The Shift: The Future of Work is Already Here

THE SHIFT

THE FUTURE OF WORK IS ALREADY HERE

LYNDA GRATTON

For my mother Barbara’s grandchildren

– the ‘regenerative generation’ –

Carla, Max, Christian, Frankie, Dominic, Hunter,

Freddie, Tilly, Jasmine, Eve and Summer

Contents

Cover

Title Page

Preface - Tomorrow’s work begins today

Introduction - Predicting the future of work

PART I - The Forces That Will Shape Your Future

Chapter 1 - The five forces

PART II - The Dark Side of the Default Future

Chapter 2 - Fragmentation: a three-minute world

Chapter 3 - Isolation: the genesis of loneliness

Chapter 4 - Exclusion: the new poor

PART III - The Bright Side of the Crafted Future

Chapter 5 - Co-creation: the multiplication of impact and energy

Chapter 6 - Social engagement: the rise of empathy and balance

Chapter 7 - Micro-entrepreneurship: crafting creative lives

PART IV - The Shift

Chapter 8 - The first shift: from shallow generalist to serial master

Chapter 9 - The second shift: from isolated competitor to innovative connector

Chapter 10 - The third shift: from voracious consumer to impassioned producer

PART V - Notes On The Future

Chapter 11 - Notes to children, CEOs and governments

Endnotes

Bibliography

Learning more about The Shift

Acknowledgements

Index

About the Author

Copyright

About the Publisher

Preface

Tomorrow’s Work Begins Today

It all began with one of those simple questions that teenagers have a habit of asking. Seated at the morning breakfast table, I found my train of thought interrupted by my eldest son Christian who, 17 years old and fresh out of school, was clearly pondering his future.

‘I’m really keen to be a journalist,’ he remarked to his brother and me.

His brother Dominic, two years his junior, perhaps inspired by his lead, followed on with ‘And I’m thinking about medicine.’

Both sentences were spoken with sufficient query that I took them as questions rather than statements of fact.

Having been a professor in a business school, and an advisor to companies for nigh on three decades, I consider myself something of an expert in the why and how of work. Of course, I am also the first to acknowledge that my sons, being teenagers, are unlikely to have much interest in my opinion. But it struck me on that busy morning that I did need at least a point of view about the future of work. The challenge was this: what was my point of view? I began to realise that, despite my years of advising companies and researching work, all I could muster that morning was a rather half-baked, old-fashioned set of assumptions, combined with ‘tidbits’ of data that seemed both hopelessly out of date and extraordinarily incomplete.

Over the following few months, as I pondered on their question, I found that more and more people asked me about their working future. I recall how one of my smartest MBA students wanted to know how he could create a future working life that allowed him to be more of a father to his own family. He explained to me that he believed it was crucial that he spent more time with his yet-to-be-born child than his own father had spent with him as a child. Others wanted to know where to live to gain the most value, the competencies they should focus on and the career paths they should develop. At the same time, the executives I taught wanted to know when to retire, what to do when they reached 65, how to take a gap year, what to say to their companies. Then my research team ran, with colleagues at Unilever, a session with kids under the age of 10. We asked them to talk about their ideas about work. They talked robots and transhumans, computers and global warming. Even at 10, they had begun to play out these future scenarios. And to cap it all, the human resource executives I teach at London Business School seemed to be deeply concerned that their companies were too hierarchical and bureaucratic, and too slow moving to catch up with the trends they saw emerging.

I put these anxieties and questions down in part to the 2009/10 global recessions that rattled everyone. I was feeling the impact myself in my own teaching. Back in 2000 my colleague Sumantra Ghoshal and I had chosen four companies to write extensive case studies on, which would then be taught both at London Business School and also around the world. We chose companies that at that time were in the top five in their sectors and generally admired. From banking we chose the Royal Bank of Scotland; from industry, BP; from investment banking, Goldman Sachs; and Nokia from the technology sector. By mid-2010 RBS had made one of the largest losses in banking history; BP was haemorrhaging oil into the Gulf of Mexico and being castigated by the US Senate for its leadership competence; and Goldman Sachs was in the process of a significant fine from the trading commission. Only Nokia was unscathed, although its share price and value seemed paltry against the mighty Apple. And of course, until 2009, I had directed the Lehman Centre at London Business School. Even ivory tower academics began to feel the winds of change.

