The Future of HR Transformation

Hey, everybody. Welcome back to our mini-series all about the future of HR. I am your host, Rodney Evans, and I am coming at you today with a very, very special guest episode. Josh Burson is here. He is an HR hero of mine. He is also the CEO of a research and advisory firm called the Josh Burson Company and author of a book that we are going to talk a lot about today. We'll get into that in a moment. This week, we are talking to the one, the only, Josh Burson. Josh, welcome to the show. Thank you, Rodney. I hope I live up to everybody's expectations, but thank you. I mean, I will have been hyping you for weeks at this point, so, you know, it's a high bar. But truly, when I worked in HR a million years ago at an investment bank, I used to read your work and truly be like, why don't my bosses read this? Why is no one paying attention to this? Why is my life like this? This guy knows what we should be doing. So I'm very excited that 20 years later, I'm meeting you to talk about your book, Irresistible, the seven secrets of the world's most enduring employee-focused organizations, as well as all of the imminent challenges on HR's horizon. But before we do that, as we always do, we're going to roll into a check-in round. Our question for today, and I'll ask you to answer it first, is what's something that you're trying to learn right now? Well, I'd say two things. One is I'm reading everything I can read about AI. And being an engineer, I'm fascinated by it. So I'm getting into the geeky part of it. And then I'm reading all these people's opinions about where it's going to go and what it's going to do. And the other thing I would say is, you know, at this stage of my life, and I'm in my late 60s, I'm working on my own well-being and just staying healthy. Because I love working and I love traveling, but I have to sustain myself as long as I can. So just like everybody else. I'm learning about health and fitness and exercise and all those wonderful things. That's awesome. I've talked before on this show about my never-ending quest to become a truly excellent swimmer. So I'm not going to talk about it anymore because it's taking forever. It's the hardest thing I've ever tried to learn. But separate from that and more in the work context, in the last year, I have really leaned into the skill of strategist. And really learning more about how to sense what is happening in the environment and notice quiet but compelling signals and figure out how to bring that into an organization to make sense of it. And it's like really hard and very ego tricky for me. But it's also really, really fun and really interesting and not something that I've had to do as a primary role before. So I would say I am on my learning journey. as a strategist. Well, I mean, that's great. Rodney, you've had a lot of interesting experiences, so I bet you're better at it than you think you are. You know, one of the things I've learned as an analyst, I call myself an analyst, maybe I'm more of a consultant, is constantly asking, why are you doing what you're doing? Why do you have this problem? Digging in, digging in, digging in. Because most of the time when you're talking about organizational issues, People are trying to treat the symptoms, but they're not talking about the causes because they're not willing to spend time thinking about the root cause. And that's a lot of what strategy is about, is taking a step back. Yeah, absolutely. It's exciting, it's daunting, and I feel like I'm getting better at it every day. So let's talk about your book. I loved this book. It was so refreshing to read and to, well, I listened to it a lot. I walk dogs a lot. I have. very energetic dogs that require hours a day. So Audible Books it is. But I'm really curious, particularly around the timing of this book and how long you were working on it. Tell us a little bit about how this book came to be. Why this book? Why at the moment that you wrote it and released it? Tell us about Irresistible. Well, I mean, I hate to say it. I think it took six or seven years to write it. It sounds ridiculous. But I mean, I've been studying organizations in HR and talent and leadership for, you know, more than 20 years. And around the time that I went to Deloitte and there was all this focus of digital disruption, digital reinvention, digital transformation, and we were involved in a lot of big companies. I realized that what Deloitte at the time saw as tactical transformation projects was actually much, much bigger. It was really a whole different organizational model that companies were embracing, but they didn't have words for it. They didn't know how to describe it. And so I did exactly what we were talking about just a minute ago, is I took all these symptoms of all of these issues that people were presenting, and I took a step back and I said, why is all this going on? And at the time, that was before the pandemic, we were in a really kind of a hyper growth economy. There was a lot of burnout due to digital overload. People were worried about employee retention. And so I did this massive data load from Glassdoor. I have a good relationship with the Glassdoor people. And I analyzed the companies that were scoring very, very high versus companies that were scoring very, very low, looked at their business outcomes, did a bunch of analysis with some folks at Deloitte. And I realized that the characteristics of the high-performing companies were very, very different in the way they managed people. And so the seven secrets in the seven chapters are the results of many, many years of research in looking at HR practices, talking to companies, and then framing where they were going versus what they thought their problems were. And so it's interesting right now in 2023, this book is even more relevant than it was when I was writing it, because a lot of these issues that we're going to talk about... are existential changes that companies are really experiencing now. They're not just kind of like good ideas anymore. They're really happening. And AI is even accelerating them faster. So, you know, I kind of frame it today as the post-industrial organization. You know, how do you run a company that's IP-based, services-based, technology-based, highly competitive, global, where productivity and... Engagement and well-being are the center of the company, and there aren't enough people to hire, and you can't just pile people into the company and assume that you can always get more people when you need them. It's a different world. We're living in it right this minute. So the book became more and more relevant over time. Yeah, I love that. I mean, truly, every chapter is such a banger. And one of the things that I noticed as I reflected on them is like, there does seem to be a through line, which is about the monolithic nature of traditional bureaucracy. And what I noticed in your chapters is that you do a really great job of like pulling things apart that are traditionally smashed together and quite complicated. So when you talk about teams, not hierarchy or work, not jobs or culture, not rules, it's like kind of seeing through the matrix and being like, what you're shown is this giant complicated thing. But if we start to pull it apart. into more understandable things, then we can really start to move it. Does that land with you or did I just take that up? I got to say you're a very insightful person. I mean, that's kind of the way my mind works. First of all, because I'm not an HR professional, I've come to HR from the outside. Of course, I've been doing this for a long time now. So I always try to put sort of a pragmatic lens on these things. Yeah. So I... have for a long time looked at all these things, you know, how we hire people in succession management and nine box grids and pay scales and job levels and all this stuff. And I've always sort of looked at them and thought, you know, it's interesting that this is the way you do it, but why do you do it this way? And what is the benefit of doing this way? And where did it come from? And one of the things I realized when I was writing the book is a lot of the seven principles are new ways of thinking about things. They were institutionalized 200 years ago. You know, I did some research when I started studying organizations, and I've read a lot of books and talked to a lot of people about this. The fundamental nature of bureaucratic industrial hierarchical organizations actually goes back to slavery. And if you read books about how the slave trade and the slave owners managed their slaves, it isn't that different from the old industrial sort of GM model of management and labor. So, you know, the idea that we have to let go of that is like so obvious. So the purpose of the book is to just show people how to sort of rethink some of these things that we're stuck in. And I think a lot of companies have just sort of figured this out on their own. And the book tries to just make it easy for everybody to get it. I love that. Someone shared an article with me about effectively why Gantt charts are rooted in white supremacy dating back to the time of slavery in America. And I was like, Preach. Yes. No long, complicated plans. It doesn't work in complexity. I think it's exactly right. So I would love to, I'd love to dig into a couple of the secrets. Sure. And I love all of the secrets. Are these like your children? Like, can you pick between seven of them or? I mean, no, I mean, I like them all. I love them all. Of course. The number one, the first one is sort of the core one, but yeah, I talk about whichever ones you'd like to talk about. So. I'm going to go to coach, not boss first. And the reason that I'm going to do that is because a lot of what you just said in terms of the history and the evolution of practices that have come to be like the air we breathe and we don't even question have to do with power holders reinforcing those things, which generally serve them well. And what I noticed in your chapter about coaches, not bosses, is that it's a pretty significant paradigm shift from like power over top-down command and control, et cetera, to something quite different. Now, we know from research why that's compelling, why that's effective, et cetera. And I'm wondering how it's looking out there from your perspective in terms of people embracing this idea of coach, not boss, and actually learning how to be good at it. What do you think? Well, Yeah, as the book shows, there's examples of companies that have really figured this out, but it's a relatively small number still. It's growing. And I think the reason it's growing is that bosses can't keep up with the stuff that their subordinates are doing. I mean, they just don't know. They don't understand it. So they have to empower them because they don't have the expertise that a lot of their staff do. It used to be that the boss knew everything and the labor was