The Future of People Management in the Digital Age

PART IIDesigning the New Employee Experience

HAVE YOU READ PART I?

Download Part 1: Redefining Teamwork, Engagement, and Leadership

to learn how HR leaders are embracing digital technology and new

opportunities to tackle the challenges of the evolving workplace.

TREND 1THE RISE OF TEAMS: BUILDING A NEW ECOSYSTEMLearn how networks of teams are becoming the model of

the future, replacing the traditional top-down, silo-based

organizational model.

TREND 2CRACKING THE ENGAGEMENT CODEFind out how to engage employees in the new digital

workplace of increased millennial influence, greater

transparency, and evolving organizational structures.

TREND 3LEADERSHIP REDEFINEDUnderstand how to guide your organization to increased

levels of performance and financial success in this increasingly

complex global marketplace.

D O W N L O A D PA R T I

TREND 4 02LEARNING AND DEVELOPMENT REIMAGINEDLearning and development (L&D) strategies are being turned on

their head in light of Millennials’ desire for flexible continuous

learning, fuelling adoption of an always-on, self-learning model

of L&D. With people living and working longer, companies must

reimagine their L&D models to accommodate an increasingly

diverse workforce.

TREND 5 05THE NEW EMPLOYEE EXPERIENCEThe employee experience game is changing. HR organizations

must learn to be digital as they guide the employee journey;

in an effort to promote transparency and facilitate collaboration

and engagement, forward-thinking companies will adopt

technology such as productivity apps, communication tools, and

integrated HR platforms at an accelerated rate.

TREND 6 09PEOPLE ANALYTICS 2.02017 saw people analytics emerge with a vengeance and there’s

no sense of slowing down. With people analytics no longer

solely an HR-centric discipline, companies must find a way to

bridge people analytics across the enterprise, merging multiple

data sources to elicit actionable, real-time insights.

TREND 7 13REINVENTING PERFORMANCE MANAGEMENTThe future of performance management is bright. No longer

hampered by antiquated annual reviews, companies are

rethinking performance management with a focus on continuous

improvement, real-time feedback, and agile goal management.

TABLE OF CONTENTS

11

T he growing presence of Millennials in the

workforce, ubiquity of digital tools, and

heightened transparency are redefining

the workplace. Similarly, the increasing role of the

gig economy, rapid dissolution of geographical

borders, and rejection of insular top-down

organizational structures in favour of team-based

models are driving a myriad of challenges—and

opportunities—for HR leaders as they recruit, develop,

and manage their people.

In Part 1, we addressed how organizational structure,

engagement, and leadership are being redefined

in response to the disruption occurring across the

economic, social, and technological landscape. In

Part 2, we explore how companies are redesigning

the employee experience—by changing the rules of

learning and development, people analytics, and

performance management—to support the changing

needs and expectations of their employees in the

digital age.

PART 2DESIGNING THE NEW

EMPLOYEE EXPERIENCE

TREND 4Learning and Development Reimagined

33

L earning and development has come a

long way since we all crowded into the

boardroom to listen to a trainer flip through

a PowerPoint presentation while we scribbled

notes in our giant binders. With the proliferation

of digital technology and mobile devices, it’s

no surprise that employees’ expectations for

learning opportunities have changed. Plus, as

people start to live longer and work longer—facing

careers spanning 60 to 70 years—the authors of

The 100-Year Life note that employees now expect

employers to help them continually reinvent

themselves through lifelong learning.

SOURCE: THE 100-YEAR LIFE: LIVING AND WORKING IN AN

AGE OF LONGEVITY, 2016

50% of babies born in Canada in 2007 can expect

to live to 107!

EMPLOYEES TAKING THE REINS

Traditional learning management systems (LMS),

characterized by facilitator-led seminars or in-

person courses, fall short in supporting a diverse,

mobile workforce seeking to continuously grow

and reinvent itself throughout a longer and broader

career. A decentralized approach to learning

that leverages the flexibility and convenience of

technology will be required. People learn in different

ways, at different paces, and have different goals.

By curating learning and development content

accessible through various mobile platforms,

companies can empower employees to take control

of their own professional development.

