Deliberate design

Organisations evolve and, with so many people spending less and less time in any one job, managing that evolution is more important than ever. At the same time the huge changes being wrought by technology combined with new global dynamics are making understanding what has evolved, and what is in place simply because it has always been so, a priority. For me, the importance of finding out why things are as they are hit home when I was helping a client who was collecting data which seemed to have no purpose. It turned out their predecessors had started collecting the data during the Second World War when it was needed in case of invasion!

To understand why organisations hold onto the past so readily, it’s tempting to repeat the famous “five monkeys” experiment. To paraphrase the telling of the story, a group of monkeys is in a cage with a ladder supporting a banana. The first monkey that climbs the ladder to get the banana triggers all the monkeys to be hosed down. This is repeated until the lesson is learnt: “don’t climb the ladder”. More monkeys are added to the enclosure and they try the ladder, before the hose can be used the other monkeys pull them off. Over time, all the “old” monkeys are removed until only monkeys who joined after the last hosing are present. These “new” monkeys still stop each other and any additional newcomers from climbing the ladder, they do so only as a cultural norm rather than any direct knowledge of why the ladder is bad.

I wanted to use the monkey story in a speech about transformation and began researching its origins. What I found was that the experiment is a myth and the story allegorical. It seems to originate from a management book in the 1990s and gained further credibility through retelling in magazines and social media.

Rather than fake experiments, behavioural economics gives us the best insight into why people hold onto the past and resist change. I recommend Dan Ariely’s excellent Predictably Irrational. Ariely uses a series of (academically sound) experiments to show that as humans we have a loss aversion. In particular, he shows we prefer “free” products and services even when we know they really have a hidden cost. We are so afraid of wasting money, in even trivial amounts, we will often make inferior choices.

This is never more so than when executives make “no regrets” investments. This is a nice way of saying that they are giving in to their loss aversion over rational risk taking. Usually these decisions involve minimal upfront cost and attempt to avoid risking a loss through a wrong decision. There are four categories of investment that are most often candidates for these “no regrets” decisions: technology, workforce skills, supplier selection and acquisitions.

The organisation that fears loss over opportunity puts off major technology investments in favour of tactical fixes in case vendor products change, uses contractors to avoid investing in skills in case future growth doesn’t come, buys only from major suppliers in case the more innovative alternatives don’t survive and shies away from business acquisitions for fear that they dilute shareholder value. By comparison, the most valuable and successful businesses have taken bold positions in all four categories. Interestingly, these same successful companies have made expensive errors and learnt from then, they aren’t afraid of risk.

A good way to overcome a fear of making mistakes is to be deliberate in designing the future in the full knowledge that every decision, or avoidance of a decision, carries risk. This is “deliberate design”. So often we just accept that a new approach isn’t possible in our own organisations. The deliberate design of technology plans for the long-term future even if it means making existing investments redundant. The deliberate design of workforce actively trains staff, often using a “train the trainer” approach, and hires for the workforce five years hence. The deliberate design of the supplier and alliance ecosystem seeks out innovative startups and makes informed bets knowing that they will learn more than they will lose in the long-term. The deliberate design of additions through acquisition looks to make bets based on the best knowledge of today, knowing that shareholder value may be destroyed in the short-term but growth without the injection of new capability is almost impossible to sustain.

A great metaphor which helps maintain the positive momentum of deliberate design and counter our negative fears is “dancing”. Mike Lipkin has done this best in his book Dancing with Disruption which focuses on maintaining momentum in the face of disruption: knowing the context, dreaming big, being analytical, being prolific, communicating, collaborating and, above all, remaining unconditionally enthusiastic.

Understanding our tendency to hold onto the past and fear change, I’ve concluded that we should stop worrying about digital disruption and pivot to a more positive frame of understanding uncertainty. With the knowledge that this uncertainty means we will sometimes make wasteful investments, but almost always gain more than we lose, we can have the confidence to embrace deliberate design for the future.

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I often get asked whether I support or oppose the intrusion of technology into every nook and cranny of our working and personal lives. The best way I can express how I feel is by drawing an analogy with the alcohol prohibition debate in the United States during the twentieth century.