When I talked to executives in Nokia and Reuters about the technological developments that are around the corner, and to colleagues at Shell about the coming energy challenges, and indeed to other academics about the growing employee distrust and anxiety they were observing, I began to realise that what I was witnessing was more than simply the backlash from the recession. Added to that, in my twice-yearly visits to India and Africa it was clear these continents were transforming in a way I had never previously witnessed. It began to dawn on me that this was not going to be business as usual. Instead I began to realise that we were entering a time of real flux and possible transformation, and that I was ill equipped to answer the questions I was being faced with.

What I needed was a point of view about the future of work that was more thoughtful and expert than the rather vague and ill-formed views I held. I knew that these questions I was being asked about the future of work were crucial. Work is, and always has been, one of the most defining aspects of our lives. It is where we meet our friends, excite ourselves and feel at our most creative and innovative. It can also be where we can feel our most frustrated, exasperated and taken for granted. Work matters – to us as individuals, to our family and friends and also to the communities and societies in which we live.

I also knew that many of the ways of working we have taken for granted in the last 20 years – working from nine to five, aligning with one company, spending time with family, taking the weekends off, working with people we know well – are all beginning to disappear. And what’s coming in its place is much less knowable and less understandable – almost too fragile to grasp.

However, despite this fragility and the difficulty of grasping the future, I needed answers – and so do the people who asked all these questions. So, of course, do you. Perhaps you don’t need absolute answers. But what you do need, like me, is a point of view, a basic idea of what the hard facts of the future are, and a way of thinking about the future which has some kind of internal cohesion, which resonates with who you are and what you believe. You and I, and my children, and others who are important to us, need to grasp the future of work because we have to prepare ourselves, and we have to prepare others.

To understand better these profound changes, I began my journey with the goal of discovering, with as much fine-grained detail as possible, how the future of work was likely to evolve. I was interested in day-to-day details like: What will friends, my children and I be doing in 2025? How will I be living my working life at 10.00 in the morning? Who will I be meeting for lunch? What tasks will I be performing? Which skills will be in the ascendant and most valued? Where will I be living? How will my family and friends fit with my work? Who will be paying me? When am I going to retire?

I also wanted to discover more about whether in the future our thoughts and aspirations could change. Questions like: What will be going on in my working conscious in 2025? What sort of work will I be aspiring to? What will be my hopes? What will keep me awake at night? What do I want for myself, and those who come after me?

These are the day-to-day events and fleeting moments of thoughts and aspirations that will influence the working lives of you and your colleagues, and those of your children and friends. These are important questions since it is from this fine-grained detail that our daily working lives are constructed.

I soon discovered that while, on the face of it, these are relatively simple questions, in reality the answers are not straightforward. At an early stage of this journey it began to dawn on me that you couldn’t describe your working future simply as a straight line from the past into the present, and then on to the future. Instead, I began to see the future as a set of possibilities, a number of ways forward, and the opportunity to travel on different paths. But the question remained of how best to draw these possibilities and different paths.

My mother is a great maker of patchwork quilts. As a child, I remember her assembling fragments of material over many years – material she had used earlier, or which had been donated by friends, or which she had bought. Over the years the height of the material scraps in the patchwork box increased, and every couple of months my mother would take them out and look at them closely.

What she was looking for was a pattern that she could discern from the pieces. She was looking for the pieces that would naturally fit together to create a pattern that made sense. Once she had decided which to keep and which to discard, she set about arranging those pieces she kept. She moved the pieces this way and that, until she decided how best to assemble them into the quilt. At this stage she made a rough layout on the floor of the bedroom, and then began the long task of making the first rough stitches to hold the pieces together. Once this had been done, and she had made any final changes to the location of the pieces, she set about the laborious task of hand-stitching them together.

I am reminded of my mother, and her construction of the quilt from the many pieces of material, as I craft this book about the future of work. It is a book that I hope will be uplifting without being ridiculously positive and Pollyanna-ish, and illustrative without being constraining. In the crafting of this book I have followed the same path my mother took as she fashioned the patchwork quilt. I have, over the years, kept many scraps of ideas and borrowed some from friends. More recently, I have assembled a wise crowd of people from across the globe to bring their insights and ideas. Then, having gone about the process of looking for patterns, I decided what to discard and what merited keeping. I have, like my mother before me, embarked on the long period of hand-stitching the pieces together to form a patchwork of the future of work. This book is the result of that long process.

I believe passionately that the scale of change we are going through in this decade puts into stark relief many of the assumptions we have held dear about what it takes for us to be successful. It is perilous and foolhardy to ignore these changes. It is also naive to imagine that what worked for the past will work for the future. To do so puts in jeopardy our own future and the future of those we care about. Predicting the future of work, and crafting a working life that brings happiness and value, are two of the most precious gifts you can give yourself and those you care about. Don’t leave it too late to make the decision to think and to act.

