, and the program manager also sits in the people function.

However, the steering committee, as I just mentioned, is made up of cross-business representation. We also have change in communications professionals from those specialised functions, and SMEs from all parts of the business. Some of them, as you absolutely say, from the people function, but also from other parts of the business as well. And they're all involved at different stages depending on the focus of the horizon.

Cynthia Cottrell: That sounds fantastic. And I think again, that wonderful joined-up view between business, people and culture, but most importantly, as you've mentioned, from Jacqueline through to your COO being the executive sponsors co-leading this is I think it's truly something that many organisations will tune into and look to try and find a way to replicate in their journeys as well. I'd like to take us in a different direction for just a moment. Because you're living this experience, there are a number of listeners who are thinking about starting a journey similar to this. And as they're thinking through this with their own organisations, it'd be interesting to hear your perspective, based on what you've learned, how this journey could get started. Skills-powered is not a new concept per se in terms of... If anything, I can tell you based on the number of organisations I speak to on any given week, this is certainly one topic that comes up quite often. But getting started is certainly new for many organisations. Could you just tell us a little bit about how you guys got started at Arcadis, and any tips and tricks for the organisations listening?

Amy Baxendale: Yeah, definitely. And as you say, Cynthia, there's a number of organisations already on the journey. And I think for any organisation, and I've spoken to many of them, for everybody, this is a multi-year whole-business change program. But every organisation approaches it, and I'm sure you hear this from your clients, everyone approaches it in a different way, and therefore at a different pace. I think for me, the advice would be to start by determining the immediate pain points relevant to your specific business and build further from there. Because what's right for us at Arcadis, won't be right for another organisation.

But I guess where we started was really understanding the art of the possible. So really starting to understand what an earth all of this stuff means. So I listen to podcasts all the time, listen about skills, and talent intelligence, and talent marketplaces, and deconstructing jobs. And a year ago it all made logical sense to me, but I couldn't work out how to piece it all together to be able to talk to the business about it. So, to be honest, to start off with it was really about educating myself for me then to bring others in the business on that journey. And there's so much thought leadership, as you say, Cynthia, around this. So I devoured a lot of that.

But also, really importantly, and the big advice I'd say is there's so many providers and companies in the market either who have supported organisations in the implementation and change journey, or those that offer the technology that enables those transitions, but also clients of both of those types of organisations who've embarked on the journey. And I spoke to lots and lots of them. And that really helped us to understand more about what it really means to transition to a skills-powered organisation.

And then from there, we started to work with the business to think about, okay, if this is the art of the possible, how could those opportunities support and respond to real challenges relevant to us, to our people and to our clients? The added complexity for us at Arcadis is we are approaching this from the start globally. Many organisations have done it in parts of their business or are only based in one particular region. We really are looking at this holistically as a business.

So, I think I've probably mentioned this a couple of times, but it's probably the key point for me to reinforce that from the start, this has been a co-creation. So this isn't just the People function. We've had our global transformation engine, we've had our global operations and project services, we've had the technology function. And really critical, as I mentioned earlier, the global business areas. So they're the people who support our clients with our services and solutions delivery. So as a People function, we've got a critical role to play, but as part of a really collaborative business-wide team. 

And I suppose as part of your question around how'd you get started, very early because of all I've talked about so far, it became really clear that because this is a cultural change program and one that we need to take a human-centred change approach around, we have to have implementation partners to support us with that. But also, to scale this globally and be future-proofed, it also needs to be technology-enabled as well. So, we purposefully from the start looked separately at an implementation partner and a technology partner to enable us to evolve our ways of working and support Arcadians globally to change. 

Cynthia Cottrell: Sure. And I think with any change of this nature, and as you point out, it's not just a technology implementation, but more importantly a cultural shift. All of this takes a lot of energy, a lot of resources. This is not something ChatGPT can solve for anybody overnight. In fact, it'd be really great to hear a little bit about how did you get that business case across the line? There's going to be resources, investment, time over multiple years by the organisation to be all in on this, to lean in. Could you tell us a little bit about what that business case process was like, and how did you get it across the line?

Amy Baxendale: Yeah, we started with what I called, a pitch. It really was just describing the art of the possible and the opportunities as we saw it to our executive leadership team. And that was really to get approval and buy-in to just take our thinking further. So, it was very much a kind of pitch at the start. But from there, as we started to work through, we created a business case ‘light’, purposefully named ‘light’. Because for a fully- costed business case, with all of the benefits realisation and ROI fully articulated, we needed to identify who our delivery partners would be because obviously, the commercials differed in different organisations. So, we started with that business case ‘light’, that really thought of all of the different various stakeholders, and articulated the potential benefits from different perspectives that we can understand from speaking to others in the market.

And then it was an approver of that business case light that enabled us to go out to the market for a request for proposals process. And as I mentioned, we did two in parallel, one for the implementation partner and one for the technology partner. And as part of that as well, we had multiple discussions to explore potential funding options, which could be finalised once we knew the commercial impact following the RFP process. I think important for us was during that whole RFP process, we had people from across the business engaged at every stage, so that we really made sure we had diversity of thought, perspectives, and questions that informed the exploration with potential partners. Because again, what we might be looking for from a People team perspective might be different to what different functions or the business are looking for. 

And I suppose some of the bits that when I reflect back, what's been really powerful over the last year, because this is such a complex program and it is a long- term commercial investment for any business, your procurement teams, your legal teams, your privacy teams, for those who have got operations in Europe, your works council specialists, they're going to be on your speed dial and they're going to be important to guide you through every single process. Because naturally, the technology to support such a broad range of functionality to enable skills to underpin all talent processes needs to be appropriately understood and implemented and managed, to ensure the highest levels of data privacy.

Cynthia Cottrell: Yeah. Just speaking of the business case, I understand that there was also a unique stakeholder in this from an Arcadis perspective. Can you just tell us a little bit about that stakeholder and how important they factored into this decision to proceed? 

Amy Baxendale: Yeah, absolutely. So, as I said, embarking on this journey is a significant multi-year investment, no matter where you decide to start. And there obviously are both internal and external costs to the business, both in terms of the partners that you need to work with and the change load in the business and people in the business to be involved. And it's really hard, actually, to fully grasp what they might be, and a challenge to really consider and help the business think about how best to prioritise investment. But as you say, Cynthia, at Arcadis, we're in a really unique and privileged position to have a foundation called Lovinklaan Foundation. So it's a foundation that's led and managed by employees, and it's the largest shareholder in Arcadis. And Lovinklaan's mission is to ensure the continuity of Arcadis, and to provide Arcadians the opportunity to reach their full potential.

Cynthia Cottrell: I just love that.

Amy Baxendale: I know it's the best, isn't it?

Cynthia Cottrell: I think it's the best thing. I could just see organisations wanting to adopt something like that into their primary shareholder group to be the employee. So sorry to interrupt. I just think that is so awesome.

Amy Baxendale: Yeah, it is really unique. And I guess the clear alignment between Lovinklaan's mission to ensure that continuity of the business and Arcadians and the vision of a skills-powered organisation, when we engaged with Lovinklaan early on, those two things really came together really naturally. And we were extremely grateful that they have co- invested with Arcadis in order to act as an incubator during the horizon-based implementation. So yeah, it's really unique to Arcadis, but it's also a really great position to be in to support us with being able to move forward with skills- powered organisation.

Cynthia Cottrell: Well, Amy, we are so excited about the start of this journey and hearing it from you as you start. Clearly, the energy and excitement is there. And just when I try and sum up what we've heard today and what you've armed yourself with and the organisation as you embark on this journey, I think of three key points for our listeners in particular.

You and the team at Arcadis have recognised that shifting to a skills-powered organisation at the end of the day is a human-centred change program. And at the end of the day, it's dedicated and committed to helping humans, Arcadians everywhere, helping them be the best they can possibly be at Arcadis. So, I think that is a neat takeaway from all of this, that sometimes we can get caught up in the technology or in the processes and in the governance and things like that. But I like that you've anchored into the human-centred piece around this as it relates to change.

I think the other piece you were really clear about that I think many organisations can take away from is that this is a business-led change. Yes, it has a lot of impact on talent processes and the way in which people and culture and HR organisations will navigate, but at the end of the day, it's business-led. And I think that's really an important nuance to this shift. And I think the third thing I heard from you is that we're recognising that this is about future- proofing the business. So you talked a lot about the vision for skills. And that yes, you are addressing current business needs, but ultimately you are designing a workforce for roles and jobs that may not actually be in place today. And so you are indeed focusing on the future-proofing aspect of what skills-powered means today.

Amy Baxendale: Yeah, and I think that last point you say there, I think you're absolutely right, and that's been really central to our thinking throughout. There's a really important point around this, around business readiness and the right time. Because ultimately, to future-proof yourself for the yet unknown than never before, if you don't start now, then you won't be ready in five years’ time. And I got a piece of advice really early on that there will never be the right time to start this journey, you've just got to start. And I think that's what we've talked about as a business going through that if we don't start now, we are impacting our readiness for the future.

Cynthia Cottrell: I couldn't have said it better. In fact, we might have to end on that note. We want to leave it on a cliff-hanger for today, everyone, because we can't wait to have Amy back on the show in a little bit of time in the future, just to see and check in on this journey. If that's okay with you, Amy?

Look, I just want to thank you for joining us today, your experience, your insights. This is happening in real time, and we're just so glad you took some time out today to share that with our listeners as they are considering their next steps to becoming a skills-powered organisation.

Amy Baxendale: My pleasure. Thanks so much for having me, Cynthia. And as you say, we're the start of the journey, so there's still a lot of learning to go. But yeah, great to have talked it through with you today. Thank you.

Cynthia Cottrell: Great. Well, I'm Cynthia Cottrell, thanks for listening to Making Work ‘Work’ from Mercer Workforce Solutions. See you next time.

I hope you enjoyed today's podcast and thank you for listening. Please subscribe to keep up to date with our latest episodes. And if you have any questions, get in touch with us via our website at mercer.com.au.

References:

1. LinkedIn 2023 Workplace Learning Report

2. Deloitte’s Human Capital Trends Report

• Talent marketplaces: the complete guide

Whether you're in the boardroom or living room, inflation and the rising cost of living continue to dominate the conversations in 2023. Employees are worried about their finances and the prospect of limited pay increases. Executives are concerned with the impact of inflation on both their businesses and talent management decisions. Where does this leave workers and their employers?