Over many decades, the US struggled with public policy to manage the production and consumption of alcohol. My favourite speech of the long debate was by Noah S. Sweat in 1952:

You have asked me how I feel about whiskey. All right, here is how I feel about whiskey:

If when you say whiskey you mean the devil’s brew, the poison scourge, the bloody monster, that defiles innocence, dethrones reason, destroys the home, creates misery and poverty, yea, literally takes the bread from the mouths of little children; if you mean the evil drink that topples the Christian man and woman from the pinnacle of righteous, gracious living into the bottomless pit of degradation, and despair, and shame and helplessness, and hopelessness, then certainly I am against it.

But, if when you say whiskey you mean the oil of conversation, the philosophic wine, the ale that is consumed when good fellows get together, that puts a song in their hearts and laughter on their lips, and the warm glow of contentment in their eyes; if you mean Christmas cheer; if you mean the stimulating drink that puts the spring in the old gentleman’s step on a frosty, crispy morning; if you mean the drink which enables a man to magnify his joy, and his happiness, and to forget, if only for a little while, life’s great tragedies, and heartaches, and sorrows; if you mean that drink, the sale of which pours into our treasuries untold millions of dollars, which are used to provide tender care for our little crippled children, our blind, our deaf, our dumb, our pitiful aged and infirm; to build highways and hospitals and schools, then certainly I am for it.

This is my stand. I will not retreat from it. I will not compromise.

This is exactly how I feel about the threat of Big Brother (see Living as far from 1984 as Orwell). Technology is the monster that undermines the innocence of children through exposure to horrific material. It is the informer that allows governments to track our every movement. It is the temptation that distracts families from spending time with each other.

But, technology also means access to information that simplifies our every day. It is the source of entertainment that our families can share. It has opened up new shared resources like holiday houses that were never previously available to rent. On a good day, I am grateful for the public safety benefits of the monitoring of our city streets, convenience of digital maps and learning support of electronic tutoring. With so much to gain, how could I possible not be in favour?

Either way, it is the reality of the world we live in (see Living without a trace of Big Data). While I’ve argued in the past for greater regulation (see The internet was a mistake, now let’s fix it), it is too late to debate whether we accept or reject technology. Rather, we need to navigate the Dr Jekyll and Mr Hyde personas of the machines that we’ve created.

The analogy with alcohol gives us some reason for optimism. While prohibition didn’t work in the US, and we are yet to solve the scourge of alcoholism, consumption is dropping in many countries, particularly amongst younger people. It’s possible to conclude that society does learn over time from the mistakes of the past.

Like the trends in alcohol, will we start to see greater moderation in the use of technology in society? If so, rather than try to come-up with permanent solutions we should try to minimise harm to the current generation and have more confidence in the future. This suggests more regulation, oversight and education is needed and some members of society will always need support to use technology for their own benefit.

The issue today is that smartphones and tablets have suddenly exploded into the market with no context and with users having little to help them manage the new temptations. This is similar to the worries our parents and grandparents had about the introduction of television and the influence of advertising. It seems ridiculous today, when we worry about social media’s influence on elections, that only a few decades ago many of the same concerns were being raised about political advertising on television.

I remain in favour of technology. I know that too many controls on data privacy will diminish its power. However, I worry that not every ill will get sorted out through the market over time and much damage could be done in the meantime. We need a deliberate approach to minimise the harm of technology and allow society time to adapt and adopt approaches for everyone’s benefit.

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Reversing cynicism with data and transparency

Trust in business is at an all-time low and cynicism is at an all-time high. At every turn there is an apparent breach of trust by business which confirms the worst in the minds of the general public. This is true around the world, and particularly so in Australia.

The breaches of trust vary, data leaks through poor security, misuse of personal information, underpayment of staff, overcharging of customers and the list goes on. At the core, though, the individual incidents all lead the public to challenge the social license of organisations they once respected. This is despite the vast majority of people, working in the vast majority of businesses doing the right thing the vast majority of the time.

The largest players in the economy need to take the lead to reverse the deterioration in public relations. This state of affairs isn’t good for the economy or society. Businesses need to understand the root causes and fix them, in turn creating a reason for the public to trust again.

Although most businesses are doing many great things, simply creating more advertising to make people aware of the positive aspects of their operations isn’t enough. Cynical audiences are largely closed to positive messages.

