What does it take for a business to survive for decades? Quite a bit, it turns out: Only 12% of companies on the 1995 Fortune 500 list remain in business today.
"The massive pace of technological change has really caused most of these businesses to go under, because they didn't anticipate it," said Dr. Linda Sharkey, global managing director at leadership consulting firm Achieveblue Inc., and former chief talent officer and vice president of people development at Hewlett Packard.
For example, Kodak did not believe digital photos would become a competitor, and did not innovate fast enough, Sharkey said. Meanwhile, other companies, like General Electric, kept their finger on the pulse and made the early choice to become digital companies.
In the book The Future-Proof Workplace: Six Strategies to Accelerate Talent Development, Reshape Your Culture, and Succeed with Purpose, published in March 2017, Sharkey and co-author Morag Barrett, CEO of HR consultancy and leadership development firm SkyeTeam, highlight the changing business environment we currently find ourselves in, and offer tips on how to change your culture to remain successful in the coming years.
Many tech companies are born from a startup mentality, Sharkey said. "Often that mentality is about the entrepreneur getting the product out there, not what it takes to run a fabulous company and get people engaged and involved," she said. "Good tech companies realize that it's all about the people, and that they need to put in place organizational and people strategies to unleash the creativity of their folks. You may not have the best product, but if you don't have that people focus, and a culture that fosters excitement, you're not going to make it."
Here are the six critical factors companies must address to remain in business.
The recent public controversies at United Air Lines and Uber all stem from flaws in leadership, Sharkey said. "When there is a lack of understanding of what it takes to lead today, it creates a toxic environment, and those are never innovative or problem-solving," Sharkey said. "People operate on the basis of fear, point fingers, go underground, and protect themselves. That could sustain itself in the 20th century, but not today."
Company culture is also tied to how leaders conduct business. "If you create a toxic culture, you're not going to be able to innovate quickly, or see those trends coming your way that cause disintermediation," Sharkey said.
3. Organizing principles
A strong leader must create value around the company's mission, Sharkey said. "People are not interested in making a better widget—they're interested in working on things that have meaning and purpose, and will impact people's lives and communities," she said. "It's about asking, 'What's the ultimate purpose of what we're doing here?'"
With new tech advancements, some people argue that employees need less human connection. "But I argue that relationships in these kinds of environments are even more important—people will always need that human connection, it's becoming more essential as time goes on," Sharkey said. "And as a leader, you need to have empathy, and be focused on the people in your workforce."
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5. Diversity and inclusion
In terms of workplace diversity, "we have not moved the needle in tech at all," Sharkey said. "We have seen a lot of policies and programs, but the real question is, 'What's the inherent unconscious bias going on?'" Addressing this question means reconsidering HR practices. Sharkey said she has been involved in Silicon Valley talent review meetings at the senior level, and has heard men discount a female from a promotion after assuming she wouldn't want more responsibility because she has a family—without asking the woman if that was the case.
Companies need to embrace technology instead of looking at ways to eliminate or limit people's use of tech on the job, Sharkey said. Tech can also open up new types of work opportunities that can feed into attracting more diverse candidates. "It changes fundamentally how you develop people and organize work," Sharkey said.
To get started on changing workplace culture and future-proofing your company, CXOs should gather and analyze data on each of the six factors to determine where you stand. "Get data on the areas where you think you are most vulnerable, and then put in place some specific strategies to move the needle," Sharkey said. "Focus in on one of the most critical factors that will have the most impact on creating dynamic and thriving work."
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Alison DeNisco is a Staff Writer for TechRepublic. She covers CXO and the convergence of tech and the workplace.