Introduction

Predicting The Future Of Work

Why now?

What we are witnessing now is a break with the past as significant as that in the late eighteenth and early nineteenth centuries when parts of the world began the long process of industrialisation. What we know as work – what we do, where we do it, how we work and when we work – has already changed fundamentally in the past when the Industrial Revolution transformed work, beginning in Britain between the late eighteenth (around 1760) and early nineteenth centuries (around 1830).1 It seems likely that the period we are moving into will see as fundamental a transformation – although of course the outcome is much less clear.

To get an idea of the velocity of the changes that can sweep away so many assumptions, consider the period between 1760 and 1830. Within a period of less than 100 years – that’s only four generations – there occurred a fundamental and irreversible shift which changed the experiences of every worker in the UK, and was to be felt across the world as industrialisation spread first to Europe and then to North America. Before that time work – whether it be ploughing the fields, weaving of wool, blowing of glass or throwing of pottery – was an artisanal activity engaged with largely in the home, using long-held and meticulously developed craft skills. From the late eighteenth century onwards these craft skills began to be transformed as the manufacturing sector was developed and began to transcend the limits of artisanal production.

Looking back with hindsight and a gap of over 200 years, we can learn much from the trajectory and speed of revolutions in working lives. The Industrial Revolution began gradually and relatively slowly to change working lives. The economic growth throughout this period was little more than 0.5% per person per year, and while we now think of the ‘dark satanic mills’ as being the key motif of this time, in fact textile production often constituted less than 6% of total economic output within Britain. In reality, the growth in total productivity during this apparent revolution was in fact slow by modern standards.2 This was an evolution rather than a revolution; gradual rather than progressing through breakthrough changes; and based on continual and small changes rather than a series of massive innovations. For those living through this period it would not have been seen as a time of immense change, and it is only when the broad sweep of history is viewed that the extent of change can be put into perspective.

The core of any revolution in the way that work gets done is inevitably changes in energy. When true innovations occur in the production of goods or services, they are the result of a capacity to unearth new sources of energy or to apply existing sources in a radically more efficient way. The first Industrial Revolution, although it had an impact on working lives, was not an energy revolution. The movement that took place at this time, from farming to fabrication, was not inherently innovative; the artisan remained the primary source of productive activity. That’s reflected in the modest growth rates throughout the late eighteenth and early nineteenth centuries.

The real revolution in the working lives of people began to occur in the mid to late nineteenth century, when British scientists, unlike their European contemporaries, began to be experimental. It was this culture of innovation, with the ideas of organisational and technological restructuring rapidly picked up by entrepreneurs and industrialists, that transformed working lives. It enabled a new class of practical scientists to emerge and to excel.

This was the emergence of the engineering class and of a culture of innovation.3 The real shift in work came with a change in energy – the power of steam that was rapidly integrated into the embryonic factory system. This transformation came as the consequence of a new energy source in the shape of steam, with a new spirit of enterprise and innovation. It was only when engine science combined with an emerging engineering culture that a new source of energy – steam – integrated into the productive process.

In the fifty years that followed the closing decades of the nineteenth century, a true revolution in work had occurred. The emergence of an engineering class signalled the professionalisation of practical science and the institutional pursuit of innovation. This also saw the transformation of the working lives of people across Britain and later the developed world. Work became more regimented, more specialised. The workplace and the work schedule became more compartmentalised and hierarchical.

This was the embryonic stage of Fordism – the rise of the engineer as the organiser of economic activity, and the decline of the artisan. The layout of a factory was as important as the technology within it, embodying as it did the power structure of the organisation. In this second Industrial Revolution, engineers redesigned factories to make employees fit into the production line. By doing so workers lost their autonomy, becoming simply as interchangeable as the parts they created.

As we look to the world of work we now inhabit, and the decades to come, what we are seeing is the potential reverse of this trend, from hierarchy and interchangeable, general skills to the reinstatement of horizontal collaboration and more specialised mastery.

What is clear is that the current scale of transformation is as great as any witnessed in the past. Again it is powered by an energy transformation (in this case computing power); again going through periods of slower and then more rapid change; and again depending on a new set of skills and an emerging class of skilled people.4

However, as we shall see, this time the impact of the Industrial Revolution is global rather than local, the speed ever more accelerated and the disconnect with the past likely to be as great. It is clear that our world is at the apex of an enormously creative and innovative shift that will result in profound changes to the everyday lives of people across the world.