In this episode, our host Cynthia Cottrell, Partner and Workforce Solutions Leader, Mercer Pacific, and guests, talk about how organisations can respond to the crisis by centring their value proposition and business model on the needs of their workforce and what support they should provide to promote higher engagement and retention. They also cover key trends from Mercer’s latest salary and benefits surveys, the role of purpose, culture and the EVP, and practical steps that organisations can take today to navigate the current environment.

Cynthia Cottrell: Is work, working for your people and organisation? In this podcast, Mercer, thought leaders, industry experts, and business visionaries share big ideas and best practices to help you build great workplaces and a future where work, works for everyone. Making Work, Work is a podcast for Mercer Workforce Solutions.

Cynthia Cottrell: Welcome to Making Work, Work. I am Cynthia Cottrell. Inflation and the rising cost of living. It's something everyone has been talking about and it's likely to continue to dominate conversations whether you're in the boardroom or you're in your living room. Let's be honest, AMPs 2022 Financial Wellness Research¹  shows that a growing number of workers right across Australia and New Zealand are worried about their finances and stressed about the cost-of-living pressures and the prospect of limited pay increases. So, where does that leave workers as we face into the prospect of another few years of inflation and cost of living pressures?

This is what we know. Talent shortages, labour market tensions and ramping inflation across all industry sectors have highlighted this shift in the social contract between employers and employees. We know that from the Mercer's 2023 Global Talent Trends²  report that it's indicated 50% of C-suite executives are saying that they're going to focus on enabling new ways of working that will restore the balance between management and labour.

We also know that at this year's annual meeting at Davos, which is the meeting of the World Economic Forum, that our very own Ravin Jesuthasan, who is Mercer's global transformation leader, presented on the topic of good work goals. And as he points out, organisations need to reinvent their proposition and business model and it needs to be centred on creating a workforce-centric enterprise. And that is actually what's going to become economically viable for all organisations and economies worldwide. And the way to do this is to do it through focusing on what's attractive and what's important to employees.

So, in today's episode, we will talk about how companies are responding to inflation and what are they doing right now and in the future to attract and retain talent during these inflationary times.

Today, I'm joined by Chi Tran, partner at Mercer Workforce Solutions and Head of our data and insights business. She recently spoke with the Australian Financial Review³  about the results of our most recent Total Remuneration Survey, which painted a picture of an Australian jobs market defined by severe labour shortages, large pay rises in some sectors, high rates of staff turnover, and a growing emphasis on non-financial benefits to attract and retain talent. Hi Chi.

Chi Tran: Hi Cynthia. Thanks for the warm welcome. Thrilled to be here.

Cynthia Cottrell: And we have Andrew McKechnie, who heads our workforce solutions business in New Zealand. He's joining the conversation to explore the impact of the current economic landscape on attraction and retention and what organisations can do to ease the financial pressure on employees and make work, work even in inflationary times. Welcome, Andrew.

Andrew McKechnie: Hi Cynthia. Thanks for the welcome and great to be here.

Cynthia Cottrell: It's great to have you both. Why don't we get started when we kind of step back, let's just sort of look at this from a big-picture perspective. What is the total rem survey telling us about what's happening right across Australian and New Zealand, Andrew?

Andrew McKechnie: Thanks, Cynthia. Our New Zealand and Australian Total Remuneration Survey⁴  shows a median remuneration increase of 3%, that's for the year ahead 2023. And this is across general market. Surprisingly, this is unchanged from the increase from 2022 and what will come as a hard truth for many employees is the significant gap between the median rate and the rate of inflation given rising cost of living and increased mortgage.

Cynthia Cottrell: Effectively Andrew, it feels like we're going backwards, right?

Andrew McKechnie: Well, look, in some respects we are, but the challenge for organisations is really closing that gap because there's only 26% of organisations that are factoring the cost of inflation into their budgets for 2023. So, what that means is there is a considerable gap there for the workforce. And what's interesting is, conversations and approaching an employer around compensation increases is a really tricky thing to navigate. And even for the best of us, it can be an uncomfortable conversation to have. So I kind of liken it to the analogy of the unhappy customer. An unhappy customer very rarely complains, they just don't come back. So if you are an organisation listening to this, the risk is, if an employee is unhappy with their compensation, they generally won't raise it and they'll walk in search of higher paid opportunities.

Cynthia Cottrell: Now that is a wake-up call, isn't it, if there was one for organisations to do more than they are at the minute around understanding employee needs and how they can do more than increased wages if that is one of their levers they pull? But before we move further into that topic, I do have to say that that felt slightly gloomy, Andrew. And I just wanted to ask, Chi, I mean, is it really gloom and doom across all sectors as it relates to wage increases and how organisations are providing financial benefits in their plans this year?

Chi Tran: Definitely not, Cynthia there's definitely industries leading the pack and it's not 3% in the 2022 Total Remuneration Survey. We definitely saw 3.5% for industries like technology, life sciences and mining and metals leading the way. But if you peel back the onion even more and dive deeper, there's definitely jobs out there getting paid really nice and getting really, really nice increases. And we're seeing these jobs in IT, sales and marketing and engineering as well, getting big pay premiums as high as 22% higher than the norm. And we're seeing it's definitely much richer than remuneration. We're seeing voluntary attrition rising to the highest point ever in five years in Australia. And that's just compounding the issue of attraction and retention. We also found in our survey results is that 64% of organisations are reporting a difficulty in hiring and retaining their employees. And we know it's a tough market out there right now. It is an employee's market and attraction and retaining the best people will be even more important in 2023.

Cynthia Cottrell: Thanks, Chi and again, I think we can safely say that there's more to the story than pay. And you mentioned things like voluntary attrition being at its highest point in five years, and as Andrew said, employees are not likely to raise their concerns about pay to their managers. So, the first time a manager might hear about this level of unhappiness leading to a regretful resignation is when that person submits their notice. With all that said, I'd be interested in what you're hearing from organisations about what else they're doing maybe in regards to their benefits and other forms of addressing the needs of their employees.

Chi Tran: Sure. Cynthia, you hit the now on the head. We know pays just really one part of the equation and benefits is where we're seeing organisations make up that difference or the differentiator in the market to attract and retain because it's not always about the money and inflation can impact employees differently. What we're seeing clients do and what we're hearing from them is that there are reviewing their flexible benefits to cover more range or extend more coverage. And it's not just about offering employees a chance to work from home. We know that with COVID that's now a given, it's non-negotiable, but it's about offering differences in that coverage. And what I mean by that is offering your employees different choices when it comes to flexibility. For example, it could be allowing them to work condensed four days a week. And we know Atlassian⁵ is doing it right now. In fact, Unilever⁶ recently announced after trialling it successfully in New Zealand that they're going to introduce it now to Australia also. So, very exciting. And then there's having the options for employees to start earlier, finish earlier, it's really about catering to all the different employee demographics within your organisations and the different personal aspects of their life and work-life balance. That's one area. Another area we're seeing companies do is review their leave policies. And it's not just about giving more paid leave time, but it's about areas such as increasing paid parental leave so that they stick out in terms of what they're offering there as a key differentiator, extending their coverage to include IVF leave, allowing their employees to take off time to do that. There's paid transgender leave and increasing days for that type of surgery and recovery, and it's leave not just for carers looking after sick children, but extending that to help elderly and aging parents and giving them leave to take parents to doctor appointments and sick pets as well is also something that's new that's coming through. So, really catering for all aspects of their life and extending that courage and option so that you're meeting all the needs of your employees and it's going to be a real differentiator out there.

Cynthia Cottrell: I agree. And I certainly look forward to this innovation. I'm already thinking through the various ways that personalising these benefits. We talk a lot about making work lovable and really placing that as the centre of how the employee experience should be thought of and designed and the onus being on organisations and employers to really think about how do we improve work. And I think, really thinking about how life fits into work and not the other way around is a really neat perspective that all these organisations are thinking about in regards to personalising their benefits. I might just turn to Andrew, you're in New Zealand and as Chi mentioned, a very important set of experiments happen there around the four-day work week with Unilever successfully passing right through that experiment and wanting to scale that out. But from your perspective, just in general, Andrew, what are you seeing in New Zealand, and how are organisations really stepping up to help their employees feel a lot more comfortable and safe where they're at?

Andrew McKechnie: What is really clear over the past two years is organisations are facing the most incredibly challenging times that they ever have. And locally in New Zealand, New Zealand's not immune to that. I just want to recap on the very fundamental point that compensation clearly isn't everything, it's a ticket to the party. And what excites me is you look at how far organisations have come, where they're starting to become more relatable with their workforce. They're really starting to have open, transparent, authentic conversations to really tap into what's important, what motivates them. Because it can't, when you're looking at a benefits platform above and beyond compensation, it can't be a one-size-fits-all solution. To Chi’s point, it's around really lifting the lid, talking to your workforce. And by doing that in an authentic transparent way, it's creating a psychological safety platform where you can really start to get to the nitty-gritty of what's important to your people and then shaping a suite of offerings or a menu based on what you have sought to understand on what's important to your team.

But some notable trends I'm seeing here in the New Zealand landscape is, yes, we've got our compressed weeks, we've got our staggered hours, but really that gift of time is the fundamental trend that sort of head and shoulders above the rest. And that's again, tailoring the gift of time to suit your workforce. So that may be, as Chi mentioned, dependence, children, elderly parents we're even seeing the gift of time being offered for pets. Now the amount of people that went through the pet purchasing process over COVID lockdown, so they're now ingrained members of the family. You may not have children, but to have that gift of time to walk pets, to take them to doggy daycare, that's an important benefit as well. And also, wellness, that personal team wellness and health and wellbeing. I know an organisation that on the last Friday of every month they give a, what they call a wellness afternoon off. Now this is a great initiative to a kind of reward your team but also put that health and wellness at the forefront of the company's sort of values. And another growing trend again is just the different types of leave and more. We're seeing more and more now that organisations are more cognizant of gender equity. So as Chi mentioned, extended parental leave top-ups and essentially making it easy for mums or returning-to-work parents to be able to integrate back into the workforce. So that's just an example of a platform that can be built that doesn't necessarily have to be attached to a kind of monetary incremental increase, but it's thinking about outside the square. But the messages, it's about being relatable with your workforce, it's really running a health check on understanding what's important to your people, to your team.

Cynthia Cottrell: Yeah, it's so important. And I think again, listening to our employees, listening to the needs and marrying that up with how work gets done and making that a two-way street is such an important theme I think for this year. And with that said, we recently spoke with Katherine Glynn who is the director of People Services at Treasury Wine Estates. And this is what she had to say about the employees and what they are saying about what their needs are.

