Talent transformation and the shift to becoming a skills-first organisation has been a hot topic for years. And now AI is turning the pressure gauge up to boiling point, even the biggest industry players are feeling the impact. 

Enter Harriet Newlyn –– a Partner in PwC UK’s HR Transformation and Technology practice who spent the last decade leading large-scale HR transformation programmes for major multinationals. And she has some robust thoughts on what this next era of radical change has in store for TA teams. 

If you’re feeling overwhelmed by mounting pressure from the C-suite to dramatically improve productivity and efficiency, while simultaneously making the shift to becoming a skills-first organisation and upgrading your recruitment process for the AI-era, this is a conversation you won’t want to miss.  

Join Robert and Harriet for the latest episode of the TA Disruptors podcast as they dive into:

💡 Lessons from PwC’s transition to a skills-first organisation – Harriet shares practical advice on how PwC made their skills taxonomy much easier to manage, and gives the inside track on how her team are thinking about preparing their 350,000 people for a workplace with rapidly changing skill requirements 

🔥 How to use skills-based hiring to improve social mobility – Harriet shares the bold, transformative thinking moves she believes every organisation should be making to support a socially mobile workforce –– from ditching CV screening, to opening up the talent pool to those with criminal records

🤖 How to think about your workforce transformation strategy in light of AI - If AI is set to disrupt half of all roles in the future, what should your strategy to support your workforce through this transition look like? Harriet shares her advice.

💥 Why AI-enabled organisations must be human-led – As AI evolves, it won’t always make decisions aligned with the purpose or sustainability of a business –– Harriet shares her thinking on how to set up AI governance to ensure it serves the organisation's long-term vision.

We promise this will be the most valuable podcast episode you listen to this week.

Listen below 👇

Podcast Transcript:

Robert: Welcome to the TA Disruptors podcast. I'm Robert Newry, CEO and co-founder of Arctic Shores, the task-based psychometric assessment company that helps organisations uncover potential and see more in people.

We live in a time of great change and TA disruptors who survive and thrive will be the ones who learn to adapt and iterate and to help them on that journey. In this podcast, I am speaking with some of the best thought leaders and pioneers who are leading that change.

I'm really excited to be welcoming Harriet Newyn, who is a partner for workforce and HR transformation at PwC. And I understand you started your career in HR and part of, I think, what will be really enjoyable in this conversation is talking with somebody who understands things both from the practical, I've been in HR, I have felt the pain to the consultant who then comes along and says, I think I can help you relieve some of this pain and transform your organisation. So on that note, Harriet, welcome. And please tell us a little bit about yourself.

Harriet: Yeah, thank you. It's a pleasure to be here. As you said, I spent my first 10 years directly in HR in various roles, looking at restructures, talent initiatives and hiring. I moved to PwC about 10 years ago now, just over. And I specialise in workforce and HR transformation.

But something happened about three, three and a half years ago where we were gravitating towards skills, technology was starting to evolve to focus on upskilling and skills, skill-centric initiatives. And I remember speaking to my boss at the time and thinking, we've got to research something here. We've got to have a point of view because we know there's a benefit to understanding what skills we need and what skills we're going to need because we can see disruption. It's happening all around us. But what is our point of view? How do we quantify this?

And since then, it's been an incredible journey. It's been a journey of looking at how do we move to hydrogen and energy across Asia and Australia. It's been working with local county councils and Government and countries across the EU on how do they reform their education and how is that gonna be linked to GDP. And finally, a bit closer to home for myself is working with large kinds of private sector organisations on their journey to as you said, what is a skills first or skills-based organisation? 

Robert: Wow, so a lot of thinking that you bring to all of this, but I mean, it'd be interesting to dive into some of those things around what you've learned and what the PwC perspective is on this. So let's just start with, I think it's interesting what you referred to earlier there, three years ago, something changed and it clearly did, and we've seen it at Arctic Shores too.

That people started talking about skills and recognising that with all this excitement around changing to digitisation and automating things, creating new roles, but we have a skills, potentially, or actually in reality, we have a skills gap and a skills shortage, and therefore working and strategising and developing our organisations in the same way as we did in the past was not going to help us be successful in the future. So what are the big things that you think and you uncovered then as to why all this focus around skills, because surely we've always been changing and need skills and skills have changed over a course of time anyway, but what the sudden urgency this time and why is it a bigger problem now than it might have been in the past?

Harriet: Yes, exactly. And we've always looked at competencies and to some degree. I think almost we're in a perfect storm. We've got faster pace of disruption, technology, GenAI. I'm sure we're going to talk about it. The sustainability agenda and green jobs and the drive from both the regulator and the consumer forcing organisations to transform. All of these, I think also in the economic environment we're in where organisations are having to, particularly over the last 24 months, really look at utilisation, productivity, efficiency. And then bottom up, what you've had is quite a significant disruption by new technology, which is suddenly making the ability to understand what skills you have now and what skills are out in the market actually very, very achievable.

