Recently we sat down with Holger Mueller of Constellation Research along with special host Anne Fulton CEO of Fuel50 during the exciting final days of the 2021 America’s Cup. Both avid followers of the racing much of the discussion draws comparisons between America’s Cup and business, particularly for innovative tech companies.
Holger goes on to share his top 3 business lessons to be learnt from the last America’s Cup and why we should think more like the racing teams. He also discusses what we can expect for the decade ahead in terms of the shifting talent dynamics and where this might lead us.
Here’s how the conversation went… This interview has been edited and condensed.
Anne Fulton: Fuel50 is a technology company and we love to be innovators in the way that we deliver technology to the world. We want to be game changers and so far ahead of the competition, so on that note what are your thoughts about the current America’s Cup racing?
Holger Mueller: First of all, being a sailing enthusiast my heart bleeds because it’s the first America’s Cup that I’ve missed due to COVID. There’s tons of things to be learned from the America’s Cup for business in my view, in my keynotes I have three lessons learned from the last America’s Cup.
One, you have to take risks. The risk the Emirates Team New Zealand took is they showed up late. I was in Bermuda for a conference one and a half years before and when taking the ferry from the to-be built America’s Cup village, Oracle was training, BAR was training and Saudi Arabia to know everything about the wind and so on. The Kiwi’s showed up six days before and capsized their boat. Everyone knows that capsizing a boat is bad, they could have been out of it with broken boat or injured people but they didn’t. They waited so long because they had an innovative new idea which is lesson two think out of the box.
Traditionally on sailing ships when you have to generate power you do this with your arms because you have to have a stable stand. The kiwis came up with this great idea that humans can produce more power on the bike with the legs than with the arms on the winch and they showed up with four bikers, which got everybody surprised. But if they’d shown up two and a half years before everybody would have copied the design and personally as a biker I love this. Make total sense, so think out of the box.
Thirdly, rethink the organization. In the last America’s Cup (and this one) this was very interesting. Typically the helmsman is the God of the ship, he or she runs everything. Oracle BMW USA came up with this BMW designed steering wheel which not only steers the ship, but also controls the angle of the ship. It’s important for dynamics so it was completely over engineered. Whereas again on the other side Emirates Team New Zealand had the skipper not being the helmsman. When does that ever happen in the America’s Cup when the skipper is not the helmsman? When they split the rules, the skipper was doing the lowly job of trimming the sails and they split things further with the angle guy as the front biker on the side and front. A totally different thinking of organization.
Which also leads us to this America’s Cup because organization is the big discussion. What could possibly go wrong with two helmsman with which the Luna Rossa Italians are competing? There was a rumor that Emirates Team New Zealand is trying two helmsmen, with Ashby being the backup salesman anyway. But it’s too late probably for them to change all the coordination which is needed for that. Similarly in business I think two CEOs is better than one. The co-CEO situation which you have unfortunately is not common in companies. My view is that it’s a much better model in general for companies.
Anne Fulton: We always talk about Fuel50’s talent marketplaces as being like a kiwi innovation and the America’s Cup and we think really carefully about what does that mean. We want to be technologically advanced, sleek, powerful and fast. We also want a beautiful design go into the engineering of the ‘boat’, which we think of as our product. But we also think of our boat as being powered by Olympian athletes. We describe our team of Fuellies as being grit, graft, grunt and grind but also gifted. Every single one of my team is like a gifted athlete, like these Olympians that are on these America’s Cup boats today. It’s interesting you’re bringing this up because I’m enjoying the dynamic around the duel helmsmen on the Italian boat. It’s exciting seeing that dynamic play out and I’m wondering why we’re not doing the same.
Holger Mueller: It’s an interesting talent dynamic. The Italians started out with Francesco Bruni who was the helmsman, then they had the chance to get amazing talent on board, someone who’s won the America’s twice, lost it once, has been in six finals – Jimmy Spithill. Then they changed the organization and made the best out of it, even having an advantage. I think the lesson learned here, we can say already because they made it to the final, is when there is amazing talent out there, you have to get amazing talent in it doesn’t mean you have to ruffle the feathers and change everything. Organizations can be very malleable. If you see the pair in press conferences, they work well together, they get along together, because they want to win this. Having a common goal is something which always gets people together. It’s been a great lesson learned already here at this point.
Anne Fulton: We’re co-founded and co-led across our entire business in terms of sharing responsibilities, and I think it’s a wonderful dynamic that can be utilized. I also think the dynamic is really, really powerful in terms of always backing each other up. There’s two heads and you’ve doubled the talent and power onto that team. I think it comes back to your point around taking a risk and thinking outside the box, and what else can we do differently that’s going to create an advantage.
