July 04, 2023
Launched in 2016, Unilever’s Future of Work initiative aimed to accelerate the speed of change throughout the organization and prepare its workforce for a digitalized and highly automated era. But despite its success over the last three years, the program still faces significant challenges in its implementation. How should Unilever, one of the world’s largest consumer goods companies, best prepare and upscale its workforce for the future? How should Unilever adapt and accelerate the speed of change throughout the organization? Is it even possible to lead a systematic, agile workforce transformation across several geographies while accounting for local context?
Harvard Business School professor and faculty co-chair of the Managing the Future of Work Project William Kerr and Patrick Hull, Unilever’s vice president of global learning and future of work, discuss how rapid advances in artificial intelligence, machine learning, and automation are changing the nature of work in the case, “Unilever’s Response to the Future of Work.”
BRIAN KENNY: On November 30, 2022, OpenAI launched the latest version of ChatGPT, the largest and most powerful AI chatbot to date. Within a few days, more than a million people tested its ability to do the mundane things we really don’t like to do, such as writing emails, coding software, and scheduling meetings. Others upped the intelligence challenge by asking for sonnets and song lyrics, and even instructions on how to remove a peanut butter sandwich from a VCR in the style of King James. But once the novelty wore off, the reality set in. ChatGPT is a game changer, and yet another example of the potential for AI to change the way we live and work. And while we often view AI as improving how we live, we tend to think of it as destroying how we work, fears that are fueled by dire predictions of job eliminations in the tens of millions and the eradication of entire industries. And while it’s true that AI will continue to evolve and improve, eventually taking over many jobs that are currently performed by people, it will also create many work opportunities that don’t yet exist. Today on Cold Call, we welcome Professor William Kerr, joined by Patrick Hull of Unilever, to discuss the case, “Unilever’s Response to the Future of Work.” I’m your host, Brian Kenny, and you’re listening to Cold Call on the HBR Podcast Network. Professor Bill Kerr is the co-director of Harvard Business School’s Managing the Future of Work initiative. His research centers on how companies and economies explore new opportunities and generate growth, and he is a fellow podcaster. He hosts a show called Managing the Future of Work. Bill, thanks for being here.
Bill Kerr: Thanks for having us.
BRIAN KENNY: And Patrick Hull is Unilever’s VP of Global Learning and Future of Work. He goes by Paddy. Paddy, thanks for joining us.
PATRICK HULL: Thank you very much for having me.
BRIAN KENNY: It’s great to have you both here today. I think people will really be interested in hearing this case and how Unilever is thinking about the future of work. So why don’t we just dive right in. And, Bill, I’m going to ask you to start by telling us what the central issue is in the case, and what your cold call is to start the discussion in class.
Bill Kerr: Well, Brian, I think your introduction clearly outlined the central issue, which is technology is really transforming the world of work. And that means, companies must learn how to do things different than what they’ve done over 50 or a hundred year history. And it also means they must transform the skill base in how they’re approaching employees and talent. I think we can simply say: that ain’t easy, and it’s also going to introduce significant challenges and tensions for organizations. A big company like Unilever is going to really want to appeal to employees, put the purpose of the company in front of employees, embrace that, but it’s also going to have to make challenging decisions regarding employees and their transition of skills and what’s the future workforce going to look like. So the most common cold call is a really simple question, which is: has Unilever, through its Future of Work Program, resolved the paradox of profit and purpose? And pretty quickly, the answer to that is, “no.” It hasn’t fully resolved that. I will occasionally get maybe one person that goes all the way there. So then we’ve got to start unpacking, okay, how close is it to resolving that? And are we very near the end point or are we farther away?
BRIAN KENNY: Yeah. Simple question to you maybe, but probably not to others who are listening. That sounds like a pretty complex question. I mentioned your involvement with the Managing the Future of Work initiative here. So I know you think a lot about this. This is on your mind all the time. How did you hear about what Unilever was doing, and why was it important to you to write this case?