So we've almost got this perfect storm where you're in this place of disruption organisations are right to look at their workforce, which are their greatest asset, and how do they get more productivity out of them? And I think to summarise this, in our CEO survey at the beginning of the year, over 50% of them said that the lack of skills or talent shortages were starting to impact their profitability and sustainability. So this is very much on the minds of the C-suite now, as opposed to just us looking at it in pockets of niche skills.

Robert: And so I absolutely get that. It's interesting that this is a number one priority for CEOs, which we can see why is gathering so much coverage from a general news perspective. And I imagine quite a lot of inquiries coming into PwC on it. So you've got the challenge around we're gonna need these skills. But I think also there's the bigger challenge too around there's a social mobility piece around this too. So this, for me, there tends to be two elements to this. One, we need to go and find the skills. But actually, if we don't do it in the right way, we are in danger of widening the social mobility divide that exists today rather than narrowing it. And so to take me through, because I know PwC are really passionate about the social mobility piece and how you think we can use this challenge that we've got as a positive way to improve things rather than just a mechanical we need to find people with more skills and so we're just going to train up certain people and if they're lucky enough to have it then great they get good jobs and then everybody else is left behind.

Harriet: Yeah it's quite a complex equation when you actually know all these factors but there is a huge opportunity here to your point but if it's not considered carefully there could be some unintended consequences when you actually go backwards when I look at the social mobility opportunity to stop hiring on traditional methods, which as you've called out, we know aren't fit for purpose anymore. To think about how you assess candidates, to think about how you onboard and develop people, actually by using skills as that kind of currency, as opposed to jobs, you're able to tap into a much broader demographic of society. And that's quite an interesting concept in itself.

I was interested to speak to actually Teach First, it's an amazing social enterprise we work with. And you've probably heard of them. Certainly have. But they were telling me that these amazing stats that when you look at children from underprivileged backgrounds, in state schools, over 50% of them do not offer a computer science GCSE. So let's say we all say we're gonna change our entry criteria, bring in people at the A level/GCSE with computer science GCSE qualifications.

So there's gonna be some unintended circumstances here that actually we've got to work with the government education authorities to how do we do this to make sure we create a greater equal playing field for all. And it's just so interesting when they told me about that, I started digging and saying, why? Well, it turns out we don't have enough teachers. Absolutely. Computing teachers. So they don't have the skills. Now, if you break that down into what skills we need, what programs should we have in educational, and in education and the workforce, you can actually start to address that challenge and make a difference. And that's the power of skills.

Robert: Definitely, okay. And you make that in a really lovely way that this is why it's important that we do this. There's not just a business piece around this, but we can make a real societal difference on this. So I think a lot of people generally now get, okay, this is important. CEOs are saying we need to do it. Business-wise, we need to do it social impact we need to do it. And then it comes down for me to, okay, well what do we mean by skills? Because we've, and I'd love to get your perspective on this because we've got ourselves into a little bit of a pickle around all of this because we talk about hard and soft skills. And skills, then you think about a skill as something that you learn and that you can have a capability in that can be credentialed in some way or verified in some way. And then we talk about soft skills, which tend to be something like communication or leadership. And then that seems to move away from that early definition. So where do either you personally or PwC sit on this? What is a skill and what's the difference between a hard skill and the other stuff that we know drives success?

Harriet: You will be pleased to hear I spend a lot of my time talking to organisations about what is a common definition of a skill? And how are we going to use it and at what level? Yes Yeah, and there's and there's so many different answers to that. In fact organisations use it in very different ways I think the main thing is to understand what other core skills are for your organisation and have a common language about talking about it Right to your point. We are talking about hard and human skills. Yes to your point, but I think when we talk about hard skills, are we talking about data science or are we talking about Python? What level of skills do you want to analyse or do you want to consider your workforce and your people strategies around? When we talk about human skills, are we talking about leadership or are we talking about the next level down?  So actually creating a common framework for skills is really, really important and a first step for organisations. It's not doing away with your old job architecture. We're not sitting here saying jobs are no longer going to be around.

There are some opportunities to think about how we change some of our traditional employment methods for sure, but actually we're thinking about how does skills match up with your current job architecture, job families, and sub-families, to be able to be that common language for talent and skills and to deploy that into your talent initiatives or your skills first hiring. And so it is a complex piece, but you've got to get your levelling right and then of course you come into a question of proficiency.

Robert: You do, and how do you assess that. But just before we get to that bit about proficiency, because I think that's a thing that I'd like to discuss a bit more with you, just coming back to that common language. I absolutely get that, because actually there isn't a common language across businesses and you can see it in job descriptions.

