Over the past months, I have made an interesting discovery. Whenever our clients’ managers, fellow entrepreneurs, and other senior executives were asked about their most pressing current business challenges in a meeting, workshop, or event, one thing popped up over and over again: people issues. Why has the people side of running a business become more challenging in recent years? While reflecting on this question, I noticed four layers that add to the increasing complexity, ambiguity, and uncertainty of modern people management. Are you ready to peel the onion with me?

Background: Introducing the four layers of modern people management

In today’s fast-changing business environment, organizations face increasing complexities in managing people effectively. Technological advances, shifting cultural norms, generational divides, and diverse personalities all contribute to a new era of people management. Each layer needs to be addressed in its own right, but their interplay adds even greater complexity. Let’s un-peel each of these layers one by one, starting with the outermost layer that is most visible at the surface:

Layer 1: The corporate cultural layer

A company’s culture describes “the way we do things around here” in an organization and can be observed in the daily behaviors of people at work. The corporate culture is shaped by the company’s values (which often align with the personal values of the founder of a venture or the top executive team of a mature corporation). It also reflects the vibe of a specific industry (think banking versus creative agencies). So, the company culture provides one of the backdrops in which you have to manage your people.

Why is this layer important in embracing the emerging technologies of the Sixth Wave? Company cultures that are adaptive and inclusive have been proven to be more successful in navigating technological changes. As the World Economic Forum noted, “Organizations with a strong, positive culture are 1.5 times more likely to achieve above-average returns.” That’s why it’s important to cultivate an organizational culture that not only fits today’s business landscape but is also future-proof, enabling the business to thrive in the age of disruption.

Layer 2: The cross-cultural layer

In any organization that is not strictly a local business where everyone is of the same nationality, a second cultural layer of complexity comes into play: country culture. Following the globalization of business over the last 2-3 decades, this applies to many leading companies, especially here in Asia, where I am based.

When we talk about the cross-cultural layer of an international company, there are various sub-layers:

• The culture of the home country where the head office is based.
• The local culture of the host country where a subsidiary is located.
• The cultural background of the top executives and senior managers running the firm.

For example, consider a German multinational bank with an American chief country officer running the Vietnamese subsidiary, leading a team of German, Indian, Sri Lankan, Filipino, and Vietnamese managers. Such diversity, while enriching, can also lead to cross-cultural misunderstandings.

To navigate these differences, tools like Hofstede’s Cultural Dimensions Theory help us understand critical factors such as power distance, individualism vs. collectivism, uncertainty avoidance, masculinity vs. femininity, and long-term vs. short-term orientation. However, be aware that Hofstede’s theory is based on data collected over 50 years ago. While this theory remains relevant, it’s important to recognize that today’s younger generations are more cosmopolitan, sharing cross-border values that sometimes transcend traditional cultural norms. For example, a recent McKinsey study highlighted that Gen Z workers globally share similar values around equity, inclusion, and work-life balance, regardless of geographic location.

The generational layer

Over the past few years—and extending into the next few—workplaces have experienced a significant generational shift. The large cohort of Baby Boomers who have risen to the top positions in many organizations are entering their well-deserved retirement. Leadership positions are now being passed on to Gen X and Gen Y (Millennials), who generally work well together. 

However, the entry of Gen Z (also known as Post-Millennials) into the workforce has led to noticeable generational conflicts around work styles, values, and expectations. For example:

• Workplace location: Boomers and Gen X tend to see value in office work and meeting and collaborating face-to-face, while Gen Y and Gen Z advocate for remote and hybrid working models.
• Work-life balance vs. career dedication: While older generations often see work as their primary or at least important focus (with personal fulfillment coming later), younger workers prioritize work-life balance and personal well-being.
• Technology usage: Gen Z, having grown up with digital tools and being digital addicts, often favors all-digital workflows, whereas older generations may prefer a mix of digital and analog work activities.

These generational differences can lead to friction but also offer opportunities to cross-fertilize each other through the different knowledge, skills, and experience “dots” of each generation. For example, a recent study by Boston Consulting Group (BCG) found that organizations that foster intergenerational collaboration and understanding are 30% more likely to innovate successfully.

The personality layer

The fourth layer that adds complexity to people management is the personality differences among team members. Within any team, you’ll find people you get along with easily almost all of the time, others with whom disagreements arise sporadically, and some with whom you clash regularly. These differences often stem from varying cognitive styles, emotional dispositions, and personal preferences.