With an increasingly diverse workforce with

different values and expectations—from Millennials

to Baby Boomers and full-timers to freelancers—it

only makes sense to shift responsibility of learning

and development to the individual, to learn at their

own pace and in alignment with their personal

career goals and values. Although in the early

stages of transitioning away from traditional LMS,

leading companies are starting to take note.

Continuous learning opportunities and self-

directed learning are becoming the goalposts

companies are aiming for. Instead of playing the

role of education provider, corporate training

departments are becoming content curators and

experience facilitators. By developing innovative

platforms and digital training opportunities, they

are turning employee learning and development

into a self-driven pursuit.1

44

THE ART OF REINVENTION

In order to satisfy the demands of self-directed

learning and a workforce wishing to continuously

reinvent itself, companies must create learning

and development strategies that deliver training

that is “always on” and always available over a

range of mobile platforms. According to Deloitte’s

2017 Global Human Capital Trends report, the

organization’s role is to create an environment and

systems which enable employees to constantly learn

and relearn, through self-directed professional

development. The HR department takes on the

role of coach, providing support and guidance

and curating learning experiences that challenge

and engage their people. And it turns out that

companies with continuous learning opportunities

and a deeply embedded culture of development

are outperforming their peers.2

MILLENNIAL L&D

Deloitte’s research found that training and

development is the job benefit most coveted

by Millennials as they plan their rapid upward

trajectory. In fact, according to Glassdoor,

Millennials view the ability to learn and progress

as the principal driver of a company’s employment

brand. When asked how they would like to learn

to lead, more than 60 percent of Millennials

surveyed wanted a mentor. And Salesforce found

that 95 percent of leaders who have mentors were

promoted within 18 months.3

The Millennial generation, in particular, values

continuous learning opportunities delivered over

multiple digital mediums. In response, companies

are adopting Massive Open Online Courses

SOURCE: DELOITTE, 2016

2/3 of Millennials don’t believe their organizations

are using their skills well

42% of Millennials say they’re likely to leave

because they aren’t learning fast enough

(MOOCs) and advanced media (video, gaming,

mobile) in support of self-directed learning

initiatives. In fact, growth in these two areas has

surged, with a 110 percent and 130 percent YoY

increase, respectively.3

To support the professional development needs

of the large Millennial cohort in the workplace,

forward-thinking organizations are providing

mentorship opportunities, continuous feedback,

and apprenticeship programs—a strategy that will

pay dividends in the competitive marketplace.

1. HTTPS://WWW2.DELOITTE.COM/CONTENT/DAM/DELOITTE/GLOBAL/DOCUMENTS/HUMANCAPITAL/GX-DUP-GLOBAL-HUMAN-CAPITAL-TRENDS-2016.PDF

2. HTTPS://WWW2.DELOITTE.COM/GLOBAL/EN/PAGES/HUMAN-CAPITAL/ARTICLES/INTRODUCTION-HUMAN-CAPITAL-TRENDS.HTML

3. HTTPS://WWW.SLIDESHARE.NET/JBERSIN/THE-FUTURE-OF-CORPORATE-LEARNING-2016/8-TRAINING_IS_KEY_TO_MILLENNIAL

TREND 5The New Employee Experience

66

A s the employee journey becomes the

backbone of HR strategy, companies

are taking a hard look at how adept

their organizations are at fostering a positive and

rewarding employee experience, from recruitment

through to retirement. Nearly 80 percent of

executives in Deloitte’s annual global survey of HR

and business leaders rated employee experience

very important (42%) or important (38%). Yet,

despite their best intentions, only 22 percent

reported that their organizations were excellent at

establishing a differentiated employee experience.

Similarly, 91 percent of Canadian respondents said

employee experience is the most important human

capital issue on the agenda, yet 58 percent felt they

were not ready to deal with engagement issues.

With the myriad factors changing the face of the

workplace—the impact of technology, the influence

of the growing Millennial cohort, the shift towards a

team-based structure, the dispersion of employees

across the globe—building a positive employee

experience is a challenge for many organizations.

According to a 2016 survey about the future

of the workplace, how we work is becoming

“more networked, more devolved, more mobile,

more team-based, more project-based, more

collaborative, more real-time, and more fluid.”

