Shareholders Are Still Top-of-Mind for Many
As Jaspar said in the intro to this series, every business has different, and often competing, interests. Each business, whether consciously or by default, end ups prioritizing the following three interests:
Looking for examples of shareholder focused companies is easy. This is exactly where you find companies like Walmart and United Airlines. These companies focus almost exclusively on delivering financial returns to their investors, with herculean efforts being spent to beat analysts projections every quarter. They aren't concerned with the complexity of the product or service, nor are they concerned with employee happiness. They have lost sight of their employees and see them as cogs in the machine, easily replaced, or even better, automated.
Customer Delight Is Increasingly Important
Customer-focused companies, like Amazon and Nordstrom, while less common, are still out there. Jeff Bezos is famous for creating customer obsession which is evident in 2 day free shipping and low prices. Nordstrom invests heavily in customer service training and hassle free returns. They judiciously implement technology to deliver a better customer experience, but still rely on employees to drive customer satisfaction. These companies look at employee satisfaction from a lens of how it impacts the end customer's happiness. Whether or not their employees are actually happy is secondary to the customer.
Looking at companies that focus on shareholders and customers, it is easy to ask if employees really have much of a role in the Age of Automation, let alone if it is a sound business strategy to be employee-centric. Every day, there is another article about how computers are automating jobs and rendering employees obsolete. In fact, a 2013 study by Oxford University that made a lasting impression posited that about half of all jobs in the U.S. today are likely to be automated in the next two decades. That study seems more likely every day, and it raises several questions. Is automation making employees increasingly irrelevant? Does a strategy of employee obsession make sense in the age of automation? Fortunately for us, the answer is yes.
Employee-Centric Companies Are on the Rise
Finding companies that truly have not lost sight of employees and are putting employees first are far more difficult to find. Many examples come from disruptive technology companies like Google, Facebook and Airbnb that are successfully putting the employee first, while delighting customers and delivering financial returns to shareholders.
These companies put people before profits, and, in some cases, even before customers. At Facebook, entry level software developers earn $225,000 a year in comp and equity. Lately, the unlimited vacation offered by many tech firms has been deemed too little, so Airbnb has begun offering employees a $2,000/year stipend for personal travel. At Google's Mountain View campus, benefits include free shuttles to work, free laundry and dry cleaning, free breakfast, lunch and dinner, as well as an onsite gym, childcare, doctors office and massage parlor. All of this costs the company a cool $26,000 a year per employee. These and other employee-centric companies are willing to make investments in their employees to attract and retain the best talent out there.
High tech firms in Silicon Valley are arguably the most employee obsessed companies in the world. Isn't it strange that the most technologically advanced companies in the world, the ones that are supposed to be automating everything are simultaneously putting people before profits and even before customers in some instances?
While these companies are working on solutions that will automate almost everything, their employees are obsessed with their brands. The work they do is interesting and challenging, as opposed to being rote and mundane. These employees are not doing things just anyone can do. They are the best and the brightest. They are change agents. They are disruptors. Now investing in employees starts to make sense.
The More Complex the Work, the More Employee Obsessed
We looked for a way to explain this relationship between complex work and employee obsession, and created what we call the Job Complexity & Employee Obsession Matrix. We plotted a number of examples of where certain companies fall below.
The Employee Obsession Matrix
As you read the matrix, stop for a minute and consider the competition for rocket scientists and computer programmers. It is far greater than the competition for United Airlines gate agents and Walmart cashiers.
Automation & The Employee Obsession Matrix
Now if we take the stance that 50% of jobs could be automated within 20 years, everything in the red represents those jobs. In the lower left are jobs that are already being automated - grocery store cashiers, airline ticket counter agents and bank tellers, just to name a few. It make sense that companies in this quadrant are not employee-centric because many of these jobs are already being automated.
Where TaskUs Was on the Matrix
So what did all of this mean for TaskUs in 2014 when we made the strategic decision to be obsessed with our employees? As we looked at the work we were doing, we realized that TaskUs was a pretty good bellwether for the entire American economy. In fact, we still are. Phoning in food orders and removing inappropriate content from the Internet is likely to be automated fairly soon. As that happens, the need for more complex and emotional customer service interactions will still be there and these interactions will be increasingly complex and intense as simpler interactions are automated. Our best guess is that about half of the work we do today will be done by machines in the next 10 years.
To survive, we knew we needed to move up the value chain into more complex work. And to move up the value chain, we needed to attract and retain better talent. To us, that meant we had to become more employee obsessed. With this as our mission, we set out to manage and measure a program to completely transform our relationship to our employees.
TaskUs Moves Up the Value Chain
We realized that the only way to move up the chart in job complexity would be to first become employee obsessed.
TaskUs Is Employee-Obsessed Today
Once we became employee obsessed, we'd be able to attract and retain the best talent, and start moving up the value chain and offering more complex services. We believe that if we keep this focus on employee experience, we can grow to offer the most complex jobs in the world over time.
The Rise of the Machine...
Next, consider the jobs in the lower left-hand quadrant of our matrix. In the next 20 years, these jobs are likely to be done by automation and machines. Think about self checkout at Walmart. That was a novel concept in the not-so-distant past, yet Walmart and Amazon are already rolling out stores with no cashiers or registers. The future is already here. And with a keen eye on delivering returns to investors, companies like WalMart and United Airlines have shown who they are putting first, and it isn't employees. Many of these employees just don't matter because they do simple, repeatable tasks that will likely be permanently replace by machines in the not-so-distant future.
...Is Really the Rise of the Employee!
There has been a lot of hype around automation and the rise of the machine, but the reality is not everything can be automated. Automation, at its foundation, is a people story, not a robot story. Even with automation, there will always be exceptions that need that personal touch from someone with a strong customer experience skill set. We are betting big on our employees because we believe they will be the the reason we continue to win and keep customers.
Any task that a computer can do, a computer eventually will do. We believe that 50% of the jobs we do today at TaskUs will be automated, and we're okay with that. Our teammates don't want to do these monotonous jobs forever, and we'll celebrate the automation wins our clients achieve that allow them to deliver more value to their customers. What can't, and won't be, automated are more complex and emotional interactions, which our happy employees will continue to do for our clients.
We know our employee-centric culture is a differentiator for us. Clients tell us that all the time and it's a concept we believe is the just the right approach. But we don't operate solely on gut feel. We use surveys and data to support and drive our decisions. And that's what I will be talking about next week, so be sure and stay tuned!