How Automation and AI Have Changed Everything
Smaller organizations and many startups are leading the way in automating and outsourcing non-core functions. Core functions are those that generate revenue (sales), invent new products or services (R&D), or deeply touch customers (customer care and support). Non-core functions are everything else.
Internal recruiting functions are not core.
For as long as people have lived together, there has been a tendency to centralize and create hierarchy. We have seen the growth of many huge, centralized systems, including government, corporations, schools, utilities, health care, and so on. Most of us currently work or have worked in one of these organizations, and most of the recruiting practices we use have evolved and been shaped by the needs of these organizations.
In a world where work was primarily physical, and it was not easy to communicate quickly, centralization and formal structures brought efficiency and speed. Hierarchical organizations allowed the consolidation of people, machinery, and money, which made mass production possible and lowered prices. Societies moved from tutoring a small number of elite children to creating formally organized and regulated schools designed to educate the masses.
Even in the creative world, formal organization became necessary for a while. Movie companies could muster the capital and the equipment to produce complex and expensive movies and distribute them to physical movie theaters. Actors were hired by one production company and signed up for life. Advertising, public relations, and media firms were also large and hierarchical.
But this has changed mainly because of two factors: the growing capability of automated tools and a change in worker’s attitudes.
Decentralization and Recruiting
The power of artificial intelligence and the complexity and capability of automated tools have accelerated the movement toward decentralized, distributed systems, particularly when it comes to breaking up the traditional media distribution hierarchies: television networks, movie studios, music producers and distributors, and newspaper empires.
The decentralized, multiple-input capabilities of the Internet have battered all of these. Distribution requires no physical movement of stuff but only the movement of electrons through space. The need to centralize has been reduced in almost all cases and eliminated in many. Automation has contributed to this by making it possible to produce physical things with fewer and fewer people. This means manufacturing has become smaller and more distributed: a product is designed in one place, prototyped in another, and manufactured elsewhere. Marketing is outsourced, as is distribution, sales, and service. For example, scripts can be written, and movies can now be generated by artificial intelligence. Fearing for their jobs, writers and actors are on strike in Hollywood.
Recruiting, too, will be decentralized. Routine hiring may be outsourced to an RPO. Sourcing is already partly automated and this will only improve. A handful of consultant sources will fill in the gaps. Hiring managers will use AI tools and apps, consulting with expert recruiters only when these fail them. Candidates will largely communicate with chatbots, and various apps will screen them for skills and abilities. Recruiters will meet only with high-value candidates when asked by a hiring manager,
The Shrinking Corporation
This trend is now moving into corporations, sensing what E. F. Schumacher said long ago: that small is beautiful. More organizations are trying to stay small or at least “right-sized” for the goals they set out to accomplish. The idea of growth for the sake of growth is dying, and more organizations are discussing how to spin off business units, outsource transactional work, and simplify their core businesses. There is an understanding that centralization reduces creativity and creates barriers to communication. The largest automobile companies are failing, and the outcome will be smaller car producers, perhaps many dozens of them, innovating on a larger scale than ever. Think Tesla, Rivian, and a host of other small producers of electric cars.
The people who staff these newer firms are less traditional in their thinking and tend, in most cases, to be open to trying new employment models. Large corporations are trying to cope with changes in employee attitudes by offering hybrid work arrangements and virtual work.
Schools and Recruiting
Schools are slowly following this pattern. With the ability to distribute information through the Internet, they are undergoing significant change. School systems are experimenting with virtual classrooms, and fewer are investing in new physical campus buildings. Online tutoring, individualized learning programs, and project-based lessons are becoming more common and will likely change how we think about educating people.
This means college recruiting will look very different in a few years from today. Articles I have written earlier this year point out some of the changes in college recruiting that are already happening and others that are on the horizon.
Recruiting Future
This move to decentralized and smaller organizations means that the way recruiting is structured and staffed will change.
While corporate recruiting won’t disappear, it will morph into a different function. The evolution may take several years for large multinational firms, but it is already a reality in many small and startup firms. The recent mass layoffs of recruiters, sparked by economic worries, is a lasting trend.
Rather than the large functions many organizations fund today, the remaining ones will be much smaller. They will be staffed with broadly skilled and experienced talent professionals who are comfortable talking with senior management, building relationships with recruitment vendors and internal managers and candidates, and contributing to (or even creating) strategic talent plans.
However, the bulk of recruiting will be automated or outsourced to RPOs that specialize in quickly finding and presenting qualified candidates. And even in RPOs, the recruiters (if we call them that anymore) will need to be highly skilled in multiple areas. I could imagine a person who focuses on managing a community of talent for a specific client. They might be able to do this for multiple clients, given the evolving technology. Another person might focus on career development, candidate assessment, and coaching to fuel the pipeline for a talent community. The competencies involved will include sales, relationship building, technical savvy, business knowledge and skills, sourcing, and social media skills, as well as the ability to move between these competencies easily.
At a high level, what is going on is the continuous movement from systems that are formally organized by a management team and where entry is closed and controlled to systems that are self-regulating, open, distributed, and filled with individuals making choices about their roles and outputs. It’s about the rise of collaboration and sharing of ideas in less structured ways.
Whether we like this trend, agree with it, or embrace it, nothing seems to stop us from moving in this direction. The only question is how fast? You should ask yourself if you are getting prepared, building the right skills, and moving into the right place.
Fixing Work – A Recommended New Book
Thomas Bertels’ and David Henkin’s new book Fixing Work: A Tale about Designing Jobs Employees Love is more than needed in today’s changing business environment. The book outlines practical ways that work and jobs can be designed to be both engaging and productive. It is written as a story about a manager named Jerry and his challenges as a boss in today’s work environment and how he struggles and succeeds in making work fulfilling. This book is easy to read and full of great ideas on how to redesign work.
I highly recommend picking up a copy today.
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