The challenge for companies is not to lose sight

of the employee experience as the workplace

structure and processes shift and evolve. Just as the

customer experience is fundamental to generating

brand loyalty and driving revenue, the employee

experience is critical to employee retention,

engagement, and wellbeing—and ultimately the

bottom line.

SOURCE: 2016 DELOITTE GLOBAL HUMAN CAPITAL TRENDS

80% of business leaders rate employee

experience as important or very important

vs.

22% feel their organizations were excellent at

establishing a differentiated employee experience

EMPLOYEE EXPERIENCE 101

But what exactly is the employee experience?

And what does it mean for companies moving

forward? Employee engagement consulting firm

DecisionWise defines the employee experience

as the “sum of perceptions employees have about

their interactions within the organization they

work.” And it’s really the foundation, the core, of a

thriving company.

77

The employee experience is a holistic concept,

reaching well beyond compensation, team-building

retreats, or Pizza Fridays. In order to create an

environment where people actually want to come

to work, companies must put employees at the

heart of their organizational design, redesigning

their workplace practices and processes to fit with

the values and expectations of their people.1

A 2016 Forbes article suggests that the employee

experience is comprised of three distinct aspects

of an organization: culture, technological

environment, and physical environment.

Historically, as organizations attempt to define

and nurture a positive employee experience, they

have focused primarily on culture—elements like

leadership style, organizational structure, employer

‘brand’, compensation, and benefits.2

But with the digitization of business across all

industries, the technological environment of

the workplace is also a vital component of the

employee experience. Millennials, in particular,

expect modern mobile devices, software, and

digital tools that optimize their work experience and

enable them to be as productive and connected

as possible.3

Similarly, the physical environment—everything

from office furniture, the espresso machine in the

breakroom, and art on the walls to whether the

office design is cubicle-dense or open-concept—

influences the employee experience.4

The goal is to design an environment—culturally,

technologically, and physically—that supports

an employee’s physical, mental, emotional, and

financial wellbeing. It’s a tall order but one that

needs to be fully embraced if companies are going

to realize their vision and continue to grow.

SOURCE: DECISIONWISE CONSULTING

Employee Experience: the sum of

perceptions employees have about their interactions

within the organization they work.

Jacob Morgan, author of The Employee Experience

Advantage, found that organizations that scored

the highest in culture, technology, and physical

environment had four times higher average profits,

two times higher average revenues, and 40% lower

turnover. Plus, their stock prices outperformed the

S&P 500 and the Nasdaq.

88

THE TECH ADVANTAGE

HR leaders have an arsenal of digital and mobile

tools at their disposal to help create rewarding

employee experiences for their people. Companies

are leveraging engagement and feedback apps

to gather employee feedback using simple

surveys. Personalized online HR platforms enable

People Managers to view the entire employee

journey at a glance and tailor leadership style

and opportunities accordingly, while empowering

employees to take control of everything from

managing their own benefits to booking vacation

time. Collaboration and productivity tools (e.g.,

Slack, Trello, Basecamp, Microsoft Teams) drive

rewarding employee experiences by supporting

team-based problem solving, communication, and

meaningful connection.

Focusing on what employees value, what matters

most to them—whether that’s meaningful work,

training and development opportunities, a flexible

work environment, or whatever other value drives

their fulfillment—is the key to building a positive

employee experience. And developing a holistic

strategy that nurtures the employee experience

throughout the entire employee journey, across all

processes, and across all employee touchpoints

will be pivotal to business success going forward.

