Knowledge at Work - Episode 8

In this episode we are going to discuss the Future of HR a concept from The Ready who we discussed earlier in the Brave New Work episode. 

This episode focuses on The Future of HR a series from The Ready.  If you are thinking “I don’t really care about HR” don’t fret the concepts being discussed can be applied to different departments or functions and even if your firm is small these concepts might be helpful for your clients. 

This content is available in a few different formats.  We will link below to a podcast and website with details. 

The authors Rodney Evans and Sam Spurlin work for The Ready.  This is the same organization that produced Brave New Work from Episode 3 earlier this season.  They are at the forefront of adapting organizational design to the needs of knowledge workers.  

As we get started, I would like to ask you to think about this content in a couple of different contexts.  The concepts are focused on human resources adapting, but the concepts of how to design the work can also be applied to any team that is providing support to Organizations.

As we think about professional service firms, this content can be used internally for how your HR department operates.  It can also be used to design how you provide service to your clients.  One of the big concepts of this work is cross functional teams.  As firms continue to provide more different services to clients, organizing so that the different services collaborate to provide the client with the best result can be impactful. 

This episode will be more focused on Organization and Management than Talent, but we will find things for all three to consider when trying to implement this concept. 

The core of the Future of HR is the maturity model.  We will walk through each level in the model and talk about what it means for HR departments and then how the same concept can be adapted to a professional service firm. 

A couple of the resources available are a quiz to find out where you are currently on the spectrum and some advice for how to move from one stage to the next.  As we get started it is also important to see this as a progression where the easiest way to your destination is through each level of the model.  Put another way it would be very difficult for an organization or department to go directly from a Call Center to a Neural Network. 

For the next few slides, we will use different colors to represent different roles.  In HR this would be things like hiring, payroll, and benefits.  In an accounting firm the colors could represent audit, tax, CAS, etc.  For those listening I will do my best to describe the different graphics showing the different structures. 

We start with the call center.  This is a very hierarchical structure; imagine the classic org chart and you can see what this looks like.  Each function has a chain of command that feeds up to a leader of the department. This is the historical model where people specialize in one thing and repeat processes.  While this can be efficient it limits adaptability and tends to cause siloed thinking. 

For an accounting firm this is the normal structure of teams working in different areas then a Partner who leads the firm and interacts with the client.  This can be a very productive and effective structure for a firm, but again it tends to not adapt well to change and creates silos which can compete instead of collaborate. 

The second level is the Brokerage, the main difference here is a layer is created to act as a go between for leadership and the operational staff.  The benefit of this structure is you have a group focused on strategy across the department or Organization.  The issue with this is the strategy group can be caught in the middle when the Talent and Organization have competing demands. 

In accounting this normally looks like the Client Manager who acts as the client’s point of contact across all engagements.  It helps the client since they have one point of contact who can advise them on all their work, but it puts the pressure on that Manager to be able to manage the different engagements across different departments. 

One way to think about this level is your Management is cross departmental, but your Talent remain in their silos.  Much like the call center this can work well if you have people who thrive in these roles. 

Moving to level 3 we find the Hollywood Model.  The name comes from TV and film production where specialists come together to work on a project then disband to move to the next project where they will mix with a different set of specialists. 

Instead of a traditional hierarchical format this model introduces cross functional teams where front-line staff from different areas work together to solve broader problems.

The fundamental change happening here is a switch from Talent staying in a silo to working in cross functional teams.  Management also evolves to balance completion of reoccurring tasks and larger issues or opportunities.  The other thing we see at this stage is the introduction of “Market Designers.”  These are people who are responsible for both production and change.  In the Brokerage we saw Management getting caught in the middle of competing pressures.  In the Hollywood Model we see Management move into a role where they have more control over both sides to enable decisions to be driven by balancing the pressures.

In an accounting firm this could look like a stronger focus on clients than deadlines.  If you are performing a suite of services for each client, the Organization then creates Client Based Teams that can work across functions to ensure the work product of a specific client can be delivered in a timely manor.  Instead of delivering the audit then tax returns and later a special project, the Organization can coordinate this work so it can be presented all at one time.  This aligns with the client needs rather than the Organization’s needs. 

Level 4 is the Marketplace and it looks very similar to the Hollywood Model.  The main difference is how projects and teams are formed and evolve over time.  In the Marketplace priority is placed on creating value over catering to the needs of the loudest voices.  Something that is not shown on the diagram is a focus on process and metrics.  The Marketplace creates space for experimentation and testing methodologies before applying them across the Organization. 

In an accounting firm this could look like adding a research and development team within the Organization.  Finding the right Manager and appropriate Talent to come together to experiment to find best practices to apply across the organization.  This can be especially beneficial when you have a small group of people who are pushing to change.  Giving them the time and resources to learn then come back and share with the boarder Organization can help speed up adoption of new methodologies and tools. 

Finally, level 5 is the Neural Network.  This looks like a complete integration between Management, Talent, and automation. 

At the core of this level is automation.  The goal is to leverage technology to eliminate as much of the routine work as possible so Talent can focus on higher level activities.  This is an extension of the Marketplace where the Organization shifted focus to creating value. 

The technology focused on in this example is artificial intelligence, but I would argue that AI is simply the tool that is currently of most interest.  What is important about this highest level is the focus moves past creating value and towards reducing the workload.  The other important thing to keep in mind is the progression from creating these teams to work on value creation processes then leveraging technology to reduce the amount of work Talent needs to do to accomplish these things. 

For an accounting firm the process would look like a team streamlining their processes to prepare a financial statement or tax return.  Then once a process is streamlined, they look for ways to automate the individual steps to reduce the time Talent needs to spend to do this work.  The risk of jumping straight to automation is in not having the correct process in place.  Automating something that doesn’t work properly just creates opportunities to produce many more errors that will need to be corrected. 

Looking at each of these stages I would like to highlight a few things. 

First, there is a logical progression at play here.  The Ready has a tool available to evaluate where your Organization lives today.  Their tool is very HR focused, but with some creativity you could use it to evaluate where your other departments or Organization live on the progression. 

Second, progression involves investment of time and effort.  As we worked through the different stages Organizations can thrive in each of these.  If you are content and productive as a Call Center you can continue to operate in that format. 

Finally, this progression has the potential to be useful for your clients.  If you can work through the different stages you could help your clients do the same and potentially create another service to provide.