told what to do. So it's just not like that anymore. But I think there's this strange human need for some people to be in control, to exercise power, to lord over others for some reason. You see it all the time. I won't mention any names. And so there's a tendency to go back to this when times are tough, especially right now. We just had all these layoffs. The economy slowed down. We've got the inflation, the high interest rates. And bosses are sort of getting back to the old draconian way of talking about their management style and their workforce. We're going to make everybody come back to the office. I know better than you do. You know, you guys aren't productive enough, so we want you to be more productive. Well, wait a minute. What about the fact that it's your problem, not the employee's problem that they're unproductive? This mismatch between the Microsoft research that 87% of employees think they're highly productive, but only 17% of leaders think they're highly productive. I think there's this natural, unfortunate history of bosses wanting to be bosses. Yeah. Well, they don't really have to be like that to be successful. So, but I think we're making progress. I mean, I think there's more awareness of this than ever. And I think the pandemic taught everybody who was a manager that if they don't give people more flexibility and forgiveness, that they're not going to be around, they're going to leave. And you know, the job market's very competitive right now. So If you're a jerky manager, you know, people are going to either quietly quit or just leave, or maybe just not show up. Exactly. Maybe find a better option. You know, yeah. So I think it's, I think it's pick up speed. So I think it has started to happen more, but I think one of the tricky parts, let me just one more thing. Yeah. The tricky part is if you're not the boss, then what is your job? You know, being a coach isn't an obvious role that everybody understands what that means. And what does it mean to be a developer of people rather than a manager of people? That's not obvious to people either. Some people weren't managed that way by others, so they've never experienced it. So I think there's a lot of role modeling that has to happen. I've noticed, though, amongst the clients we talk to, we tend to talk to mostly bigger companies, the people that are getting promoted these days are. much more coaching personalities. They're very approachable. They're very sympathetic. They're very good listeners. I'm seeing more and more of that every day in the companies we talk to. That's really good to hear. And I was going to make a similar point, which is just that during the pandemic, I think a lot of the sort of org debt nonsense, bureaucratic theater went out the window because a lot of folks were in survival mode. They were trying to just cope and keep the job going with the kids at home, et cetera, et cetera. And I saw a lot of bosses who were at a bit of a loose end in terms of what to do, because a lot of the managing of the work around the work rather than doing real work just wasn't necessary in the same way. And I do see in this reversion to more draconian managerial style, like in some ways, a recreation of the old boss mode. That just isn't really necessary. Like, as it turned out, we didn't really need it. And now I think rather than certainly for some strata of organizations, those folks figuring out how to become coaches, my deepest desire is that all middle managers become org designers because we just need them. But rather than sort of. Looking to the left and right and thinking about re-skilling, I do see a lot of managers reverting to tracking and targets and this sort of drumbeat around productivity and efficiency that I think is not helpful. I agree with you. And I think there's two things that we have to focus on to try to prevent that. One is the top-down problem. If the CEO is acting that way, then it forces everybody else to act that way. So it starts at the top. But the second is that, you know, actually managers are under more stress than employees. There's some studies that just came out the last couple of weeks that show that something like 55% of managers feel like they're stressed out and only 45% of employees. So we've sort of pressed these people in multiple directions, hit the numbers, grow the business, make everybody more productive. And by the way, don't lose any people and be nice to everybody. Oh, okay. Well, that's kind of a lot of pressure, though. By the way, I'm not telling you what's going on, because we're going to about to do a reorg. And there's a layoff coming, but we're not going to tell you about it until we're done. You know, that's a lot of pressure to put on mid level managers. So we need to take care of those people. It's not obvious that they're going to become coaches, just because we tell them. Absolutely, absolutely. And one of the things I wanted to ask you about, which feels very related is, you talk a lot about how success is defined in irresistible companies versus more traditional companies. And I think, look, like measurement and the definition of success has a lot to do with things like how managers show up and prioritize and what they do. So could you talk a little bit about that difference? How would you say an irresistible company defines its own success? Well, you know, once the companies go public, things change, but But even then, I think to me, the fundamentals of business, and I've run a couple of companies and I've been involved in a lot of companies, is the reason we build a business is to solve a problem that is not yet solved in a way that we think we can do it better than everybody else. And as a result of that, we're going to delight some customers and we're going to make some money. And so the fundamental idea of a business is this. problem that we're going to solve that we feel privileged and smart enough to do better than whoever else has tried to do it before in a new way. And when you focus on that and you continuously focus on that and you let the profit and the revenue come from that, then you become irresistible. But as soon as you start to worry about the profit and worry about the revenue and you say, oh, we're not growing fast enough. Let's buy another company over here. Let's go into this other market. Let's, you know, tweak this thing and lay off some people and make raise everybody's quotas. You're not so irresistible anymore. Now you're basically a financial operation trying to make more money for the sake of making more money. Now, I'm not a money person. I don't feel that motivated by money personally. I know some people do. And of course, if you're a publicly traded company, there's all the, you know, bravado of being well known on CNBC or wherever else. But We've got to let that go because that doesn't actually usually last. Look at GE. I mean, GE was a house of cards. You know, they made their numbers for something like 90 quarters. And then we find out later that they were, you know, doing all sorts of shenanigans behind the scenes to try to hit those numbers. To me, that's not irresistible. Now, some people, some investors might like companies like that, but I'm not an investor. So the companies that stay true to that idea. of solving this problem and extending their expertise into new areas in a unique way, and then learning from their competitors or their market on what they need to do next, they turn out to be just incredible companies, Johnson & Johnson. I mean, look at even, you know, you look at Tesla, Elon Musk, or SpaceX, you might not like his personality, but that guy's gone after some problems that were completely unsolved before. And he's making good money at it now and growing like crazy. And I think his mind is constantly focused on how can we solve this problem better and better and better and better. And people love working for companies like that. It's really fun. It's really inspiring. So that to me is the essence of this. Absolutely. That's really cool. You know, I do org design for a living as you know, when I'm not doing this. And I come back to the Deming quote. all the time that says every system is perfectly designed to get the results that it gets. And what I love about what you're saying is... So often in the boardroom or in the, you know, C-suite, it's like, go change the result, but don't, and then hope that somehow that translates inward. And it's like so much wiser to go from the inside out and to change all of the things you're talking about inside the system and trust that the results will come. If you are doing what you're saying around the board. identifying and solving problems and pointing expertise at them and prioritizing quality, not just, you know, bumping the stock price for the quarter. But it's a rare leadership team that can sort of take that stance to stay in the operating system of the company rather than always wanting to control the external environment. You know, Rodney, I can tell you think the way I do. I mean, it always galls me when I listen to an analyst call. And I won't mention any names and the companies go, well, we closed 18 deals and we made, you know, we closed this deal and we, they use the word like we won this, we won that deal. We won this deal. Well, did you actually help that customer do anything? They don't even mention that. They don't even talk about it. I don't even think they think about it. Yeah. That, that to me is a little bit of a bad sign. I mean, and to your point, what are we facing? Most companies do operate that way, but I think you have to be careful that you don't let that get out of hand. I mean, hard agree. So there are so many things that I want to talk to you about, but I want to make sure that we talk about HR today and also AI. So let's dig in a little bit to HR because you have been in and around HR. for a long time. I know you're not an HR person, you're just an HR hero, including mine. We have really taken a perspective on HR in the last year that it is time for a significant change in HR. And part of the reason for that is because of the known issues. Part is because of, you know, HR's inability to like demonstrate value, not that HR isn't valuable, but the talk track is often, where does the money go? And just that, you know, HR has not evolved and yet is being looked at to lead the future of work, to become more adaptive, to help organizations become irresistible. They just hold the keys to a lot of the operating system and, in my opinion, deserve their own transformation. I'm curious, when you look at irresistible companies and then you look at the current state of the HR industry, What are you noticing and what's sort of your call to action for the HR leaders out there? Because I think you and I both have a lot of faith in those people and a lot of hope for those people. And also there's like a lot of work to be done. Yeah, I mean, this is a big project