S I M P LY I R R E S I S T I B L E O R G A N I Z AT I O N T M M O D E L

M E A N I N G F U L W O R K

S U P P O R T I V E M A N A G E M E N T

P O S I T I V E W O R K E N V I R O N M E N T

G R O W T H O P P O R T U N I T Y

T R U S T I N L E A D E R S H I P

Autonomy Clear and transparent goals Flexible work

environment

Training and support

on the job

Mission and purpose

Select to fit Coaching Humanistic

workplace

Facilitated talent

mobility

Continuous

investment in people

Small, empowered

teams

Investment in development

of managers

Culture of

recognition

Self-directed,

dynamic learning

Transparency and

honesty

Time for slack Agile performance

management

Fair, inclusive, diverse

work environment

High-impact learning

culture

Inspiration

C R O S S - O R G A N I Z AT I O N C O L L A B O R AT I O N A N D C O M M U N I C AT I O N

SOURCE: 2017 DELOITTE GLOBAL HUMAN CAPITAL TRENDS

1.,4. HTTPS://WWW.SHRM.ORG/HR-TODAY/NEWS/HR-MAGAZINE/0317/PAGES/3-THINGS-TO-KNOW-ABOUT-EMPLOYEE-EXPERIENCE-.ASPX

2. HTTPS://WWW.FORBES.COM/SITES/JACOBMORGAN/2016/04/22/WHAT-IS-EMPLOYEE-EXPERIENCE/#39BF582B7386

3. HTTPS://WWW.FORBES.COM/SITES/CAUSEINTEGRATION/2017/05/04/EMPLOYEE-ENGAGEMENT-VS-EMPLOYEE-EXPERIENCE/#42F05AD27883

TREND 6People Analytics 2.0

1010

W ith the changing employee

demographic, the rise of team-based

organizational models, globalization

of the workforce, and the increasing influence

of technology, companies are turning to people

analytics to better understand employee data and

its impact on business performance.

SOURCE: 2017 DELOITTE GLOBAL HUMAN CAPITAL TRENDS

71% of companies see people analytics as a high

priority in their organization.

People analytics as a business discipline is starting

to gain traction in the corporate world, according

to Deloitte’s 2017 Global Human Capital

Trends report. What began as a narrow focus

on engagement and employee retention has

expanded into an enterprise-wide discipline

applied to a wide range of business challenges

across the employee lifecycle; in a significant shift

away from traditional employee data analysis,

the new incarnation of people analytics is a true

business function, focused on using people data to

understand every facet of business operations and

predict business performance.

Companies are realizing the value of evidence-

based insights as it relates to predicting and

improving performance across the organization,

from recruiting—the No. 1 area of focus—to

compensation, workforce planning, engagement,

retention, and learning and development. And

with people costs often approaching close to

60 percent of corporate variable costs, it makes

sense to manage such a large cost centre analytically

vs subjectively.1

Some organizations are already successfully putting

people analytics to work for them. A testament to

the power of fact-based decision-making, Google

has implemented a fully data-driven HR function

and is reaping astounding performance benefits:

Google’s workforce productivity has surged, with

each employee, on average, generating nearly $1M

in revenue and $200K in profit each year.2 Going

forward, more companies will embrace evidence-

based decision-making to drive performance in

their organizations.

1111

ROADBLOCKS TO

IMPLEMENTATION

Despite the proven value of data-driven decision-

making, numerous challenges are hampering

companies’ efforts. In fact, only 8 percent of

companies report they have usable data, according

to Deloitte’s 2017 survey. Respondents to a PwC

survey reported the biggest barrier to effective

people analytics was the presence of “multiple

unintegrated sources” of people and organizational

data. And with siloed departmental structures and

disparate data sources, time-consuming and error-

prone manual processes are required to massage

the data into meaningful analysis.

Data governance is also a huge issue, with only

6 percent of participants in the PwC Saratoga

benchmarking survey reported being “very

satisfied” with the quality of their people data.

Nearly one-third cited poor data quality as a top

barrier to successful analytics. Data governance—

the availability, usability, integrity, and security of

enterprise data—also brings to light the challenge

of ensuring the privacy and confidentiality of

employee data.

SOURCE: 2017 DELOITTE GLOBAL HUMAN CAPITAL TRENDS

Only 8% of companies have usable data!

1212

EMBRACING THE POSSIBILITIES

To tackle the challenges involved in integrating

data, various tools and technologies are gaining

popularity. HR platforms can analyze hourly labour,

overtime, vacation and other payroll data to improve

workforce management strategies, inform best

practices and reduce payroll leakage. HR analytics

tools can provide insight on people management

goals, such as creating more effective hiring

criteria, better engaging employees, improving

performance management, and determining who’s

at risk of quitting.3

Armed with meaningful people analytics from the

complete employee lifecycle, organizations can

gain visibility into a broad range of employee

behaviours and trends, influencing decisions

around process and organizational structure.

