Bryan Hancock, Global Leader of Talent Management at McKinsey & Company: Are You Ready for the Impact of Automation?
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Bryan Hancock has spent the last two decades focused on the disconnect between the skilled workers employers need and what is available in the workforce. As Global Leader of McKinsey & Company’s Talent Management Practice, he’s able to tap into the firm’s deep research on workforce trends to advise private and public sector clients and what he’s seeing is an even larger skills gap developing as automation and digitization take over a significant portion of what he calls “the dull and dangerous” work. In fact, McKinsey estimates 30 to 40 percent of all workers in developed countries may need to move into new occupations or at least upgrade their skill sets significantly in the next decade.  Despite that daunting challenge, he’s not discouraged because many large employers are making big investments in employee learning opportunities, and technologies like virtual reality are creating fun and effective options for training. He’s also encouraged by growth in the “workforce ecosystem” – independent foundations, companies, and other organizations who are innovating to close gaps in skills and opportunity. Check out this episode of Workforce Rx as Bryan and Futuro Health CEO Van Ton-Quinlivan explore all of those issues plus the growing importance of soft skills, the impact of the gig economy, and how employers can take a “talent first” approach.

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Van Ton-Quinlivan: Welcome to WorkforceRx with Futuro Health, where future-focused, education, health care and workforce leaders explore new education-to-work approaches and innovations. I’m your host Van Ton-Quinlivan CEO of Futuro Health. And today I’m happy to welcome Bryan Hancock, the global leader of McKinsey & Company’s talent management practice. McKinsey is widely considered the leading management consulting firm in the U.S., helping thousands of clients in the public and private sectors to improve their business practices. In his role, Bryan advises a wide range of businesses in sectors such as health care, retail, banking and transportation, as well as state and local governments. Bryan has also advised multiple foundations on education and economic development initiatives. Thank you so much for being with us here today, Bryan.

Bryan Hancock: Thanks for having me.

Van Ton-Quinlivan: Absolutely. Can you start by telling us about yourself and what led to your interest in workforce issues?

Bryan Hancock: Well, I’m a lawyer by training. I came over to McKinsey about 20 years ago and pretty quickly got involved in our organization and people-related work. And one of the things that caught my attention was the disconnect between our clients who said we don’t really have enough people with the skills that we need and what I was seeing in the broader workforce. So I thought this would be an interesting area to dig deeper in and through that got more involved in some of our research efforts of the McKinsey Global Institute, some of our work in the education practice, and then the work we did on organization and pulled that together into what we’ve been doing at Talent. And so, ever since that initial question of the disconnect I’ve kind of been working to understand it more and help bridge the gap ever since.

Van Ton-Quinlivan: Oh, wonderful. So you mentioned that you’ve been with McKinsey for 20 years and working with many, many clients whom you advise on workforce trends, including this disconnect. So we’ve been experiencing in the U.S. these workforce issues. What trends do you see predominantly whether that’s related to COVID or not?

Bryan Hancock: I think there are probably four big trends that I would pull out related to the workforce. One is a trend towards automation and digitization, but not necessarily in the way that a lot of people envision it. I don’t see a world where robots are taking over, you know, thousands and thousands of individual jobs. But what I do see is technology automating the dull and the dangerous parts of the work, and leaving what is more human left over. So we still will have work in the future, but it will look different as a result of automation and digitization. I see a concentration of jobs in a subset of geographies. We did a piece last year looking at how the future of work will look different across the 3,150 some odd counties in the U.S., along with all of our cities. And we found that there are going to be only 25 cities that represent 60 percent of job growth between now and 2030. And while that number may change a little bit due to COVID, we do think that concentration of jobs in a subset of geographies is going to continue. I think the third trend that we’re seeing is work from home. I don’t envision a world where no one ever goes back into the office and of course, our essential workers have needed to be on the frontlines throughout COVID. But I do think this work from home experiment that we’ve all been part of, or many of us have been part of, as a result of COVID has shifted some mindsets on what can be done remotely and what has to be done in the office. And I think that is going to also shift mindsets of what really needs to be in a headquarters building. And can we have multiple locations? Can we go to closer to where the talent is? So I think work from home is going to change a lot, in particular the white collar workforce. And then finally and hopefully I think the workforce ecosystem is changing. And what I mean by that is the number of foundations, companies, people like you who are looking at closing the gap between organizations that need workers and the workers themselves, I think there’s a lot of innovation here that is really going to continue over the next few years. Some of the things like learning and employment records, better technology for understanding the exact skills that people have, keeping track of that over time, and all of those developments, I think, are largely to the good and a pretty exciting part of what’s happening.

Van Ton-Quinlivan: You’ve given us so much to think about. Let’s for a moment talk about the automation of the dull and the dangerous. How can we go about training workers to develop socio-emotional and cognitive skills that are transferable across jobs and across careers that will survive this automation trend?

