Business in the 21st century
...rt of each day on new idea development and their ideas are forwarded to management at the end of each week for execution. By midday, 15% of employees’ time is spent on generating new ideas. 3.1.2 Businesses have to improve their knowledge Education is more important than ever. Companies must develop more capability, processes, and programs to increase knowledge and education. The most important function of the human resource division in the 20th century was delivery, executive compensation, or leadership development. In the 21st century; training and development will be the most important function of the human resource department. Employees’ capacity to constantly learn is linked to a company’s success. Employees are motivated and engaged when a company operates with values and a noble purpose. 3.1.3 Decline in Employment The 20th century was the first time people started working for other people. The 21st century will witness a reversal of that trend. It’s estimated that 80% of all job functions will be obsolete in 5 years. Telecommuting employees will grow from 30 million today to 100 million in ten years. The challenge for employers is to build a “virtual” culture and effectively manage these remote employees. 3.1.4 Employee loyalty will begin to erode The workforce will become more contingent, with the ability and desire to switch employers and vendor relationships very quickly. Tenure is decreasing among employees. Disloyalty will be the norm; loyalty will be special. Most employees approach their careers as “Me, Inc.” Employers must learn how to create relationships and build mutual commitment with contingency staff. The only sustainable advantage in the 21st century will be relationships among company, employees, and customers. It’s been proven that organizations that value human capital have higher margins than those who do not. Companies must identify their values and purpose and communicate it constantly with employees. 3.1.5 Businesses will become a network of partnerships. Successful businesses of the 21st century will look very different than businesses in then 20th century. It’s an economic reality that companies can’t work alone in today’s speed-intensive and technology-intensive world. Successful businesses should operate with a small core of employees together with a large network of vendors, suppliers, outsourcing partners, etc. This virtual type of company using small, nimble suppliers will allow greater speed and better work while saving time and money thus keeping overhead costs to the minimum. One industry already capitalizing on the benefits of virtual partnerships is the pharmaceutical industry, where many early-stage research and development projects are outsourced to smaller firms. The biggest challenge for any virtual employers of the 21st century is to determine how to create a company culture in the midst of all these interdependent relationships. 3.1.6 Growing disparity is coupled with growing tensions. A big challenge facing businesses in the 21st century is that the population rate is increasing at a fast rate. Developing countries will have more people than jobs thus causing an immigration burst that will continue to grow causing a brain drain in many developing companies. The gap between skilled and unskilled will continue to grow. A business that fails to address this challenge will face problems of trust in their culture. 3.1.7 Uncertainty will continue to increase. The complexity of doing business in the world will increase with ongoing issues of financial instability, leadership credibility, and global/political tensions. Change is a constant companion, but most organizations aren’t equipped to handle change very well. All employees must have common tools and processes to deal with change. The company, Shell Oil, is an example of a company that built the capability to deal with ambiguity with a process called scenario planning. It helps Shell Oil develop alternatives to prepare for the future. Recently, Shell took the process one step further by separating the unknowable from the inevitable. This is called TINA—There Is No Alternative—it focuses on the inevitable trends such as globalization and technology. TINA has resulted in annual cost reductions of $4 billion for Shell. 3.1.8 Technology Technology can play a significant and positive role in providing businesses with the ability to respond in an agile manner to the velocity of change and the pressures it brings. The speed of technology is creating a true global economy. The future of businesses will be driven by global knowledge, but many in the world do not have access to the Internet, further dividing nations into “haves”...