Maybe automation will hit managers as hard as staff

Super (long) read from over the weekend on the FT.com site titled 'When Your Boss is an Algorithm' that takes a really deep and thoughtful look at the challenges, pain, and potential of automation and algorithms in work and workplaces.

While the piece hits many familiar themes that have been covered before in the ongoing discussion and debate about the cost/benefits of increased automation for front line workers, (Uber and the like largely controlling their workers while still insisting they are independent contractors, the likelihood of reduced wage pressure that arises from increased scheduling efficiency, and how the 'gig economy', just like every other economy before it, seems to create winners and losers both), there was one really interesting passage in the piece about how a particular form of algorithm might just impact managers as much if not more than workers.

Here's the excerpt of interest from the FT.com piece, then some comments from me after the quote:

The next frontier for algorithmic management is the traditional service sector, tackling retailers and restaurants.

Percolata is one of the Silicon Valley companies trying to make this happen. The technology business has about 40 retail chains as clients, including Uniqlo and 7-Eleven. It installs sensors in shops that measure the volume and type of customers flowing in and out, combines that with data on the amount of sales per employee, and calculates what it describes as the “true productivity” of a shop worker: a measure it calls “shopper yield”, or sales divided by traffic.

Percolata provides management with a list of employees ranked from lowest to highest by shopper yield. Its algorithm builds profiles on each employee — when do they perform well? When do they perform badly? It learns whether some people do better when paired with certain colleagues, and worse when paired with others. It uses weather, online traffic and other signals to forecast customer footfall in advance. Then it creates a schedule with the optimal mix of workers to maximise sales for every 15-minute slot of the day. Managers press a button and the schedule publishes to employees’ personal smartphones. People with the highest shopper yields are usually given more hours. Some store managers print out the leaderboard and post it in the break room. “It creates this competitive spirit — if I want more hours, I need to step it up a bit,” explains Greg Tanaka, Percolata’s 42-year-old founder.

The company runs “twin study” tests where it takes two very similar stores and only implements the system in one of them. The data so far suggest the algorithm can boost sales by 10-30 per cent, Tanaka says. “What’s ironic is we’re not automating the sales associates’ jobs per se, but we’re automating the manager’s job, and [our algorithm] can actually do it better than them.”

The last sentence in bold is the key bit I think. 

If the combination of sensor data, sales data, and scheduling and employee information when passed through the software's algorithm can produce a staffing/scheduling plan that is from 10% - 30% better (in terms of sales), than what even an experienced manager can conjure himself or herself, then the argument to replace at least some 'management' with said algorithm is quite compelling. And it is a notable outlier in these kinds of 'automation is taking our jobs' stories that usually focus on the people holding the jobs that 'seem' more easily automated, the ones that are repetitive, involve low levels of decision making, and require skills that even simple technology can master.

Crafting the 'optimal' schedule for a retail location seems to require plenty managerial skills and understanding of the business and its goals. And at least a decent understanding of the personalities, needs, wants, and foibles of the actual people whose names are being written on the schedule.

It seems like algorithms from companies like Percolata are making significant advances, at least on the first set of criteria, that include predicting traffic, estimating yield, and devising the 'best' staffing plan, (at least on paper). My suspicion is the algorithm is not quite ready to really deeply understand the latter set of issues, the ones that are, you know, more 'human' in nature.

Or said differently, it is unlikely the algorithm will be able to predict a drop in productivity due to issues an employee may be having outside of work or adequately assess the importance to a good employee of the need to schedule around a second job or some other responsibilities.

There is probably a long way to go for algorithms to completely take over these kinds of management tasks, you know, the ones where actually talking to people is needed to reach solutions.

But when/if all the workers are automated away themselves? Well, then that is a different story entirely. 

PODCAST - Steve on the Infor Reinventing Retail Show

Wanted to share the information for a guest appearance I did recently with the really fun and interesting crew at the Infor Reinventing Retail podcast.