Bryan Hancock: I think we have to start by recognizing that these are skills that we value and that we want to track. Some of it starts in the education system and making sure we don’t just think about STEM, but as some folks call it, you know, think about STEAM with the “a” being for the arts, you know, thinking broadly. Then as we go from education to the workforce, how do we assess for soft skills? How do we do that through structured interviews or through new gamified simulations? But we need to be able to track it. And then once on the job, how are we intentional about tracking the soft skills that folks perhaps get organically on the job. So if you’re working in retail and you’ve developed those soft skills, those human skills, those essential skills by being on the floor, by answering customer concerns, by dealing with difficult coworkers or managers and doing it with skill and with grace, how do you get a certificate recognizing that work? How does it go on your review? How do you actually, you know, keep track of those learnings in addition to the types of learning experiences that can be more formally given through a training program? And then, once you’ve gotten to that point, how do you track the development over time? How do you set your own aspirations for what soft skills are important? I think one of the soft skills that is most commonly cited is communications. And communications when you break it down, actually has a lot of underlying soft skills beneath it. A good communicator needs to be able to understand their audience, needs to be able to relate to them, needs to be able to have the critical thinking skills to pull out what is most important. And I think as we get intentional about describing what the soft skills are, and intentional about describing what’s underneath them, I think at that point we can measure it, we can have the right training interventions and we can improve it for everyone.

Van Ton-Quinlivan: I love your point about the intentionality and how we need to put that level of intentionality in order to measure and focus and train for those skills. So McKinsey’s modeling shows that in the next decade, up to 30 to 40 percent of all workers in developed countries may need to move into new occupations or at least upgrade their skill sets significantly. What’s driving this, Bryan?

Bryan Hancock: So the way we got at that number is we started by looking at the 800 occupations that make up the economy and the 2000 underlying tasks. We then said, “of those tasks, what can be automatable using currently available technologies? And then what do we think the take up rate of those technologies are going to be between now and 2030?” When we looked at that, we found a few things. One, we found that very few jobs are fully automatable. If you’re a sewing machine operator, your job may be at risk. But for most of us, robots aren’t going to take over all of the tasks that we have. But what we did find is that 60 percent of occupations are 30 percent or more automatable. What that means is work is going to be transformed, the “dull and the dangerous” parts of the job. For a finance person, the repetitive opening and closing Excel spreadsheets across different parts of the business are going to have… Robotic Process Automation can do that for them. So what they need to do is spend less time on the manual, working across spreadsheets, and more time thinking about what it means, thinking about communicating the results. And so when we talk about that 30 to 40 percent of people are going to need to meaningfully change jobs, what we’re really referring to there is that job content that they used to be doing, 30, 40 percent of that, is going to be going away and they need to develop the skills to take up that other part of their time. And for some people, work may be rearranged so that, you know, new jobs will be created while some will be eliminated. But on net, what’s going to happen is we’re going to need more people with critical thinking, more people with interpersonal skills and more people with the ability to manage in a changing environment, manage to work alongside machines.

Van Ton-Quinlivan: I’m glad you addressed this anxiety that many have around robots taking over our jobs, but I think you have laid it out in a balanced way, also giving us signals that the future of work will require a different portfolio of skills or with greater emphasis around critical thinking, managing change, working besides technology, etc., so thank you. Now, Bryan, I see in your writings that you are a proponent of having companies manage their employees with the same strategic thinking and attention that they give to managing their financials. What are some examples of the steps that an organization can take to develop a “talent first” approach?

Bryan Hancock: So what my colleague Bill Schaninger and I like to say is that human capital is scarcer than financial capital. And it’s really the people that are required to bring new business plans to life. It’s people that are required to deliver on the front line every day. It’s people that make the difference in whether a plan succeeds or fails. So we should think about the people side of the equation with the same rigor we think about the financial side of the equation. And one way of doing that is thinking through how are you going to make money over the next three to five years? And as we lay out that plan, what are the subset of people that are disproportionately important for that new growth initiative, disproportionately important to deliver some of the biggest value-creation initiatives that we have as a company? And how do we disproportionately invest in those folks — whether they are a subset of leaders in the corporate center or whether it is a cadre of people with a new set of skills in the front line? How do we disproportionately focus our energy in on those people? And when we do it, what ends up happening is H.R. shifts its perspective from a one size fits all approach with a set of broad based initiatives that hit all employees, to targeted approaches and interventions to make sure that we have the best people with the right skills in the areas that are going to deliver the most value going forward.