Going forward, companies will implement people

analytics in order to:

Explore the relationship between productivity,

sick leave, overtime, and safety incidents.

Compare the characteristics between high

performers vs underachievers.

Measure the effectiveness of learning and

development programs.

Examine the differences between performance

of permanent employees vs contractors.

Focus on the link between customer satisfaction

and employee performance.

Delve into the relationship between the

employee experience, engagement,

and retention4.

Address specific business problems, such as

sales productivity, fraud & customer satisfaction.

Understand the behavior of teams and how

people work together effectively through

organizational network analysis (ONA)5.

1.,2. HTTPS://WWW.EREMEDIA.COM/TLNT/HOW-GOOGLE-IS-USING-PEOPLE-ANALYTICS-TO-COMPLETELY-REINVENT-HR/

3. HTTP://SEARCHHRSOFTWARE.TECHTARGET.COM/FEATURE/HOW-PEOPLE-ANALYTICS-TOOLS-CAN-IMPROVE-TALENT-MANAGEMENT/

4. HTTPS://WWW.ANALYTICSINHR.COM/BLOG/GREAT-PROMISE-PEOPLE-ANALYTICS/

5. HTTP://JOSHBERSIN.COM/2016/07/PEOPLE-ANALYTICS-MARKET-GROWTH-TEN-THINGS-YOU-NEED-TO-KNOW/

TREND 7Reinventing Performance Management

1414

T here’s a revolution underway in the

performance management (PM) arena.

Annual reviews, the dinosaurs of PM, are

being tossed aside as companies re-engineer

their PM strategies to reflect the current workplace

environment characterized by networks of

teams and a focus on continuous learning and

development. Big companies—Microsoft, Dell,

Adobe—led the way a few years ago and Amazon

followed suit in 2016, dropping the oft-criticized

process of stack-ranking performance reviews.

Annual employee performance reviews rank

people on a bell curve but research has uncovered

that the bell curve doesn’t accurately represent

human performance—at school, at work, or on

the sports field. Many people are actually outliers

on the long curve. In fact, the normal distribution

curve may actually be constraining how well people

perform.1 Unfortunately, most PM ratings and

compensation models are based on the bell curve.

The widely-adopted “rank and yank” system that

Jack Welch, CEO of General Electric, popularized

pitted employees against each other, penalizing

workers who ended up on the wrong side of the

bell curve with denial of raises and bonuses or

even the loss of their job. Forced employee ratings

can cripple creativity and collaboration: David

Rock's research shows that when we receive a rating

or appraisal, our brain shifts into “fight-or-flight"

mode, as if we are being threatened, taking us

out of the mode to learn or create. In effect, the

act of executing a performance appraisal itself

reduces performance.

Despite the inefficacy of performance ratings, in

2016 nearly nine out of ten companies around

the world were continuing not only to generate

performance scores for employees, but also to

use them as the basis for compensation decisions.

Today is a different story. The redesign of PM is

picking up speed; Deloitte research in 2017 found

79 percent of executives rate it a high priority, up

from 71 percent three years ago. Indeed, many

companies, especially high-growth organizations,

are ditching the antiquated rating systems for a

more continuous, feedback-based approach to PM.

SOURCE: 2017 DELOITTE GLOBAL HUMAN CAPITAL TRENDS

79% of executives rate redesigning their PM

model as a high priority

12

3

1515

RETHINKING PERFORMANCE

MANAGEMENT

The new approach to PM does not rely on formal

ratings or rankings, and does not incorporate

an annual performance review. Instead, the

focus is on continuous improvement and growth

and development through ongoing feedback,

regular check-ins with employees, and agile goal

management. Frequent conversations between

managers and team members are low-stress and

unintimidating, enabling employees to have an

authentic, productive dialogue. Employee-driven

communication and mutual connection creates a

shared ownership and responsibility of goals and

outcomes, in alignment with business objectives

and company culture.