On the show, we talked about some of the trends, challenges, and opportunities that modern HCM technologies offer to retail organizations. From tools to better improve recruiting, scheduling, and making sure every HR and workplace technology is optimized for mobile today’s leading retailers know that investments in workforce management solutions that take advantage of these technologies are key when it comes to modernizing their businesses.

In this episode of the Reinventing Retail podcast, I talked about what role modern technologies are playing in today’s retail landscape, and how they’re set to change the global retail landscape moving forward.

You can listen to the show on the Infor Reinventing Retail Podcast show page here, or using the widget player below, (email and RSS subscribers will need to click through)

And you can learn more about Infor's modern workforce management solutions for modern retailers here.

Thanks to the Infor Reinventing Retail Podcast for having me on the show!

Have a great week!

PODCAST - #HRHappyHour 256 - Steps to Re-imagine and Reinvent Your Workplace

HR Happy Hour 256- Steps to Re-Imagine and Reinvent Your Workplace

Hosts: Steve Boese, Trish McFarlane

Guest: Jeanne Meister

Listen to the show HERE

This week on the show, Steve and Trish were joined by Jeanne Meister.  Jeanne is a Partner at Future Workplace, a firm dedicated to re-thinking, re-imagining and re-inventing the workplace. Jeanne is the receipt of the Distinguished Contribution in Workplace Learning Award, an award given by Association For Talent Development to one executive each year honoring their body of work. She is also a Contributor to Forbes Magazine.  She is the co-author of the best selling book, The 2020 Workplace: How Innovative Companies Attract, Develop & Keep Tomorrow’s Employees Today and the upcoming book The Future Workplace Experience: 10 Rules for Mastering Disruption in Recruiting and Engaging Employees.

Steve and Trish talked with Jeanne about the importance of thinking ahead, about identifying important trends in workplaces, and how HR and business leaders can be ready for the future. We also talked about the panel Jeanne will be leading at the upcoming HR Technology Conference in October, on ‘The Consumerization of HR’. 

You can listen to the show on the show page HERE, or by using the widget player below:

Give this lively episode a listen, and be sure to subscribe to the HR Happy Hour Show on iTunes, Stitcher Radio, or your favorite podcast app.

Three quick 'Gig Economy' links and a warning for HR leaders

There are about 12,238 surveys and data points that you can unearth when researching the rapidly evolving, and probably growing, 'gig economy', i.e. work that is performed by independent contractors, self-employed types, and those that for better or worse, (worse), get referred to as '1099 workers', for the IRS form on which their earnings are reported.

Rather than spit out a bunch of (sometimes contradictory) data on how and where this gig economy is heading, I wanted to share three quick and interesting developments in this area that are worth thinking about and then one more recently released set of survey data that should be a warning to HR and business leaders that are moving towards increased usage and reliance on 'gig' workers.

Item 1 - Atlassian now lets you hire freelancers right from Jira

JIRA, Atlassian’s flagship project management service, is getting a new feature today that will let you easily convert JIRA tickets into job postings on Upwork’s freelance marketplace. “The smartest people will always exist outside of your company,” Atlassian’s head of growth for JIRA and Bitbucket Sean Regan told me. For many companies — and especially small startups — it’s also hard to have all the right expertise available in-house to solve every problem. With this new integration, these companies can now click a button in JIRA and get a pre-populated form to submit to Upwork’s marketplace.

Steve here - an example (of which we will see more I am sure), of enterprise technology and management tools integrated with sourcing/hiring platforms for 'Gig' workers 

Item 2 - LinkedIn enters the Gig Economy with an Upwork competitor

LinkedIn has created a freelance marketplace. Launched on Wednesday, "LinkedIn ProFinder" asks employers to submit contract jobs in categories such as design, writing, or financial services and promises to send them up to five free quotes from LinkedIn users in response. Over the last five years, the number of freelancers on LinkedIn has increased by 50%, according to the company.

