Speaker 1: All right, we're going to kick things off this morning with a talk from Josh Burson. Josh is an industry analyst and thought leader in the world of corporate talent, learning and HR technology. He's the CEO of the Josh Burson Company, which is a team of analysts and advisors who work to support and guide HR organizations all around the world. And their research covers topics such as hybrid and remote work, HR technology, market trends, employee experience, and diversity, equity, and inclusion. Prior to that, he founded Burson & Associates, which is a research and advisory service focused on corporate learning, which he sold to Deloitte. He's written three books. He has a BS from Cornell and an MS from Stanford in engineering. He's doing a book signing also after this at 10 a.m. downstairs on level one at Julia's Books & Brew. So if you enjoy the talk, please meet him down there for that. That'll be great. And yeah, we're thrilled to have him here. He's here to talk about the trends in learning and HR tech markets. So please give it up for Josh Burson.

Speaker 2: Thank you, Chris. Well, okay, so we've got a pretty big crowd and a good number of corporate people here. So I'm going to give you a two hour presentation in 20 minutes on what's going on in corporate learning, HR technology, AI, and the workforce. And hopefully, what my goal here is not to really give you the details, but give you, for many of you who are not on the corporate side, to really understand what is going on in the workforce. And so just to, okay, and if you really want to dive into this stuff, we do write a lot of research reports on a lot of things, and many of them are available for free. So you can look for this one in particular, because this is a kind of a synopsis of everything going on in corporate HR and technology that came out in January and February, and I think you'll find it helpful. Okay, so the number one issue, before I talk about tech and workforce, let's talk about the economy. Most companies, and we do talk to a lot of companies, are struggling with a paradox. The economy is slowed down, interest rates are high, there's a lot of inflation, as you know, and it's very hard to hire people. And so they have this issue of improving productivity, improving go-to-market, at the same time they're reducing their workforce in some area, growing in another area, and finding it very hard to hire people, and in the middle of all that, of course, there's a high turnover rate. And so the workforce, from a corporate standpoint, is under enormous amounts of stress. I have never seen in my career, and you know, I was born in the 50s, a time when the unemployment rate was this low, it was so hard to hire people, and roughly a third of the workers in the United States changed jobs in one year last year. That is also unprecedented. So imagine you're a corporate CEO or CHO or hiring manager trying to deal with that. And added to that, of course, is that the number of workers is expected to shrink in every developed economy. I know a lot of you look at these demographics. The baby boomers are retiring, and the Biden administration has poured a trillion dollars into the United States to do infrastructure projects, which is going to create more jobs and make the unemployment rate probably go lower. So from a corporate standpoint, even though there's layoffs, and you saw today there were layoffs by Meta, and Disney's doing some layoffs, that isn't really the story. The real story is we need more people, we need people with different skills, and we need to educate and train them more quickly. Now why do they need people with more skills? The big story that we have discovered by talking to, you know, many, many companies is really about transformation of industries. So let me give you one minute on this. And as I said, there's lots of things to think about here. So in 20 minutes, you're going to get kind of a whole one-on-one course on what's going on in the workforce. You know, in the early 2000s, most of you know we had this idea of a digital transformation. We all tried to, you know, build websites and mobile phones and online, you know, shopping experiences and so forth. And what happened, and I happen to be at Deloitte in the middle of all this, what happened was most companies found out that digital transformation wasn't about technology. It was about how the company operates. It was about operating in a digital way and managing this constant flow of information we were getting from customers, and then developing software and tools and experiences faster and faster and faster. And then we had the pandemic, and everybody who said, we have a three-year digital transformation said, no, no, no, we have a one-month digital transformation. We're going digital this month. You guys are all going home. We're not going to shut down the company. And you remember what happened. For a first month or two of the pandemic, everybody kind of shut down, and then the economy picked up really fast, and we had these digital delivery systems and, you know, remote purchasing systems and all of that technology. And companies realized that they could transform a lot faster than they thought. And what then happened is they realized that the industry that they are in changed. And so what's going on now is virtually every industry is colliding with another industry. So Walmart, CVS, most of the retailers are getting into healthcare, drugs, not just giving people shots, but buying and delivering healthcare services. Healthcare companies are being impacted by technology companies who are hiring and getting into digital health. Banks are getting disrupted. You saw Apple, Apple's deal with Goldman that was announced yesterday. Banks, consumer banks are getting disrupted by tech companies, and even Walmart is getting into banking. And so they're all struggling to find people that understand this adjacent industry that they kind of know they have to deal with. And by the way, those people are in demand by the people who started in that industry. And so, you know, all the people that get laid off from, say, Meta or, you know, maybe, you know, Amazon, who might be tech people, you know, they could get a job with a bank. They could get a job with a healthcare company. So the market has become very, very disruptive. And I think, you know, from my standpoint as an analyst, there's going to be different industries. You know, the automobile and the reason Ford split into two companies was because they realized that the EV industry is not the same as building gasoline-powered automobiles. It's completely different. Different technology, different batteries, different instrumentation, different software. And so the corporate, you know, people that you're working with or those of you that work in corporations are dealing with this massive change. Now, in the middle of that, something else has