The current pandemic has dramatically exposed the vulnerabilities of some organizations. Others meanwhile have been catapulted to success. While some organizations were quick to adapt to the new normal, others struggled to contend with the crisis. To survive the next pandemic or any future disruption, organizations must take better steps to make themselves resilient, flexible, and agile. This starts with foresight or the ability to transform an organization for the future. But what will that future organization look like? Here we'll look at how organizations' structure, processes, leadership, and workforce may evolve.
Building Resilient, Flexible, and Agile Organizations
It’s reasonable to assume that rapid technological changes and global health and economic challenges will continue to disrupt industries in the future. We can therefore reasonably assume that the trend will be towards building resilient, flexible, and agile organizations. Traditional structures, design, leadership styles, and employee management must evolve. Otherwise, the whole organization's future will be more susceptible to collapse. It will therefore be important to put in the right tools and machinery to make yourself aware of these trends.
Efficiency to Adaptability
Traditionally, a key goal of any organization's structure and design is efficiency. The focus is to produce the highest amount of output with the least amount of input and to complete tasks within the shortest time possible. The future organization, however, must also embrace adaptability as a key goal. Adaptability is simply the capability to respond to changing circumstances or new environments.
Organizations are now investing to overhaul their old systems to enable them to embrace these more flexible designs. This is closely tied to efficiency; it's economical to invest time and resources to devise plans and restructure your organization to be adaptable, rather than conduct a complete overhaul every time a crisis strikes. Future organizations will not waste their time resisting the current of change; they'll build a stronger ship to overcome any wave.
Hierarchies to Flatter Structures
Another continuing trend is the shift from hierarchies to flatter structures. For decades, the organizational structure has been characterized as horizontal, centralized, and departmentalized. A clear chain of command dictates who reports to whom, the concentration of decision-making to a few, and a rigid division of functions based on specialization. The movement is now towards delegation, decentralization, and cross-functional teams. Organizations are removing supervision levels, blurring lines of authority, assigning more responsibility to ordinary employees, and transforming departments into dynamic teams. According to an article from the Harvard Business Review, a flat organizational structure works best when situations change rapidly. Smaller and more autonomous teams are more agile than large hierarchies. And, since organizations will be undergoing rapid changes, we can expect the gradual collapse of hierarchies and continuous rise of flatter organizational structures. With this, employees can expect more opportunities to lead, but also greater responsibility and accountability. Likewise, cross-functional networks and teams can be easier to form, split, and combine to meet the organization's needs and respond to disruptions. This will allow a freer flow of information and feedback with fewer layers to navigate.
Command and control to Collaboration
One effect of a flatter structure is the shift from command and control leadership to collaboration. Leaders will be more receptive to ideas regardless of the position of the employee. Instead of dictating the work, employers are encouraging workers to contribute towards the organization's strategy, looking at them as partners, not merely tools for production. With an employers' less imposing attitude, the workplace culture can become more informal as well. Uniforms and the use of formal names and titles that were once imperative can soon become optional. Revered leaders who worked diligently to climb the corporate ladder may find this uncomfortable, but they must brace themselves for the inevitable.
The movement towards automation is crucial for the resiliency of many organizations. The coronavirus pandemic really impacted enterprises dependent on physical labor and on-site production. This crisis will act as a major prompt for organizations to accelerate the adoption of new technologies and the automation of routine jobs. That will also mean more flexible processes and mobile workers. Cloud storage services, engagement systems, and platforms for digital collaboration are just some of the advancements that future organizations may embrace. An article featured in the World Economic Forum literature stressed the importance of the adoption of these technologies. It stated that the winners in a post-pandemic economy would be businesses that use cloud computing and those that utilize robotic process automation (RPA) and artificial intelligence (AI) within their supply chains.
Offices to Off-site Locations
COVID-19 prompted many organizations to shift to remote work for the health and safety of their employees. But many people are expecting off-site work to continue even after the restrictions are lifted. Tech-giant Google already announced the extension of their work from home option until June 2021. Amazon, Apple, Facebook, and Twitter also made similar pronouncements. The move of these giant companies can inspire others to do the same.