So there's this huge benefit of just having a common language there. But one of the things I get asked a lot about, and so it'd be great to get your perspective on this, is When organisations, it's quite often large organisations that are going through this, right, let's develop the common language, we'll get everybody to list the skills that they've got. They end up, I was talking to one organisation, they end up with 40,000. And then they said, oh no, it's okay, we'll use AI and we'll get it down to 4,000 skills. But that's still a huge amount. And I think a lot of people worry about, okay, we can have that common language, but actually, potentially that could just introduce complexity and some people's definition of a skill may be different to others. So how do we take some of that risk element out that the common language just becomes a mess rather than a saviour?

Harriet: It's such a great point. I think a starting point was there. Even come in and upload all your skills from LinkedIn and then you end up with hundreds of thousands of skills. But how do you analyse that? How do you make something meaningful of it from a people or talent or work for strategy? I think we've slowly clamped down on that and the technology vendors have as well, to try and create one consistent, two or three levels of skills max. There is still variance to your point. I'm working with one organisation which has 300 skills, and they want to keep it at that level because they're at the beginning of the journey and use it to just target specific initiatives. I'm working with one organisation who has 2,000. Right. So a huge level of variance. I think what is helping here is the tech, because the tech, and I'm not sure if you're aware.

We've always had our core workforce in HR technologies, our tier one and tier two providers, you know, the big SAPs, Oracle's work days, et cetera. What's happened over the last 18 months is really fascinating. There's been these intelligent skills platforms, which have just boomed onto the market and were very fast-moving. And they're absolutely partnering and forming alliances with your core tech stack. But those organisations are providing a skills taxonomy, which is industry-relevant. They're using AI to swipe the market so they can see what your competitors are hiring, when they're not hiring, what are sunset, what are sunrise skills, what are skills which are likely to be disrupted by AI. So they're giving you real time insights. And that's fascinating because if you're hiring at the moment and so all your competitors hiring the same skills, you clearly need a different strategy. One way or the other from pay to brand to engagement to benefits to upskilling and long term career aspirations. But you're suddenly able to get a common language for skills and the techs providing it and keeping it real time while also giving you additional insights. So it's a really brilliant foundation which has come in over the last 18 months, which is helping organisations progress in their journey.

Robert: Yes, and I think that's very exciting and it does, you know, it's a brilliant way for way the technology can support addressing that complexity. But I'd like to just question one bit particularly worried about, because obviously I'm a keen fan of technology and using that to automate things, but at Arctic Shores, we come from a social science perspective rather than a data science perspective. And let me just give you an example of where I see the difference around that and why I think it's important as to how we use technology and therefore any perspective that you have on it. So when my daughter was applying for a job recently, she went on to LinkedIn and she was looking at a couple of jobs and LinkedIn said, oh, you don't have project management as a skill listed. Do you want to put that in in order for you to apply for this job? And she said, oh no, I don't have project management as a skill. And I said, no, of course you do. You've been doing a PhD for the last four years. You've run three or four initiatives around sustainability and other things.

That's absolutely what they mean by project management. And you have that classic case of what we know, that quite often women will want to have 80% of what they feel is a match for the skill before they apply, as opposed to men, much more gung-ho about it all, yes, I've got some vague things around that, so I'll apply for the job. And so what I would throw back at you about the danger of all this sort of AI coming in. In a social science world, we are worried about self-report bias. We're worried about comparing use of language to a general population group rather than just finding a data science match. So do you see any of that risk and how can, what's your advice that organisations can get past this sort of social science versus data science divide?

Harriet: It's such again, an interesting point, we use a term at PwC called human-led tech-powered. Okay. And it's, it's got to be human led because you need judgment on these topics and issues at the same time to move to a skills first organisation where you're able to identify that candidate who has a 60% match to skills or comes from a different background and might have a 40% match for skills. So you're going to bring them into a role with a series of tasks and learning and development and mentoring.

You actually do need quite sophisticated technology to make this work real-time, but it's gotta be human-led, and it's gotta be governed, by responsible AI, because technology will evolve and it won't necessarily make the right decisions. So there is risk in that. And when I'm working with a number of organisations who have looked at this, as I said earlier, there can be some unintended consequences. So for example, an organisation that's got a large amount of coders, when they've looked at their future skills requirements, actually they don't really need as many coders anymore because generative AI is gonna disrupt that. So in theory, these people don't have the skills they need. They're not necessarily all gonna be required. So those jobs are no longer required. However, when they looked at that population and the demographic of that population, it was a very diverse area of their business. And so they were about to make some decisions which absolutely would have short term hit the share price, but longer term these people were actually were prime. They had learning agility, they had job corridors to upskill closely to the future skills. But it needed leadership to come in and say, hang on, can we look at this in a little bit more detail really because the technology is telling us one thing, which is an efficiency game, but there's something around the purpose and the sustainability of our business, which needs consideration. So that's just an example of how technology is a part of the equation, but it needs to be human-led.