Steve here - Of course it makes sense for LinkedIn to dive in more heavily into the 'Gig' work space. It's growing, and LinkedIn thinks/knows it has the way to connect gig workers with opportunity

Item 3 - This CEO says he was shut out by tons of investors in Silicon Valley for classifying his workers as W-2 employees

But Josh Bruno, the CEO of senior-care startup Hometeam, said that for him it was always clear that Hometeam's 1,000-plus caregivers needed to be on W-2s. They needed a lot of training, and Bruno wanted to give them the sense that Hometeam was investing in them for the long haul.

But unfortunately, when Bruno was trying to raise money, that wasn't what Silicon Valley VCs wanted to hear.

"I was kicked out of every office on Sand Hill Road," Bruno said, referring to the iconic street that houses many famous Silicon Valley VCs. Bruno said he even had a verbal agreement with a "flashy name" VC, who then wouldn't go through with the investment unless Bruno put his workers on 1099s.

Why? One reason, Bruno said, is because big names like Uber and Lyft were doing it. Bruno's main competitor, Honor, which was named one of Business Insider's hottest San Franciscostartups to watch in 2016, originally used 1099s. It has since switched to W-2s.

But it wasn't simply because everyone was doing it, Bruno said. The deeper reason rested in what a 1099 represented.

Bruno said that to VCs he spoke with, a 1099 meant a job that was both easy and repeatable. The worker is a part that can be swapped in, which is good because it means the business will be easier to scale, Bruno explained. And it would be easier to get the kind of growth the VCs were looking for.

Steve here - In case you wondered what the general attitude of 'people who have money and are looking to have more money' is towards labor, there you have it. 'Gog' workers are cogs, more or less the same, more or less interchangeable. This isn't a problem until.... Well, let's ask some of the Gig workers.

And as promised, here's your warning, 67 percent of Americans who have worked as independent contractors would choose not to do so in the future (infographic below courtesy of Deloitte).

A recent online poll by Deloitte of nearly 4,000 workers found that 67 percent of respondents who have worked as an independent contractor would choose not to do so again in the future. Additionally, more than 60 percent of employed workers said that their stability would suffer if they moved to independent contract work, and 42 percent worry about sacrificing good compensation and benefits.

Steve here - Lots of interesting nuggets to take away from the Deloitte data, but they all point to the same place - that many, many 'Gig' workers are not at all happy to be Gig workers, and that most organizations are doing a terrible job managing and engaging these gig workers. it's almost as if the Silicon Valley VC attitude towards labor is taking hold and becoming more common.

The danger is at the same time you as an organization make the strategic move to increase your use of Gig workers, and the tools and technologies are making it easier for you to incorporate Gig workers into your processes and workflow, that the way we value, treat, and support Gig workers seems to be getting worse. And lots of Gig workers are not happy.

Plenty to think about here as the next few years play out.

Have a great week!

The best, or at least most fun, workplace reaction to Pokémon GO

There are two possible reactions to the current Pokémon GO craze for the owner/boss/supervisor who is concerned that their employees are wasting too much time playing the game and are subsequently shirking their workplace duties and responsibilities.

1. Issue a ban or similar crackdown on playing the game, up to and possibly including blocking access to the app on company-issued devices

2. Ignore the phenomenon completely, continue to manage to organizational and individual norms and expectations for performance, and treat people as adults, more or less. This approach treats and categorizes Pokémon GO as just the latest in the endless and endlessly updating list of 'shiny things that are more fun than work, and will distract our weak-minded staffs from their tasks.' 

And like the other distractions that have come before it, (the Internet, March Madness, Facebook, fantasy football, etc.), if you and your organization finds itself having a real Pokémon GO problem, well, your problem is not really Pokémon GO, if you know what I mean. The problem is one or more of hiring the right people, giving them engaging assignments, management not up to the task, inefficient process design, or something else - Pokémon GO only helps you to realize something more fundamental is going on that won't be fixed by taking away people's Pokémon fix.

You know, now that I think of it, there is a third possible organizational reaction to the Pokémon GO craze - make playing the game a required activity for employees.

Check out what the folks over at The Next Web office in Amsterdam are up to:

Sounds to me like the best, (and geekiest) workplace reaction to Pokémon GO yet.

Have a great day and I hope you Level Up!