we've been working on for the last couple of years. The reason we started our academy. First of all, I have complete faith in the HR profession. I don't have any question that they're going to transform themselves and we're just going to try to help them. But there's two parts to me to the transformation. One is, when I started as an analyst, it was a copy and paste problem. You know, everybody would say to me, what did GE do? Can we just copy that? Or what did, we're going to copy what Google did, or we're going to copy what Starbucks did. You can't do that anymore because now every company has to have a unique, crafted set of design solutions based on organization, as you know, leadership. training, development, all that stuff. So there's a lot of custom development going on inside of companies. And that means that the HR professionals in the organization have to have the time and they have to be organized in a way that they don't just sort of like, oh, you ordered a hamburger, here it is, I got you a hamburger. They say, well, why do you want a hamburger? Are you sure that's what you're trying to do? And what we call falling in love with the problem, instead of falling in love with the thing you built. and trying to get everybody to use it. So that's the number one thing. The second thing that's different is the siloed, all rich kind of functional domains of HR are all crossing each other. So, you know, we've got this new model we call systemic HR, which we haven't published it all yet, but we're getting a lot of the material together, which shows how you have to think about HR as an integrated set of services and skills and people. that can solve problems in many, many ways, and also delivers a lot of scalable services. Because, you know, a lot of the basics of HR are operational things that the company, you know, gets really mad when they don't work right. And the Ulrich model wasn't designed for that. The Ulrich model, to me, was really designed around the sort of 1980s IT department. which was, you need a new computer? We'll have it to you tomorrow afternoon at three o'clock. Are you happy with your new computer? Yes. Okay, great. Talk to you later. Bye. I mean, there's some of that, but the service delivery part of HR is more and more self-service now. I don't want to have to ask an HR person every time I want to do something. I just want to do it and get on with it, which means people like you that do design and consulting should be much more. front and center. And lots of things are connected together. Now, right now, for example, most companies we talk to are realizing that their recruiting problem isn't just an external recruiting problem. It's also an internal recruiting problem, which means it's an internal development problem. So the recruiting department, which used to be on one end of HR, and the training department that used to be on the other end of HR need to be squashed together, and they need to talk to each other. And then, of course, they have to talk to the people in the compensation group about why isn't this person making as much money as that person? And that's the reason they don't want to take this job. And then the diversity person who's sitting over there in the corner and sort of raising their hand and saying, well, wait a minute, that's not really a very diverse, inclusive way to do this. They have to be involved. So these COEs have to be more integrated together. So we're really doing a lot of work on the building of what we call the full stack HR professional career where HR... professionals learn about these other domains, and then the organization operates in a more systemic way. So I completely agree with you. I think when we talk to companies about this, within the first two minutes of the conversation, they're like, yes, yes, yes, we want to do that, just tell us how. And so I think the HR profession has woken up to the fact that they need to operate differently, and they're just looking for great ideas on how to do it. That's awesome. I mean, we're newer to this. category, certainly, than you are, but so far have had a very similar response. The thing that we've been talking to people a lot about is this idea of the Hollywood model and really having the idea that people come together cross-functionally around a problem or a movie, make it, and then disperse, but the movie studio doesn't go away. So we're always going to have payroll and ops, and some of those things should be automated and outsourced, but there are persistent functions and there are seasonal functions. And the idea that we can bring the right capacity together to solve a problem as a habit, not as a crisis, seems to be landing with HR so far, which I feel like really, really aligns with your systemic HR. That is absolutely part of it. But the difference between a movie and the HR department, because I know about that concept, is once the movie's made, you just sort of ship it. The problem with HR is the solution has to evolve. Somebody's got to own it. It doesn't just end. So you've got to have an operations group and sort of a product management group to evolve it. So there's a lot of new concepts that exist in business that just haven't been embraced in HR enough yet. And just to play it out, my sense so far in the conversation has been as we bring people together cross-functionally to solve. something, you know, like reimagining a hiring process, for example, that included in that team should be the individual or team that will be responsible for maintenance. So if we're going to reimagine or we're going to break ground on something for the first time, that happens in one way, but included in that effort are the individuals who will have to ultimately care and feed for it, which in my experience in HR very rarely happened. It was much more like, There were fences between all of us, and we just threw stuff over them and hoped for the best. Yeah, exactly. And in fact, one of the things that happens all the time is somebody will say, we need a better process for recruiting. So a bunch of smart people get together for a couple of weeks in a conference room, and they design a new process. They fire up Workday. They hire Deloitte or somebody. They implement it. Then they turn it on, and they tell everybody to use it, and they find out they don't like it. And they say, too bad, we already designed it, you're using it. And there's no reason to do that. I mean, there's that whole design, sort of co-design thing is relatively new. It's obviously much more prevalent now than it used to be. But sort of how do you design a people practice with the company while the company is changing, that integrates all these things together? That's not... as easy as it sounds. I'm sure, you know what, Rodney, I'll bet you can figure out how to do it. I mean, that's the magic, right? That's the magic. You know what? I think it's not as easy as it sounds, but it's also not as hard as we make it out to be. Right. I mean, there has to be adaptability. The thing about HR is these people processes are never perfect. That's the difference. Once the movie's in the can, I think it's kind of done. And then the company changes, the economy changes, the job market changes, you go into a new business, new geography, it's a little bit different. I think HR is just an incredibly strategic part of a company. And when it's well run, it can be really instrumental in the whole growth strategy of the business all over. Absolutely. And one of the things I wanted to ask you about, because I am keenly interested in HR and HR folks, if you were advising an HR leader who is interviewing right now, and they wanted to go work for an irresistible-like company, what would you tell them to look for in the process? Or what would you tell them to be asking in those interviews? Well, I would say there's two types of things to look for. One is, you know, what is the energy and enthusiasm and alignment of the people you meet. Do they all seem to be breathing the same air and talking the same language and is excited about the company for the same reasons? That's something to pick up because you do find in slightly dysfunctional companies, a lot of silos and people not necessarily aligned on different things. So that would be one thing to pick up because if you're going to join the company in HR, you're going to have to cross all those lines because HR people tend to cross a lot of lines. And the second thing is, if you're relatively senior or you're in a senior facing role, try to meet the leaders and see how do they feel about talent? How do they feel about the people's side of the business? Or do they just delegate it to HR and think, that's not my job? It is their job. I mean, we're here to help them run the company. We're not running the company. So, you know, we may want to just do a leadership development program and say, okay, well, now we're done. But... Day-to-day, month-to-month, things come up where we would hope that the senior leaders are talking to us and that we're using our expertise to help them. And how open are they to that? Or are they in the older model where we just want somebody to run HR and then you guys worry about that and I'll worry about something else? And that does happen. I'm not saying that's every company, but you want to stay away from that kind of situation. Sure. The CEO that's It's like, you go figure out the culture thing. When you figure out HR, I'm too busy. Right, right. I love that. You know, this is a little provocative, but I've had this conversation with a CPO recently who landed somewhere that was not good, did not last long. And, you know, understandably, she'd been very careful in her new search and looking for more progressive organizations. And one of the things that she was like, I will never say that out loud in an interview, Rodney, but I still think it's a good idea, is real clarity on. authority and decision rights. Because I just think HR is one of the only roles in the executive team where you get the job and then you have to keep asking everyone for approval to do that job. That's just not how people don't say to the CFO, I don't think we should do that audit this year. But people say to the CHRO, I don't think this is the year for DEI training. Right. Or I don't care what you think about hybrid work, we're making everybody come back to the office. Exactly. It's like everybody's an expert in HR. But I think that's a really tricky part about this profession. Everybody thinks they're an expert at people's stuff. You've got to find a management team that does respect the principles and science and professionalism of HR. And then you have to act in that way and prove to them that you know what you're doing. And that's why it's kind of a... fun profession to be a part of. Listen, to my engineering mind, it's the ultimate challenge. It's a vexing, complicated problem that's dealing with all sorts of