Also: Fortune's Quarterly Investment Guide, inflation misses and pay-rise hits.
Good morning.
Whether you call it the great resignation or the great reshuffling, or just a great battle for talent, there is something going on in the labor market that is unprecedented in modern times.
But I was encouraged and even inspired yesterday by a conversation among forward-thinking CEOs, assembled by Fortune and McKinsey, who are using the talent-challenge as an opportunity to reinvent HR. They are shifting to skill-based from degree-based hiring, finding new and unconventional ways to source diverse talent, up-skilling existing employees rather than replacing them, providing new flexibility to workers as to when and where and even how they work.
The battle for talent is forcing the best companies to become better, by rethinking policies towards people. Some excerpts:
“The great resignation is real… But you can greatly mitigate it by ‘re-recruiting’ existing employees and talking about what are the benefits, what is the career path, what is the workplace experience (if they stay)… We use A.I. to determine which employees may be at risk of leaving, and then sit down and make an assessment of what’s driving them out.”
—Arvind Krishna, CEO, IBM
“We are now looking at how to extend the incentive compensation plans through the whole hotel, as opposed to just for managers and above… The people who can move the guest experience data, which we’re tracking very carefully, are the ones who are intersecting with the guests directly.”
—Mark Hoplamazian, CEO, Hyatt
“You have to think about training and hiring differently… We have a group of companies—there are 50 or 60 in Chicago, and we’ve expanded this to six or seven cities across the U.S.—that are using apprenticeships, working with city colleges, and, I kid you not, we have come to realize this is as a source of talent that is performing as well as our current talent ever performed.”
—Greg Case, CEO, Aon
“There are actually 100 million people in the United States alone who do not have four-year college degrees, but are employable, if we take a skills-based approach.”
—Asutosh Padhi, Managing Partner, McKinsey North America
“I have to say, I was not in favor of this virtual way of working. But early on, we said you can work from wherever as long as your supervisor agrees. And it’s working. And if anybody on the line doesn’t want to be flexible, tell me your company name, and I’ll be happy to recruit your employees.”
—Dave Burritt, CEO, U.S. Steel
“We’re reducing our real estate footprint over the next three years by 70%. And our whole senior team, starting with myself, is going virtual… We’re able to source talent, not just from the traditional geographies, but wherever the best talent is available.”
—Rod Martin, CEO, Voya
“In health care, we are seeing people doing remote work who we never thought would do remote work. I mean physicians in remote work—10 years ago people would have laughed at that. But that is a real thing now .“
—Anne Klibanski, CEO, Mass General Brigham
“We have a program to prepare returning veterans for technician-level skills for our customers.”
—Blake Moret, CEO, Rockwell Automation
“You have to build an environment where people feel empowered. It gives people agency if they understand the why of what we do and feel connected to a bigger thing. They’re more inspired to do it. “
—Joanne Crevoiserat, CEO, Tapestry
“I think, high level, people seek more autonomy. For more freedom, people leave their countries. They leave their families… So my belief is that if you don’t give the autonomy that people want, they will find companies that will give them the autonomy.”
—Ari Ojalvo, CEO, REEF
“Corporate responsibility is an area that we really doubled down on through the pandemic. We created a new metric for the number of patient lives that we touch… We actually counted 100 million last year, and we’re going to track that every single year. And it was wildly positively received by our employees.”
—Kevin Lobo, CEO, Stryker
“We can learn so much from our teams. At the beginning of COVID, there were lots of town halls, which is very good for management communications. We’ve switched to spending a lot of time listening to our teams.”
—Stanley Bergman, CEO, Henry Schein
“We think about why people come to work, and it is really three things: ‘What’s the job?’ is number one. Number two is: ‘What’s the pay?’ And number three is: ‘Who’s my boss?’ So we spent a lot of time on the last topic, which is leadership.”
—Steve Rusckowski, CEO, Quest Diagnostics
CEO Daily will be off tomorrow. See you next week.
More news below.
Alan Murray
@alansmurray
alan.murray@fortune.com
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This edition of CEO Daily was edited by Bernhard Warner.
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