Patching together the future

Faced with the magnitude of these changes, how do we both make sense of them, and indeed ensure that we and those we care about are able to do the very best they can over the coming decades? I’ve used the story of my mother’s quilt-making as a metaphor for the task that we are all faced with as we prepare for the future. As I attempt to make sense of the future for myself – in a sense to stitch together the pieces that are important to me – I cannot help but be occasionally overwhelmed with the sheer complexity of this endeavour, very much as I suspect my mother must have felt at the beginning of her craft. I wonder if indeed it is worthwhile to try and make any predictions about our working life in 2020, 2025 or beyond, as far out as 2050? However, what has spurred me on is that, the more I have learnt, the more I have come to believe that while this endeavour is indeed complex it is also incredibly worthwhile. It is worthwhile because you and I, and those whom we care about, need some sort of realistic picture of what the future might bring in order to make choices and sound decisions.

Think about it this way: I am now 55 and could expect to live to my mid-eighties – perhaps even into my mid-nineties. My two sons are currently aged 16 and 19 and they could well live more than a century. If I work into my seventies, then that’s 2025, and if my sons do the same they will be working into 2060. Take a moment now to make the same time period calculations for yourself and others who are important to you.

Of course, all the decisions about your working life don’t need to be made now. In the case of my children, for example, I expect they will adapt and change and morph over the next 50 years – just as I have done through my own working career. However, wouldn’t it be useful to have some picture of the future, storylines of future lives, scenarios of choice to guide and give inspiration? We need these, not only for our personal or local near-term futures, but also for remoter global futures.

Just because my children, you and I ‘need’ realistic pictures of the future, it does not mean of course that we can have them. Predictions about future technical and social developments are notoriously unreliable – to an extent that has led some to propose that we do away altogether with prediction in our planning and preparation for the future. Yet, while the methodological problems of such forecasting are certainly very significant, I believe that doing away with prediction altogether is misguided.5

The reason it is so important now at least to attempt to paint a realistic picture of the future is that we can no longer imagine the future simply by extrapolating from the past. I cannot imagine my future working life by drawing a direct line with the working life of my father – any more than I could expect my sons to predict their working lives from mine. I am not suggesting that everything will shift. Of course some aspects of work will remain the same; one of the challenges, in fact, is actually knowing what will remain stable. As the science fiction writer William Gibson famously remarked, ‘the future is here – just unevenly distributed’.6

It has not always been so difficult to simply extrapolate from the past. For much of the ages of mankind, perceptions of daily lives were envisaged – with very few exceptions – as changeless in their material, technological, and economic conditions. This transformed fundamentally from the eighteenth century with the advent of the Industrial Revolution, when what was seen as hitherto untamable forces of nature could be controlled through the appliance of science and rationality.7

The past six generations have amounted to the most rapid and profound change mankind has experienced in its 5,000 years of recorded history.8 If the world economy continues to grow at the same pace as in the last half-century, then by the time my children are the same age as me – in 2050 – the world will be seven times richer than it is today, world population could be over 9 billion, and average wealth would also increase dramatically.9

What is important about my sons’ questions about their future work is that they are living in an age in which they face a schism with the past of the same magnitude as that previously seen in the late nineteenth century. The drivers of that change were the development of coal and steam power. This time round the change is not the result of a single force, but rather the subtle combination of five forces – the needs of a low-carbon economy, rapid advances in technology, increasing globalisation, profound changes in longevity and demography, and important societal changes that together will fundamentally transform much of what we take for granted about work.

It is not just our day-to-day working conditions and habits that will change so dramatically. What will also change is our working consciousness, just as the industrial age changed the working consciousness of our predecessors. The Industrial Revolution brought a mass market for goods, and with it a rewiring of the human brain towards an increasing desire for consumption, and the acquisition of wealth and property. The question we face now is how the working consciousness of current and future workers will be further transformed in the age of technology and globalisation we are entering.

What is inevitable is that, for younger people, their work will change perhaps unrecognisably – and those of us already in the workforce will be employed in ways we can hardly imagine. This new wave of change will, like those that have gone before them, build on what has been accomplished in the past, made up of a gradual process with some possibly unpredictable major waves. It is about increasing globalisation, industry and technology. But, as in the past, these changes will also bring something that is qualitatively different – new industries based around renewable energy sources, new developments of the internet, and indeed new ways to think about work.10