Katherine Glynn: The expectations of what employees are looking for, what they want in terms of work-life balance, the hybrid working, all of that actually has faced further into those workforce challenges that we're already emerging through COVID. So, that still is top of mind, finding the right people, the right roles, the right way, a constant battle for us as an organisation.

Cynthia Cottrell: I thought that was super interesting to hear from Katherine who is doing all the right things to check in with her employees and really understand how they want to work, where they want to work. And doing that in the name of creating an environment that helps them find the right people, retain them and certainly create that healthy culture. And I think both Andrew and Chi you've talked quite a lot about the myriad of ways that this can be done through benefits and through tailoring programs that are supportive of both the work and the lifestyles of employees. And I think that brings us to this, I think really important point about where workers are in the way they think about work. With all of the change that's happened over the last few years throughout the pandemic, which is really ushered in, let's be honest, this new way of working that is not likely to snap back to something pre-pandemic.

And I think one way I've thought about this quite a bit over the last few weeks, even from a personal standpoint, which is, there's got to be more to life than work. I spend a lot of time at work, so do all of you, I'm looking for more fulfilment. I'm looking for ways to enjoy and feel passionate about my work and I want it to mean something. And in order for those things to happen, I know that it's important to work in partnership with the managers, with the leaders that I work with. And I think that what I'm feeling is probably not too far away from how a lot of people are feeling right now. And so when we think about working in partnership, almost, not so much a one-way street of I employee you and therefore you must do what these things are in your job description, but rather how do we have and use all of these tools that are ready, benefits, pay, hybrid working flexibility and so forth, how can we really, as organisations and employers, how can we really take a different sort of position on these items to really bring that level of fulfilment and passion back to work. So Andrew, I'm going to turn that question to you. It's a deep one, but also I'd be interested in your own personal view on this. What are some examples of how companies are embracing this new way of thinking, this new employee contract?

Andrew McKechnie: Cynthia, that's a great question and you've really hit a very passionate point with me because we talk about compensation, we talk about benefits, and I see it time and time again a compensation increase very quickly normalizes. So a five, $10, $15K increase, it normalizes so it becomes the given. I love the analogy that your compensation, your benefits, yes is the ticket to the party, but if the music isn't happening, what's going to keep your people at the party? And so then we talk about culture and culturing is the music at the party. You've got to have all your ducks in a row, you've got to be making sure that you're competitively in line with market dynamics and the competitive landscape, but you've really got to dig deep on the culture aspect and that's make or break for a lot of organisations. Organisations that are winning in this area are creating a culture of high performance. And again, it's working in partnership with your people, your workforce. And we know because we see it and we hear it all the time, employees don't want to work for an organisation anymore. They want to work with an organisation. So again, it just speaks to the culture that you embed and create in a team environment. And when we talk about a culture of high performance that's not necessarily about winning and achieving, although winning and achieving is a good thing, but it's more around a culture of high performance in ways of working, trusted ways of working, how management will communicate and liaise with their people, how open and freely can feedback be given and received that is all about high performance.

The winning organisations are really doubling down on culturing and creating that environment, which again is the music at the party. If organisations listening to this, that would be some of the key is to really sort of hone in on and focus in on culturing high performance.

Cynthia Cottrell:  I love that analogy and I'll have to ask Chi, just riffing off your analogy there. Chi, what are organisations needing to do to pump up that music? What are they potentially got it there ready to help them strengthen culture and make it a great place to work?

Chi Tran: Yeah, it's definitely about amping up that music where I can. Finding that song sheet, that song that's going to resonate to all your employees and really the key is unlocking what energizes your people, what's going to keep them happy, what's that glue? So my take is, besides communication, transparency and taking your employees on that journey with you is look at the whole employee value proposition as well, and really look at that.

So it's not just about, we mentioned already benchmarking the financials, the non-financial, but it's really about the vision, the purpose, the whole spectrum of it, looking at it from all your employees lens because we know that certain things will resonate to certain employees and certain things may not. It's really breaking it down, understanding the demographics within your organisations, the different personas within your organisation and putting together a sheet of music that's really going to bring the whole employee experience come to life, that whole employee experience that's going to meet the needs of all your employees and not just certain groups.

That's going to be really key because I totally agree with everything that Andrew said there. Culture’s the glue, and we know for a fact from our latest survey results is that employees no longer want to work for a company, they want to work with the company in partnership and with purpose. So, getting the numbers right is important, but definitely relook at your whole employee value proposition and what's to come and really getting that right as well.

Cynthia Cottrell: Thanks, Chi. I think that as we get into some practical steps organisations can take. We've talked a lot today about financial and non-financial benefits and programs and ways to weave that into work today. At the end of the day, it is about listening and it is about being responsive to needs, not a one-size-fits-all version of creating an experience for your employees that marries life and work. And I think on that note, it would be interesting from your standpoint, how do organisations know what good looks like in this space with such a myriad of ways that they can view the employee value proposition and package things up. What would you name as one of your top practical steps organisations can take to get started, and how should they approach it?

Chi Tran: Employee listening tools is going to be key. So, definitely survey your employees, understand what they're passionate about, what ticks the boxes, what energises them. For me, and I think Ravin also said at Davos this year, is people is the centre of all this, and for me that's the value proposition. A good way to start is pulsing your employees and doing it more regularly. Check in with them and really crafting it based on what it is that they need, their wants, what it is they feel passionate about and not just on the business requirements, the revenue, the targets. They really need to blend together, but I would say is: start with listening to your people.

Cynthia Cottrell: Good advice Chi. And same question to you Andrew. If you could give some practical sage advice to all our listeners, to all the organisations out there, what would you say are a couple of important, doable next steps?

Andrew McKechnie: Absolutely, Cynthia. Look, the organisation's working with essentially taking a three-pronged approach. So one is compensation and benefits benchmarking as we've spoken about. It's just a ticket to the party, but your benchmarking has to be done. You need to know what the competitive line in the sand is and you need to be know what your competitors are doing. If you're not within yelling distance of that, then there's a risk. The important part with that is to make sure that you use incredible, robust data. That's absolutely essential. The second part, Chi mentioned this is engaging in meaningful conversations with your people. Seek to understand, provide that or create that platform for psychological safety where your workforce can speak and can provide feedback on what's important to them. And then that gives you the opportunity to really tailor a solution to fit the needs of your specific workforce or various teams across the workforce. Then, the last piece, which is absolutely important as well, is really understanding what your workforce heartbeat is. Now, by that, I mean pressure testing, engagement and sentiment. That can be done in various ways. It doesn't have to be overcomplicated, but it's actually again, engaging in meaningful conversations with your people to understand how they're feeling. And the key here is a happy, engaged, prosperous team will always thrive. So do a health check, do a heartbeat, pulse check.

Cynthia Cottrell: Great. Thanks, Andrew. And thanks, Chi. Look, I think that if organisations are pursuing any number of these recommendations that you've shared, I think workers everywhere should feel really optimistic about the future. I know that I would, I'd feel extremely excited if I knew that my managers were thinking about these things and pursuing these actions. So not to belabour the analogy earlier, I'm really quite pumped. I'm pumped about the prospects of improving the music everywhere because that would only mean things like the quality of work will improve, the way in which great work is accessible to more workers who want that opportunity, to make that more available would be awesome. And of course, creating just an enjoyable place to be, certainly a place to weather this storm of inflation, is not a bad proposition, is it for workers today? So, Chi thanks for all of your insights today.

Chi Tran: My pleasure, Cynthia, anytime.

Cynthia Cottrell: And Andrew, thanks for letting me steal your music metaphor and of course for all of the insights and wonderful advice for our listeners today.

Andrew McKechnie: My pleasure, Cynthia. Look, it's been a great conversation and it's just been thrilled to be part of this. Thanks very much.

Cynthia Cottrell: I'm Cynthia Cottrell. Thanks for listening to Making Work, Work from Mercer Workforce Solutions. See you next time.

Cynthia Cottrell: I hope you enjoyed today's podcast, and thank you for listening. Please subscribe to keep up to date with our latest episodes. And if you have any questions, get in touch with us via our website at mercer.com.au

References:

1. AMP’s 2022 Financial Wellness research

2. Mercer 2023 Global Talent Trends

3. AFR - The three sectors planning the biggest pay rises in 2023

4. The data doesn’t lie: what we learned when we tried a 4-day workweek

5. Unilever launches 4 Day Work Week trial in Australia following positive NZ trial

Is your graduate or early talent program delivering long-term value? In this episode, Laura Manescu, Senior Talent Strategy Consultant at Mercer Workforce Solutions, Fiona Herron, Senior Manager of Graduate Programs at Commonwealth Bank, and Phil Harrington, Leader of Mercer’s Talent Assessment Business, talk about trends and best practices that will help you bring talent in early and develop and nurture them through your organisation. 

In this conversation, they talk about the challenges and opportunities for hybrid work in recruiting and developing early talent, the evolution of assessment practices, assessing for skills, aligning graduate programs with broader HR strategy, using the recruitment process to make strides in DEI, personalizing the candidate experience, using data beyond the point of hire, getting candidates excited about your offer, and more.

Is work working for your people and organisation? In this podcast, Mercer thought leaders, industry experts and business visionaries share big ideas and best practices to help build great workplaces and a future where work works for everyone. Making Work ‘Work’ is a podcast from Mercer Workforce Solutions.

Laura Manescu: You're listening to Mercer's Making Work ‘Work’ Podcast. I'm Laura Manescu, a Senior Strategy Consultant in Mercer's Workforce Solutions business. Today I'm guest host for Cynthia Cottrell and we are talking about all things early talent, that's graduate programs, internships, apprenticeships, any programs that allow organisations to bring talent in early and develop that talent through the organisation. I've led and advised on early talent programs for the last five years, and organisations are not using these programs strategically to support their broader HR strategy. There's a lot more that organisations can be doing to think about the types of skills and capabilities they want to bring into their organisation, and growing that type of skillset early through these programs.

Today we're going to be talking a bit about the challenges that organisations are facing in making really world-class programs that engage and retain great early talent. When we look at Mercer's data, our Global Talent Trends survey in 20221 tells us that 55% of Generation Z employees say that they're likely to leave their role in the next 12 months. This makes it even more important to think strategically about how we design graduate and internship programs because this talent is not staying for the sake of it, they're purpose-driven and motivated and they want to work for a cause that they care about.

So today we want to talk more about that, what can we do from a recruitment perspective and a program design perspective to really attract and retain this talent? Today I welcome Fiona Herron, who's a Senior Manager at Commonwealth Bank in their graduate program space, specialising in technology. She's also got a lot of recruitment experience and over 10 years of HR generalist experience. Welcome, Fiona.