Van Ton-Quinlivan: That makes sense in terms of focusing attention on the high performers or the people that you’re going to need for the future. I love that as a framework. Now, if you are advising that we focus on human capital as being scarcer than financial capital, what impact is the gig economy having on companies looking for talent? What kinds of adjustments do they need to make to accommodate workers who have expectations for work that don’t fit the traditional models, Bryan?

Bryan Hancock: I think what’s really interesting about the gig economy is that there are so many different ways that people can engage in nontraditional work. And when I say nontraditional work, I mean more than showing up as a full-time employee with an indefinite contract term at an employer. You can have a gig delivering a set service — whether it’s an Uber ride or a legal contract — you’re delivering a service for a time. Whether it is agreeing on a contingent assignment or a temporary laborer assignment where you may be working in an environment for four months to six months, to where perhaps you decide that you want to be a freelancer and there are freelance management services that can now directly connect you with companies. I think technology and platforms have made it easier for individuals to be more fluid in how they engage with work and as a result, employers need to be more fluid in how they think about engaging with folks. They need to have a portfolio approach to the workforce. For some areas, it may make perfect sense to do it as folks have done it for dozens and dozens of years. For other areas — in particular areas that are growing and where skills are scarce, or in areas where it’s unclear what the future brings or areas where “we need to get caught up fast” — in those areas tapping into gig workers or contingent workers is a way that we’re seeing companies get ahead even in the midst of the pandemic. One of the stats I found most interesting was the demand for gig and contract workers in IT spiked in the early days of the pandemic. And the reason was everything was moving online. So companies that didn’t have an online presence — take a retailer that maybe hadn’t invested in their online presence — all of a sudden they need to have that online “click and collect” capability that maybe was on the pipeline for five years from now. So now that retailer needs to figure out “how am I going to get the people to do the coding now?” And we’re seeing that in retail and in other sectors and that was driving a bit of a spike in some of the gig IT workers, and I think that is only going to continue going forward, maybe not as acutely in the early as in the early days of the pandemic, but I think now organizations are seeing how it can work and I expect that to continue going forward.

Van Ton-Quinlivan: I’m curious, Bryan, if employers are to think about a portfolio approach for their workforce, what advice do you have to the workers who are working in the gig economy?

Bryan Hancock: I think for the workers, it’s to be clear what you want out of each assignment. So I think there are a number of workers who are very happy to work in a gig environment. That they actually want the flexibility to ramp-on and ramp-off on an individual assignment, whether it’s a contract or a ride, and to be able to do that. And if that’s what they’re excited to do great, but have a plan. Recognize where you want to go over time with your career, and whether it’s a lifetime gig or whether you want to make the next step and what the next step looks like and what training and development you can take on yourself to do that. For some, and we do see this in the contingent workforce, the ultimate goal is full time employment. And for those workers, you know, I would encourage them to think about, OK, “what is the nature of the job that I want? What are folks looking to do? And how can I leverage my current assignments into the full-time work, whether it’s because of the work experience, whether it’s because of the connections that I make, or whether it’s because of the skills that I build, know how can I play it forward?” So, essentially I think the big picture here is have a plan.

Van Ton-Quinlivan: When I first learned about Upwork and its composition of maybe having two people on its contingent staff compared to one full time staff, it occurred to me that graduates’ first jobs may be a gig before they actually can access a full-time job. Which means you have to have a profile to be able to compete for gigs. So that really just changes the nature of how you exit education and then move into the workforce. So, Brian, as a partner with McKinsey’s Global Talent Practice, you see trends across many, many employers. What are some of the innovations in workforce learning that seem to be catching on or that you are encouraged by?

Bryan Hancock: I think there are two things that I’m encouraged by. One is the number of large employers that are offering learning programs that go well beyond tuition assistance. So whether it is InStride and what they’re doing with Starbucks, whether it’s what McDonald’s offers through their Archways to Opportunity, or whether it is Wal-Mart and Live Better U, I think the number of large employers who are making significant investments so that their employees can develop skills on their own, on their own time — and in areas that are related to their current work, but also related to what comes beyond — I think those really are exciting to me. I think the other area that I’m excited about is the technology-assisted learning. And I use that as a broad term because there’s a range of learning technologies in a fast moving corporate EdTech landscape. What’s really exciting to me is the idea that you can train somebody how to drive a forklift using Virtual Reality. That you can deliver training “just in time” via an app. That you can simulate customer service environments that may be particularly tricky and use that as an opportunity to teach soft skills. I mean, the range of simulations, gamification, Virtual Reality, bringing all of that — you know what my 14 and 16 year old sons would love to play with in their spare time — bringing that into the workplace and applying it to learning, I think is tremendous and a field that I see continuing to accelerate and evolve over the next few years.

