In brief

Jobs are changing fast—and so are the skills needed to do them. With 44% of workers’ core skills potentially being disrupted between now and 2027, it’s no wonder business leaders view upskilling and other reinvention-oriented investments as a priority. But do your employees know what’s coming and why? Training efforts will underwhelm if people can’t link them to how their own skills—and jobs—may change. And it’s the responsibility of leaders to ensure their employees understand and anticipate the changing nature of their work.

Companies are pouring money into training, but employees aren’t convinced.

In brief

Gap 1: (Up)skills confusion

Gap 2: In AI we trust?

Gap 3: Defensive culture

How leaders and employees can scale new heights, together

divided workforce

It’s not unusual for leaders and employees to see things differently—just look at the ongoing return-to-office debate. But what happens when there’s a disconnect around issues critical to your organization’s future? That’s the moment leaders need to step up if they’re to bring employees with them on the transformation journey to becoming a thriving company. Reinvention plans won’t succeed without a united workforce, yet PwC’s 26th Annual Global CEO Survey and Global Workforce Hopes and Fears Survey 2023 found marked differences between how leaders and employees view three key business areas: upskilling, artificial intelligence (AI), and culture. Focus on bridging these gaps to help your organization reach new heights.

In depth

Gap 2:

If you’re like most business leaders, you probably see AI’s enormous potential through rose-colored glasses. But the outlook among your employees is more like a dozen shades of gray. PwC’s Hopes and Fears survey found employees were more than twice as likely to see AI as clearly positive than negative—but those pure AI “cheerleaders” and “fear-leaders” only represent 40% of your workforce. The rest either have mixed views, or they are among the one in five people who aren’t convinced that AI will affect their roles at all. And if that’s not complicated enough, employees’ views tend to cut across demographics, making it hard to predict who falls into which camp. All of this puts pressure on frontline managers to understand AI and its potential risks and rewards, and to coach their people accordingly.

Experimenting, proposing new ideas, offering dissenting opinions—from the perspective of senior leaders, these are hallmarks of innovation. Yet, only about half of CEOs say their company leaders tolerate small-scale failures or encourage dissent and debate. Worse, just one-third of employees agree. It’s not easy for employees to contradict a more senior team member or admit failure—especially if they fear reprisal. And this dynamic is even more challenging when they struggle with feeling included or accepted within a company—only half of employees in the Hopes and Fears survey said they can truly be themselves at work. If you have any transformative plans for your company, this particular gap should be a red flag. As PwC’s Katzenbach Center notes, differences between what leaders say about their company’s culture and what employees actually experience can cause a sense of “cultural incoherence” that erodes trust—making it much more difficult to enact change.

CEOs worry about company culture. Employees say it’s worse than they think.

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In conclusion

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October 2023

Illustrations by Aad Goudappel

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Uniting a

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Empower to transform

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Transact to transform: How you can achieve better business outcomes through deals

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PwC’s Global Workforce Hopes and Fears Survey 2023

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Dive deeper: Meet the four forces shaping your workforce strategy

In AI we trust?

Mahadeva Matt Mani Transformation Platform for PwC and Strategy&, Principal, PwC US Email

Marthle du Plessis Africa Workforce of the Future Platform Leader, Partner, PwC South Africa Email

Parul Munshi Regional Sustainability Leader | Southeast Asia Consulting, Partner, PwC Singapore Email

Peter Brown Global Workforce Leader, Partner, PwC UK Email

Mitra Best Technology Impact Leader, Principal, PwC US Email

Carol Stubbings Global Markets and TLS Leader, Partner, PwC UK Email

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How risky is AI?

Dive deeper: Closing the gap: Strategies for managing a divided workforce

confusion

Gap 1:

(Up)skills

we trust?

In AI

Gap 2:

culture

Defensive

Gap 3:

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Portrait by Noli Novak

—Shay David, cofounder and CEO of talent intelligence platform retrain.ai, in an interview with strategy+business

Oftentimes, organizations don’t understand which employees have what skills, which jobs require what skills, and how to create a good match between jobs and either existing employees or new candidates.”

Choose your role carefully

Listen to podcast

—Paul Leinwand and Mahadeva Matt Mani Beyond Digital: How Great Leaders Transform Their Organizations and Shape the Future

The earlier you engage your people to shape the change, the easier it is to enable difficult changes to happen…. Without this engagement, companies learned the hard way that people can’t seem to get over their fear of technology, struggle to understand why they should change what seemed to be working well, and even insist that leadership has it all wrong and is actually harming the company.”

Chaymaa, IT engineer

Defensive culture

Gap 3:

(Up)skills confusion

Gap 1:

Laura, administrative professional

Training? Not so much

What do employees say?

A stacked column chart showing that 72% of CEOs are prioritizing investments in upskilling and 59% of these CEOs say the investments aren’t for keeping the current business running, but for reinventing for the future

A stacked column chart showing that 36% of employees believe the skills required to do their job will change significantly in the next five years. Only 43% overall say they strongly and moderately agree that they have a clear sense of how the skills their job requires will change

Dive deeper: Culture: Transformation’s invisible enabler

Pranshu, assistant director

Empowerment is hard to come by

What do employees say?

Let employees lead

The fastest way to get your business to adapt to new technologies and ways of working is to empower your people to experiment with both. Try citizen-led innovation, an approach focused on helping employees build skills and apply them right away in their work. It requires advocacy and support from senior leaders so employees know they can experiment—and that it’s OK to fail. But don’t forget what all this innovation is for—outcomes that matter to customers and the market. Small failures are just steps toward innovation that customers value and will pay for.

Trust matters. Our Hopes and Fears survey found a clear link between the trust employees have in their managers and employees’ views on AI, job satisfaction, and even their level of clarity on how the skills required to do their jobs may change. But how do you build trust? Start with transparency. Establish open, two-way communication about AI to help employees feel more in control of their futures. In addition, consider involving them in focus groups and brainstorming sessions about how they can use AI and other technologies to free up time for more stimulating, higher-value work.

Double down on trust and transparency

Trust can also be nurtured by helping managers shift toward a coaching style of leadership and away from “command and control.” To do this, focus on employee development, active listening, and high levels of empathy—as well as having company leaders walking the talk on culture. For instance, Wharton professor Adam Grant found managers increased psychological safety within their teams when they shared their own past experiences of receiving feedback and identified areas they were working to improve. Admitting their imperfections encouraged their teams to open up as well.

Turn managers into coaches

Three ways to bridge the gaps

Decline

Explore the podcast series from strategy+business, which convenes a global community of solvers to tackle the world’s most important problems

Want to hear more?

EXPLORE

Check out The Leadership Agenda for more sharp, actionable insights from PwC curated to help global leaders build trust and deliver sustained outcomes

Want even more leadership insights?

EXPLORE

Get s+b direct to your inbox

Like what you’ve seen?

In conclusion

Let employees lead

Double down on trust and transparency

Turn managers into coaches

In brief | What matters? | Build better | Focus leaders | Top

6 min

In depth

30 sec

In brief

In AI

we trust?