It’s a beautiful dynamic that’s playing out in the America’s Cup right now, in terms of talent, risk and strategy around talent. Because of your involvement in our space we’re keen to understand what are your observations of how the talent dynamics have shifted, during this past year?
Holger Mueller: The way how people work. Obviously, we’ve been working from home and it’s very different. The longer this pandemic goes the more likely they’re going to work from home. So there has to be a different way of leadership, that’s the first thing. Leaders who were great at managing by walking around, looking people in the eyes, going to drinks after work or lunch with a different team member every day in the week lined up at his favorite restaurant have come to realise that is not going to work right now. So leaders have to change their skills.
It might also be potentially a more intrinsic person who’s better at picking up on a phone call or on a video call if somebody is not doing as well because we can’t see the full body language. I think it’s going to be very, very different skills with remote working teams. Even with teams that can go to the office, people have realized why should I spend 1,2,3,4 or five hours a week on commuting? So we see new leadership requirements.
We’ve separated companies into three large buckets in a pandemic world. There are the super busy ones, the hospitals and the essential business who are realizing, this is not a 5k race, this is the marathon, we are running much longer and so we have to invest into our system again, we cannot stop everything just holding the fort down. There’s an awakening there, which is good for the technology space doing things, and good for HR to develop new things to make sure people don’t burn out, have the skills for the future, to avoid huge hiring pressure to hire people because people want to not be in dangerous jobs, and so on.
The other ones are the staggerized, I call them staggerized because they’re on off on off closed. Often the problem is by order of magnitude bigger, because they have to do this across different cities and locations and all of a sudden it’s no longer the central command headquarters saying this is how you run your business. Now it’s the local managers making hiring decisions, opening decisions or salary decisions. He or she is the only person who even sees people to tell them sorry we have to shut down again, we have to furlough you or has to hire people to open up in five days and in these cycles. Our systems are good for the average economic cycles of seven years up seven years down, but now you have to operate on seven weeks, potentially seven days, up and down closing for location.
Then there are the sidelines ones who don’t even know if they’re going to reopen their business like this. Like the airlines. Are you going to be an airline? Are you going to be in the hospitality business? Are you going to be something totally different? They have totally different systems and sit on IT infrastructures, which now don’t make sense so they have to pivot quickly. That comes back to the ability of employees and the main capabilities into one you can train. This is why we’ve seen a strong focus on training, obviously, and learning for people now. It really comes back to who are my best people? How can I get the best people who I dropped?
I’m happy to talk about the concept that’s called transboarding. It’s a word I created with transfer and onboarding. Because yes, you will hire people from the outside but transfers, especially now the company’s pivot and change their value proposition are going to be even more valuable because you can get in quicker on the pace of the skills in your better employees and you can keep your people by putting them in new jobs, make their life more interesting. In this trend, the transfers in the company usually outnumber the new hire people by five to seven to eight. So if you get the transfer experience better, you can get qualified people ready earlier, get them running on the next job faster and transition them better. The transition is easy now. Remember, when in the office you had to physically move if you were changing departments, today, you don’t have to move anything. So the transboarding speed increases. Enterprise acceleration companies have to move faster and have to become more agile; so transboarding is a super important process for infrastructure.
Anne Fulton: We do need talent agility in the workforce today, more so than ever. This ability to, as you say, prepare talent to be agile and to be fast movers, and ready for the next project or assignment that might be coming their way, unexpectedly is key. I’m also liking your three buckets and helping those that have got the marathons in front of them, as well as those that need this extreme agility and unpredictability. We’re preparing people for all sorts of unknowns, but I think the transboarding conceptualization into the new career currencies is really important to support that enterprise acceleration right now. What do you see supporting that methodology?
Holger Mueller: You have to understand what your people can do. There’s this big trend around skills right now. As we know in the old world we would fill out forms and the forms will be collated and tabulated. Half a year or one year later, you would know oh, this is what my people knew a year ago. You didn’t know what they’re doing right now. That’s being proved to be done better, there’s no question with electronical ‘skills clouds’ with AI. I think our digital artifacts that we create, and our digital exhaust tells enough about your skills dynamically to come up with which skills does somebody have. So the skills can be derived by what we do, because we create so much digital things into the work right.
Many people have been asking what do we do with people who for example manufacture cars, who have no digital exhaust. In fact, they check in, you know when they go on break, you know what systems they use and most importantly, you know what quality the car is. You can track that back and figure out when Jack, Jo and Jill work together the car is always bad. But if you team up Jack, Jo and John the car’s going to be better and you need to find a new home for Jill on different jobs. This is the biggest missing link in the performance management world, that the real world performance has no way to really be tied outside from spreadsheets into the real performance management systems. Once you have the value creation of teams being measured and you know the quality of that and bring that together into performance management and what skills they have then I think you’ve changed something.