Fiona Herron: Hi Laura, thanks for having me.

Laura Manescu: And I also welcome Phil Harrington who is the leader of Mercer's Talent Assessment business. He's got a wealth of global experience in talent assessment, including a focus on graduate and internship programs and recruitment. Welcome, Phil.

Phil Harrington: Thanks, Laura. Great to be here.

Laura Manescu: I'm keen to get us started by talking about the future of the sector and the graduate and intern industry and what trends you're seeing. So Fiona, I might start with you. What are you seeing, whether it's at Commonwealth Bank or in terms of the tech sector, what should organisations be looking out for and thinking about?

Fiona Herron: I think the big one to focus on for now is the expectation of hybrid and flexibility and how much that's changed coming out of COVID. So, learning on demand, what does that mean from your expectations from school and uni and what's the realities in the workplace where you want to have those together moments, learning in the classroom, things like that. Having that mix of behaviours that people aren't used to showing up at certain times, and challenging ourselves as businesses to think differently about what we actually need, and being prepared to teach people some different behaviours that we've really lost three years of being able to have ingrained from things like school and uni.

Laura Manescu: I love that, Fiona. There's no doubt that things have changed significantly over the last three years. Phil, I'm keen to hear your perspective on that.

Phil Harrington: Yeah, thanks. Look, as an assessment guy, I'm starting to see a greater interest in skill- based assessment. I think for a long time organisations have assessed for personality and cognitive ability through psychometric assessment and key competencies required for the job through the likes of a behavioural interview. Now there's the option of assessing specific skills required for a job, which might be technical, programming or coding specific, for example, or they might be specific to various role types such as accountants or marketing. And some research from McKinsey2 shows that being able to validate skills, competencies and references is the top hiring and talent challenge for organisations. And that was common across 48% respondents. As more organisations move towards being skill based and adopting the likes of talent marketplaces, and we're seeing a lot of that globally, I expect we'll see greater uptake of these types of assessments. And they're really going to help to validate the candidate's skills against what's required for the role. And they'll tell us whether those employees have got the skills that they say that they have.

Laura Manescu: Phil, that really ties nicely into what we were just mentioning previously about the future of skills and using programs more strategically. So that point around if you know that there are critical capability gaps, cybersecurity being a great example, it's an area that there is a shortage of talent and skillset, and that is increasingly important in the current landscape. It's really interesting to hear about how the talent assessment space is evolving to support that as well. So I might move us on to our second question. I really want to talk about strategies that organisations can use to design world- class programs and attract top talent.

When we look at our Australian Benefits Review3 that recently came out, over 70% of organisations and undergraduate levels still aren't offering internships. That's a really clear example when I think about the strategies organisations are taking. There's a critical shortage of skills and talent, yet many of these organisations aren't looking at that talent until they're actually finishing university. So there is an opportunity for so many of these, over 70% of these companies in the general market, to actually start earlier by introducing internship programs and bringing that talent in while they're still studying. But I'm quite curious to hear from both of you about what you're seeing, what kinds of strategies are working for organisations and for yourselves. Phil, if I start with you, what strategies do you recommend organisations consider?

Phil Harrington: I'm seeing more of entire recruitment processes being moved online. That's increasingly common. That provides the opportunity to attract and assess a much broader group of candidates, and that's from a geographical perspective and also from a diversity and social mobility angle, meaning that it helps to remove some of the barriers relating to background or wealth. An example of that could be candidates who can't afford a train or air travel to attend an interview, they can now do that online. Or if they can't afford their first suit, that won't be a deal-breaker. And the good news is that technology is good enough now for most existing recruitment processes to be completely digitised from application through to testing, assessment centres and through interview. And that's got a huge benefit of saving time for candidates, recruiters, as well as hiring managers. And it also reduces some of those risks around COVID and scrambling to continue business as usual recruitment when working from home.

So there's a reduction of travel cost and carbon emissions, which is terrific. And I've also had clients running virtual assessment centres, and sometimes they'll send candidates an Uber Eats voucher so they can order their own lunch and have breakout rooms where candidates can meet leaders and ask questions and learn more about the culture. Feedback we are receiving is that most organisations who've gone virtual have remained largely virtual even after the opportunity exists to move back to face-to-face.

Laura Manescu: Fiona, what are your thoughts on that? What have we won and lost out of moving some of these recruitment processes virtually? One of the things we've spoken about in the past is this need to assess talent in terms of how graduates and interns work together. And so those group assessment centre activities that were very heavily face-to-face, they're so important and they don't replicate quite so well in a virtual environment. But I'm keen to hear your thoughts on that.

Fiona Herron: I'm a big fan of it, particularly to some of Phil's points about the accessibility of it and the ability to move away from people having to be in a capital city to participate or at a certain level of socioeconomic status. It is a bit tricky. I think there's some really cool innovations coming through of what people are doing, how you can actually see a lot of those behaviours in a virtual way as we all start as employers to understand in ourselves and our own behaviours what equates to that. And then I think being prepared for there will be some core skill building needed in the programs when, again, you could bank on people learning some interpersonal skills at school or uni, there's going to be less of that, so how can you design your program around having some of that basis so those that just haven't had those opportunities, everyone's lifted to the same level, and the need to embrace that it might be some core communication skills or interpersonal skills, and adapting the program to that, I think, will be the flow to keep that nice balance.

Laura Manescu: Yeah. And that shows a really nice tie-in to how you need to be thinking about the way recruitment fits in with program design and not just as a recruitment activity. Graduate programs, they're a holistic program and you need to think about the learning design piece too. So to your point, when there's a lot less learning by osmosis because people aren't in the office and somebody's brand new to a corporate environment, thinking about how are we intentionally training those skills and building spaces for people to learn in it's increasingly interesting. But Fiona, in terms of strategies, what else are you seeing or what's working for you and that you want to do more of?

Fiona Herron: Expanding on I guess the digitisation of it, doing something with that data that we have and personalising the experience as much as possible. We really live in a world where everything's adapted, you're served up content, you've got personalised messaging, you've got all of that really to you, and then the expectation that that should happen in the workplace and that things are no longer for the masses, you're getting the individualised target, development, communications, seeing the rise of things like AI bots through a lot of process just to help with similar basic questions, really then personalising that through as well. So you can be part of a program, big or small, but still feel like an individual that you have agency in it, you have some control over what you're doing, what's happening and you're really taking part in your career. I think that there's a lot more that we all need to do in that space.

Laura Manescu: Thanks, Fiona. We might move on to our next question and really talk about why aren't these programs working for organisations at the moment? So there are obviously challenges getting in the way. I know that funding and resourcing is always going to be a constraint and that is a practicality of the business world. There's also things like silos. I know from experience that one of the challenges can be that not all of your business lines or functions are working together in terms of your talent programs. Maybe you don't have the same vision for talent, or not even equal amounts of funding or lengths of programs, all of that kind of alignment. Fiona, I might start with you. What do you think are the biggest challenges in running really world-class programs and attracting this talent, and what can organisations do differently?

Fiona Herron: I'd really encourage anyone listening to be prepared to think about four calendar years at any given time. You're thinking now it's for roles in your headcount that's in FY26, FY27 and beyond. And you have to embrace that from the start and think long- term, the size and the scale of programs is going to be different for everyone. But if you can just get your head around thinking, "I have to think long- term," even if you don't have that really set out, but you know where you're going, you know where the plane's flying and you can make your course corrections along the way, but you've got to chart that route from the get- go.

Laura Manescu: Yeah, that's a consistent challenge we're seeing in the market, it's this complete competing dynamic between what the HR forecasting cycle is and strategic workforce planning is doing, and how you look at headcount in a broader business versus what the early talent space needs and how far ahead that market is. You're recruiting, you're making offers up through a year ahead, and then that comes back to things like your keep- warm strategy and how you actually engage this talent in between the time you've made an offer to have them stick around until they start. So I think that piece of thinking ahead and strategising ahead is really important. And then how do you actually translate that to also the execution of the program, the way that you really bring talent on board through a long period of time. Phil, what about your perspective? You've worked with such a range of clients in your talent assessment and recruitment experience. What are you seeing as the biggest challenges and where these organisations are getting in their own way?

Phil Harrington: Certainly stakeholders with competing interests and insufficient budgets to run effective and engaging programs is a common challenge. But I’d love to see more organisations using the data they've already gathered through the recruitment process for onboarding and developing their new talent. I think all too often we see valuable data filed away or put through the shredder, when it could really assess the hiring manager to have meaningful conversations with a team member and help with their ongoing development. And then more assessments are conducted for development purposes, when in many instances the assessment the candidate's just completed could have been utilised for that purpose. So it's quite a waste of money and time, but it does require greater cooperation and coordination from recruitment and OD. And I think it's easier said than done, I'd struggle to pick more than a handful of clients out of the hundreds I've worked with who've done this well.

Laura Manescu: Data being the keyword for all of us when we think about HR strategy more broadly. Fiona, on that point, what do you think we could do? Where could data be better used when it comes to in program and through this recruitment process? What could we be doing better with that information?

Fiona Herron: I really think that's the key to the personalisation point I made before. Use what the candidate's telling you about themselves to think how you can tailor the experience for them. Thinking about just some of the adaptive tools that can tweak that for you, even if you can't do that but just listening to what actually the candidates are saying. Big or small, you can absolutely do that in a small operation and just do something with it. And I think through that, also being really clear with what you're doing with that data for the candidates to make sure that safety is there for them to go, "Okay, this is a really good place for me to participate. What I'm saying is being used in an ethical way." I think this Gen Z is really, really keen on making sure that as we all should be, data's safe, we're being ethical in our decisions. So that mix of being upfront about what you're doing with it and then finding a way to use that in a meaningful way.

Laura Manescu: So I want to bring us to the topic of diversity, equity and inclusion. And it's something that all three of us are very passionate about, and I'm keen to, I guess, ask the million-dollar question, which is what does it take and what can organisations be doing to build more diverse, equitable and inclusive programs? Phil, I might start with you.

Phil Harrington: This is a great question. DEI isn't about one particular gender, race or group. The research suggests4 that 15 to 20% of the population may be neurodiverse, and this includes those who are dyslexic, autistic, have ADHD or epilepsy, in addition to a range of other conditions. So with this in mind, neurodiverse candidates are a really essential part of the labour market, particularly in a tight labour market. And we need to ensure that we understand what reasonable adjustments to our recruitment process need to be made, and changes to the workplace in order to set these individuals up for success. First up, I'd strongly recommend to have an assessment policy that goes into detail around how assessments are used, as well as looking at what to do if a candidate raises that they've got a condition that requires a reasonable adjustment. And that allows for consistency of process and fairness.