personality issues. And if you can do it well, you're a superstar. I love that. Speaking of engineering, we have to talk about AI. I mean, has there been a change as significant for work ever? Maybe the internet? Has there ever been a change? as big as the one that you think is coming or is kind of here? Well, I think every big technological change feels as disruptive as this one. The internet itself, the cloud, the mobile phone, AI, they're probably each as big. And, you know, looking back, you always think the other ones were no big deal, but actually each one of them was just as disruptive. But I do think AI is at that scale. And I don't think everybody... Gets that, yeah. Yeah. I just listened to one of your podcasts about AI, and everyone should listen to it because to me, it was the best explanation for AI's application for real to... HR and work that I've heard so far. But just in case people haven't, can you talk a little bit about what are your top three AI-related topics, ideas, tools that should be on every HR org's radar right now? Sure. I'll go through the three things in a sec, but let me just make a little quick preface. So the reason I think AI is so valuable for HR is we're sitting on this massive investment that companies have in people, roughly the largest expense they have. And most of the decisions we make are sort of seat of the pants. Who to hire, who to promote, how much to pay somebody, who gets this role, who gets that role, how we're going to manage this team, blah, blah, blah. I mean, all these things, we work so hard to do them as best as we can. And we don't have that much data about what's going to work and what's not going to work. We have some. So AI is going to give us... Another order of magnitude of data around those kinds of decisions. Now, in terms of three big areas, one huge area of AI is this whole area of skills and recruiting and job matching. So who is the right person for what job? What are the real skills needed in this job? What are the activities that this job will require people to do? That used to be a handcrafted, sit down in a room, open the FYI book, copy a bunch of competencies. You've probably done this. I have, indeed. Yeah, well, you don't need to do that way anymore. The AI can show you who's succeeding and why they're succeeding, and therefore who you should hire and who's a good internal candidate and so forth. So that's one thing. So that falls in the category of talent intelligence. So there's a whole bunch of examples of that. Who should be moving into what role? Who's ready for leadership? Those are massive, massive. issues that we've tried to solve in many, many other ways that AI is going to help. The second is support. I'm an employee. I'm a manager. I need help with something I don't know how to do. Maybe it's a training problem. Maybe it's an administrative problem. I'm going to call my HR business partner. I'm going to ask him or her to help me. She's busy, can't get back to me for another 24 hours. I'm stuck. Well, because of the way these AI tools work, we can take our documentation. We can take our workday. implementation or whatever training guide. We can stick it in there and people can find what they need and they can solve their own problems. So all of this kind of mishmash of HR technologies and tools and programs suddenly become much, much easier to navigate with a really intelligent chatbot. We built one of these for our research, which we call the HR Copilot. And we've seen it. I mean, it just is amazing how the generative AI will find things within your company, not outside your company. and solve a lot of problems that business partners have to do by hand. Yes. We're very excited about Copilot at the ready. And then the third area is generative AI for education and training and development. You know, there's a $250 or $260 billion market of training programs, leadership development programs, technical training, safety training, compliance training, DEI training, et cetera. It's a handcrafted, old-fashioned publishing model where an instructional designer authors a course, builds an outline, videotapes people, develops the course, sticks it in an LMS, tests it, launches it, et cetera. And that works okay, but the AI can do it way better. And not only can the AI develop content, but the AI can answer questions and point you to information so you can learn in the flow of work, which we've been trying to do in learning and development for a long time. So I think there's going to be a big revolution there. So those are three massive sort of use cases in HR. And there'll be others that I haven't even thought of yet that will come up. Those are pretty massive. I have a lot of confidence that this is going to be a really big deal. Yeah. You know what I'm excited about is, you know, take performance management out of it. Just real feedback, performance-based feedback, style-based feedback, contribution-based feedback, whatever you want to talk about. It has been such a tough nut to crack historically. And like the feedback rich environment is mostly a myth. And what I have noticed in my interaction with a variety of AI tools so far is how non-reactive I am from getting feedback from a bot around how I sound or whether I'm doing it right versus getting it from a person. And I cannot wait for that to be integrated into more of the day to day. Yeah, that's an interesting point. I mean, there are these passive listening tools, Perceptix just bought one, Vizier just bought one, BetterUp bought one, that are out there that, including the Microsoft tools, that give you unprompted advice or comments or suggestions or nudges. And I guess you're right. I never thought about it. I never mind getting those things either because I don't feel insulted. Right. Because I can just ignore it if I don't believe it. Yeah. I haven't used a tool yet that gives me advice unprompted, though I would be very curious about trying that. But yeah, just this idea that there's no part of my ego that's like, well, how do you know? How do you know that my sentiment was unfriendly? You know what I mean? It's because it's like, well, you know, because you have all of the internet at your disposal, but, and you're just telling me what you see. So like the three domains that you just mentioned are massive and they are a huge part of any people organizations domain. What are you telling people to do to get started? Because I'm having conversations with HR leaders that are like, the tsunami is coming and we are woefully underprepared. So we've been talking to companies about this for a long time, and it's particularly around skills. I mean, the strategy that we tell them is focus on a problem. Don't focus on the technology. I mean, there's a lot of people that, because of the nature of their job, they say, okay, oh, we need one of these tools. Let's go buy an AI recruiting tool. Let's go buy an AI skills inference tool. Let's turn on the Workday Skills Cloud. I mean, a lot of companies have said to us, how do we use the Workday Skills Cloud? Well, you don't use it. It's there to solve a problem. So go after a problem. So pick a problem. We're growing. We have to hire people in this particular country. We have high turnover. We have low productivity. We have a management leadership gap. Our innovation sucks. Whatever it is, everybody's got these things. Pick one of those big things that the CEO and the CFO care about. Go after that and then apply the tools to that problem. And the tools will make more sense and you'll see which ones apply. And you'll learn a lot about them if you evaluate them in the framing of the problem. If you just look at the tools and you listen to the salespeople, first of all, the salespeople usually aren't very good at talking about the problems. All they do is talk about the system. You're going to end up with RFP frenzy and you're going to end up in these big RFP things. And then you're going to finally buy something and then you're not going to know what to do with it. So I think that's where it starts. And the vendors are very immature. A lot of these AI systems, some of them are fairly sophisticated and some of them are pretty new and a little bit oversold. So that's what we tell people. And what happens is when you do that, a lot of times, a lot of the AI efforts start with recruiting. You think you have a recruiting problem and then you realize, well, I also have an internal mobility problem because I need to fill some of these slots with internal candidates. So does this tool work for internal mobility? And then I say, well, what kind of mobility am I moving people who are already ready for the role or people who aren't ready for the role? Oh, I need a little bit of development in there too. And the next thing you know, you've solved a pretty big problem in the company. And you've picked a tool that's proven itself in the domain that you exist. And I think that's the market we're in. None of these systems do everything for everybody in every domain yet. They're all pretty new. Yeah, that is such good advice. I love that we sort of ended this conversation where it started, which is investigate the problem, think deeply about the problem rather than skipping that step and going right to a shiny or compelling or rational solution. That was so, so fun, Josh. I know we have to wrap up. I can't believe how fast this hour went. Please tell our listeners where they can find you and learn more about. all of the amazing things that you shared with me today. Well, thank you, Rodney. It was really fun to talk to you. JoshBurson.com is our primary sort of market-facing website. We have the Twitter account, a bunch of LinkedIn accounts. I'm pretty easy to find on LinkedIn. We sell a corporate membership program, which has all sorts of fascinating information, including our co-pilots. You can get in there and use our AI. And then we have an online academy called BursonAcademy.com. which is both for corporations and individuals. So if you're an HR person or even a non-HR person, you just want to learn about this stuff, the Academy is very inexpensive. You can go in there and just take a lot of courses and see all these resources and research. And then, you know, call us later when you're ready for the big corporate stuff. And that's kind of where we are. Fantastic. And folks, definitely read Irresistible if you haven't already. It is a wonderful book. There's so much more we could talk about. Next week, I will be back with Sam for our final episode of this mini-series reflecting on what we've learned from Josh and our other awesome guests. Thanks, as always, to Taylor Marvin for making us sound good. This mini-series is produced by The Ready, where we help organizations around the world change the way they work. You can get in touch with us by emailing fohr at theready.com. As for you HR listeners out there right now, let's change ourselves first.