Van Ton-Quinlivan: I agree with you. There’s going to be a lot of exciting innovations around the space of technology-assisted learning. And I have to tell you, we’re also developing this curriculum called Human Touch Healthcare, which is the soft skills. So there’s a set of simulations embedded in there to help students get exposure to the real situations they may face, because employers in the health centers have stated it’s not textbook pretty when you are working with real clients and real people and real complicated issues in their lives. So the more the students can be exposed to those situations, the less they’re surprised and they’re fully aware of what they’re getting into as a career. So, this is an area where we’re not only taking advantage of video, but the next overlay will be the AR-VR component of creating immersive experiences. So that’s going to be a really interesting frontier.

Bryan Hancock: Just think about, I mean, the way that you can provide that kind of training and experience for someone now is incredible, right?

Van Ton-Quinlivan: Have you checked out the technology called Mursion?

Bryan Hancock: I haven’t.

Van Ton-Quinlivan: So it’s amazing. So they have a set of skins, AR-VR skins, and they also have a set of settings so they can switch out hospital setting, clinic setting, and the in terms of skins, the avatars can be white, African-American, Asian, etc. and different genders, different ages. And so you can simulate all sorts of scenarios using the combination of two. So it’s very similar to STRIVR, except you don’t have to have the Oculus glasses.

Bryan Hancock: Yep. Of all the innovations that you have, because you’ve got a ton going on all at once with Futuro, which is the one you’re most excited about?

Van Ton-Quinlivan: Hmmm. I’m very excited about the Human Touch Healthcare, because I think when you’re talking about diverse communities being able to give people standard experiences so that they can develop their soft skills is going to be really important. The other part that I’m really just interested about is how we’re able to sort of mix and match students supports with education providers really quickly. Now, we’ve set up a system — for example, you and I talked about the McKinsey report with “gateway jobs” — so one of the gateway jobs we picked was Health IT Specialist, which does end-user computer support or Help Desk support, so a good gateway job that transcends multiple industries. We could not source that curriculum at scale. So we then approached Coursera, Coursera brought in Google IT and Johns Hopkins University because we requested the health care component — how do you navigate healthcare for IT? And so the two combined were able to create the curriculum that we wanted. And then SEIU-UHW became the recruiting partner and in the first three weeks of recruiting, they generated over 900 candidates for the 250 slots that we had. So I think this concept of creating a learning ecosystem, mixing and matching good partners, and then having an underlying data infrastructure so that everybody can see what’s happening with the students — including us and including our recruiting partner and education partners — that seems like it’s going to scale quite well. So pretty interesting stuff.

Bryan Hancock: It’s super interesting. I mean, I can’t think of another organization that is as on the frontier as you are in really making the ecosystem come to life. Saying, “OK, we need this curriculum, let’s do this, and if it doesn’t have student supports as part of it, we’ll bolt that on, we’ll make it as part of the piece.” I mean, it’s so cool. It’s really taking all of what the potential exists in the system, but it needs somebody to take that “learner view” and that market view that pulls it all together. And it’s just cool. So you’ve got the health care IT underway. What are the next ones in the queue?

Van Ton-Quinlivan: So we are going to roll out Community Health Workers with behavioral health emphasis. And so that seems to be the one sub-baccalaureate credential that could help that space. And there’s a new bill that was passed in California just this month, and it’s a bill that creates peer specialists, and that’s also sub- baccalaureate, and those will go into effect in 2022 so we have our radar on that occupation as well. Dental Assistant is a big need so we’ll launch that program with two colleges next year. And in addition to Health IT Specialist, we’re going to add on Electronic Health Records Analyst. So we’ll begin to move up from the gateway jobs.

Bryan Hancock: Well, I love the behavioral health and the mental health.

Van Ton-Quinlivan: And so we come to the end here, Bryan. Any final words for us in terms of education to work or innovations in the space?

Bryan Hancock: I think the last one, and this is one that I know resonates with you, is we have to think about the learner journey the same way we think about a customer journey. And we need to think about where the learner is starting from and what barriers the learner has in the way. Because many times it’s not just a skills gap that is creating the gap between a person with incredible potential and the job. It’s an opportunity gap. And how do we think more broadly about what else fills-in that opportunity gap other than skills? It may be something that some might consider skills like language. It may be other things like a lot of the rest of life going on. And how do we collectively think about the ways of filling those opportunity gaps so that we can better connect learners with a lot of potential to the jobs where they’ll be able to thrive?

Van Ton-Quinlivan: Well, that is an excellent point to end on, which is we all need to do what we can to lower the friction of having students access opportunity. Thank you very much, Brian, for being with us today.

Bryan Hancock: Thank you.

Van Ton-Quinlivan: I am Van Ton-Quinlivan with Futuro Health. Thanks for checking out this episode of WorkforceRX. I hope you will join us again as we continue to explore how to create a future-focused workforce in America.