Robert: I love that. And I also think it's very interesting, that particular story, because what you share there is that what makes, what we're being very clear about, what we need in the future is more around learning agility, coachability, conscientious, maybe attention to detail. There'll be a number of different things. Creativity, curiosity, exactly. So what we're saying there is that when we're thinking about the skills of the future, and I say skills of the future because creativity is not something that you can, I suppose you can think about it a bit, but in terms of you're either creative or you're not creative.

So now we need to start thinking a bit more about, well, what are these human elements in a job that will really enable somebody to succeed and less significance on the hard skills? And that starts to change how you think about using your internal workforce. Also starts changing how you think about how you hire externally to around this. And I suppose that the point is my that I see a lot of people thinking about the skills first organisation naturally going ah we're going to need more Python skills. Oh actually we're not going to need more Python skills going forward we're going to need more AI skills. So Python skills no longer needed AI skills needed. And the danger is that the skills first organisation gets them focused on the skill rather than the capability to get to that skill. Do you see that as a challenge at all?

Harriet: Yes, and I think if we step back to the disruption and why this has come about, the reality is the skills we need tomorrow, particularly the hard skills, don't exist. Some of these green jobs, Gen. AI, we know demand, far outstrips apply. But what, and those jobs, this was our work that we partnered with the World Economic Forum on. It looked at how we're now at a 16-year high of having talent shortages globally it looked at this 3.5 million cyber jobs which can't go field because of hard skills. So yes, we've got to address that, but actually those hard skills, it pointed out, going to be disrupted much faster than some of the soft skills which are going to keep you going throughout your career, that learning agility, that curiosity. So you look at a tech skill, the average lifetime or lifespan of that is 2.5 years, and increasingly that's coming down to about 18 months.

So it's fascinating about the new generation coming into the workplace. I think of the new generation who've never known the workplace without Gen. AI. Yes, which is scary and terrifying. Yes, it is. But they're going to be re-skilling every 15 months. They're hard skills. But how they develop that change, agility and their leadership to support them, and navigate a workforce in a world of change is what's going to be what can differentiate them in the future.

Robert: So let's let's just dig into that a little bit, because I think you know, this for me is where the skills first trend can, if it's done right, can really address that social mobility gap that we talked about at the beginning. Because if the things that we say are going to be important for the future are things like your learning agility, your curiosity, your creativity, then that's normally distributed around the country. It's not going to be limited to people who've had a private education or been to a Russell Group University. So that makes it exciting because it suddenly opens up now the talent pool to the people who may not previously have been exposed to the type of education that would enable them to have got the skills that we need. So how do you see them or organisations you're working with changing the job advert or the job description? To bring those things out so that they are making sure that they're opening up the talent pool rather than restricting it because they're only focusing on hard skills.

Harriet: A key thing here is HR has to adapt and leaders need to adapt to their traditional standards. So hiring in isolation of understanding your workforce plan or your upskilling agenda or how you're actually recognising the deployment of critical skills. None of this can happen in isolation anymore. It's forcing organisations to be much more connected with their people's strategies, which is a good thing. But then it's really challenging those COE leads, you know, the head of talent acquisition, to go, how do we revolutionise? Where are we tapping into talent? How are we breaking down our traditional qualifications and certifications right through to, if we're being quite radical, when I first entered the workforce, if you had a criminal record, you are completely banned from having a job. 

Robert: Yeah, there was no opportunity to get back in. No flexibility.

Harriet: But if you look at people under the age of 21 who have some kind of criminal record, you have to take this with measured focus and review, but actually a number of them come from underprivileged backgrounds. So you have to change these traditional things which we've been programmed are completely normal. You've got to rip up the rule book here work much more creatively around a central people strategy, which looks at, yes, attracting, but more importantly, retaining and upskilling, and that internal resourcing and mobility is very, very important to achieve that. So this is how I think organisations are tackling it, and it's really, really excited to see some organizations finally rip up the rule book.

Another example I recently saw was, it was a bank, a big global bank saying, Why are we paying someone or rewarding them a bonus for something they did 12 months ago when those skills are no longer relevant? Why shouldn't we pay them now if they're delivering it? And why shouldn't we incentivise them? And so just again, creative thinking, why have we done this? Why have we done annual reward cycles the way we have? Was probably because it was the easiest way to do it.