Anne Fulton: I think the skills intelligence that we’re supporting our ecosystem with is increasingly vital. The way that we’re thinking about it is, contribution index rather than performance evaluation. More focus into what’s been those digital contributions of somebody across the ecosystem, how do we collate that and how do we surface that information back into the hands of not just HR, but into the hands of leaders.
We’re certainly supporting clients with that kind of skills intelligence but it’s also twofold because we also want exactly as your example before, we want the workforce to be reskilled and ready, armed and able to know potentially trending in-demand skills. Do you have any additional thoughts on the shift that the pandemic’s created in the kind of talent technologies that are being used today and whether they’re going to be in demand in the decade ahead?
Holger Mueller: The biggest demand has been created for a new way of leadership, different skills of leadership and different systems of leadership. I would say it’s a new category potentially for HR or IT, traditionally would be in the HR core domain. How do you manage and lead your people? How do you make sure people leaders are more effective in knowing what people can do? From the talent management side of things, we have to empower the hiring manager much better. The whole process of recruiters can be difficult to get people in place. The manager has to live with the person who comes on board anyway so serve the candidates to them and allow people to onboard much faster. Everything has to move faster.
I also hope that somebody is going to fix performance management at some point because it cannot be fixed by software alone. That’s what has been oversold by many Talent Management vendors this, there has been this software plus and the plus component has largely been missing for showing people what to do. We know that we need more continuous feedback and we need more artifacts to figure that out. The direction is there but the best practice has not been established.
Anne Fulton: As work is being delivered more in deconstructed units like projects, so instead of having a job that you had your KPIs, you’re now contributing to five different projects with different objectives and different kind of evaluation criteria, it’s important to allow a type of feedback loop. At the end of that project, or gig or assignment, whatever it is, the way that we like to conceptualize it is to push the ownership in getting that feedback back onto the employee. At the end of that assignment, get your feedback and then you aggregate that and that gets surfaced into the hands of your leader when it comes around to having those growth conversations and developing conversations going forward. You can invite feedback from your peers as well as your leaders and the project owner so that we’re creating that kind of digital footprint that becomes measurable, around impact and contribution. I do agree that we need to create a shift because the world is accelerating and I like your focus on the enterprise acceleration as being the outcome, we need to help organizations respond. I’m interested in what changes you might be anticipating in workforce dynamics over the next decade, what can we expect ahead that you’re thinking about?
Holger Mueller: I think it will be a huge saving grace for the first world, which has an aging problem. One of the hardest things for people when they get older is to go to the office, it’s not to sit in a chair and do the work. Now, it’s basically from their beds to the chair to do the work. I think it’s going to give a break to the first world which has it’s unfavorable aging dynamics, which were not prepared.
To a certain point it will hold us back for people who love AI. If you’re concerned about AI, just talk to the Japanese senior who prefers a robot to assist them than a human. Because the robot is reliable, is always there, doesn’t steal from you, which is a big concern of seniors in Japan and so they prefer the robot over the real person. So we might see less AI automation than we want to from that part, but we will be able to work much, much longer than we ever have before. Because that gruesome commute, in some places is no longer part of the whole equation.
Anne Fulton: You’re passionate about the work that you do and here at TalentX we want everyone to love the work that they do so we’d love to hear what are you passionate about with the work that you do?
Holger Mueller: What motivates me is seeing if my work can make a difference. If somebody says ‘Oh, I learned something’, I see that most importantly, I’ve done something differently and was more successful. Or if they come back to me and say, ‘Look, I tried what you said and doesn’t work’ I love to hear that even more, because that’s the only way to get better. Trying to make a difference for my research and my work is enough motivation to get me out of bed.
Rhonda Taylor: A last word in parting Holger?
Holger Mueller: Hopefully we come out stronger and better out of the pandemic. I think from a technology and leadership and HR perspective, there’s so much upside over disruption of that. There’s this joke of saying who has done more for digital disruption than the CEO, the CFO, the CIO = the C.O.V.I.D. Officer. We’ve done a lot of transformation and improvement of things. I remember three-four years ago I had panels where people said no people can’t work at home, we’re not going to be productive, that’s the wrong way of doing this. Now we see that for most companies if they’re not affected, they’re even more productive. We had the blinders on for the longest time on the working from home perspective, which is a very sad thing. So hopefully that helps us and hopefully we learn from it for different aspects to where we also have the blinders on.
We hope you enjoy listening to this episode of the TalentX Podcast with Holger Mueller! Look forward to sharing more learning with you.