Hey, everybody. Welcome back to our mini-series all about the future of HR. I am your host, Rodney Evans, and I am coming at you today with a very, very special guest episode.

Josh Burson is here. He is an HR hero of mine. He is also the CEO of a research and advisory firm called the Josh Burson Company and author of a book that we are going to talk a lot about today.

We'll get into that in a moment. This week, we are talking to the one, the only, Josh Burson. Josh, welcome to the show.

Thank you, Rodney. I hope I live up to everybody's expectations, but thank you. I mean, I will have been hyping you for weeks at this point, so, you know, it's a high bar.

But truly, when I worked in HR a million years ago at an investment bank, I used to read your work and truly be like, why don't my bosses read this? Why is no one paying attention to this? Why is my life like this?

This guy knows what we should be doing. So I'm very excited that 20 years later, I'm meeting you to talk about your book, Irresistible, the seven secrets of the world's most enduring employee-focused organizations, as well as all of the imminent challenges on HR's horizon. But before we do that, as we always do, we're going to roll into a check-in round.

Our question for today, and I'll ask you to answer it first, is what's something that you're trying to learn right now? Well, I'd say two things. One is I'm reading everything I can read about AI.

And being an engineer, I'm fascinated by it. So I'm getting into the geeky part of it. And then I'm reading all these people's opinions about where it's going to go and what it's going to do.

And the other thing I would say is, you know, at this stage of my life, and I'm in my late 60s, I'm working on my own well-being and just staying healthy. Because I love working and I love traveling, but I have to sustain myself as long as I can. So just like everybody else.

I'm learning about health and fitness and exercise and all those wonderful things. That's awesome. I've talked before on this show about my never-ending quest to become a truly excellent swimmer. So I'm not going to talk about it anymore because it's taking forever. It's the hardest thing I've ever tried to learn.

But separate from that and more in the work context, in the last year, I have really leaned into the skill of strategist. And really learning more about how to sense what is happening in the environment and notice quiet but compelling signals and figure out how to bring that into an organization to make sense of it. And it's like really hard and very ego tricky for me.

But it's also really, really fun and really interesting and not something that I've had to do as a primary role before. So I would say I am on my learning journey. as a strategist.

Well, I mean, that's great. Rodney, you've had a lot of interesting experiences, so I bet you're better at it than you think you are. You know, one of the things I've learned as an analyst, I call myself an analyst, maybe I'm more of a consultant, is constantly asking, why are you doing what you're doing? Why do you have this problem?

Digging in, digging in, digging in. Because most of the time when you're talking about organizational issues, People are trying to treat the symptoms, but they're not talking about the causes because they're not willing to spend time thinking about the root cause. And that's a lot of what strategy is about, is taking a step back.

Yeah, absolutely. It's exciting, it's daunting, and I feel like I'm getting better at it every day. So let's talk about your book.

I loved this book. It was so refreshing to read and to, well, I listened to it a lot. I walk dogs a lot. I have.

very energetic dogs that require hours a day. So Audible Books it is. But I'm really curious, particularly around the timing of this book and how long you were working on it. Tell us a little bit about how this book came to be. Why this book?

Why at the moment that you wrote it and released it? Tell us about Irresistible. Well, I mean, I hate to say it. I think it took six or seven years to write it.

It sounds ridiculous. But I mean, I've been studying organizations in HR and talent and leadership for, you know, more than 20 years. And around the time that I went to Deloitte and there was all this focus of digital disruption, digital reinvention, digital transformation, and we were involved in a lot of big companies. I realized that what Deloitte at the time saw as tactical transformation projects was actually much, much bigger. It was really a whole different organizational model that companies were embracing, but they didn't have words for it.

They didn't know how to describe it. And so I did exactly what we were talking about just a minute ago, is I took all these symptoms of all of these issues that people were presenting, and I took a step back and I said, why is all this going on? And at the time, that was before the pandemic, we were in a really kind of a hyper growth economy. There was a lot of burnout due to digital overload.

People were worried about employee retention. And so I did this massive data load from Glassdoor. I have a good relationship with the Glassdoor people.

And I analyzed the companies that were scoring very, very high versus companies that were scoring very, very low, looked at their business outcomes, did a bunch of analysis with some folks at Deloitte. And I realized that the characteristics of the high-performing companies were very, very different in the way they managed people. And so the seven secrets in the seven chapters are the results of many, many years of research in looking at HR practices, talking to companies, and then framing where they were going versus what they thought their problems were. And so it's interesting right now in 2023, this book is even more relevant than it was when I was writing it, because a lot of these issues that we're going to talk about...

are existential changes that companies are really experiencing now. They're not just kind of like good ideas anymore. They're really happening. And AI is even accelerating them faster.

So, you know, I kind of frame it today as the post-industrial organization. You know, how do you run a company that's IP-based, services-based, technology-based, highly competitive, global, where productivity and... Engagement and well-being are the center of the company, and there aren't enough people to hire, and you can't just pile people into the company and assume that you can always get more people when you need them.

It's a different world. We're living in it right this minute. So the book became more and more relevant over time. Yeah, I love that. I mean, truly, every chapter is such a banger.

And one of the things that I noticed as I reflected on them is like, there does seem to be a through line, which is about the monolithic nature of traditional bureaucracy. And what I noticed in your chapters is that you do a really great job of like pulling things apart that are traditionally smashed together and quite complicated. So when you talk about teams, not hierarchy or work, not jobs or culture, not rules, it's like kind of seeing through the matrix and being like, what you're shown is this giant complicated thing.

But if we start to pull it apart. into more understandable things, then we can really start to move it. Does that land with you or did I just take that up? I got to say you're a very insightful person.

I mean, that's kind of the way my mind works. First of all, because I'm not an HR professional, I've come to HR from the outside. Of course, I've been doing this for a long time now. So I always try to put sort of a pragmatic lens on these things. Yeah.

So I... have for a long time looked at all these things, you know, how we hire people in succession management and nine box grids and pay scales and job levels and all this stuff. And I've always sort of looked at them and thought, you know, it's interesting that this is the way you do it, but why do you do it this way?

And what is the benefit of doing this way? And where did it come from? And one of the things I realized when I was writing the book is a lot of the seven principles are new ways of thinking about things.

They were institutionalized 200 years ago. You know, I did some research when I started studying organizations, and I've read a lot of books and talked to a lot of people about this. The fundamental nature of bureaucratic industrial hierarchical organizations actually goes back to slavery.

And if you read books about how the slave trade and the slave owners managed their slaves, it isn't that different from the old industrial sort of GM model of management and labor. So, you know, the idea that we have to let go of that is like so obvious. So the purpose of the book is to just show people how to sort of rethink some of these things that we're stuck in. And I think a lot of companies have just sort of figured this out on their own.

And the book tries to just make it easy for everybody to get it. I love that. Someone shared an article with me about effectively why Gantt charts are rooted in white supremacy dating back to the time of slavery in America. And I was like, Preach. Yes.

No long, complicated plans. It doesn't work in complexity. I think it's exactly right.

So I would love to, I'd love to dig into a couple of the secrets. Sure. And I love all of the secrets. Are these like your children? Like, can you pick between seven of them or?

I mean, no, I mean, I like them all. I love them all. Of course. The number one, the first one is sort of the core one, but yeah, I talk about whichever ones you'd like to talk about.

So. I'm going to go to coach, not boss first. And the reason that I'm going to do that is because a lot of what you just said in terms of the history and the evolution of practices that have come to be like the air we breathe and we don't even question have to do with power holders reinforcing those things, which generally serve them well.

And what I noticed in your chapter about coaches, not bosses, is that it's a pretty significant paradigm shift from like power over top-down command and control, et cetera, to something quite different. Now, we know from research why that's compelling, why that's effective, et cetera. And I'm wondering how it's looking out there from your perspective in terms of people embracing this idea of coach, not boss, and actually learning how to be good at it.

What do you think? Well, Yeah, as the book shows, there's examples of companies that have really figured this out, but it's a relatively small number still. It's growing. And I think the reason it's growing is that bosses can't keep up with the stuff that their subordinates are doing. I mean, they just don't know.

They don't understand it. So they have to empower them because they don't have the expertise that a lot of their staff do. It used to be that the boss knew everything and the labor was told what to do. So it's just not like that anymore.

But I think there's this strange human need for some people to be in control, to exercise power, to lord over others for some reason. You see it all the time. I won't mention any names.