Robert: Yes, you're right. There's a lot of things like that. And I love, I love, love, love your idea about ripping up the rule book, because my big campaign has been about scrapping the CV, which is very much ripping up the rule book on this one because it's starting to challenge, like you were saying about annual bonuses there, things that have just been ingrained into the way that we do things. And if you follow through all the things that you've been talking about, about skills-based hiring and thinking about the skills both hard and human-led, then, and this point about historical versus future and skills only having a short lifespan, then the CV increasingly becomes an irrelevant document. Certainly in the way that we traditionally framed it, which is list your job title, list your education and list the things that you've done as if that is a prerequisite to success in any form in the future. 

Harriet: Yeah, it seems absolutely crazy. When you really challenge ourselves on these topics, it's mind-blowing. You go, why have we done this the way we have? Working with an organisation right now, whos doing a pilot, working with local councils and charities to support young offenders, get back into the workplace. Yes. These people often haven't got a degree to the same standard as someone who's been through a university degree. An educational experience isn't the same. So they're breaking down jobs into two days a week, which are a series of tasks. They're associating that with skills and they're giving them upskilling of how do you do this on really foundational skills you need, like literacy. So this is how you change the world. But no CV, they're never going to pass into that job with a CV which says you need these roles, this experience, these GCSEs, these A levels. And you're missing out on a huge population of society because of that.

And that's really, it's actually quite sad to see when you still see organisations progressing down that strategy because there's so much opportunity to actually progress with the social mobility agenda, which organisations now can, but are they taking advantage of this opportunity? It comes with significant challenges and change and transformation and thinking out of the box to your point, but the opportunity is definitely there.

Robert: Brilliant. So this is, because this is what I feel too. And I think that's one of the things that hold, is holding quite a few people back from adopting skills-based hiring. It's because it seems complex. It seems to, is it really different from competency-based hiring in the past and from the way that we've been talking, it clearly is. But the big thing that's been going on in TA, at our acquisition around this, is this whole drive to diversity, equity and inclusion. And so unless you start reframing skills into that sort of broader definition, then it's not providing them with the opportunity to look for talent from alternative pathways. And actually, I'm personally particularly clean on looking at people from backgrounds who've been traditionally excluded.

Prison leavers is definitely one of those and I've talked to James Timpson in the past On that one and I think what Timpsons have done Saw a stat on that one. They've had 1500 prison leavers. Do you know how many of them ended up? Reoffending at a 1500 for four that is less than 1% It is you know, you're into decimal points there. And so this is the point about how you break the rule book and challenging because there's a lot of things that we think if you did this, it would cause chaos. Risk. And risk, and that's right. And so it'd be nice just to talk through a few more of those kind of examples as how you see, what's your advice for organisations thinking about, OK, how should we go about this? Because you know you've been talking to a council in there.

But what are the things that I suppose an organisation should be thinking of if they're going to experiment on this and mitigate the risk while at the same time breaking the rule book? Because we don't normally ask HR to break the rule book, we just think that's going to bring the organisation down. And HR in regulated organisations. Exactly, exactly, at another level of... Financial services.

Harriet: Firstly, on Timsons, what an inspiring story and inspiring leadership. And doesn't that show strong leadership, providing purpose and meaningful work. That's what's the first thing which is required in this, in this equation is the vision, is the aspiration.

Robert: It's gotta come from the top, isn't it? It's the values, it's what you're trying to achieve.

Harriet: And that's such an inspirational story. It's so lovely to hear. I think organisations have got to not try and achieve the world on this because it's actually quite daunting. I have a lot of organisations come to me and say, we've either got a specific problem, e.g. we need this skill but we can't find it and we can't hire it, or we seem to be hiring it but we always lose out to our competitors, or we don't understand what the future looks like, or we need to actually target our reward a bit more effectively because in this economic environment we wanna make sure we're targeting it at the people who are gonna build the future workforce. Or I do have a lot of organisations come to me and say,

We know there's value, we now get the concept. We saw the hype, we've now seen some front-movers deliver some huge benefits from this. Where do we start? Exactly. And I think the first answer to that is leadership and vision. The second is start where you're at. And I know that sounds simple, but understand what skills you have in your workforce today. Just by looking at that and generating a skills heat map you will straight away go, well, this is interesting. We've got similar skills here and there. We know these skills are being disrupted by technology. You start just to form that baseline picture, which lays out the foundations to your strategy. Because often when organisations do come with a, this is the issue we're trying to solve for, by looking at their current skills, they almost say, well, we're still solving for that problem, but actually we think the biggest opportunity is over here.