happened, and that is workers have become more mobile. Last year, as I said, about a third of the U.S. workforce changed jobs. Forty-five percent of them changed industries. That is also unprecedented because we have much more power as employees than we've ever had before. And the reason for that is we can work remotely, but also more and more of the value add in corporate and, you know, in companies is delivered by individual employees. You know, it used to be, if I go back, you know, in the 1800s, employees were considered labor. They were replaceable parts. If we lost this guy, we could get this guy to take his place, and after a couple of days of training, he could do the same work. That's not true anymore. If you look at Starbucks and the experience they've had with unions, if you look at, you know, the people that drive for Amazon, the people that drive for UPS, these are not routine jobs anymore. These are human-centered jobs where each individual is adding value in their own unique way based on what that company is trying to do. Now, we've also had the growth of LinkedIn, Monster.com, and the, you know, the openness of the job market. I remember when I got out of college in 1978, the only way you could find a job was to type a letter on paper and put it in the mail and wait. And I'm not kidding. You just waited because there was no way to know if anybody ever read it. Now, of course, you can sit on LinkedIn and you can apply to 20 jobs in about five minutes, and on the other side, you can look at candidates in a continuous basis. So we have this very, very fluid market, and what companies have realized is that in the middle of all of this mobility and all of this data that we can capture about candidates and employees, maybe we don't need to look at their pedigree, maybe we don't need to look at their job history quite so much, maybe we should hire them based on their skills. Because if they have the right skills, we can teach them about our company, we can teach them a little bit about our industry. And so we're moving into this world where every individual, every employee, and this is going to happen at the front line in the blue collar work as well, is going to be evaluated and to some degree paid by their skills. Now, on the corporate side, there has been this crazy concept of building what is called a skills-based organization. And honestly, it means nothing. I mean, it's just a bunch of talk by consulting firms to try to get companies to hire them. But what really is happening is everybody now is freaked out about what are the skills we have, what are the skills we need, what are the skills that are growing, what are the skills that are shrinking, and how do we move our workforce in that direction based on that industry that we're either in or trying to get into faster and faster and faster. And so technology, AI, new HR technology is very, very focused on this idea of skills. And I'm going to talk about that in a minute and try to sort of define what a skill is for you. The training industry, of course, sorry about that, I was touching the antenna. The training industry behind this is a massive industry. I was just talking to Rob Lauber outside, who's the ex-CLO of McDonald's. It's a very large industry. My estimate is it's over $300 billion around the world. I actually think it might shrink. I think if you look at the impact of chat GPT and generational AI and some of the tools that are coming, we might not need so much of this stuff. I'll talk about that in a couple of minutes. But it's very robust. Every company invests in training. In fact, one of the problems companies have is sometimes they think every problem is a training problem, which is not true. But this is a massive industry, and it has come a long way. If you look back 10 or 15 years, when I first started on this, training was courseware. It was a page-clicking sort of instructor-led course put on the web. We had YouTube and video and then the iPhone, which turned it into video learning. Then we realized, well, maybe we don't need four-hour courses. Maybe we can have five-minute courses. Maybe we can make 10-minute courses. We had this proliferation of content that gave birth to the learning experience platform. By the way, I'm going to be having a talk a little bit later today with David Blake, who's the pioneer and the founder of DeGreed, which was really the leading learning experience platform at the time. And then we had all this content floating around inside companies. Nobody could find any of it. And we realized, well, maybe we should tag it based on skills. By the way, what is a skill? I'll talk about that in a minute. And finally, we're in a new world, which is, as I'll show you in a minute, it's all about growth. It isn't just about skilling people. It's about figuring out if the skills that we are helping this person acquire, will it help them advance into the role, the job, the industry, the needs in the future of our company? And of course, we're going to add AI to that, and that's going to just turbocharge this whole process. Now, the complexity of the word skill, it's a very confusing term for the HR folks. And let me just give you a very short discussion. Many people think skill is a new word for what we used to call a competency. Competencies are a 30 or 40-year-old idea, where you used to literally sit down as an HR person, and you would define a job, you'd say, okay, sales, and let's write down what this person's going to do. And let's look through the book of competencies. There was a book of competencies. It's now owned by Corn Fairy. It was called FYI. It had about 500 companies in it. And you'd go through it, and you'd say, that one, that one, that one, and that one. And then he even did something called competency card sorting, where you'd put all the competencies on the table, and all the HR people would look at the companies and say, let's pick the ones that we think are the right ones for this job. And we write them down, we put them into the job description, and then we would use them for hiring and for development and for growth. And that was it. And we thought it was great stuff. And you know, most companies didn't use it. They used it for, you know, heavily regulated jobs, but they didn't use it for most white collar jobs, because it wasn't really that useful. Now we have these AI systems, these, you know, very powerful indexing engines, and I know a lot of them, you guys, some of you are, I know, providing this stuff. And we can actually read through somebody's bio, we can look at their history, we can crawl through their GitHub if they're a software engineer, we can look at their certifications as their nurse, and we can figure out what their skills are, and we can do a pretty good job. And then the employee can go in and click on the skills that they believe that they have, and their peers can do that. And we're starting