And so there's a tendency to go back to this when times are tough, especially right now. We just had all these layoffs. The economy slowed down.

We've got the inflation, the high interest rates. And bosses are sort of getting back to the old draconian way of talking about their management style and their workforce. We're going to make everybody come back to the office.

I know better than you do. You know, you guys aren't productive enough, so we want you to be more productive. Well, wait a minute.

What about the fact that it's your problem, not the employee's problem that they're unproductive? This mismatch between the Microsoft research that 87% of employees think they're highly productive, but only 17% of leaders think they're highly productive. I think there's this natural, unfortunate history of bosses wanting to be bosses.

Yeah. Well, they don't really have to be like that to be successful. So, but I think we're making progress.

I mean, I think there's more awareness of this than ever. And I think the pandemic taught everybody who was a manager that if they don't give people more flexibility and forgiveness, that they're not going to be around, they're going to leave. And you know, the job market's very competitive right now. So If you're a jerky manager, you know, people are going to either quietly quit or just leave, or maybe just not show up. Exactly.

Maybe find a better option. You know, yeah. So I think it's, I think it's pick up speed.

So I think it has started to happen more, but I think one of the tricky parts, let me just one more thing. Yeah. The tricky part is if you're not the boss, then what is your job? You know, being a coach isn't an obvious role that everybody understands what that means.

And what does it mean to be a developer of people rather than a manager of people? That's not obvious to people either. Some people weren't managed that way by others, so they've never experienced it. So I think there's a lot of role modeling that has to happen. I've noticed, though, amongst the clients we talk to, we tend to talk to mostly bigger companies, the people that are getting promoted these days are.

much more coaching personalities. They're very approachable. They're very sympathetic.

They're very good listeners. I'm seeing more and more of that every day in the companies we talk to. That's really good to hear. And I was going to make a similar point, which is just that during the pandemic, I think a lot of the sort of org debt nonsense, bureaucratic theater went out the window because a lot of folks were in survival mode. They were trying to just cope and keep the job going with the kids at home, et cetera, et cetera.

And I saw a lot of bosses who were at a bit of a loose end in terms of what to do, because a lot of the managing of the work around the work rather than doing real work just wasn't necessary in the same way. And I do see in this reversion to more draconian managerial style, like in some ways, a recreation of the old boss mode. That just isn't really necessary.

Like, as it turned out, we didn't really need it. And now I think rather than certainly for some strata of organizations, those folks figuring out how to become coaches, my deepest desire is that all middle managers become org designers because we just need them. But rather than sort of.

Looking to the left and right and thinking about re-skilling, I do see a lot of managers reverting to tracking and targets and this sort of drumbeat around productivity and efficiency that I think is not helpful. I agree with you. And I think there's two things that we have to focus on to try to prevent that.

One is the top-down problem. If the CEO is acting that way, then it forces everybody else to act that way. So it starts at the top. But the second is that, you know, actually managers are under more stress than employees. There's some studies that just came out the last couple of weeks that show that something like 55% of managers feel like they're stressed out and only 45% of employees.

So we've sort of pressed these people in multiple directions, hit the numbers, grow the business, make everybody more productive. And by the way, don't lose any people and be nice to everybody. Oh, okay.

Well, that's kind of a lot of pressure, though. By the way, I'm not telling you what's going on, because we're going to about to do a reorg. And there's a layoff coming, but we're not going to tell you about it until we're done. You know, that's a lot of pressure to put on mid level managers.

So we need to take care of those people. It's not obvious that they're going to become coaches, just because we tell them. Absolutely, absolutely. And one of the things I wanted to ask you about, which feels very related is, you talk a lot about how success is defined in irresistible companies versus more traditional companies. And I think, look, like measurement and the definition of success has a lot to do with things like how managers show up and prioritize and what they do.

So could you talk a little bit about that difference? How would you say an irresistible company defines its own success? Well, you know, once the companies go public, things change, but But even then, I think to me, the fundamentals of business, and I've run a couple of companies and I've been involved in a lot of companies, is the reason we build a business is to solve a problem that is not yet solved in a way that we think we can do it better than everybody else.

And as a result of that, we're going to delight some customers and we're going to make some money. And so the fundamental idea of a business is this. problem that we're going to solve that we feel privileged and smart enough to do better than whoever else has tried to do it before in a new way.

And when you focus on that and you continuously focus on that and you let the profit and the revenue come from that, then you become irresistible. But as soon as you start to worry about the profit and worry about the revenue and you say, oh, we're not growing fast enough. Let's buy another company over here.

Let's go into this other market. Let's, you know, tweak this thing and lay off some people and make raise everybody's quotas. You're not so irresistible anymore.

Now you're basically a financial operation trying to make more money for the sake of making more money. Now, I'm not a money person. I don't feel that motivated by money personally. I know some people do. And of course, if you're a publicly traded company, there's all the, you know, bravado of being well known on CNBC or wherever else.

But We've got to let that go because that doesn't actually usually last. Look at GE. I mean, GE was a house of cards.

You know, they made their numbers for something like 90 quarters. And then we find out later that they were, you know, doing all sorts of shenanigans behind the scenes to try to hit those numbers. To me, that's not irresistible. Now, some people, some investors might like companies like that, but I'm not an investor.

So the companies that stay true to that idea. of solving this problem and extending their expertise into new areas in a unique way, and then learning from their competitors or their market on what they need to do next, they turn out to be just incredible companies, Johnson & Johnson. I mean, look at even, you know, you look at Tesla, Elon Musk, or SpaceX, you might not like his personality, but that guy's gone after some problems that were completely unsolved before. And he's making good money at it now and growing like crazy. And I think his mind is constantly focused on how can we solve this problem better and better and better and better.

And people love working for companies like that. It's really fun. It's really inspiring. So that to me is the essence of this.

Absolutely. That's really cool. You know, I do org design for a living as you know, when I'm not doing this.

And I come back to the Deming quote. all the time that says every system is perfectly designed to get the results that it gets. And what I love about what you're saying is... So often in the boardroom or in the, you know, C-suite, it's like, go change the result, but don't, and then hope that somehow that translates inward. And it's like so much wiser to go from the inside out and to change all of the things you're talking about inside the system and trust that the results will come.

If you are doing what you're saying around the board. identifying and solving problems and pointing expertise at them and prioritizing quality, not just, you know, bumping the stock price for the quarter. But it's a rare leadership team that can sort of take that stance to stay in the operating system of the company rather than always wanting to control the external environment.

You know, Rodney, I can tell you think the way I do. I mean, it always galls me when I listen to an analyst call. And I won't mention any names and the companies go, well, we closed 18 deals and we made, you know, we closed this deal and we, they use the word like we won this, we won that deal. We won this deal. Well, did you actually help that customer do anything?

They don't even mention that. They don't even talk about it. I don't even think they think about it. Yeah. That, that to me is a little bit of a bad sign.

I mean, and to your point, what are we facing? Most companies do operate that way, but I think you have to be careful that you don't let that get out of hand. I mean, hard agree.

So there are so many things that I want to talk to you about, but I want to make sure that we talk about HR today and also AI. So let's dig in a little bit to HR because you have been in and around HR. for a long time. I know you're not an HR person, you're just an HR hero, including mine. We have really taken a perspective on HR in the last year that it is time for a significant change in HR. And part of the reason for that is because of the known issues.

Part is because of, you know, HR's inability to like demonstrate value, not that HR isn't valuable, but the talk track is often, where does the money go? And just that, you know, HR has not evolved and yet is being looked at to lead the future of work, to become more adaptive, to help organizations become irresistible. They just hold the keys to a lot of the operating system and, in my opinion, deserve their own transformation. I'm curious, when you look at irresistible companies and then you look at the current state of the HR industry, What are you noticing and what's sort of your call to action for the HR leaders out there?

Because I think you and I both have a lot of faith in those people and a lot of hope for those people. And also there's like a lot of work to be done. Yeah, I mean, this is a big project we've been working on for the last couple of years.

The reason we started our academy. First of all, I have complete faith in the HR profession. I don't have any question that they're going to transform themselves and we're just going to try to help them.