To properly establish a new relationship between the general public and business, three things are needed: transparency, simplification and mutual understanding.

I’ve written before about the important role of transparency in business (see Behind the scenes). Transparency is important in everything from financial results to operational decisions that are made and, most importantly, the data that is used. There is a sense in the general public and media that business decision making is opaque. Hence public inquiries of various forms are launched, which always seem to uncover egregious decision making which further reinforces the breakdown of social licenses.

However, simply creating transparency in today’s business environment isn’t going to be enough. There have been thousands of words written about why good people make bad, and sometimes even unethical, business decisions. What is lost in all this, though, is that it is more than simply the profit motive, it is also the complexity of the business environment that we’ve created.

It takes every executive many months or even years to understand the sophisticated business context in which they work. No wonder then that simply putting transparent “wrappers” around complex organisations is not enough, we have to simplify the workings of the business itself, so outsiders can comprehend what they are seeing.

In today’s organisation, there are an almost infinite number of ways that things can go wrong. One “bad apple” is now multiplied in impact many times over thanks to the exponential effect of the technology that powers business today. Simplification combined with transparency makes it easier for managers and the broader leadership team to spot these issues before the harm becomes systemic.

The transparent organisation is willing to expose the data that highlights issues as quickly as they are willing to admit to the issues themselves. Such openness encourages customers and other stakeholders to engage directly in the good governance of business, making them take a sense of personal ownership. This can come in terms of transparent pricing, balancing of risk and fair payment.

This greater understanding needs to be two-way. As much as organisations hope the public will invest in understanding their business practices, they must be willing to invest in understanding the community. In creating this new mutual relationship, open data is the friend of all parties. It enables many eyes to navigate the organisation, encourages alternative commercial arrangements and makes sure relationships are based on mutual and ongoing value rather than either party relying on the inertia of the other.

A surprising trend associated with openness and mutual understanding is the link to social impact. Some businesses in fields as diverse as insurance, travel and retail have made a big deal of social causes with a direct link to their workforce and other stakeholders. Such a strategy directly associates the business with a purpose and helps strengthen their social license.

Taking a position on social matters demonstrates an understanding of what is important to both the staff and customers in the community that they work with. Doing so isn’t without controversy, but in this the transparency of decision making on the corporate position is particularly important and self-reinforcing.

Similarly, donating a percentage of earnings and, even better, giving customers a choice on where it goes, makes good business sense. Simply understanding how a donation can be made goes some of the way to explaining the financial structure of the business.

These trends help explain why simpler business models, such as single product providers in energy and telecommunications and online providers of insurance are becoming more popular. Some of these providers have combined their simplicity with social causes demonstrating a particular affinity with the communities they service.

There is no reason, however, why the wider business community can’t achieve the same goals. Opening-up organisations through open data, culture change and genuine community engagement, combined with transforming for simplicity can only make business more effective, sustainable and help reverse the cynicism of business that permeates our society today.

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Fashioning the future

We know that the future is coming, but it is sometimes hard to imagine what it will look like. The very clothes we wear are a good place to start, after all the industrial revolution was arguably fashioned by the mills of the textile industries that are synonymous with gritty manufacturing towns of the time. With the fourth industrial revolution fast approaching, it is likely that we will see some radical changes again in this all-pervasive industry, perhaps giving us some hints of wider changes in the decades ahead.

Because clothes are everywhere we look, we often forget the industry that supports them is even there. Yet fashion is worth trillions of dollars and employs many millions of people across the globe. Despite all the positives, textiles and clothing manufacturing still have a social and environmental dark side through poor work practices, excessive use of chemicals, huge volumes of water and waste at every stage of the business.

The drivers for change are everywhere: increasing consumer wealth, social awareness, opportunities for automation and emerging materials technologies. With all of the foundations in place, it is no surprise that investment is flooding in to take advantage of markets that haven’t even been defined yet.

Increasingly affluent consumers are seeking the latest fashion trends, which is driving more rapid product cycles than ever before. That means the gap between design and delivery to customers will continue to shorten. We can expect that customisation (akin to traditional tailoring) is going to be an expectation rather than an exception.

With greater affluence also comes social and environmental awareness. Consumers want to know which garments are ethically produced, the environmental impact and the carbon footprint of the supply chain. Integrity of this reporting is going to be increasingly important with digital signature technology likely to play a role.

