A looming economic slowdown, the Great Resignation, a relentlessly expanding skills gap, and employees that would simply rather work from home. This week at Fortune’s CEO Initiative forum, a panel of company executives discussed the litany of challenges they face in developing and maintaining their workforces over the next several years.
And while one-size-fits-all solutions proved elusive, on one point everyone agreed: Companies that want to future-proof their workforces should start by developing cultures that value lifelong learning and continuous workforce re-skilling—and make peace with the fact that hybrid work is here to stay.
“I believe in a flexible hybrid model,” said Dan Houston, chairman, president, and CEO of Principal Financial Group, during a panel discussion in Palm Beach, Fla. on Wednesday. “I hate it, but I recognize we have to do it.”
The company has to embrace a hybrid model that allows employees a mix of in-office and work-from-home days, Houston said, not least because internal company polling indicates it’s what his employees want. But interpersonal, face-to-face relationships within the office offer the best avenue for the company’s current managers to mentor new, often younger employees and develop its next generation of leaders. The current solution for Principal Financial charts a middle ground, allowing employees to work from home part of the time while keeping pressure on company leadership to maintain a regular physical presence in the office to help mentor and develop the company’s incoming talent.
“I think this is a grand experiment,” he said. “I think you do whatever you have to do in the midst of a pandemic, but we’re post-pandemic at this point in time, and the grand experiment is going to tell us, in the next three or four years, the impact it’s going to have on the culture of our organizations.”
The executives agreed that fostering the right kind of company culture is key to future-proofing any company’s workforce, though each company must determine exactly how to do so based on its own unique circumstances. As companies across every major sector suffer from expanding gaps between the skills they require and the skills their employees possess, a healthy company culture should continuously help employees develop new skill sets and periodically reorient their career paths.
“What if instead of having a hiring machine going all the time, you invested in employees and made a commitment to their lifelong education?” said Vivek Sharma, cofounder and CEO of enterprise education company InStride. Sharma noted that not only is the rate at which job skills become obsolete accelerating, but the average American with student loan debt spends the first 15 to 20 years paying it off. That means that for the first 15 to 20 years of many employees’ working lives—a time when they will likely need to pursue further education or retool their skill sets—they likely lack the resources to do so.
Many companies are addressing this problem by investing more in new employees as they come in the door, said Frida Polli, chief data officer at Harver, a maker of technology solutions that helps companies optimize their talent decisions. These investments include technologies that assist with recruitment and hiring, but also with on-the-job training and re-skilling once workers are on the job, keeping employee skill sets fresh. These technologies can only take a company so far, but they do help large organizations more effectively match individuals with specialized skills to the specific roles that require them. They also empower employers to drop often meaningless employment criteria, like the four-year college degree.
“That’s going to create a better alignment between the person and the knowledge, skills, and abilities of that role,” Polli said. “Ultimately that will create an employee who is happier, more engaged, and more successful in that role.”
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