TEAM INFLUENCE

With the trend toward more team-centric

organizational structures, companies are beginning

to shift the performance focus from individual

achievements to evaluating an employee’s

contribution to the team and the team’s impact

on driving overall business goals. Team

performance is evaluated using different metrics—

trust, inclusion, diversity, interconnectivity, clarity of

roles, engagement of leaders—but is driven by the

same ethos of continuous improvement and agile

goal management.2

TOOLS + DATA = RESULTS

Companies are turning to performance

management (PM) tools and technologies to

help them evaluate their employees. By using PM

software to conduct frequent discussions with

team members, collect real-time feedback, and

set and track goals, managers can better appraise,

understand, and motivate their people. In addition,

companies are able to help employees understand

how their individual goals align with overall business

goals, in an effort to guide employee performance

toward mutual success.

By integrating a PM application with their HRIS

platform, companies can gather higher-quality

data to help identify high performers, inform

compensation decision-making, and address

impediments to performance and growth more

rapidly. Ninety-one percent of companies that

have adopted continuous PM say that they now

have better data for people decisions, making

major progress in removing bias in promotion

and advancement.

SOURCE: DELOITTE INSIGHTS, 2017

91% of companies adopting continuous PM now

have better data for decision-making

1616

CHANGING THE GAME

The impact of the new PM tactics is significant.

Research into how companies are re-engineering

their PM noted that 90 percent of companies

that redesigned their approach saw direct

improvements in engagement, while 96 percent

say the processes are simpler and 83 percent felt

the quality of conversations between employees

and managers went up.

The new rules for performance management

are changing how companies motivate their

people, increasing engagement through a

transparent process that no longer pits employees

against each other. Going forward, companies

will continue to build on the new system of

consistent communication and real-time feedback,

helping to fuel continuous improvement while

aligning employee goals with company objectives

to drive growth.

SOURCE: NEUROLEADERSHIP INSTITUTE, 2017

Performance management redesign:

90% of companies experienced direct improvements

in engagement

96% say processes are simpler

83% felt the quality of conversations between

employees and managers improved

1. HTTPS://WWW.NPR.ORG/2012/05/03/151860154/PUT-AWAY-THE-BELL-CURVE-MOST-OF-US-ARENT-AVERAGE

2. HTTPS://WWW2.DELOITTE.COM/GLOBAL/EN/PAGES/HUMAN-CAPITAL/ARTICLES/INTRODUCTION-HUMAN-CAPITAL-TRENDS.HTML

1717

THE YEAR OFEMPLOYEE EXPERIENCE

W ith Forbes predicting that 2018 will

be The Year of Employee Experience,

HR leaders around the globe are

scrambling to redesign their employee experience

(EX) to create an environment where people want

to be. EX is essentially the sum of all interactions

of an employee with the organization throughout

their entire journey—and employees are expecting a

consumer-style, digital experience in the workplace

that reflects their vision of flexibility, transparency

and personal development.

With fierce competition for quality talent, a superior

EX can make all the difference in attracting, and

more importantly, retaining good people. By

offering an environment of continuous growth

and development, flexible learning, and multiple

opportunities for promotion within the organization,

companies can create an employee journey that

respects employee values, aligns with their needs,

and helps them achieve their goals—ultimately

turning employees into brand ambassadors.

IBM Smarter Workforce Institute’s global survey of

22,000 workers found that “feedback, recognition

and growth” is the third most important contributor

to a positive employee experience. As a result,

forward-thinking companies are redesigning

performance management with a focus on

continuous feedback that supports employees’

desire to consistently improve and grow within

the organization.

According to Qualtrix research, people analytics

will be shifting in 2018 from solely explicit

employee data (e.g., engagement surveys) to

include data derived from AI and machine learning;

organizations will begin leveraging data sources

that provide implicit signals of underlying attitudes

and emotions. Plus, by integrating data sources

from across the enterprise, HR leaders can uncover

actionable insights to improve the employee

experience, heighten performance, and drive

growth.

Is your organization investing in the technology and

tools to create a rewarding employee journey? Are

your employees your best brand ambassadors?

Employees [with a positive experience at work] are more likely to report a high level of performance and discretionary effort in their

work, and they are more likely to want to stay at their organization

IBM SMARTER WORKFORCE INSTITUTE, 2017 THE

EMPLOYEE EXPERIENCE INDEX

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