to build these massively interesting databases of skills in companies. By the way, for those of you in the education industry, most companies couldn't care less about validating those skills, about credentialing those skills. We just want to know if you have them, because we're going to put you to work in some role that we desperately need. And if you don't have the skills, we kind of want to understand what either somebody else can take that job, or what can we do to help you develop those skills. And so that's really what's been going on. And as a result of that, companies have changed the way they do corporate training. I ran into Pamé last night from Kraft Heinz, we have worked with many, many companies to redesign all of their corporate training around these clusters of skills. It used to be, 10 years ago, that corporate training was courses, courses, curriculum, and just tons and tons and tons of it. And you had to figure out, based on the job you were in, what courses to take. Now what companies are starting to do is they're realizing, we need a risk management academy, we need an HR academy, which is what we do, by the way, or we need a digital, we need an AI academy, Intel built an AI academy, so they could understand all the disciplines of AI and code them into their chips, or we need a sales academy, or we need a leadership academy. And so they're bringing these things together in a much more integrated way. And one of the things that's coming out of that, is they're realizing that once we know what capabilities we need, maybe we should figure out what people would be interested in moving into these new capabilities. So because the job market is so competitive, and because we have such a low unemployment rate, companies are saying, you know, maybe we can't hire this job. Maybe we better build them and develop them internally. And so there's this whole new domain of internal mobility and what is called a talent marketplace to help companies move people from low value, declining skill jobs into higher powered, badly needed roles. And so there's all this infrastructure that's being built inside of corporations to facilitate this mobility and development process. And it's a very, very complex market. You know, for those of you that work in corporate training, or you sell to corporate training, unfortunately, you're going to go into a corporation and you're going to find out they have 50 things. They've got an L, they've got multiple LMSs, they've got multiple content systems, they've got virtual reality stuff, they've got video conferencing, they've got some assessment systems, they've got a talent marketplace, they're looking around at skills tech. It's a very messy space. And so, you know, what we find and the reason we kind of do what we do is a lot of the challenge companies have is just making sense of what they need, because eventually they end up with too much stuff, and they can't manage it all. So anyway, that's what's been going on sort of in corporate learning, and how the corporations have really dealt with these massive changes going on around them. Now, we did a study late last year on the space, and this is what we do for a living. We do a lot of these big studies to figure out, you know, what's changing. And what we found in the corporate education and training business is that the practices that are adding the most value now are not about high-fidelity learning. They're about learning to grow. They're about understanding the skills and capabilities that you as an individual need to move to the next level, the next job, the next role, the next responsibility in your company. And you can see this data here. And when we looked at this data across about 1,000 companies, we found that only about 11% of companies get this. Many, many learning and development leaders are stuck in learning. They're stuck doing training. And there's somebody else, or maybe nobody, looking at careers and growth and mobility. And so one of the biggest changes that's going on in HR is really reframing what the corporate learning and development group does. And I really think that great learning leaders, you could call them chief growth officers, because they're really there to grow the roles and responsibilities and the skills of everybody in the company. And that means they've got to understand this complex, multidimensional problem we have in business skills. I mean, you can get deeper and deeper and deeper and deeper into the role you're in. But as you know, and if you've read the book Range, which is a wonderful book about this, the most successful people in business have cross-domain skills. And this is going on in HR, by the way. One of our big themes for HR over the last year is broadening the capabilities of HR people. And that's in sales and marketing and engineering and tech. And so we're trying to build inside of companies these systems that can integrate and understand these cross-domain skills that people need. And companies are really struggling with where to put this data and where to get this information. So this is just a very, very small picture of the complexity that companies are dealing with. I don't need to tell you how complicated it is. There's many, many categories of this market. There are many subcategories of that market. It all fits into this big world of HR technology. HR technology is roughly something $20, $25 billion market in and of itself. Microsoft has entered it. Google is getting into it. I even talked to some folks at TikTok. TikTok is building an HCM system. I have no idea why they want to sell one of these things. So in a parallel universe to you guys, there are conferences going on to just help people understand that. Final thing I'll just sort of leave you with is AI. It is very clear to me as an analyst and a technology kind of guy that AI is going to upset this apple cart in a major way. Many, many of the things that we buy and build and use in corporations are based on traditional transaction models. Learning management systems, which I know most of you know what they are, are basically old-fashioned mainframe-oriented transactional systems. Once we have AI, everything's going to change. We're going to develop content faster. People are going to look for information and get training directly from the chat bot. We're going to have new ways of training using chat and prompt interfaces. And we're going to have richer and richer VR and other forms of content as well. So there's a lot of exciting opportunities for all of you. Anyway, I just want to leave you with this. I hope you found this interesting. Like I said, it was a 20-minute overview of a very complex topic. And I look forward to meeting you. I'm going to be in a couple of roundtables later and also be signing a book in a little bit later. But thank you for the opportunity to speak. Bye, everybody. Thank you. Thank you. Thank you.