The great thing about the scientific assessments is our objective. We're not judging candidates based on appearance or their ability to answer interview questions perfectly, many clients actually prefer to call psychometric assessments objective assessments for that reason. So the recommendation would be that in most instances a recruiter has a conversation with a candidate, they learn about what accommodations have been made in the past, at school, for tests or exams, and whether changes are required for the recruitment process in order to make it fair and appropriate. And the main point here being that each candidate's unique so there's no one-size-fits-all approach, but it really doesn't have to be a big deal.

I've worked with clients who've targeted specific groups from those with autism, for analytical and technical roles, where being neurodiverse can be a real strength. Other clients are focused on increasing gender balance for roles like coders, where females are underrepresented and they've looked for females who've got no coding experience but the right cognitive and behavioural fit to be successful. Most of these skills are trainable and these organisations are overcoming talent shortages and a lack of diversity by adopting this approach.

Laura Manescu: Fiona, what are your thoughts on that point? And just even in terms of having that conversation about reasonable adjustments in the recruitment process, how do you see organisations do that well and create these safe spaces?

Fiona Herron: Thanks, Laura. This one strikes really close to home for me. I'm a person with a disability, I have low vision. So having clear policies out there of exactly what's going to happen in a process are really helpful to allow anyone with any type of disability to see what the standard practice might be, and ask for adjustments in a real way. Asking a blanket question can be really hard to navigate because you don't know what the situation you're going into, and it's really hard to navigate that with just the broad, broad spectrum of adjustments that people might need for the huge range of disabilities that there are. So again, coming back to feeling safe about what data you're putting out there, making sure that you're really transparent, genuinely asking the question, being open to making the adjustments, and then actually doing it, are those really important behaviours.

Laura Manescu: Fiona, thanks so much for sharing. We really appreciate those personal stories, and it just goes to show the impact that it can have when someone has a really genuine conversation with you about your own experiences and what you need from the organisation through this process, and then even once you're on board and once you're in the team. From a diversity, equity and inclusion perspective, what kinds of things are you seeing as an opportunity to build more inclusive programs at Commonwealth Bank and in the broader industry?

Fiona Herron: I think challenging ourselves about education, backgrounds and locations in particular. So with the rise of obviously working from home and location flexibility, hybrid, really challenging ourselves to think what barriers are we putting up by saying people have to be in a certain location, thinking about can people work in the communities that they live in now, and the massive door that that opens for talent who don't want to move away from home and from the community that they're connected to. And thinking about as well different educational backgrounds and the social mobility of… there's not always the privilege to go to university. So thinking about is there different ways to look at, like at Phil's example of females who've done some type of study but have no coding experience, how can you build that directly, or just really thinking outside of the box of the typical universities is really challenging that, I think, is so important, and just embracing that people will come from all sorts of different walks of life and getting out into rural, there's some really phenomenal rural universities that are such an untapped market.

Laura Manescu: It's interesting too, I think about not just the recruitment process but into how we manage performance cycles and the standard way that a large organisation might run their roundtables at performance review time. And this is where a graduate who doesn't fit into your stereotypical box of what corporate is used to can really fall between the cracks and not be supported and not be recognised. So, even if I think about introverted talent and when you're having a conversation about, "okay, who wants to speak up for this grad and put them up as a star performer?" and the types of conversations you're having is where multiple leaders are speaking up about a graduate because they've seen them perform, but that generally still favours extroverted talent who is getting out there and they're in the office and they're networking. So, it's quite interesting because even when it comes to diversity of personality and approaches, and that can come back to culture as well, it just shows that we're not always recognising talent if we lean heavily on the way we've always assessed talent, the way we've always recognised talent. And these are important conversations that leaders need to be having to challenge their dialogue and what they're asking when they're asking it in a round table.

Fiona Herron: I think expanding on that as well, Laura, is the importance of making sure we don't just look at the talent that's in-person, in face-to-face. So it's really easy to fall back on, yeah, who's extroverted, but who's in-person as well, so people who might have caring responsibilities or life needs to be not in the office, working in multiple different locations, making sure that if you've got data and a way to track that is great, or just being really conscious of it and being aware. Don't just reward those who are in-person, face-to-face, because you will really make the others feel like ‘othered’ and like they shouldn't bother participating, that you have to be in person to participate or the best opportunities happen to those who are extroverted. We are all in positions to do something about that, and really keeping ourselves accountable to that is really important.

Laura Manescu: An area I'm really interested in getting your thoughts on is candidate experience. And particularly through that recruitment process, we've talked a lot about the talent shortage and how hard it can be to attract this talent. Phil, I might start with you, but what are your thoughts on this, and what do organisations need to do to really make it a great candidate experience when they're recruiting and stand out from the market?

Phil Harrington: It's certainly a market where it's exceptionally competitive. And I'm hearing this term ‘reverse recruitment’ thrown around quite a lot, meaning it's not the hiring managers and recruiters who are in control, but actually the candidate, that candidate experience is absolutely critical. Keeping it appropriate in a length, so shorter typically for early talent programs, longer perhaps for senior leadership positions, but that process from job application to offer is really important to keep stuff timely so that you don't lose talent to competitors who do have a shorter process.

Laura Manescu: Thanks so much, Phil, and it's a really interesting point about that reverse recruitment and how much power is back with candidates in the current market. Fiona, what's your perspective and what are you seeing in terms of candidate experience and the important parts of that recruitment process?

Fiona Herron: I think it has to be at the centre of absolutely everything that you design around the program. From offer point then through to start date, from start date through to end of program, that should be at the core of any design. When I talked before about your strategy should be three to four years in advance, that's thinking about the talent that you might want to start at that time, and how you're going to engage them in that time as well. So that should absolutely be a core part of how you're going to find them through your great experience, but then keep them excited once you've made the offer so that they actually start with you. That's the biggest challenge I think facing most grad people and it's one of the most important areas.

Phil Harrington: And if I just add to that, if we think about what it is that you're wanting to understand, that can change over time. So, depending on your strategy now and what you think it might be in a couple of years time, are you assessing for now or are you assessing for the behaviours, the skills, those competencies that you're going to require in the future in order to be successful? And organisations need to remember to continuously update their success profiles or their competency framework so that it reflects their strategy and is current.

Laura Manescu: Couldn't agree more, Phil. It's that relevance every single year, not just set and forget once, and in five years’ time, re-look at what you're assessing for in this process. It's a great point. Just want to bring us to our final piece of advice and closing takeaways. So Phil, what is your short, sharp takeaway for anyone who's listening out there and wanting to design these world-class programs?

Phil Harrington: Use the data you collected through the recruitment process beyond point of hire. You may have to break down some silos, but the holistic use of that data is really powerful and it should support that hiring manager and support ongoing development conversations well into the future.

Laura Manescu: Thanks, Phil. And Fiona, what about you?

Fiona Herron: Talk to some grads would be my immediate advice and takeaway. Engage them, use grads that have come through, are now alumni. If you've never had grads, just get in front of some students so that you can personalise the experience around what they want, what you're looking for. But absolutely put them at the heart of that experience.

Laura Manescu: I think we can't go past it, both of you have really touched on this throughout, but that personalisation, the data, the experience that is centred around an individual person and somehow delivering that at scale, that is the crux of the challenge and the opportunity for all organisations. So thank you so much. Fiona Herron, Senior Manager, Graduate Programs at Commonwealth Bank.

Fiona Herron: Thanks so much for having me, Laura. This has been a great conversation to be part of.

Laura Manescu: And thank you so much, Phil, Practice Lead, Mercer Mettl ANZ.

Phil Harrington: Hey, it's been a really fun conversation. Thank you.

Laura Manescu: You've been listening to Mercer's Making Work ‘Work’ Podcast. If you liked what you heard, you can subscribe at mercer.com.au or wherever you get your podcast from. We'll see you next time.

References

1. Mercer 2022 Global Talent Trends Study

2. McKinsey - Taking a skills-based approach to building the future workforce

3. Neurodiversity

• Mercer 2022 Global Talent Trends Study

Do jobs really define what we do? In this episode, Cynthia Cottrell, Partner and Workforce Solutions Leader at Mercer Pacific and her colleague Anne Leblanc, talk about the evolution of work: the journey from job descriptions, capability and competencies to units of skills and the cultural shift required to unleash the value that all employees can bring to their organisations.

In this conversation, they discuss the circular economy of talent development, the pressing need to close talent gaps by quickly moving skills to where they are needed most, the benefits of building a skills-powered organisation, and the role of technology and talent marketplaces. They also share three actionable tips for employees, HR and organisations to start their own skills revolution today.

Cynthia Cottrell: Is work working for your people and organisation? In this podcast, Mercer thought leaders, industry experts and business visionaries share big ideas and best practices to help build great workplaces and a future where work works for everyone. Making Work ‘Work’ is a podcast from Mercer Workforce Solutions.

Cynthia Cottrell: Welcome to Making Work ‘Work’, a podcast from Mercer. I'm Cynthia Cottrell.

There used to be a time when the difference between getting hired or not, came down to your qualifications. These qualifications were used to screen applicants in order to get to a shortlist of candidates that would go on to be interviewed and, eventually, the selected candidate would receive an offer. These qualifications might include things like a degree, proof of residency in a certain jurisdiction, word processing proficiency, a driver's license, your years of work experience. These qualifications assumed that you had all the necessary technical skills to be successful in your job. In some cases, it meant that organisations did not have to invest as much into your development because they were hiring you for your skills.

Sounds familiar? Well, if you're like many organisations right now, who are experiencing unprecedented talent and skill shortages, whilst navigating rising inflation and the threat of global recession, then this is the podcast for you.

Skills have become one of the most important topics globally. We know from the Mercer Global Talent Trends Study, that reskilling is the number one priority of executives across Australia. Meanwhile, the Australian government has sharply increased permanent migration since COVID. To help ease widespread skill shortages. In the short term, the government has agreed to inject a billion dollars into a one year National Skills agreement that will provide additional funding for fee free TAFE and 2023.

But will this all be enough? What do we need to do to view skills through a different lens? How do we untether from the old ways to unleash the full potential of our teams and organisations where skills will set us free?

