In TomorrowToday we have had the privilege to have been involved with several profession service firms internationally – both in the accounting and legal spheres. Such institutions are always quick to inform you that they are different – different from ‘the corporate sector’ – and of course they are different. The very business model and how that plays out internally sets professional service firms apart from their corporate counterparts. However, the haste to differentiate themselves from the corporates, can also cover a twin-challenge that both face; they are challenges that in the case of professional service firms, if not addressed effectively, will have significant consequences.
The ‘twin-challenge’, to which I refer, is that of talent retention and diversity. They are not unrelated for one of the major strands of diversity is in fact, generational (age) difference.
Distilling research done by the East West Center, Hawaii my colleague Prof Nick Barker identified four distinct characteristics of globalization. One of these characteristics was something of a surprise in that it represented the opposite of what one might expect in an increasingly connected world: it was the fact that there is an increasing emphasis on difference. Digging deeper, it is not hard to understand this emphasis. It stems from the fact that as there is evidence of more and more ‘sameness’ – due to an increasingly connected world (as seen for example in the emergence of universal brands) – so there is a strong reaction of ‘see me’ / ‘see us’. The more we appear ‘the same’, the greater is the need for distinction. This is what makes dealing with diversity so important. As our workforce and clients / customers and markets converge, the need to be able to both understand and leverage diversity become essential.
The benefits of diversity are numerous: better decision-making; accessing deeper knowledge – especially when it comes to emerging markets; innovation; getting the participation and buy-in of younger generations, adaption and resilience are but some of the more obvious. However dealing effectively with diversity is also not without its challenges. There is an African proverb that states: ‘If you want to travel fast, go alone; If you what to travel far, go together’. There is the need to see diversity through a fresh lens, one in which we both frame and approach it differently. We need to learn how to move from being ‘different from’ each other to being ‘different for’ each other. It is not about reducing our difference to the lowest workable common denominator but rather how to engage our difference in order to reap the benefits mentioned.
This understanding and process is what we tend to do so badly. The approaches I have seen are more often than not superficial and one-dimensional. In some cases, they can even do more harm than good. In TomorrowToday we know that not only is this an emerging global theme but also one in which we are well equipped to help both professional service firms and corporates navigate. We have been working extensively with two leading international business schools in the development and delivery of a ‘leading diversity’ framework for their respective clients – all of whom are household names internationally. It is work that has been rooted in Russia, Turkey, Argentina, Brazil, China, Sweden and South Africa. This has provided ample evidence of the need to be doing this work and how best to get meaningful engagement into what I believe is one of the most challenging learning terrains – that of diversity. It requires engagement of both head and heart and this is where the challenge is located as the context for learning how to grow through diversity is one that requires both unlearning and a degree of disequilibrium or discomfort.
Setting the context in which diversity is understood, valued and leveraged is a leadership responsibility. In professional service firms, senior partners are often dislocated from some of the ‘ground-floor’ realities. They can also be isolated from some of the broader contextual changes taking place due to their deep professional knowledge emersion along with the existence of strong silos within their business. The lack of internal cohesion and at times competing agendas also makes it difficult to tackle and harness the issue of diversity. One of the major results of a poor approach to productively engaging with diversity is evidenced in the struggle to retain ‘talent’.
Talent retention is one of the most significant challenges for both professional service firms as well as corporates. For professional service firms, the inability to retain talent poses a threat to their entire business model – it is that serious! Retaining talent is underpinned by a generational difference that simply means a departure from the ‘norm’ as defined by the Boomer generation – those currently ‘in charge’ and who have traditionally established the rules of the game. The reality is that by the age of 30, 72% of graduates are no longer working in their field of qualification. This one statistic alone epitomises the shift that has taken place in the approach to how best to build your career. The consequences of this in-built change or DNA shift across generations, is playing havoc with retention strategies. Daniel Pink (in his Ted Talk and book Drive) makes the telling point that if we want compliance, then our current management thinking and practices work very well; however if it is engagement that we desire, we will need to rethink how we approach and do things.
Talent attraction and retention are about engagement. It will require us to rethink both our ‘theory’ / approach and our practice.
The harsh reality is we don’t have a choice.
Engaging in the twin-challenges of diversity and talent is simply not optional if we wish to not merely survive, but rather thrive, in the future. How we do this will always be context specific and will differ from professional service firms to corporates – but perhaps not as much as we might initially think. They are challenges that although have their unique features, are inextricably intertwined. They will require courageous leadership where the willingness to ask the hard – or the unasked questions, challenge assumptions and the status quo, learn, unlearn and relearn, together with an ability to look beyond the now. It will mean acknowledging that the ‘old rules’ simply no longer work – or work as well as they used to – it will require acknowledging that ‘our world’ is not ‘the world’. This is all easier said (or written) than done!
Indra Nooyi, CEO of PepsiCo put it best when she said, “It takes great courage to live in the moment and look beyond it at the same time”.
Ignore these twin-challenges at your peril. It doesn’t matter how impregnable you believe your profession or institution to be – we all know the fate that befell the ‘unsinkable’ Titanic. You have been warned.