You can explain these differences by differences in cognitive styles and personal preferences. As a manager or business leader in the modern workplace, you will notice that you cannot approach team members with different personalities and cognitive styles with a “one-size-fits-all” approach. Instead, you need to understand the conflict potential that is imminent between the different people in your team and also manage people individually in harmony with their personal styles 

As a manager or business leader in today’s workplace, it’s critical to understand that a “one-size-fits-all” approach won’t work. Instead, it’s essential to tailor your people management approach to each individual’s personality type and preferred cognitive styles. This is where modern personal assessment tools come in.

I argue that dated personality tests like Myers-Briggs (created roughly 80 years ago) need to give way to more contemporary, dynamic tools like TIPS, the Talent and Innovator Profiling System I created for Thinkergy. TIPS not only reveals how individuals in your team prefer to think, work, interact, live, and innovate but also provides actionable strategies for all critical aspects of the talent management lifecycle, from talent acquisition over talent alignment to talent management. 

How to untangle the issues of modern people management layer by layer?

Cultural layer: I believe that given the disruptive nature of technological change that all established industries will face in the coming years, now is a good time to redefine your vision, corporate values, and behaviors So, ask yourself in the executive team: 

What’s our vision to make your business ride the Sixth Wave of Technological Innovation? Are our values still up to date to rise to the challenges of the Sixth Wave and align with our new vision of a prosperous future? Are our values still attractive to our people, especially the younger generations?

Corporate cultural layer: Given the disruptive nature of technological change that all established industries will face by the end of this decade, now is the ideal time to redefine your company’s vision, corporate values, and behaviors. This is the pivotal starting point for gradually transforming your corporate culture into that of an agile, creative organization. Begin this journey by asking:

• What’s our vision to ride the Sixth Wave of Technological Innovation?
• Are our values still aligned with this new vision? Do our values resonate with the younger generations entering the workforce?
• How can we use the imminent, technological, market-driven, and generational shifts in the workplace to transform and modernize your company culture gradually?

In their Harvard Business Review article The Leader's Guide to Corporate Culture, Boris Groysberg et al. note that aligning corporate culture with long-term strategy helps build organizational agility, which will be key to surviving and thriving during this period of rapid change.

Cross-cultural layer: Hofstede’s cultural dimensions can still serve as a foundation for understanding the different nationalities at work in your company. Thereby, factor in the mix of your head office’s culture, the local host country’s culture, and the cultures within your top management team. Encourage cross-cultural training and open dialogue to foster better collaboration and communication across borders. Importantly, realize that cross-cultural differences may be less of an issue in Gen Z workers of different nationalities who largely all grew up cherishing similar cosmopolitan content, cultural phenomena, and must-have technologies in different parts of the world. 

Generational layer: Be flexible in accommodating different generational preferences. For example, rethink work models, such as offering a hybrid approach between in-office and remote work, revising benefits packages to align work-life balance with business priorities, and ensuring that digital tools are up-to-date for the younger workforce while encouraging them to coach older employees on how to use these.

Personality layer: Modernize your approach to personality assessments. Drop outdated personality tests of the 20th century in favor of adopting new personal assessment tools created in the 21st century to address the people management challenges in the modern workplace. Consider adopting modern profiling tools like TIPS that give you deeper insights into your cognitive preferences and natural talents and those of every member of your team, business unit, or office. TIPS will allow you to manage people in a tailored way that fits their unique styles. It also gives you insights on how to reframe and dissolve interpersonal conflicts between team members to increase overall work productivity, creativity, and satisfaction.

Conclusion: Moving forward with modern people management

In today’s business landscape, successfully managing people is no longer about addressing just one issue at a time. It’s about understanding the complex interplay between company culture, cross-cultural dynamics, generations, and individual personalities. By peeling back these layers and addressing each one with a tailored approach, you can create a more cohesive, agile, and innovative workforce and strengthen employee engagement, collaboration, and retention.

• Understand more about the drivers of the changing modern business environment (including generational shifts) in my new book, Unleashing Wow.
• Want to learn more about TIPS? Check out the TIPS website and this TIPS booklet for more information. 
• Ready to unveil your talent and innovator profile? Buy your TIPS test coupon for USD 88.88 now and take the TIPS test to find out.
• Contact us today to learn more about our TIPS training and project workshops or my keynotes on how to prepare your business for the Sixth Wave of Technology Innovation.

© Dr. Detlef Reis 2024.