Textile and clothing manufacture is still a highly labour intensive industry that has complex supply chains. The opportunity and cost motivation has allowed the exploitation of the most vulnerable workers globally. The nature of clothing, with rapidly changing styles, often short runs and complex material interactions has not lent itself to the same automation that other industries have enjoyed.

Technologies are emerging which overcome these obstacles. Radical new materials enable textiles to be 3D printed rather than produced in large quantities. The emerging generation of artificial intelligence combined with more dextrous robotics has the potential to solve past automation challenges.

With the automation of manufacturing, the cost drivers, and pursuit of faster consumer delivery, it is likely production will move closer to the end customer. This will combine with body scanning technology that is maturing to do away with clumsy tape measures and sizing guesses and allow an almost immediate turnaround of a custom garment.

Accurate fitting is the nirvana that online retailers are looking for as they disrupt their bricks-and-mortar counterparts. It is also a threat to established brands who have long depended on customers getting to know which size they are in a particular brand’s clothing making return custom an easy decision.

If the power of the brand reduces, individual designs are going to be even more important. Fashion designers are already frustrated by how quickly their intellectual property is borrowed. The Louis Vuitton monogram is an early example of trying to reduce knockoffs of their designs. However, counterfeiters have few qualms in making blatant copies. New materials are going to take the monogram to whole new levels, with embedded technology making those who choose copies immediately stand out rather than blend in.

But the impact of new materials and manufacturing goes beyond today’s fashion. We can look to the popularity of wearable computing to sense how technology embedded in our clothing will evolve. The killer use cases are only emerging, but we can assume that step counts will be derived directly from your pants, your heart rate from your shirt and your hydration needs from the perspiration detected over your body. The medical profession can look forward to providing ongoing care such as through detecting small blood spots which can be a sign of skin cancer.

Textiles, clothing and fashion were the harbinger of major changes to society in the past. We can look to this sector again as we navigate the fourth industrial revolution. There has never been a more exciting time for those with imagination to fashion the future.

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Navigating the future with lifelong learning

Flourishing in the future of work requires all of us to embrace lifelong learning. But you can’t train for jobs of the future when you don’t know what you don’t know. While most discussions on education concentrate on funding, it is just as important to motivate employees to learn and redesign work to encourage incremental change.

In general, learning budgets are spent to help each worker get better at their existing job. The pressure that so many employees feel day-to-day mean that they often don’t embrace training that isn’t immediately applicable to the role that they play. At the same time, more and more workers are instinctively feeling the need to move jobs with increasing regularity. This is true of all demographics but particularly evident in surveys such as that done by Deloitte on the “Millennial” generation.

The future of work suggests that everything that can be automated will be automated. This creates two challenges. The first is that many entry-level jobs that provided basic skills are the most at risk of automation. The second is that as fast as new roles appear old ones are rendered obsolete.

The first challenge requires entry level jobs to be thought of as a capital investment rather than simply in terms of operational efficiency. I’ve previously argued that teaching is an important part of more senior roles (see Experts make better decisions with an understudy). If future roles require junior levels as a source of talent then designing jobs that will create those skills early is simply an investment in the future.

The second challenge requires rethinking the design of jobs over time. Shortly before the latest Millennial survey, Deloitte also asked executives about their readiness for the future in a survey on the fourth industrial revolution. In summary, executives know there is change coming but acknowledge they aren’t ready.

Rethinking education and engaging everyone in evolving their own jobs is a good step towards sustainable career pathways and reducing churn as employees seek new experiences to avoid obsolescence. Historically, students were encouraged to set career goals and ambitions based around a target job. It’s become a glib, but accurate, comment that the job you want to do hasn’t been invented yet.

STEM (Science, Technology, Engineering and Mathematics) is often tied to these jobs of the future, which is then assumed to particularly mean learning to code. Although it would be great if everyone could program, there is little evidence of a link between coding skills and the majority of future jobs. What is important, as more jobs embrace automation, is numeracy skills through a mathematical foundation. When combined with a broad syllabus of foundational subjects, a student is as set up for the future as they can be.