So it's a start where you're at understand where your skills are today, and then think about layering on a smarter piece of workforce planning, potentially using some real-time gen AI to give you wider insights. You're not going and speaking with business leaders about a blank piece of paper. You're showing them what your competitors are doing. You're showing them what's going on in the industry, and then start to build up a workforce plan. And from that, look at your hard-to-retire processes and connect them from a people strategy. What skills do we really need to hire? Which ones do we need to retain? Which ones will have job corridors where we can upskill them naturally into what we think we need in the future? Where do we need to buy those skills? Because this is critical. And what I said before, still stands, you've got to go on sprints. I was at a large SAP conference the other week and we were there with a big global bank and the bank stood up and said you've got to go on sprints here because you will learn so much as you go.

So go and experiment, but don't try and change the world in a year. This is a multi-year journey, which is going to only accelerate. Um, so, so yes, experiment, start with where you're at, look at the baseline, have a vision, and then go on sprints and, and start to put in place skills, initiatives, which you can measure. Because I think that's also what the C-suite are looking for to say, well, how much productivity or utilisation or engagement or reduction of turnover did we achieve through that initiative?

Robert: So I like that. That's an interesting point about what's the benefit of doing all of this and part of it I get your point about you need to have a strategic vision on all of this and you need to know where you're at. But at the end of the day, there has to be a benefit that comes from this. And I like the point about sprint benefits in that too, and thinking about making this down into little micro sort of pilots and initiatives. Exactly. So what are the type of things that you're seeing then that if you do a pilot in something, you need to be clear about the ROI on this. So what are the types of measures that you're seeing that if you get this right, that people should be tracking and trying to measure.

Harriet: And a huge variety. So to provide a couple of examples, one of the opportunities now, again, sorry to go down the tech lens again, but it is being enabled by tech, but human led. Is this opportunity or talent marketplaces? So they enable me to work for you in a full-time job. But actually a manager in a different part of the organisation says, I've got three hours a week or three days a month of support needed. You're actually suddenly able to go and work for that manager without necessarily your approval because this is all about mobility around the organisation, breaking down barriers, and you can measure the productivity hours. And furthermore from that, you can actually measure the reduction of turnover and how you're retaining these people and how they're moving around your organisation and their engagement and productivity levels.

Again, another organisation, big global organisation, was able to sit down at the C-suite and say, this year we've got 30,000 additional hours from our people in existing jobs, working in different areas, while doing their existing jobs. And of course that got their attention. But there's other things. It's absolutely up-skilling. How many people are you moving around the business? What skills are you building? We've got organisations right now coming out with objectives for the year ahead. They're talking about, right, we're gonna assign everyone's objectives to skills we want them to learn. One's gonna be digital literacy, and one's gonna be about ways of working behaviours aligned to our purpose. How powerful is that when you roll that down through your organisation in terms of this is our North Star and what we're heading for? And how does that result in productivity? I need to come back to talent acquisition here though, I have to, because it's interesting how we've traditionally thought about talent acquisition and what the measures are.

Of course you're looking at speed to hire, acceptance rate, bums on seats, all of those good metrics still stand. But you're now hiring a population of individuals who may have potentially not the right skills or some might have highly specialist, generative AI, large language model skills, which we're seeing we released some research last month around the AI jobs barometer, analysed 500 million job ads through AI. Yes, this is how AI is disrupting even what we do today. But it showed that jobs which specialised in AI, not necessarily augmented, but specialised in AI, were demanding absolutely a 30% premium in the market. Particularly in the markets which were getting ahead and the industries which were getting ahead, which you can imagine Singapore, US, us, Netherlands, you can imagine the industries which are first adopters, financial services, technology areas, professional services was that those hard skills they have are also the skills which are likely to be disrupted the fastest.

Robert: Okay, so they're getting a premium, but they're not likely to have that premium for long.

Harriet: Right, so this cost per hire metric we've looked at, and remember they may only have 70% of the right skills, so then you've got a cost of productivity investment which you've got to get people up to understand the organisation, maybe bolster on a few more skills. Actually, by the time you've done that. Where is GenAI gonna be? Where are large language models going to be? So it starts to really challenge again how we traditionally think about cost per hire and where's the value and what do we do with that problem? And we don't know all the answers there yet.

Robert: That's fascinating that some of the traditional things that we've always felt a drive around this and I'm a big one around for the cost per hire changing because you know one of the examples that we at Arctic Shores reference is something we helped with the Siemens where they ended up hiring two people that they were able to train up in six months for the same cost as one person with specialist skills who would have got the 30% premium on there and so then now they've got two people who are.

A, bringing a diversity of thought because they came from alternative backgrounds, but also really passionate about the opportunity. And loyal. That's right. Rather than being, oh, the only reason they were attracted in there was because they were being paid more. And so that's starting to change.

