Learn a new word: The Grey Swan Event

For some fun for a snowy Friday, (at least in my part of the world), let's have another installment of the often imitated but never duplicated 'Learn a new word' series, wherein I share the definition and give a couple of examples of a word, phrase, or concept I never knew before recently.

You likely have heard of the term 'Black Swan', an event or occurrence, (sometimes even a person of rare talent), that is unpredictable, (really NOT predictable), is incredibly unique, happens infrequently, and often has significant consequences. Some examples of 'Black Swans' could be a disruptive new invention, like the internet, a global conflict like World War I, or a business or economic event that could not be predicted like the financial crisis of 2007 and 2008. 

Black Swans are so rare, so unpredictable, and so unique that generally speaking it is a waste of time, energy, and resources to try and predict them or forecast or plan for them.

But not all unusual or unanticipated events are true Black Swans. Some of these, at least in theory, could be foreseen or at least imagined. These kinds of events are today's Learn a new word', these are the 'Grey Swans'. The Grey Swan is an unlikely, but impactful event that generally lies outside the base case for business planning but can, if you have just a little bit of ability to think laterally, be envisaged.

The chart on the right created by Nomura Securities shows a few of these Grey Swan possibilities from the world of global economics and finance. Some seem kind of crazy, and some, maybe not so much out ot the realm of potential economic events.

When Nomura put together these possible Grey Swan events, they were purposefully seeking to identify, and more importantly try and plan for, events that are not being generally discussed, remain under the radar, but if they did occur would have significant, and potentially negative consequences for the bank's business.

The lesson for the rest of us as we wind down 2016 and think about our plans for next year?

Maybe build in a few Grey Swans of your own into your scenario planning for 2017. Maybe the CEO AND the COO might both resign in the first quarter. Maybe the new administration will dramatically reduce the availability of foreign worker visas, or maybe Amazon will decide to get into your business, and disrupt the heck out of everything you do.

Who knows? That's why these kinds of events are called Grey Swans.

Sure, they probably won't happen. But if one does, it sure will be good to be the guy or gal who saw it coming.

Have a great weekend!

PODCAST - HR Market Watch 3 - Can you correlate employee engagement to business results?

NOTE: The HR Happy Hour Podcast Network is still going strong - wanted to share the latest episode of HR Market Watch with host George LaRocque that posted earlier this week. Enjoy!

HR Market Watch 3 – Can You Correlate Employee Engagement To Business Results?

Host: George LaRocque

Guest: Chris Powell, CEO, Talmetrix

Listen to the show HERE

HR Market Watch puts a special lens on new and innovative HR technology from emerging and established technology companies. Join host George LaRocque, Principal Analyst and Founder of the #HRWINS. In this episode he is joined by CEO Chris Powell of Talmetrix, a tech firm helping employers discover the correlation between employee engagement, HR programs, and business results. George and Chris talk about some of the misconceptions around employee engagement, and how current market trends are helping companies of all sizes connect their HR data to business performance.

Also, hear about some of the recent trends in talent acquisition and how small and medium sized businesses are driving big innovations in HR technology.

You can listen to the show on the show page here, or using the widget player below, (email and RSS subscribers click through)

You can subscribe to HR Market Watch, and all the HR Happy Hour Network Shows on iTunes, Stitcher Radio, or your favorite podcast app - just search for 'HR Happy Hour' to subscribe and never miss a show.

CHART OF THE DAY: Manufacturing Output and Employment

I am sure you have seen something in the news about President-Elect Trump's negotiations with the United Technologies owned Carrier Corp to eliminate or at least reduce Carrier's plans to close and/or reduce manufacturing operations in Indiana, and shift production, (and create jobs), in Mexico.  After a bunch of back and forth, (and back and forth), and some finger pointing from both sides, it does appear that Trump's efforts will at least for the time being, keep some of these operations and jobs in the USA.

I don't really want to get into the politics part of this story, but rather want to present some data (from the fantastic St. Louis Fed FRED site), that reminds us that companies packing up and moving manufacturing operations from the US to other, less-expensive places is only part of the reason why US manufacturing jobs continue to be pressured. 

Here's the data showing US manufacturing output, (left axis, and indexed to 2009) and US manufacturing employment (right axis) - then some FREE comments from me after the data.

Apologies if some of the fine details of the chart are a little hard to read, but the key things I think to take away from this data are these:

1. Manufacturing employment has been on a steady downward trend since 1980s, with the steepest declines starting in around 2001 (which coincides with an increase in offshoring activity to China and other places); and then again during the financial crisis and recession of 2008. But with the exception of recession-driven dips, manufacturing output has been increasing since the 1980s and is now near its pre-financial crisis level.

In other words, US manufacturers have continued to increase output, and pretty dramatically post-recession, while employing fewer workers.

2. So while outsourcing and offshoring are at least partially to 'blame' for the loss of US manufacturing jobs, those causes can't be the only or even probably the primary driver of manufacturing job loss. Increasing output, with fewer workers means one thing - improvements in manufacturing productivity that have to be attributed to technology, automation, robots, etc. US (and global) manufacturers are simply getting better and more efficient at producing goods, particularly electronics, cars, even steel. Technology gains will continue pressure organizations to 'keep up' with competitors and seek to reduce labor costs via automation.

3. While Mr. Trump's efforts with Carrier probably should be commended, we also should not be beguiled that these kinds of one-off decisions are likely to cause any kind of meaningful or lasting turnaround in the long-term trend of manufacturing job declines. As fast as a thousand ot two jobs might be saved by the application of political pressure, it is also extremely probable that technology/automation will jump in to ratchet up the continued pressure on manufacturers to get even more productive.