In the absence of certainty about that future, an evolution of jobs rather than a single radical change is the best approach. Too many employees see their roles as fixed and fear becoming obsolete if they don’t move. These same employees seem unable on their own to make the leap to develop their skills over time. If anyone spends too long in a fixed role, all the training they receive simply reinforces the same set of skills, potentially to a dead-end. An evolving job can be aligned to a training programme of “micro credentials”.

Rather than accepting job hopping as the norm, leaders should work with their teams on evolving their existing roles in this way. Managers find their people have various attitudes to change but regardless of their comfort should not let any of them become isolated by a lack of skill development. This should even include the ecosystem of gig, casual and part time workers. Like the upfront investment in entry-level roles, the culture organisations create to develop their workforce pays back over the long term.

A good opening to the creation of sustainable careers is an ongoing investment in the streamlining of each job. Sometimes referred to as “pixelating”, each role can be broken into its constituent bits and the team members invited to consider which activities are candidates for automation in the near or more distant future. Anything that is done by rote is a likely candidate for some form of automation either now or as artificial intelligence matures. No matter what, leaders shouldn’t fall into the trap of waiting for the big ticket technology project, small investments in automation will establish the design for future systems if or when they come.

Most of all, leaders and their teams should be curious. One of the strengths of humans is our ability to cross-pollinate ideas. Something that is making progress in banking might be highly relevant in health and vice versa. The curious mind is unlikely to be obsolete.

No matter what the time pressure, the most impactful things that anyone can do are often the least time consuming. Everyone should be encouraged to make even the smallest of investments of their time each week to progress one strategic idea or advance at least one new skill no matter how trivial.

After all, the biggest long-term obstacle to being ready for the future is the lack of even minor progress over an extended period. There are no dead-end jobs, only leaders with a dead-end mindset.

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Sometimes it’s lonely being a robot

I’m committed to be a global citizen but, living in Australia, I simply can’t get to as many meetings around the world as my role would ideally involve. To deal with this, I find other ways to participate. The myriad of technologies available today, including video conferencing and telepresence robots (think an iPad sitting on top of a remote-controlled Segway), has made this much easier than any time in the past.

I’ve spent many hours, often in the middle of the night, sitting alone participating in meetings thousands of kilometres away. As I load up on caffeine, I find myself comparing the experience to that I would have in person. Overwhelmingly it is positive, I can get to more meetings, contribute more often and avoid many days away from my family. However, there are subtle differences that we often put down to our need to develop relationships in person.

Given the cost and productivity benefit of doing more meetings virtually, it is important to challenge the catch-all excuse that we need to meet in the same physical location and really understand what works, when and why. It is an oversimplification to say that we rely on body language to develop relationships, but there is no doubt that electronic participants in meetings are treated differently.

Through an accident of birth, I am part of society’s “in group”. I seldom experience the unconscious bias that many of my talented colleagues have to navigate in their day-to-day work. However, when I sit in the same room, with the same people, as a robot rather than in-person, I start to experience some of the same subtle shift in behaviour that I’ve observed some of my “out group” colleagues experience in the past.

The thing about bias is that it is based on the short-hand that our brains use. Does the other person look like me? Do they move the way I expect? Can I predict how they will talk? If someone doesn’t fit a mould, then our reptilian brain tends to group them as outsiders who shouldn’t be trusted. This is unconscious bias.

As an electronic participant in a meeting, particularly when I’m on the end of a telepresence robot, I find it fascinating to participate in a meeting and move from being part of the “in group” to being part of the “out group”. I’m still “me”, yet even people that I know well, act differently. I’m included, but not in the natural flow of the conversation. I’m consulted, but as an afterthought. I’m respected, but because of who I have been (in person) not because of who I am as a robot in that meeting.

Of all the faces around the table, I look the most different. They have to use their imaginations to convert my avatar into the person they are used to seeing in the chair. I also move differently, not the natural movement of a human but jerky electronic movements that, as a result of lag, can overshoot – sometimes with hilarious consequences. And, even on the best of video conferences, I don’t talk in quite the same way.

Researchers have found that the normal flow of conversation relies on speakers taking turns with remarkably small gaps. Moreover, these gaps differ by culture as a result of language and local norms with Japanese speakers leaving as little as 7 milliseconds compared to Danish speakers who wait an average of 469 milliseconds. The study found that English speakers average gap was 236 milliseconds.