Organizations, however, must be wary of jumping into the remote-working trend. Assess your organization's culture and identify your priorities before choosing a set-up that can work for you. Do you want an on-site, remote, or hybrid arrangement? Why? Is co-location essential for your firm's productivity? Is in-person interaction necessary for effective collaboration among your employees? Can you trust your workers to perform optimally despite the physical absence of their supervisors? Are the security of data and other operations really properly dealt with when working remotely? Consider these factors before moving to a new arrangement.
Full-time to Freelance
There is an increasing number of independent contracting workers. In 2019, a study commissioned by Upwork, a global freelancing website, estimated that about 57 million Americans freelanced that year alone, and their collective income is nearly $1 trillion or equivalent to about 5% of the US GDP.
This is not surprising that companies are starting to hire freelancers or on-demand workers over full-time employees. But what drives these companies to adopt this solution? A case study by the Oxford Internet Institute titled "Platform Sourcing: How Fortune 500 Firms are Adopting Online Freelancing Platforms" found three distinct motivations among these organizations. These are: "(1) Providing easy access to a scalable source of manpower, skills, and expertise, (2) Reducing start-up and transaction costs, and (3) Eliminating conventional hiring barriers". As companies look for ways to become more responsive to disruptions, we can expect more firms to choose dynamic on-demand workers over full-time employees
Towards a Diverse and Inclusive workforce
In the US, the Bureau of Labor Statistics (BLS) "Long-term Labor Force Projections to 2060" stated that racial and ethnic minorities had increased their presence in the population and the labor force. This led to a growing diversity of the workforce. Future organizations will respond to these changes by embracing strategies that promote diversity and inclusion. We can also expect more women in leadership positions. Forward-thinking organizations learn early that such a diverse workforce will introduce them to a talent pool with different perspectives and approaches and use it for breathing life to their companies.
Profitability to Prosperity
Future Organizations will gauge their success based on prosperity or overall economic well-being and not just profitability. They will look beyond the numbers and consider their employees' empowerment and their communities' betterment. Organizations of the future must offer purposeful and meaningful employment. Workers will not be treated as mere tools of production but as partners and collaborators. Future organizations must also take their social responsibilities seriously. It must be conscious of how its operations impact society and what efforts it can contribute positively. Marketing will suffer if they don’t as customers search for new ways to validate their purchases in an online environment. These can be in the form of a donation to social causes, reduction of carbon footprint, and improvement of labor policies, among others.
Local to Global Mindset
While some countries are actively kicking against the concept of ‘globalization’, for the world at large, it is still an ongoing trend. Globalization has increased interaction among people and the exchange of ideas and cultures. Cross-border distribution and sale of goods and services is made easier. With this, more and more organizations are shifting from a localized to a globalized mindset. Catering to a defined consumer market with predictable tastes and demands is no longer practicable. Future organizations think about introducing their products to the global community, meeting the fluid and changing needs of customers from various cultures, and how to stand out amidst the growing competition. Old strategies that attracted local customers may not work for global consumers with vastly different tastes and spending habits. Thus, future organizations must be attuned to emerging needs and amenable to change their existing products to meet consumer demands.
List of sources mentioned
Kastelle, Tim. "Hierarchy is Overrated." Harvard Business Review, November 20. https://hbr.org/2013/11/hierarchy-is-overrated
Mohit Josh. "Who will be the winners in a post-pandemic economy?" World Economic Forum, April 20, 2020. https://www.weforum.org/agenda/2020/04/post-pandemic-economy-favour-fastest-movers/
Adam Ozimek. "Freelancing and the Economy in 2019." Upwork. https://www.upwork.com/i/freelancing-in-america/
Corporaal, G.F., & Lehdonvirta, V. (2017). "Platform Sourcing: How Fortune 500 Firms are Adopting Online Freelancing Platforms". Oxford Internet Institute. https://www.oii.ox.ac.uk/publications/platform-sourcing. pdf
Mitra Toossi. "A look at the future of the US labor force to 2060." US Bureau of Labor Statistics, September 2016. https://www.bls.gov/spotlight/2016/a-look-at-the-future-of-the-us-labor-force-to-2060/home.htm