Foretelling future predictions

13-Jun-2007

Thinking about the future is notoriously difficult. Businesses and governments have dedicated millions of pounds into trying to predict social, political and technical change — with mixed results. The CEO of computer manufacturer IBM once confidently predicted that “there is a world market for maybe five computers”. Futures guru Peter Schwartz broke his own cardinal rule by forecasting that the Silicon Valley technology boom would last for 25 years — shortly before the dotcom bubble burst.

But while predicting the future can be fraught with problems, organisations are finding new ways to best prepare themselves to cope with change — and crucially to shape it themselves. In early 2006, Demos began Recruitment 2020, a project in partnership with the REC and The Guardian, exploring the future of recruitment industry. What would be the social and organisational challenges created by the long-term trends affecting the industry?

The project drew on a technique pioneered by Shell in the 1980s, now used around the world: scenario planning. Rather than settling on a single vision of the future, scenario planning uses social trends to identify a number of possible futures. Considering the challenges posed by a variety of scenarios helps organisations shake off three bad, but common, habits:
Clinging to the past
Organisations often become conservative with success, risking dependence on old models of working, rather than remaining alive to new possibilities — often the real foundation of their original success
Buying the official line
Too often organisations fail to examine the assumptions behind the received wisdom, leaving them in a poor position to respond to unexpected events such as economic downturns or technological breakthroughs
Defeatism
Faced with the uncertainty of the future, the risk is that people and organisations give up trying to influence their future and decide simply to let things take their course.

The scenarios for the Recruitment 2020 project were created through drawing on a range of data sources, expertise and perspectives. An eclectic mix of people were brought together at a scenarios workshop held at Demos to identify the most important and uncertain trends for the future of recruitment.

The process revealed two ’critical uncertainties’ (important and uncertain trends). These were the level of disruption to existing business models created by new technology, and the focus of power in the labour market, ie. is it with employees or employers? The following four scenarios were constructed around those key variables.

1 Choice utopia – disruptive technology and employee-driven market.
Google search technologies have become so effective that all recruitment happens online, direct from CVs, squeezing the middleman out. In this world everything is transparent — lives, jobs, employers and employees. The economy is booming and smart graduates dominate the market, choosing employers based on brand and ethics, as well as salary. The recruitment industry, previously dominated by agencies, has shifted its focus, offering ’HR solutions’ and the human touch in a world dominated by technology.

2 If you find it, it’s yours – incremental progress in technology and employee-driven market
The economy is strong and employees are firmly in the driving seat. The idea of a career no longer exists, as people gather a string of ’experiences’, often in different fields of work. Companies are using technology more efficiently, but what they are using it for hasn’t changed profoundly. The strong economy and constant shifting around of jobs means recruitment companies are powerful — trading on networks, expertise and knowledge, both individuals and companies rely on them to help navigate the job market.

3 Take what you can get – incremental progress in technology and an employer-driven market
There’s high competition for jobs, and employees are concerned about keeping existing positions, rather than looking for new work, while employers can get away with what they like as employees fight to get and maintain jobs. Technology has been less successful than the hysteria of the early 1990s suggested, but the recruitment industry still faces uncertainty as businesses bring recruitment back in house to maximise efficiency, or demand tight accountability and low costs from those companies that have survived.

4 Don’t call us, we’ll call you – disruptive technological progress and an employer-driven market
nd employee-driven market.
The low-cost nature of the technology industry means that despite a weak economy this sector is booming. It dominates recruitment, so much so that the HR industry has all but disappeared. Employees are rated online, and privacy concerns and employee rights have been forced to take a back seat as complete transparency and technological progress drives the industry forward in a very particular way. Any surviving recruitment agency is staffed by IT graduates and competition has shifted completely online.

Strategic challenges
Based on the strategic challenges that emerge in the scenarios — and the wider research process involving nearly 50 in-depth interviews — Recruitment 2020 offers some recommendations to the industry for the future. These recommendations, listed below, are rooted in three areas of growing importance for the recruitment industry: accountability, brand and the internet.

Accountability
Whatever the scenario, one thing is clear — recruitment will continue to be an intensely competitive business. Clients, wanting the best possible service on the most efficient terms, will demand tighter accountability and evidence that third parties can deliver greater value for money rather than just reduced cost. The industry can lead here by taking two important steps. First, by tracking retention levels after making placements, in order to demonstrate impact. Second, by driving a shift towards accountable advertising online, where money follows success in directing candidates towards job information.

Brand
The first two scenarios, based on a strong economy, show more jobs in the marketplace, and increased communication and transparency. This means companies have to work harder than ever to define themselves and attract the best candidates for jobs. The recruitment industry has a role to play in facilitating this process for businesses in two ways.

First, by helping organisations learn about themselves by overcoming the ’insider/outsider problem’. The way we think about our own organisations often differs from the perceptions of others. Recruiters, as intermediaries, can provide invaluable feedback.

Second, by aligning the recruitment experience with the client ethos. If brand matters, then the experience of being recruited — when many candidates are still gathering clues about prospective employers — must reflect that brand as much as possible.

Web 2.0 and the internet
Our research and the scenarios demonstrated changes in the way people are using the internet is the single most important challenge the recruitment industry faces. Old business models are likely to be overtaken as users become more active in online communities — communicating with one another, sifting through information and expressing their own preferences. But this challenge is an opportunity, too, and recruiters should embrace this by finding ways to connect with the passive job seeker.

Widening the talent pool to those who may be interested in a new job, without actively looking for one, represents a real opportunity to identify and reach the best candidates. Peer-to-peer relationships can be vital here. Technology also helps personalise relationships online — as the amount of information online grows exponentially, helping people navigate their way through this becomes more and more important.

These recommendations and others are expanded upon in Recruitment 2020. Importantly, though, the scenarios are designed to provoke further debate and thinking within organisations about the key challenges of the future. In this way, the report is intended to provide a stimulus for creative thinking, as well as a resource of information and analysis.

As the technologist Stewart Brand argues: “Scenario planning ensures that you are not always right about the future, but — better — that you are almost never wrong.”