But there's two parts to me to the transformation. One is, when I started as an analyst, it was a copy and paste problem. You know, everybody would say to me, what did GE do?

Can we just copy that? Or what did, we're going to copy what Google did, or we're going to copy what Starbucks did. You can't do that anymore because now every company has to have a unique, crafted set of design solutions based on organization, as you know, leadership. training, development, all that stuff.

So there's a lot of custom development going on inside of companies. And that means that the HR professionals in the organization have to have the time and they have to be organized in a way that they don't just sort of like, oh, you ordered a hamburger, here it is, I got you a hamburger. They say, well, why do you want a hamburger? Are you sure that's what you're trying to do?

And what we call falling in love with the problem, instead of falling in love with the thing you built. and trying to get everybody to use it. So that's the number one thing. The second thing that's different is the siloed, all rich kind of functional domains of HR are all crossing each other. So, you know, we've got this new model we call systemic HR, which we haven't published it all yet, but we're getting a lot of the material together, which shows how you have to think about HR as an integrated set of services and skills and people.

that can solve problems in many, many ways, and also delivers a lot of scalable services. Because, you know, a lot of the basics of HR are operational things that the company, you know, gets really mad when they don't work right. And the Ulrich model wasn't designed for that. The Ulrich model, to me, was really designed around the sort of 1980s IT department. which was, you need a new computer?

We'll have it to you tomorrow afternoon at three o'clock. Are you happy with your new computer? Yes. Okay, great.

Talk to you later. Bye. I mean, there's some of that, but the service delivery part of HR is more and more self-service now.

I don't want to have to ask an HR person every time I want to do something. I just want to do it and get on with it, which means people like you that do design and consulting should be much more. front and center. And lots of things are connected together.

Now, right now, for example, most companies we talk to are realizing that their recruiting problem isn't just an external recruiting problem. It's also an internal recruiting problem, which means it's an internal development problem. So the recruiting department, which used to be on one end of HR, and the training department that used to be on the other end of HR need to be squashed together, and they need to talk to each other. And then, of course, they have to talk to the people in the compensation group about why isn't this person making as much money as that person? And that's the reason they don't want to take this job.

And then the diversity person who's sitting over there in the corner and sort of raising their hand and saying, well, wait a minute, that's not really a very diverse, inclusive way to do this. They have to be involved. So these COEs have to be more integrated together.

So we're really doing a lot of work on the building of what we call the full stack HR professional career where HR... professionals learn about these other domains, and then the organization operates in a more systemic way. So I completely agree with you.

I think when we talk to companies about this, within the first two minutes of the conversation, they're like, yes, yes, yes, we want to do that, just tell us how. And so I think the HR profession has woken up to the fact that they need to operate differently, and they're just looking for great ideas on how to do it. That's awesome. I mean, we're newer to this.

category, certainly, than you are, but so far have had a very similar response. The thing that we've been talking to people a lot about is this idea of the Hollywood model and really having the idea that people come together cross-functionally around a problem or a movie, make it, and then disperse, but the movie studio doesn't go away. So we're always going to have payroll and ops, and some of those things should be automated and outsourced, but there are persistent functions and there are seasonal functions. And the idea that we can bring the right capacity together to solve a problem as a habit, not as a crisis, seems to be landing with HR so far, which I feel like really, really aligns with your systemic HR. That is absolutely part of it.

But the difference between a movie and the HR department, because I know about that concept, is once the movie's made, you just sort of ship it. The problem with HR is the solution has to evolve. Somebody's got to own it.

It doesn't just end. So you've got to have an operations group and sort of a product management group to evolve it. So there's a lot of new concepts that exist in business that just haven't been embraced in HR enough yet. And just to play it out, my sense so far in the conversation has been as we bring people together cross-functionally to solve.

something, you know, like reimagining a hiring process, for example, that included in that team should be the individual or team that will be responsible for maintenance. So if we're going to reimagine or we're going to break ground on something for the first time, that happens in one way, but included in that effort are the individuals who will have to ultimately care and feed for it, which in my experience in HR very rarely happened. It was much more like, There were fences between all of us, and we just threw stuff over them and hoped for the best.

Yeah, exactly. And in fact, one of the things that happens all the time is somebody will say, we need a better process for recruiting. So a bunch of smart people get together for a couple of weeks in a conference room, and they design a new process. They fire up Workday.

They hire Deloitte or somebody. They implement it. Then they turn it on, and they tell everybody to use it, and they find out they don't like it. And they say, too bad, we already designed it, you're using it.

And there's no reason to do that. I mean, there's that whole design, sort of co-design thing is relatively new. It's obviously much more prevalent now than it used to be.

But sort of how do you design a people practice with the company while the company is changing, that integrates all these things together? That's not... as easy as it sounds. I'm sure, you know what, Rodney, I'll bet you can figure out how to do it.

I mean, that's the magic, right? That's the magic. You know what? I think it's not as easy as it sounds, but it's also not as hard as we make it out to be.

Right. I mean, there has to be adaptability. The thing about HR is these people processes are never perfect. That's the difference.

Once the movie's in the can, I think it's kind of done. And then the company changes, the economy changes, the job market changes, you go into a new business, new geography, it's a little bit different. I think HR is just an incredibly strategic part of a company.

And when it's well run, it can be really instrumental in the whole growth strategy of the business all over. Absolutely. And one of the things I wanted to ask you about, because I am keenly interested in HR and HR folks, if you were advising an HR leader who is interviewing right now, and they wanted to go work for an irresistible-like company, what would you tell them to look for in the process?

Or what would you tell them to be asking in those interviews? Well, I would say there's two types of things to look for. One is, you know, what is the energy and enthusiasm and alignment of the people you meet.

Do they all seem to be breathing the same air and talking the same language and is excited about the company for the same reasons? That's something to pick up because you do find in slightly dysfunctional companies, a lot of silos and people not necessarily aligned on different things. So that would be one thing to pick up because if you're going to join the company in HR, you're going to have to cross all those lines because HR people tend to cross a lot of lines. And the second thing is, if you're relatively senior or you're in a senior facing role, try to meet the leaders and see how do they feel about talent?

How do they feel about the people's side of the business? Or do they just delegate it to HR and think, that's not my job? It is their job.

I mean, we're here to help them run the company. We're not running the company. So, you know, we may want to just do a leadership development program and say, okay, well, now we're done. But...

Day-to-day, month-to-month, things come up where we would hope that the senior leaders are talking to us and that we're using our expertise to help them. And how open are they to that? Or are they in the older model where we just want somebody to run HR and then you guys worry about that and I'll worry about something else? And that does happen.

I'm not saying that's every company, but you want to stay away from that kind of situation. Sure. The CEO that's It's like, you go figure out the culture thing. When you figure out HR, I'm too busy.

Right, right. I love that. You know, this is a little provocative, but I've had this conversation with a CPO recently who landed somewhere that was not good, did not last long.

And, you know, understandably, she'd been very careful in her new search and looking for more progressive organizations. And one of the things that she was like, I will never say that out loud in an interview, Rodney, but I still think it's a good idea, is real clarity on. authority and decision rights. Because I just think HR is one of the only roles in the executive team where you get the job and then you have to keep asking everyone for approval to do that job.

That's just not how people don't say to the CFO, I don't think we should do that audit this year. But people say to the CHRO, I don't think this is the year for DEI training. Right.

Or I don't care what you think about hybrid work, we're making everybody come back to the office. Exactly. It's like everybody's an expert in HR. But I think that's a really tricky part about this profession. Everybody thinks they're an expert at people's stuff.

You've got to find a management team that does respect the principles and science and professionalism of HR. And then you have to act in that way and prove to them that you know what you're doing. And that's why it's kind of a...

fun profession to be a part of. Listen, to my engineering mind, it's the ultimate challenge. It's a vexing, complicated problem that's dealing with all sorts of personality issues. And if you can do it well, you're a superstar. I love that.

Speaking of engineering, we have to talk about AI. I mean, has there been a change as significant for work ever? Maybe the internet? Has there ever been a change? as big as the one that you think is coming or is kind of here?