One of the metrics and then say what we tend to look for too is around the challenging organisations and I think it comes a little bit to your strategy on this on time to hire because if something's taking a long time to hire you can either change the benefits or pay more on that or it could be an indicator to tell you you know what actually there's very few people with that skill in the marketplace maybe you actually need to rethink our whole strategy around this and find people, if we can get two for the same price, then even better, because then we're future-proofing our business going forward. So is that the kind of thing that you sort of feel that people should be doing?

Harriet: I love that. The challenge is how do you measure that longer term? And then of course you can, because data and performance metrics and succession and promotions and retention. But it's quite a complex tapestry here. So how do you measure how far these people stay in your organisation? How do you use listening surveys and poll surveys to check engagement levels? You're looking at a whole host of metrics which you really need to understand and simplify so that you can tell that story because that's such a lovely story as well. Why wouldn't you do that in terms of the longer term and sustainable benefits of the organisation? It's fantastic to hear.

Robert: And I think that's the other interesting point about this too, and I suppose that it links to the sort of sprint piece around this, I think your point about simplifying and storytelling is so important, because one of the things that I suppose holds, again holds people back from being successful in doing this is that they introduce words like taxonomies and... Ontology. Ontology, yes, exactly. And so people are now sort of thinking, oh gosh, you know, it was hard enough to you know, to understand what some of the technology requirements, you've got GDPR, you've then, I've now got to suddenly become an expert on API suddenly now. CSRD. Exactly. And now you're saying, oh, I want to induce another element to this. And so I think the only way that people can get their minds around this is how do we simplify and how do we tell stories? And maybe that's part of the sprint and initiation of this is, okay, is there a little area where I can experiment, learn from it, and actually not try and make it too complex. Yes. And, but use the storytelling to help get round. Inevitably, there's always complexity in these things, but use the storytelling to help people get round some of the things that might hold them back, I suppose, on the complexity.

Harriet: And the most successful pilot, so gone into larger implementation and workforce changes, including restructures, has been when the head of talent aquisiton acquisition or the CHRO and the business CEO or the business leader are hand in hand working together, sponsoring it. So that's such a critical kind of contracting component at the top and upfront on any experiment to say, what are we trying to achieve? Why are we trying to achieve it? But you're right, as soon as you go to the business, say we've got some ontologies, and we've got some taxonomies.

Robert: Exactly, and yeah, and then they're going, okay, hang on, am I being brought into another whole world of new language?

Robert: Yes, exactly, and it's gotta be business, and it's gotta be commercial. And again, that's the great thing about, I've got a background of 10 years in HR, really understanding actually working side by side with business leaders. But I've also now got 10 years of thinking commercially around how do we run this business and how do we get ahead and how do we invest in innovation. Which, and combining those two actually is a really nice complimentary skillset. Some of my skills are no longer relevant, I'll tell you that, some of the hard skills. But certainly, I find it quite interesting when I sit in front of business leaders, often with some of my clients HRDs, it's not for me to persuade them to do this, it's to understand what's the value of doing this and is it worth it? And there's a great article out there, you can Google it around, is the juice worth the squeeze? Which is, of which there was a lot of responding articles to say the juice is worth the squeeze.

Robert: No, that's right. And I think where people have got a little bit unstuck on some of this is just understanding, you know what actually is the Skills First organisation, how do you then translate it, because there's a lot of people saying out there, oh, there's huge benefits, it'll change your life, your world, everything will become easier. And actually, as you shared on this, it is more, there is complexity to this. That doesn't mean that you should not do it, but you should do it in small steps in order to be able to understand that.

So I think that's really good advice. I also know as a sort of other bit that I would like to just get a little bit of thought from you on this, that PwC have themselves, I mean, you're not just advising people on this, you've actually put in quite a few initiatives as your own organization to help upskill areas and there's other benefits of taking this thinking because it's a thinking as much as it is a process. Could you share some of those?

Harriet: Absolutely. We've been going through our absolute business leaders and our HR teams are leading the way on our skills first journey. We've been going on it for about two years now. That's included an upgrade to our taxonomy where we have refined it so it's more manageable. How many of you are you able to share?

Robert: How many? 

Harriet: Well, we've got down to around about a thousand core skills. And remember when you look at an organisation like us, we're putting 350,000 people through this to understand what skills we have. And when you start at face value, we have 100,000 senior associates.So each one of them can have a skill. Exactly, exactly. And then there's what skills are associated with the job and what skills do actually people have from their backgrounds and how can you match all of this up and proficiency levels and spend a lot of time talking about proficiency levels with organisations and with ourselves. But what's come out of the back of it? is some really interesting experiments which have turned into a long-term people strategy.

So where we've worked with government, where we've worked with councils in both Birmingham and Manchester, where we've set up tech hubs, from zero technology skilled workers there to over a thousand now. We've looked at where our competitors are, we've opened an office in Barnsley where we know there was people coming out with not necessarily degrees but certain levels of education that we could support people transition into some of our career paths. And we knew that we'd be able to find a talent there, whereas it was highly competitive in some of the other cities in London.