Finally, maybe it is time that we start to look a little differently about manufacturing jobs as somehow 'better' or more desirable than other types of jobs. There will always be manufacturing in the US, but as these trends show, it will almost certainly continue to decline as a percentage of the labor force.

Technology-driven shifts in aggregate employment just happen. How many farmers do you know, if you get my meaning. We have to learn as a country and as individuals, to adapt.

Have a great week!

Color of the Year 2017

I continue to be completely, and probably irrationally fascinated with Pantone's 'Color of the Year' designation and process.

In case you are unfamiliar (shock!), with Pantone and the Color of the Year designation here is all you need to know. Pantone is the world's leading authority on color, color systems, and publishes the industry standard definitions of colors. In other words that nice new orange shirt you just bought is not just 'orange' it is 'Pantone Persimmon Orange 16-1356 TPG'. Pantone provides guidelines and definitions for thousands of variations of colors, and it is the standard by which colors are classified.

Each year the color experts at Pantone declare one specific shade the 'Color of the Year'. This specific color, (in 2016 it was actually two colors of the year, 'Rose Quartz' and 'Serenity' in case you did not know), is meant to be a kind of reflection of trends in art, design, fashion, movies, popular culture, and branding and often will subsequently become more common in actual products like clothing and jewelry as a result of the Color of the Year designation. So perhaps if you think back on 2016 and think you have seen a lot of Rose Quartz and Serenity around - sort of a pastel-type pairing of blue and pink, you have Pantone to thank or blame for that.

So this week Pantone announced its choice for Color of the Year for 2017 a bright, happy, spring-like shade of green called oddly enough 'Greenery'. 

The rationale behind this choice of of Greenery for color of the year?

Here's what Pantone's color experts had to say about the selection:

Greenery is a fresh and zesty yellow-green shade that evokes the first days of spring when nature’s greens revive, restore and renew. Illustrative of flourishing foliage and the lushness of the great outdoors, the fortifying attributes of Greenery signals consumers to take a deep breath, oxygenate and reinvigorate.

Greenery is nature’s neutral. The more submerged people are in modern life, the greater their innate craving to immerse themselves in the physical beauty and inherent unity of the natural world. This shift is reflected by the proliferation of all things expressive of Greenery in daily lives through urban planning, architecture, lifestyle and design choices globally. A constant on the periphery, Greenery is now being pulled to the forefront - it is an omnipresent hue around the world.

A life-affirming shade, Greenery is also emblematic of the pursuit of personal passions and vitality.

So what, if anything, should any of us care about what Pantone says about culture, trends, society, fashion, and how we all are collectively feeling - expressed through the colors we are seeing and using more and more?

I suppose the main thing to think about is right in the verbiage Pantone used to describe their thinking processes behind the selection. The words restore, renew, fortifying, and life-affirming all show up in the description. Pantone is suggesting that the colors (and feelings) we will seek in 2017 will be ones like Greenery, a color that (if such a thing is possible), will help to make us feel  - comfortable, vibrant, refreshed, and more inspired to take on the world perhaps.

No matter your personal point of view, it is pretty fair to characterize 2016 as a kind of mixed bag of a year. The US economy continues to recover from the 2008 lows, unemployment is really low, the stock market as I write this is at another all-time high. But lots and lots of folks are not sharing equally, if at all, from this recovery and growth. And of course the recent election and the aftermath remind us all how fundamentally split this nation can be. 

Pantone thinks/hopes that Greenery will 'provide us with the reassurance we yearn for amid a tumultuous social and political environment. Greenery symbolizes the reconnection we seek with nature, one another, and a larger purpose.'

Let's hope.

The colors we choose say plenty about us, about who we are, how we feel, and perhaps how we want to feel.

What do you think? Ready to rock plenty of Greenery in 2017? I think it would make an excellent tie, (in case you have not shopped for my Christmas present yet).

Have a great weekend! 

PODCAST - #HRHappyHour 269 - Health and Benefits Trends for 2017

HR Happy Hour 269 - Health and Benefits Trends for 2017

Hosts: Steve Boese, Trish McFarlane

Guest: Jonathan Rende, Chief Research & Development Officer, Castlight Health

Listen HERE

This week on the HR Happy Hour Show, Steve Boese and Trish McFarlane are joined by Jonathan Rende, Chief Research & Development Officer at Castlight Health, a leading provider of benefits technology solutions to talk about important benefits issues, trends, and opportunities for 2017. With inevitable but hard to predict change facing HR and benefits leaders with the ACA regulations, the potential for different regulations emerging with a new administration, and the continuing need to provide effective, transparent, and engaging benefits programs - 2017 is shaping up to be a challenging year for HR and benefits leaders.

Jonathan also shared his insights on the importance of guidance, i.e., technology and programs to help employees make better decisions about their benefits elections. New approaches, many of them borrowed from the consumer marketing and commerce space are being applied to employer benefits for the first time, and the results for employees are positive and exciting. Almost 3/4 of employees don't fully understand their benefits, and in 2017 HR and Benefits leaders are challenged to bridge this understanding gap for their workforces, and provider better decision support, content, and access to their benefits programs and offerings. 

We also had an important Orlando Magic update, and Steve admitted to liking Benefits almost as much as he likes basketball.

You can listen to the show here, or using the widget player below (Email and RSS subscribers need to click through)

This was a fun and interesting show, thanks to Jonathan and the folks at Castlight Health.

And thanks to our sponsor Virgin Pulse - learn more about them at www.virginpulse.com.

Finally, remember to subscribe to the HR Happy Hour Show on iTunes, Stitcher Radio, or your favorite podcast app - just search for 'HR Happy Hour' to subscribe and never miss a show.