Well, I think every big technological change feels as disruptive as this one. The internet itself, the cloud, the mobile phone, AI, they're probably each as big. And, you know, looking back, you always think the other ones were no big deal, but actually each one of them was just as disruptive.

But I do think AI is at that scale. And I don't think everybody... Gets that, yeah.

Yeah. I just listened to one of your podcasts about AI, and everyone should listen to it because to me, it was the best explanation for AI's application for real to... HR and work that I've heard so far. But just in case people haven't, can you talk a little bit about what are your top three AI-related topics, ideas, tools that should be on every HR org's radar right now? Sure.

I'll go through the three things in a sec, but let me just make a little quick preface. So the reason I think AI is so valuable for HR is we're sitting on this massive investment that companies have in people, roughly the largest expense they have. And most of the decisions we make are sort of seat of the pants. Who to hire, who to promote, how much to pay somebody, who gets this role, who gets that role, how we're going to manage this team, blah, blah, blah. I mean, all these things, we work so hard to do them as best as we can.

And we don't have that much data about what's going to work and what's not going to work. We have some. So AI is going to give us... Another order of magnitude of data around those kinds of decisions. Now, in terms of three big areas, one huge area of AI is this whole area of skills and recruiting and job matching.

So who is the right person for what job? What are the real skills needed in this job? What are the activities that this job will require people to do? That used to be a handcrafted, sit down in a room, open the FYI book, copy a bunch of competencies. You've probably done this.

I have, indeed. Yeah, well, you don't need to do that way anymore. The AI can show you who's succeeding and why they're succeeding, and therefore who you should hire and who's a good internal candidate and so forth.

So that's one thing. So that falls in the category of talent intelligence. So there's a whole bunch of examples of that. Who should be moving into what role?

Who's ready for leadership? Those are massive, massive. issues that we've tried to solve in many, many other ways that AI is going to help. The second is support.

I'm an employee. I'm a manager. I need help with something I don't know how to do.

Maybe it's a training problem. Maybe it's an administrative problem. I'm going to call my HR business partner. I'm going to ask him or her to help me. She's busy, can't get back to me for another 24 hours.

I'm stuck. Well, because of the way these AI tools work, we can take our documentation. We can take our workday. implementation or whatever training guide. We can stick it in there and people can find what they need and they can solve their own problems.

So all of this kind of mishmash of HR technologies and tools and programs suddenly become much, much easier to navigate with a really intelligent chatbot. We built one of these for our research, which we call the HR Copilot. And we've seen it.

I mean, it just is amazing how the generative AI will find things within your company, not outside your company. and solve a lot of problems that business partners have to do by hand. Yes. We're very excited about Copilot at the ready.

And then the third area is generative AI for education and training and development. You know, there's a $250 or $260 billion market of training programs, leadership development programs, technical training, safety training, compliance training, DEI training, et cetera. It's a handcrafted, old-fashioned publishing model where an instructional designer authors a course, builds an outline, videotapes people, develops the course, sticks it in an LMS, tests it, launches it, et cetera.

And that works okay, but the AI can do it way better. And not only can the AI develop content, but the AI can answer questions and point you to information so you can learn in the flow of work, which we've been trying to do in learning and development for a long time. So I think there's going to be a big revolution there. So those are three massive sort of use cases in HR.

And there'll be others that I haven't even thought of yet that will come up. Those are pretty massive. I have a lot of confidence that this is going to be a really big deal.

Yeah. You know what I'm excited about is, you know, take performance management out of it. Just real feedback, performance-based feedback, style-based feedback, contribution-based feedback, whatever you want to talk about. It has been such a tough nut to crack historically.

And like the feedback rich environment is mostly a myth. And what I have noticed in my interaction with a variety of AI tools so far is how non-reactive I am from getting feedback from a bot around how I sound or whether I'm doing it right versus getting it from a person. And I cannot wait for that to be integrated into more of the day to day.

Yeah, that's an interesting point. I mean, there are these passive listening tools, Perceptix just bought one, Vizier just bought one, BetterUp bought one, that are out there that, including the Microsoft tools, that give you unprompted advice or comments or suggestions or nudges. And I guess you're right.

I never thought about it. I never mind getting those things either because I don't feel insulted. Right.

Because I can just ignore it if I don't believe it. Yeah. I haven't used a tool yet that gives me advice unprompted, though I would be very curious about trying that.

But yeah, just this idea that there's no part of my ego that's like, well, how do you know? How do you know that my sentiment was unfriendly? You know what I mean?

It's because it's like, well, you know, because you have all of the internet at your disposal, but, and you're just telling me what you see. So like the three domains that you just mentioned are massive and they are a huge part of any people organizations domain. What are you telling people to do to get started? Because I'm having conversations with HR leaders that are like, the tsunami is coming and we are woefully underprepared. So we've been talking to companies about this for a long time, and it's particularly around skills.

I mean, the strategy that we tell them is focus on a problem. Don't focus on the technology. I mean, there's a lot of people that, because of the nature of their job, they say, okay, oh, we need one of these tools.

Let's go buy an AI recruiting tool. Let's go buy an AI skills inference tool. Let's turn on the Workday Skills Cloud.

I mean, a lot of companies have said to us, how do we use the Workday Skills Cloud? Well, you don't use it. It's there to solve a problem. So go after a problem. So pick a problem.

We're growing. We have to hire people in this particular country. We have high turnover. We have low productivity.

We have a management leadership gap. Our innovation sucks. Whatever it is, everybody's got these things. Pick one of those big things that the CEO and the CFO care about. Go after that and then apply the tools to that problem.

And the tools will make more sense and you'll see which ones apply. And you'll learn a lot about them if you evaluate them in the framing of the problem. If you just look at the tools and you listen to the salespeople, first of all, the salespeople usually aren't very good at talking about the problems.

All they do is talk about the system. You're going to end up with RFP frenzy and you're going to end up in these big RFP things. And then you're going to finally buy something and then you're not going to know what to do with it. So I think that's where it starts. And the vendors are very immature.

A lot of these AI systems, some of them are fairly sophisticated and some of them are pretty new and a little bit oversold. So that's what we tell people. And what happens is when you do that, a lot of times, a lot of the AI efforts start with recruiting.

You think you have a recruiting problem and then you realize, well, I also have an internal mobility problem because I need to fill some of these slots with internal candidates. So does this tool work for internal mobility? And then I say, well, what kind of mobility am I moving people who are already ready for the role or people who aren't ready for the role?

Oh, I need a little bit of development in there too. And the next thing you know, you've solved a pretty big problem in the company. And you've picked a tool that's proven itself in the domain that you exist.

And I think that's the market we're in. None of these systems do everything for everybody in every domain yet. They're all pretty new. Yeah, that is such good advice. I love that we sort of ended this conversation where it started, which is investigate the problem, think deeply about the problem rather than skipping that step and going right to a shiny or compelling or rational solution.

That was so, so fun, Josh. I know we have to wrap up. I can't believe how fast this hour went. Please tell our listeners where they can find you and learn more about. all of the amazing things that you shared with me today.

Well, thank you, Rodney. It was really fun to talk to you. JoshBurson.com is our primary sort of market-facing website. We have the Twitter account, a bunch of LinkedIn accounts. I'm pretty easy to find on LinkedIn.

We sell a corporate membership program, which has all sorts of fascinating information, including our co-pilots. You can get in there and use our AI. And then we have an online academy called BursonAcademy.com.

which is both for corporations and individuals. So if you're an HR person or even a non-HR person, you just want to learn about this stuff, the Academy is very inexpensive. You can go in there and just take a lot of courses and see all these resources and research.

And then, you know, call us later when you're ready for the big corporate stuff. And that's kind of where we are. Fantastic.

And folks, definitely read Irresistible if you haven't already. It is a wonderful book. There's so much more we could talk about.

Next week, I will be back with Sam for our final episode of this mini-series reflecting on what we've learned from Josh and our other awesome guests. Thanks, as always, to Taylor Marvin for making us sound good. This mini-series is produced by The Ready, where we help organizations around the world change the way they work.

You can get in touch with us by emailing fohr at theready.com. As for you HR listeners out there right now, let's change ourselves first.

Transcript for:The Future of HR Transformation

Transcript for:
The Future of HR Transformation