Most people notice that other cultures seem different in conversation which may be partly attributable to the differences in conversational turn taking. It is no surprise then that when someone is participating in a conversation electronically, and the gap is measured in seconds rather than milliseconds, they seem even more different again.

An unexpected benefit of this bias against electronic participants is that it can be used as a training tool to explain what unconscious bias feels like to people who don’t normally experience it. While only a microcosm of what many have to deal with, such exposure can change your perspective.

There is work for all of us to do to unlock the power of a global community. We need to include our electronic colleagues in each and every conversation knowing that the favour you do now will benefit you next time around.

If we make the unconscious conscious we can include everyone in every meeting. Remember to pause at appropriate times, check everyone is participating and listen carefully to every idea. After all, these behaviours are just as valuable in an inclusive workplace regardless of whether we are supporting remote colleagues.

Sometimes it’s lonely being a robot!

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Information-driven work

I’ve recently spoken to several executives who have more than two thousand unread emails. They all said roughly the same thing: “If someone really wants me they’ll keep trying”. Others have said the opposite, they are keen to be easy to reach.

There must be a better way. Last month, I wrote about personal skills (see White collar productivity). However, the capability of the individual is only part of the story, with the interface between roles and activities reflecting the efficiency of the whole enterprise.

If the leadership of an organisation is struggling with productivity, the pieces of work aren’t necessarily fitting together. It might be time to introduce some inefficiency into the workplace in order to get the most from the extended leadership and management team. It is more important to have agreed protocols for interactions between roles and activities than to optimise every individual task.

A good metaphor is the introduction of containerisation through different modes of goods transport over the last couple of centuries. At face value, the idea of trains and ships using containers with so much free space seems inefficient. Yet their introduction marks the start of the cheap mass movement of goods all over the world. The key insight the industry gained was that standardisation is more important than wringing every ounce of efficiency out of each shipment.

We get to know the working style of each executive that we rely on. The best way to engage them, insert things into their diary and get their buy-in as stakeholders. In trying to be as efficient as possible, leaders and managers have tailored their individual approaches to work. This is equivalent to ships being packed individually by their captains, great for each instance but not for the whole network.

Some years ago, I wrote Information-Driven Business (Wiley 2010). While there is still much to be done, many of the goals of that book have now come to fruition in business. It is time now to talk about “information-driven work” as part of the “future of work”.

While Information-Driven Business is about the direction of business, the future of work needs to be informed by who is best positioned to take on given activities and ensure that hand-offs are seamless and free of friction.

One of the causes of friction is the lack of transparency on the distribution of the leadership load. Each activity needs to be assigned based on the skills, strategic alignment and capacity of the whole leadership and management team. This group, more than any other, bring a wide range of experiences and capabilities to work but little of that background is necessarily visible to other stakeholders.

Worse, it is very hard for anyone to see what load each executive has at any point in time. However, there is ample data available from collaboration, messaging, diaries, phone and other data sources which can be interpreted and scored so that the workload for each executive can be easily estimated and the leadership agenda adjusted accordingly.

Many executives are their own worst enemies. In an era where work is almost entirely mobile, there are few constraints to taking on more work. The result is a high degree of stress as the most capable are constantly being loaded-up with more and more to do.

The future of work will allow more leaders to shine by smoothing their workload and providing clear reporting on their progress and freeing them to spend their efforts on the creative aspects of their role.

To do this, we will see greater standardisation of day-to-day activities, metrics and information flows supporting the application of artificial intelligence to a broader range of leadership functions. For example, approvals and mundane decisions are crying-out to be automated.

We can expect to see new artificial intelligence solutions surface that detect patterns in decisions made and hint at repeatable rules applied to the more mundane activities. Like semi-autonomous cars with human drivers still in the seat, they will start by writing emails in an executive’s typical style but leaving it to the human to press “send”.

For all of these measures to be effective there will need to be some hard actions put in place. Perhaps stopping email inboxes from getting so full by redirecting certain requests when there are a given number of outstanding messages or blocking meeting invites when diaries are becoming overloaded.

We’ve already reinvented many aspects of how business is done, but the future of work is only just beginning for the leaders of tomorrow.

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