Today, I'm speaking with Anne Le Blanc, Senior Principal at Mercer Workforce Solutions, and has over 30 years of experience building continuous learning cultures for organisations that include a big for bank, telecommunications and technology and insurance companies. She recently blogged about talent marketplace in which she talks about the need for a cultural revolution in order to fully realise the benefits of a skills-powered organisation. Anne, welcome to the podcast.

Anne Le Blanc: Thanks, Cynthia, great to be here.

Cynthia Cottrell: Let's start with the big picture. Why are organisations and governments placing a big bet on skills?

Anne Le Blanc: We live in a world today where things are changing super fast around us. Organisations, teams, individuals need to adapt with a fair amount of pace. At the individual level, the more skills you have, the more attractive you are to help your team, your organisation and actually your own career. And that means that you become more employable in the future. On the flip side, you have organisations who are coming to the point of working in this highly adaptive environment where new skills emerge, other skills become obsolete. And Cynthia, you noted that we are in a super tight labour market, which is what we're seeing today. It's really extremely difficult for businesses to fill jobs. But you know, what if filling jobs was actually the wrong way to think about it? What if there's a better way to plug the skills gap in your organisation?

In the Wall Street Journal bestselling book, Work Without Jobs, our colleague, Ravin Jesuthasan, says that the very concept of job, and the one to one relationship with a person, may be the factor that's actually really holding businesses back, and back from success. So instead, we see that many leading organisations are shifting to a new model; deconstructing jobs to the underlying tasks and matching those tasks to different individual skills. Resetting the work operating system around skills, not jobs, opens a potent new way of thinking about working talent.

Cynthia Cottrell: So and what strikes me about what you said is this idea of untethering from jobs, and thinking about what that means in terms of applying skills to specific activities or tasks. As I opened at the beginning, about how people feel about going through the job application process. It all begins with this idea that there is a way to say: “I've got all the right skills and qualifications to do this job that I've been hired for.” It made me think, I can't remember what job description I was hired for. And I was hired only a couple years ago. I do wonder, you know, is there something behind that about how organisations think about jobs? And then these underlying long held ideas that you're hired for this job that's described in the form of words and qualifications? And yet, the work that you actually do doesn't seem to match with that? What do you think?

Anne Le Blanc: It's a, it's a super interesting thing, when you think about the job description. I too actually, I think I looked at it at the start, and really haven't looked at it since. I think it's a great guide to help people get a feel for the job. But if you think about, we've always had skills, and in the past, we've actually referred to them kind of loosely as capabilities and competencies, right? And job descriptions, comprise of that to a higher degree. But if you think about, and this is kind of thing that Ravin talks about, that jobs are effectively disintegrating, the focus really comes back to: what skills does the employee bring to the table? What experiences do they have? And so, as an organisation shifts, either small, or sometimes even large chunks of their population, in their workforce to what we call sort of fungible teams, and that is all about having the team do the most important work, the most prioritise work. When you start to think about that, that means that you really need to know what skills and experiences people bring to the table. And that is just so much more than a job description, right. So don't get me wrong, they'll still be jobs, and there will still be some generic job descriptions. But more organisations are really focusing on this concept of flex and flow work types. And that goes to the heart of really understanding what skills people have or need to acquire and develop. The talent for organisations is thinking about how do we untether from jobs and really embrace the ability to move people around to the most important work that needs to get done.

Cynthia Cottrell: I hear you. I think it feels like a massive mindset shift. And I don't think it's a choice. I think it's a necessity, particularly in the current environment. Whilst the real reality right, of a global recession continues to loom large, organisations really can't afford to pull back on this challenge. Tell me more about what you're seeing and how this is becoming more of a necessity rather than a choice.

Anne Le Blanc: For sure. It is an absolute necessity. And when you look at the data, it helps us understand why skills are becoming important. We have a quite a low birth rate. So we're not having enough people coming into our workforce, ultimately, and we have an aging workforce. And we have a huge need for service or people related roles. And we don't have enough people coming in to immigration into our country. What that means, with general market turnover up by about a third, we're at full employment right now effectively, because our employment rate is so low. And so, the bottom line is ultimately both now and into the future, we just don't have enough humans for the work. That's why skills are becoming so important because we've got to match humans, to the skills that we need to get the work done.

There's an increased expectation that employers play a leading role in helping people remain employable. With retention being the mainstay of HR’s focus, it requires organisations to embrace the concept of what we call a circular economy, where skill development is continuous, it's perpetual, and renewable. So more of the organisation can be deployed to the important and right work. I recently ran a poll to find out what people thought about why skills are important. And it wasn't about being recognised and it wasn't about doing more work. A huge percentage was about them feeling more valuable, and building a better future. I think our people are really thinking about this too.

Cynthia Cottrell: I like that concept of understanding that it's not skills for the sake of trying to complete a particular job for which you can't remember why you got hired for in the first place. And that it is about more than that. We talk about creating lovable work, better work. And as you say, organisations who are adopting that mindset of a circular economy, I love that term. I've not heard it before in regards to skills, that the idea of developing your people is about building a more valuable workforce, but a better future, not just for the organisation, but for those who are working inside of the organisation inside the teams. And I think that’s another important mindset shift that really matters in the name of making things better for everybody. I think that begs the next question about what organisations are doing today about skills. Talking about developing them isn't a new concept. But what we're talking about here sounds a lot like putting skills and reskilling on hyperdrive, and really thinking about how do we continuously develop them? What do you think organisations are doing today to build that culture of continuous learning?

Anne Le Blanc: If I reflect on my time when I was at one of Australia's leading telcos, we had the opportunity to be in flexible teams, and to go through different work. It really meant that the people in those teams could develop and supercharge their skills forward - because they were getting such a concentration, and they're not being stuck in teams, doing work that might not be super important. They were able to move around at more pace, with more agility, and go to the work that's really meaningful.

Being able to have that opportunity, and really fast-forward your skills by gaining maximum exposure on lots of different things, that's a really good thing not only for the employee, but also the organisation.

Cynthia Cottrell: You had the story of told me about a song you guys came up with? Come on, you gotta give me a couple of bars of that. Come on.

Anne Le Blanc: Oh, my goodness. First and foremost, let me say, I can't sing. And I'm constantly told I can't sing by my family. So I'm definitely not singing for you today. But we talked about it in the concept of ‘I've got skills, they're multiplying” to get into an kind of "Greased Lightnin."

Cynthia Cottrell: In honour of Olivia Newton John, let's do it!

Anne Le Blanc: We love the concept and what sits behind that: multiplying your skills. This is really about taking time to invest in you as an individual by focusing on skills. And it means that you're actually setting yourself up for success and for your long-term employability. Actually, someone showed this visual a long time ago of a dinosaur and a chameleon and she asked, “which one do you want to be? Because we know what happened to dinosaurs.” So this concept of always being the chameleon around skills, and always reinventing, it’s a really a great way to think about skills and renewability: how do I keep growing?

Cynthia Cottrell: The important benefit you keep mentioning here, and it's wrapped up in all of these efforts to create a continuous learning culture and to invest in your people, is retention. And if you really step back for a moment, and everyone's searching for the best inflation busting strategies that are out there right now, it's hard not to go past this one. You're focusing on your own workforce and really working on unique ways to drive that ability to transfer skills, upskill, reskill. You know what are some of the ways organisations really are supercharging this way forwards, especially in the current environment.

Anne Le Blanc: One of the things that we are seeing emerge is the concept of a talent marketplace. At the heart of a talent marketplace is the use of AI to match people to work, and even jobs - there will always be some traditional jobs - matching the workers to the work. And what it does is, it kind of takes out that middle layer, it's much more direct, it's much more agile. And the way that AI works is on matching skills. That's why skills is super important and we're having that conversation today, because that is the basis of the way talent marketplace works. But talent marketplace also gives you the ability to actually refresh, revolutionise some of those other processes, and the way that you do things in your employee lifecycle. I think that is super exciting about what talent marketplace can bring to an organisation and really unleash capacity and unleash the people inside your organisation.

Cynthia Cottrell: As we mentioned earlier, you recently blogged about talent marketplaces. And I love this term you used in it, which is the need for a cultural revolution. We sort of touched on learning culture already. But could you help me understand what you mean by that? Could you dive a little deeper?

Anne Le Blanc: I sure, can. One of the things I talked about before was that exceptional employee experience. And in doing that or achieving that, what for me is a bit of a holy grail, I think there are benefits for the individual and the organisation. But I actually look at this through four different lenses. So maybe if I just take a moment to explain a little bit about each, each lens:

Firstly, there's the employees. They have the opportunity, in a skills culture, empowered by talent marketplace, to really engage in more diverse projects and career opportunities that in turn exposes them to a broader network of people. It in turn gives greater flexibility and control over their career, the experiences they have and the work that they do. And what we know is that, that often increases the likelihood of better reward and higher engagement in the future. How that works in practice is: I can search in talent marketplace and express an interest in different projects or gigs, or work that I'm interested in, because the AI is matching to my skills, which means it's much more inclusive of a wider array of opportunities.

Now, if I sit back and then think about this from the people leaders’ perspective, that means I have access to a wider talent pool, or internal talent pool, and diverse mix of skills and experiences. It's faster to source talent with the right skills and capabilities, and in many ways, I save money and increase efficiency by going direct. It opens up potential for succession planning and key person risks. And the thing that I also love about this is that greater transparency about the current skills and gaps in my own team.

How this works in practice as a leader: my gig or the work gets matched to so many more interesting candidates. And I can actually act fast on that. I'm not necessarily just relying on my own networks, it really opens it up. From the HR lens and the organisation, from an HR perspective, this means higher retention through reskilling and higher engagement levels, there's cost efficiencies, there's reduced time in those processes. The ability to support strategic workforce plans and reskill talent into critical roles, I think is super important. And that just heads to that greater workforce mobility.

From the organisation perspective, because there's loads in it for them as well, like reduce turnover, higher retention, strategic and efficient allocation of resources to higher value projects, with the right skills to support the business strategy. And if that doesn't get the heart pumping, I don't know what will. Better customer outcomes. I mean, that is the heart of why we do stuff. The ability to stand up teams and respond in crises and to support continuous planning. The other thing that I particularly love about this is that it really reduces silos across the organisation and increases agility.

Cynthia Cottrell: It sounds like a no brainer, right? I mean, it feels like in this kind of urgency, we have to accelerate skill development to fill these shortages that we're seeing right across every industry, small or large businesses at this point. It seems like we should all be on this talent marketplace train. But yet, what are some of the things that prevent us from doing this? What's getting in our way?

