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Is work working for your people and organization? 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 organizations will struggle to meet demand with their current talent models as they face into persistent labor 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, skill sets 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 world that we live in?
Today, I'm joined by Amy Baxendale, global capability and workforce readiness director at Arcadis. Arcadis is a global organization 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 organization, 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.
It's great to be here, Cynthia. Thanks so much for having me.
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 in your current role at Arcadis.
Sure, Cynthia. Thank you. So I first joined Arcadis 18 and 1/2 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 pieces, I feel really fortunate that I've had the privilege as a career that's been really personalized 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 level. So that as we as 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.
That is certainly a squiggly career path. And I think it sets us up nicely to talk about this journey that you and Arcadis are just embarking on. So before we get into more about that journey, let's just 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?
I think, for us, Arcadis, the journey towards becoming a skills-powered organization, 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, like as an example, during 2022, we've acquired four organizations. So we've welcomed 6,000 new Arcadians into the business. If we had been further on our skills transformation journey, then we would have 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.
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 for this very critical shift to skills-powered. Tell us more about why it's so critical now for Arcadis.
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 organization for multiple reasons, and I could go on all day.
But I guess, if I think about the kind of, I guess, 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 routes 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 personalized 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, I guess, a really important thing one for us is as part of our ongoing evolution and growth, we're going through digital transformation. And as part of this, we've launched the standardized and automate program. So this is all about identifying, developing, and reaping the benefits from having globally aligned processes, definition, and much more harmonized 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 maximize their skills in different ways. Also for our clients, they really benefit as we're able to more proactively change the way that work can be delivered for our clients.
So by having the skills-powered organization 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 aligned to their personalized career ambitions as well. So for us, part of this journey, really, importantly, is we're also looking to support our people to be able to stay relevant for the long term by reskilling, 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're creating 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, I guess, potentially democratize learning and access to role opportunities across the whole business. To quote Jacoline, our chief people officer, we really see this as an equalizer 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.
Amy, that is so exciting. It is very clear to me based on the way that you and the organization 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?
Yeah, so as we evolved our understanding of the opportunities and the possibilities of a skills-powered organization and we work with the business to better understand the potential impact, we started to recognize 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 organization over time, we needed to start the journey with an ultimate vision. And you've just said it there, Cynthia, that vision for 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 to talent globally.
So we've, really, purposefully designed this as a multi-year, multi-horizon strategy and that 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, 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.
You've really hit on an important point, I think, for everyone listening, 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 recognize that this is a multi-year journey, and I think like all good journeys, it would 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 organization.
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 lifecycle. 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're 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, and need, and expect increased agency choice and influence over the way they work and also over the organization for which they work. So therefore, really, central to our strategy and approach, we'll be making sure that we've continuously got opportunities for our Arcadians to contribute and be part of the design and the evolution of what the future of work 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, utilizing those to test and learn, as you say, and adjust our approach as needed, and also brings 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 organization team and responsible for, really, designing, building, and implementing the change needed in the business.
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. And so what is the role that HR plays in all of this from a transformation perspective?
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 organization 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 Arcadis, so Jacoline, 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 and communications professionals from those specialized 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.
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 Jacoline through to your COO being the executive sponsors co-leading this is-- I think it's truly something that many organizations will tune into and look to try and find a way to replicate in their journeys as well.
I'd like to sort of 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 this-- a journey similar to this. And as they're thinking through this with their own organizations, 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 organizations 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 organizations. Could you just tell us a little bit about how you guys got started at Arcadis? And any tips and tricks for the organizations listening?
Yeah, definitely. And as you say, Cynthia, there's a number of organizations already on the journey. And I think for any organization-- I've spoken to many of them. For everybody, this is a multi-year whole business change program. But every organization 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 organization. But I guess, where we started was, really, understanding the art of the possible, so really, starting to understand what on earth all of this stuff means. So I listen to podcasts all the time, listening 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, 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 organizations 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 organizations 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 organization. And then from there, we started to work with the business to think about, OK, 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 organizations 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 it's part of your question around how do 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-centered 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.
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 organization 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?
Yeah, we started with what I called a pitch. It, really, was just sort of 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 realization and ROI fully articulated, we needed to identify who our delivery partners would be because obviously the commercials differed in different organizations. 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 approval of that business case light that enabled us to go out to the market for requests for proposals process. And as I mentioned, we did 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 finalized 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 thoughts, 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 counsel 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.
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?
Yeah, absolutely. So as I said, embarking on this journey, it 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 that might be and a challenge to really consider and help the business think about how best to prioritize 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.
I just love that.
I know. It's the best, isn't it?
I think it's the best thing. I could just see organizations wanting to adopt something like that, and so their primary shareholder group to be the employee. So sorry to-- I just think that it's so awesome.
Yeah, it is really unique. And I guess the clear alignment between the Lovinklaan's mission, to ensure that continuity of the business and Arcadians, and the vision of a skills-powered organization, when we engage 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 organization.
Well, Amy, we're so excited about the start of this journey, and hearing it from you as you start, clearly, the energy and excitement is there. And I just-- when I try and of sum up what we've heard today and what you've armed yourself with and the organization as you embark on this journey, I think of three key points for our listeners in particular. You and the team at Arcadis have recognized that shifting to a skills-powered organization, at the end of the day, is a human-centered change program, and at the end of the day, it's dedicated and committed to helping humans, to the Arcadian everywhere, helping them be the best they can possibly be at Arcadis. So I think that is a neat take away 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-centered piece around this as it relates to change.
I think the other piece you were really clear about that, I think, many organizations 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 organizations 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 recognizing 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.
Yeah, I think that last point you say there, I think there's a big-- you're absolutely right, and that's been really central to our thinking throughout. And there's a really important point around this around kind of business readiness and the right time because ultimately, to future-proof yourself for the yet unknown, the 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 been the sort of 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
Oh, I couldn't have said it better. And in fact, we might have to end on that note. We want to leave it on a cliffhanger 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 OK 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 organization.
My pleasure. Thanks so much for having me, Cynthia. And as you say, we're at 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.
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.