Robert: So that's really different thinking, isn't it? If we could go to a different city, find skills there, rather than just competing in the big cities like everybody else.

Harriet: Exactly, and that leads into our global strategy, absolutely, which goes way beyond that into our acceleration centres. But yeah, so we're doing a huge, and I'm very proud of the work we do around social mobility, but there's always more we can do, but being transparent with your pay gaps being transparent with where you are and publicising them like we have, and then putting in place initiatives to tap into different demographics in societies, break down formal ways of recruiting and our degree standards is absolutely how we're making a change and building the future.

Robert: Yeah, and I know you've been one of the pioneers around dropping degree requirements as one of the things that was holding people back from different backgrounds. And that's really great to see. Thank you for sharing that. One last question, which you alluded to earlier, was what do you think the impact of Gen.AI is going to be then? We talked a little bit about, obviously, it's gonna require different skills, but it's clearly going to have an impact on the way that we hire, the way that we work to do you have a particular sort of set of areas that you think it's gonna have the biggest impact, both I suppose from a risk and a benefit point of view?

Harriet: Yeah, what's the magic number? We get asked, what's the magic number? What's the disruption? I think when we look at it, what we see with the World Economic Forum predicts that all future jobs, over 40% of them will have some emerging technology requirements. And in our CEO survey, 77% of them said they were investing in AI.

It's huge. So you put the stats together. So it's going to change and we need people, it's going to change education. We need people coming out of education with more digital skillsets, whether it's specific qualifications or certifications or whether it's digital literacy, because this is going to become a new norm. So it's absolutely high on the priority to boost productivity, but I am of the opinion, and so are PwC, that this is about augmenting what we do. So that we can focus on different more highly valued activities. It's about complementing what we do, as opposed to replacing humans. So it's about augmenting what we do. It's about supporting us and complementing us. We've talked a huge amount about responsible AI. That is so critical. And if you're not doing it without the governance standards in place, it is irresponsible.

It's going to impact jobs. We can see it's going to be over 50% of jobs. We know that it's demanding a premium in the market right now. We know that industries though, it is industry specific. So it's going to go at its own pace. It's going to impact professional workers faster than when you can get it into engineering, and manufacturing, but we also know experiments and pilots are happening there. So yeah, I think it's hugely exciting to be embraced. When we looked at our hopes and fears, we saw that 60% of it's a survey of about 60,000 people, employees. So it's a really good sample. Most of them were embracing it, but some were concerned about stability, which in this economic environment with interest rates, and inflation, is understandable. So you've got to support your workforce through this. And there's going to be a couple of different strategies that you're going to need to deploy, but you've got to embrace the change.

Robert: So I think you made two really good points there. One, you've got to embrace it, and the other, you've got to have the governance around that. I think that makes it really interesting for hiring too, because we now have the AI-enabled candidate, which we didn't have before. So we have, again, part of the thinking around, oh, let's rip up the rule book just to sort out the skills challenges we have. But actually we need to rip up the rule book because we've got an AI enabled candidate now who can write a job description that's as good using AI as any human could. And therefore if the CV or the cover letter are our traditional ways of determining who we bring forward for an interview, we're gonna be in a mess.

And so that how do you embrace it, how do you bring the governance in too, is clearly got to apply to hiring as well as internally around that. And I think part of the biggest challenge for TA around the skills first and skills-based sort of changes they're going to implement is also factoring in the impact of GenAI, both in terms of benefits helping to learn, but risk in terms of candidates have now got this. So the danger is you're gonna be bringing in the wrong people just because they used AI more cleverly than you thought. And so that's gonna be, and you've got any final thought on how people might address that.

Harriet:  I think it comes back to your point that technology is brilliant and I'm a big tech fan, I'm a big data fan, but it almost in this case suggests that you too need to balance it with human interaction and judgement here. Particularly given things are moving so fast. I'm sure there will be technology which then works out if someone's said they've got all these skills and they haven't, who knows? It's starting to appear, but I think it's the balance of, yes, leveraging technology so that you can deploy sophisticated talent acquisition processes and initiatives, but actually balancing that with human interaction, that should not be underestimated.

Robert: That’s a great way to end it, Harriet, and I think you make that sort of point. So well and it's such a good piece of advice on this. We need to embrace this technology but we need to do it with eyes wide open, we need to do it in ways that we still maintain the power of the human capability and capacity to use technology for greater things than just automation and efficiency. Well it's been so lovely talking to you about all these things and it's been great hearing about some of the things that PWC are doing around this you're supporting some of your clients too and thank you very much for for taking the time.

Harriet: Thank you it's been a lovely conversation.