Anne Le Blanc: From an organisation perspective, you know, lots of things that we do take time and planning and investment. The one thing about this particular revolution, as I like to call it, is it does touch every part of the ecosystem. A number of people have said to me, “well, it's just about putting in technology to support the skills culture,” but actually, it's so much more than that. If there's one thing that I would love to leave our listeners with is that a talent marketplace really combines the power of technology and the culture piece together to really supercharge that forward. Just thinking about those two things, and how they come together, is a really important step forward. But it takes planning, and it takes effort, and it takes prioritisation from the organisation to really put this on top of their agenda.

Cynthia Cottrell: As you say, it is a cultural revolution. When we bring it back to this idea that it starts with the job, and that there are rows and rows of people that you can kind of walk down the proverbial aisle and sort of count how many people you have, and that they're doing their job. To move from that mindset to one where people should flow to the work that needs to be done, that in fact, they may be doing multiple jobs, at the same time, that leaders are leading work. It feels a big shift in today's time, and I think when you mentioned cultural revolution, that really resonated with me, because as I mentioned earlier, I think many of us came up through the system as having provided some qualifications years ago, and today we find ourselves constantly learning in order to continue to be valuable, as you say.

But I think the most important thing many of us have found, particularly as a result of the pandemic, is that we're looking for so much more than just a job. We're looking for a way to fulfil our need to be good at something, to continue to hone our craft, right? I think that in and of itself is another important shift, maybe ushered in more quickly than most thought, because of the pandemic.

Anne Le Blanc: Absolutely. Then really thinking about how do I deeply develop my craft, and the skills that support them? But also, what are those other skills that are transferable? So that over time, I might develop some multiple crafts, actually. But I've got this top layer of skills that helped me move inside an organisation to do different things to increase being valuable to the organisation. That actually aids my own employability for the future.

Cynthia Cottrell: Anne, you have given us so much to think about. I can imagine what it must feel like if you are in an organisation right now, and just thinking about practical ways to start. What would you recommend are the top one, two, or three things that leaders, HR and organisations could do today, if they haven't already, to get on this cultural revolution around skills?

Anne Le Blanc: Cynthia, three things that can be done: as an employee, make a list of your skills, what you're good at, and what you want to be good at, and go for it.

As a leader, try and actually hire not for a direct job description match, but for the skills and experiences, and they might be adjacent, that really complement your team. And then the last one, from an HR perspective, is: ask the question, where's my skills data? And maybe think about developing those use cases, as a great way to see the possibilities of what you could do with that data.

I've actually got one more to add Cynthia. In the old way, your people actually worked in talent, captive silos. What I mean by that is, my team works on my work, for me, rather than creating these fluid teams to go to the work and unlock capacity or release to flow to where the organisation needs the most. I think this really goes to the heart of having a skills culture because you suddenly understand the skills to be able to deploy your people to work on the most important work. By and large, you're doing far less busy work and work that just isn't a priority. This needs a really good understanding of skills, and really helps to make that cultural shift that many organisations are currently talking about.

Cynthia Cottrell: Thanks, Anne. I think that the cultural revolution is on, and I really appreciate you sharing your views today.

Anne Le Blanc: Thanks, Cynthia. It's been great to be a part of the show today, and thanks for having me.

Cynthia Cottrell: You bet. I'm Cynthia Cottrell. Thanks for listening to Making work ‘work’ from Mercer Workforce Solutions. See you next time.

Cynthia Cottrell: I hope you enjoyed today's podcasts and thank you for listening. Please subscribe to keep up to date with our latest episodes. And if you have any questions get in touch with us via our website at: mercer.com.au

References

• Mercer 2022 Global Talent Trends
• Wall Street Journal-bestseller Work Without Jobs
• Outcomes of Jobs and Skills Summit

• Your complete guide to talent marketplaces
• Are you ready for the skills economy?

In this episode, we explore what makes workers happy at work and why it's so important for organisations to focus on creating "lovable" work experiences. Podcast host, Cynthia Cottrell, Partner and Workforce Solutions Leader, Mercer Pacific, and her guest Andrew Lafontaine, Partner, Strategy & Growth, Workforce Solutions, Mercer Pacific talk about the decline of employee engagement in organisations, the rise of the Chief Happiness Officer, the role of employee benefits, flexibility, the 4-day work week, culture and work design. Not many organisations are able to say that the hours and effort that their people dedicate to work truly contribute to making a happy life. Our host and guest share insights and practical actions that employers can take to create the conditions to make work lovable.

Cynthia Cottrell: Is work working for your people and organisation? In this podcast, Mercer thought leaders, industry experts and business visionaries share big ideas and best practices to help build great workplaces and a future where work works for everyone. Making Work ‘Work’ is a podcast from Mercer Workforce Solutions.

Cynthia Cottrell: Welcome to Making Work ‘Work’, a podcast from Mercer. I'm Cynthia Cottrell.

Thanks to the pandemic, we were all ushered into the world of full-time virtual work in a matter of weeks. ‘Waking up to work’ was, and still is for many of us, the phrase that best describes the blurred lines between work and life. Quiet quitting, burnout, well-being, productivity, hybrid, four-day workweek. These are all the headline-grabbing topics of the day that tend to shape the conversations about how work has changed - and they are all important aspects of today's future of work. But I think there's more to the story. I think there's an important question we need to solve for that may in fact unlock greater benefits for individuals, organisations, and societies at large. And that question is: how can we make work lovable?

I bet you weren't expecting that, but hear me out. Why do we care if work is lovable? It's a job. It's not supposed to be lovable, right? I love my kids, I can never love my job in the same way. What's love got to do with this? It turns out a lot. According to a study conducted by Gallup1, disengaged employees cost organisations around $550 billion a year in countries like the US. When individuals find joy and connection with the work that they do, engagement levels are higher, productivity is higher, but most importantly, feelings of happiness are more present. Makes sense, right? But unfortunately, many workers are finding it increasingly challenging to connect with their work, leading to increasing rates of burnout, absenteeism and resignations. So, we asked teachers, baristas, marketing managers, the sales guys, the creative comms professionals, Uber drivers - we asked them what they disliked most about their jobs. Here's what a few had to say.

Cynthia Cottrell: What do you like least about your job?

Anonymous speakers: “Red tape, inefficient processes, and where it takes the firm a long time to make a decision. I think sometimes we can be a little bit slow.”

“The thing that annoys me the most about my role is when people make assumptions about what you should be doing as a comms professional, and I think that means you end up spending time on the wrong things instead of what you should be doing to add value at work.”

“What really annoys me about my job is the lack of information that they need to make an informed decision, but sometimes, also the abundance of information that is not relevant or reliable, and we have to make sense of what we have.”

“I’m a teacher and what I don’t like about my work is the overcrowded curriculum which leads to too much paperwork and too little time to complete that.”

“Forget about digital communication, teams zoom email, text message. Telephones work great. They did for how many 100 years? Just use them guys. It makes life easier.”

Cynthia Cottrell: Today I'm joined by Andrew Lafontaine, who leads strategy and growth for Mercer Workforce Solutions. Andrew has been on both sides of the fence, having served in executive HR roles in the financial services sector and also as a consulting services leader for major firms leading enterprise transformation. Andrew, welcome to the podcast.

Andrew Lafontaine: Thanks Cynthia. It’s really great to be here.

Cynthia Cottrell: Andrew, let's start with the big picture, stepping back. Are people less happy or engaged at work than they were 10-20 years ago? What do you think?

Andrew Lafontaine: It's really difficult to say because I think the last two to three years have been an anomaly, right? So when we're trying to compare the data, we're trying to compare apples with apples - it's very hard to say, categorically, that people are less engaged than they were 20 years ago. But let's look at some of the things that we do know. We do know that employee engagement across Australia and New Zealand has dropped two to three points through the pandemic. It's now sitting at 17% - below the global average, according to Gallup 2022 Workplace Report2. And then if you think about our own Mercer Global Talent Trends Study3, it shows that 81% of employees feel at risk of burnout this year and that's up from 63% previously. So, the two words for me are lots of fatigue and maybe a lack of energy leading to some burnout. Are they less engaged? As I said, it's very hard to compare apples with apples over the last 20 years.

Cynthia Cottrell: I agree with that. But I do wonder if the way we work has changed, the way that the lines between home and the office, work and life, have led to some of these increased trends that we're seeing. One of the interesting trends I saw recently was this comparison of engagement versus thriving. And why do we look at that, right? We often see organisations focus a lot on engagement and the scores of 17% or 50%, whatever that might be for organisations – and it is meant to sort of indicate whether or not employees are happy, productive and, in general, thriving. But there is a way to actually separate those two measures out. And in that same study by Gallup in 20222 you actually see that employees who are thriving is on the rise, whereas engagement has dropped. I think that's an interesting point to make in that when people think about their time at work, it's very hard to separate what work is now, when work is happening a few feet from your bed, or from your dining table and your arranging times to go out and pick up your children in the middle of the workday. I wonder actually if these new ways of working, if hybrid, if working three days in the office in two days at home or changing your hours, is also a potential positive in helping people find joy and connection in their work today.

Andrew Lafontaine: I think that's a really good point and observation to make. I mean, are people actually thriving in the new way of working? But does that necessarily correlate to them thriving in their work? Around that definition, is it more thriving in life now because they have this flexibility? It's something I think that we'll be able to start to measure in the coming years.

Cynthia Cottrell: Yes, and I think that one of the terms that we talk about with organisations that we consult with, the neat new term about this is: "life experience". We talk a lot about the employee experience, and what is the employers responsibility or focus? Is it just that time between nine to five and that time in the workspace? Or is it actually the life experience that employers could take a stronger position on?

Andrew Lafontaine: I definitely think it's the latter. I think organisations have accepted that we have definitely changed the way we work, how we work, the days we work, the times that we work. And so, it's really inextricable in terms of work and life now, and it's a total life experience. We've moved very quickly from the total employee experience now to life experience, due to the pandemic.

Cynthia Cottrell: We'll call it here Life X, right? Everyone calls it an employee experience, EX. So we'll go with Life X, right?

So we've established that there is burnout, there's stress, there are different levels of thriving, whether it's thriving in your work or thriving in life, but bringing it back to organisations and what the impact is when we do look at the current state of where we are in control or at least trying to take control back on how do we attract and retain talent? How do we how to keep our workforce healthy, and engaged and thriving? The impact of that in a market such as ours here in Australia and many global markets, the truth is we're facing one of the tightest labour markets this country has seen in almost 50 years at a 3.4% unemployment rate. And yet, we still see with many workers who are voting with their feet, and are switching jobs. Some are ‘quiet quitting’, whatever it might be. What we do see is that deep unhappiness with jobs still points to a larger problem, which is: can you solve this problem by simply paying people more? Can you solve this problem by simply throwing in more yoga classes and other perks and benefits that many organisations have spent a lot of time and resources on? There's something more to this, Andrew, than just start answering the call on well-being alone. What do you think organisations are going to be challenged most with?

Andrew Lafontaine: I think the number one fundamental change and shift that's happened first and foremost - and organisations absolutely have to acknowledge - is that talent is now highly mobile. More mobile than it's ever been before, I would argue in the history of work. People are definitely happy to change jobs if they don't get the flexibility that they want, if they don't get the careers that they want. We know one thing that hasn't changed is that people will come for money but they will stay because of leadership, culture, career development opportunities, etc. So you talked a little bit about, Cynthia, what's been ushered in with this waking up to work because of the pandemic. And lines have been absolutely blurred between that. As a result, we've got this new phrase of "quiet quitting". While it might not necessarily be a new concept, we're certainly getting a fair bit of media air-play at the moment where employees are simply saying: “I need to stop working late at night,” “I need to stop communicating with work late into the night, and not necessarily working to 10, 11 or 12 just because I can.” So, I think there's a lot that's really swirling around, and then on top of that, as you said, low unemployment makes retention even harder because people are paying more money. But in order to really think this through, organisations need to think through actually: are we really defining the jobs correctly in this new world of work? Do we need to think about how work gets done? Can there be hybrid roles? Can people flow to work that's important for the organisation? What does that all mean in terms of trying to create a little bit of a gig workflow within organisations, rather than the traditional jobs? These are things organisations are grappling with and primarily to try and retain staff because, the traditional lever of paying more money, as I said, will potentially get people to your organisation, but it won't keep them there. There's no doubt about that. And we know that that's been the case for a very long time now.

Cynthia Cottrell: What you've said really resonated with me personally. I’m thinking about 10 years ago when I worked at a technology firm and had my first child. I remember distinctly, facing into a situation where there weren't a huge number of choices I could make. I would go on maternity leave and then decide if I would come back part-time or full-time, and it was one or the other. And then from there, sort out how I would be a first-time mum and somehow transition into that new phase of my life - whilst still doing the exact same job as it was designed prior to having children.

When I think about that, and I think about where we're at today, I'm filled with a lot of hope. It's a fantastic time for organisations to work in partnership with their employees and to see them as humans first and that these changes that happen; our work and our lives, are intertwined. As you were saying, being open about not just the flexible ways of working, but the work design itself. And inevitably work continues to change in the way we do it, whether it's through technology or automation or other things that will impact how work gets done. We need to also think about how work gets done when life requires for those particular tasks to be done differently.

Andrew Lafontaine: And we know from our recent global survey3 that the vast majority of employees would be willing to forego salary increases for greater flexibility. And I think it's not just greater flexibility in how the day's structure but it's also greater flexibility in how the work gets done. These are the things that organisations are thinking through when it comes to making work ‘work’ for everybody.

Cynthia Cottrell: That's right. And while we're on the topic of what are organisations doing about this, we've talked a lot about what they should do, but what are some doing right now to create and sustain thriving workforces? How are they going to maintain their competitive advantage for their people? What are you seeing Andrew?

Andrew Lafontaine: Well, I think this is probably the single biggest challenge that organisations are facing in terms of their workforce: Providing flexibility, ensuring business strategies are met, how do they continue to look at productivity gains, leveraging technology. This is one of the biggest challenges they're facing unlike ever before. And of course, you've got differences between the roles that can have a lot of flexibility versus the roles within an organisation that require people to be in the office or at a store or in a factory five days a week. How do you create equality between those roles? Organisations have got to start with thinking about things differently and not necessarily starting with the five-day a week as that starting point for the discussion. Rather, work through: what does the future actually need to look like without the parameters of the past? I think that's all the conversation has been about. Is it two days, is it three days? Is it five days? Is it work anywhere? Some companies have gone to working from anywhere. But they're still talking within that parameters of the five-day workweek. There's a great study4 coming out of the UK recently with the four-day workweek where, I think, more than 40% of organisations actually are claiming improved productivity from four days a week, so not the compressed work week, but the genuine four day week where they're only doing the 32 hours, you know, that's where some of the organisations need to think about these challenges and really start with a clean sheet of paper. These are the companies that are going to really come up with the solutions and get ahead of the curve. They're the ones who are going to be attracting the talent.

Cynthia Cottrell: I am really interested in the four-day experiment that's happening globally, and it’s happening here in Australia as well. We know from the most recent benefits survey5 that we ran earlier this year that 26% of organisations surveyed are offering the ability to work four-day week. I guess the key question anyone who's listening is probably asking is: who are these organisations and where do I sign up?

Andrew Lafontaine: That's where the work design comes into it, because it really is about how do you redesign work that they can get done in 32 hours as opposed to 40 hours? We know a lot of people work more than 40 hours, as it is today. They're the kinds of things that, we as an organisation, as workforce engineers, we're helping organisations think through some of those areas around redesigning work. If it's a four-day week or a five-day week, and all the other variations as possible.

Cynthia Cottrell: Well, speaking workforce engineers, and the various conduits to make work lovable - I bring it back to the lovable peace again. I can't help but ask you about this Andrew: I'm curious to know what you think. You're always pretty straight about these things. There is this rising tide of Chief Happiness Officers. The CHO as they are known globally. They actually have these roles appointed at the executive level at large organisations like Google, Amazon, Airbnb, SAP, slack. Did you know that Prince Harry, when he stepped back from Royal family duties, his first job is as Chief Impact Officer - different three letters but the role is the same - at a start-up called Better Up, where his role is to focus on connecting employees with personal development opportunities, mental health opportunities and other ways that help to improve the overall general well-being and happiness of employees.

Now the title: Chief Happiness Officers. Before I get your full rundown on what you think what that means, and what kind of job that must be, and the main goal of the role, if you go into LinkedIn and try and apply for one of these jobs, the main goal of this job is to drive the overall happiness and engagement of the workforce. So what do you think it would be like to be the CHO of any organisation today?

Andrew Lafontaine: Chief Happiness Officer. I think I'd start that with the premise, which I've never really been comfortable with, that saying: “if you love what you do, you'll never work a day in your life.” Underlying that premise is that finding something that you love actually is going to provide you with a living and that's not necessarily always the case. For me, this concept of happiness is also one that is an interesting concept because I'm not sure that people are looking or even can define what happiness means in all aspects of their life, let alone their work. For me, I always think that people want to go to work and feel like they've achieved. They feel fulfilled, they feel that they're growing in their roles and as a person, and then, if the output of all of that means that they feel more happy at the end of the day than when they started the day, that's a great outcome. But the idea of focusing specifically on being happy, I think it's a really difficult concept for me personally to get my head around in trying to define. While I think it's a great endeavour, I'm not sure this is one of those roles that we might see in the next 10 to 15 years. Well-being, absolutely. I think making sure people feel that their well-being has been considered and focused on, definitely, but I'm probably a little bit sceptical around the Chief Happiness Officer roles.

Cynthia Cottrell: Let's check in ten years and see what happens. I might go and apply for one of those roles myself.

Just on this subject again, what are organisations doing today to drive up engagement and overall energy with their employees? I did have this great opportunity to catch up with Angela Barton, who is CHRO of Sixt, the car hire company, and here's what she had to say.

Cynthia Cottrell: What's the secret sauce at Sixt? What are you guys doing to make work lovable for everybody?

Angela Barton: We have a campaign what we call above and beyonding. And that was our marketing campaign. And we followed it through to our people, because our people are our most valuable asset, far and away our most valuable asset. We're a relatively unknown brand in the market, which is super exciting. We put a challenge out to people to above and beyond. For our frontline staff, that can mean anything - just excite the customers, whatever you need to do, to make them feel like they've had the best experience when they rent with us. And for the rest of our staff, the above and beyonding can be come to us with a crazy idea, and we'll fund it. We're going to test and learn. We want a culture innovation. That's what we do. We also ask our people bring their best selves to work; we have an amazing RAP (Reconciliation Action Plan) committee and amazing Shine committee. We really just want you to come and enjoy what you're doing. And that everyone will rip the benefits of that.

Cynthia Cottrell: I want to come work for you. Thank you.

Cynthia Cottrell: I think that's pretty cool. Above and Beyonding doing I didn't know you could turn beyond into a verb but it's a really neat campaign and the part I really like about what they're doing is they've invited employees in to have an equal and fair say about how they can treat their customers with all the possible neat things that they could do and have that ownership, and that excites them, not just the customer. I love that aspect of playing to increasing the joy that they find in their jobs by having them be active leaders and participants, and forming, and shaping that customer experience. What do you think Andrew?

Andrew Lafontaine: I have always loved when organisations put in frameworks that really allow employees and also recognise employees who are willing to exert that discretionary effort in many different ways. That is still something that absolutely holds true for organisations and employees.  There are always going to be people who want to exert that discretionary effort and I think framing it in programs of work or recognition programs is something that still holds true for a lot of people. Tthat is really important from an engagement perspective.

Cynthia Cottrell: So Andrew, what are your key takeaways from our conversation today?

Andrew Lafontaine: For me probably the key takeaway would be that organisations have to be really deliberate if they're going to make work lovable. They really have to think about the work design, they have to think about the leadership, the culture, all those traditional areas. But more so these days it is about the work design and how that fits into the more flexible lifestyle that everybody is craving for. If they can do that, that's how they'll win.

Cynthia Cottrell: I think lots to learn from organisations like Sixt, from all the various organisations that we've had a chance to work with. This has been a fascinating discussion, Andrew. Making work lovable and having people be happy at their work, as you say, has a lot to do with the culture and the way in which employees and employers work in partnership with each other. Thanks, Andrew for joining us today. I'm Cynthia Cottrell. Thanks for listening to Making Work ‘Work’ from Mercer. See you next time.

Cynthia Cottrell: I hope you enjoyed today's podcasts and thank you for listening. Please subscribe to keep up to date with our latest episodes. And if you have any questions get in touch with us via our website at: mercer.com.au

References

1. https://news.gallup.com/businessjournal/162953/tackle-employees-stagnating-engagement.aspx

2. https://www.gallup.com/workplace/349484/state-of-the-global-workplace-2022-report.aspx

3. Mercer 2022 Global Talent Trends Study

4. https://www.hrmagazine.co.uk/content/news/four-day-week-pilot-success-for-majority-at-mid-way-point/