Bill Kerr: Well, it’s interesting. The history of the connection came through another case that we wrote. Very early in our project on Managing the Future of Work, we’re always very deliberate about putting the “managing” in front of the future of work, and that we want to think about how leading companies are reacting to the forces that are shaping the future, like digitization and demographic changes and so forth. So, we’ve written a case about Vodafone, which we did a Cold Call a while back. With Vittorio Colao. And Vittorio was on Unilever’s board and said, “You have got to go and meet this organization and see what they’re doing,” because they have one of the most comprehensive, well thought out programs for the future of work that he had come across. And in fact, that was the connection that then followed on. And yes, for a sector that Unilever’s working in that has end-to-end change going on from the manufacturers, all the way down through the consumers or the products, to be able to have an organization that’s thought very deeply about what pillars do we need to put into place to make the change occur is great. The other thing that was delightful about Unilever and writing this case study is that, a lot of times, companies want to talk about their programs, only after they know that it was a success. They would prefer to wait until they’ve… They’re like, wait another two years and then we’ll write the case study about this transformation. But Unilever’s been very upfront in saying, “The future of work’s a big challenge. We have to get in front of that. Here’s what we’re doing. We haven’t necessarily figured it all out yet, and some of this will prove wildly successful. Others may be challenging, but this is where we’re going.” And that’s been a great thing to really spark a lot of executives and students a conversation about, what will the future of work require, and how can we get there?
BRIAN KENNY: Yeah. So, Patty, I have to ask, I have to start by asking you, what’s your job? Because your title’s very lofty. It basically calls you a visionary. You are the VP of Global Learning and Future of Work. So what do you do?
PATRICK HULL: I’ve got a funny answer to that question. Since the pandemic, and obviously, been working a lot from home, and I work in a slightly open area, so my wife gets to hear a little bit of what I’m talking about. She seems to think that what I do is laugh a lot and chat a lot to people. So that’s what-
BRIAN KENNY: Kind of like we’re doing today. So, she’s listening in…
PATRICK HULL: She says, “When do you do some real work?” But yes, I guess what I do is work with a really passionate, dedicated team of people who are looking at how are we preparing our organization, and our people in particular, for a future that is very different to what we’ve been experiencing in our traditional work models up to this point. You mentioned ChatGPT as well. I mean, that really is the talk of the town at the moment. And I guess we’ve been thinking for a bit of time, as Bill mentioned, about the impact of things like that on our business, and trying to get on the forefront of what’s our response to that. So I wouldn’t quite say visionary. I think, at this stage in business and what’s going on, it’s quite hard to be truly visionary, but trying to stay one or two steps slightly ahead of what’s going on in the world of work, that’s, I guess, what my job’s all about.
BRIAN KENNY: Yeah. That’s great. For our listeners who… I think most people have heard of Unilever, but for people who aren’t really aware of the scope and scale of Unilever, can you describe the business for us a little bit?
PATRICK HULL: Yes. So we’re a fast moving consumer goods business. So most of you will probably interact with one of our brands or products every day. In fact, we say that we serve 3.4 billion people every day. That’s how often someone buys one of our products or uses one of our products. We’ve got about 400 brands in 190 countries across the world, ranging from global brands like Dove, Sunsilk, Hellmann’s, Rexona, all the way through to what we call local jewels like Marmite in the UK, which is one of those brands that you either love it or hate it.
BRIAN KENNY: How big is the workforce at Unilever?
PATRICK HULL: The workforce is about 149,000 people who are directly employed by us. But we always often speak about how we have an extended workforce of around 3 to 5 million people, who if you ask them who they work for, they would say Unilever, even though they’re actually employed by someone else.
BRIAN KENNY: Yeah. So we know Unilever well at Harvard Business School. We’ve had lots of cases written on over the years by our faculty, and we’ve actually talked about it on Cold Call before, particularly, the focus on sustainability. Unilever really stands out in this regard. And I wonder if you could talk a little bit about how important this is to the culture at Unilever.
PATRICK HULL: It is. I can’t tell you how important it is. In fact, when Paul Polman, previous CEO, came into the organization in 2009, he launched the Unilever Sustainable Living Plan in 2010. And he did this beautiful job when he launched it of reminding us that sustainability has been part of Unilever since day one. When Lord Leverhulme started selling Sunlight soap, his mission was to make cleanliness commonplace. That was back in the late 1800s. And what Paul did beautifully is he then simply shifted that a little bit and said, “We are now here to make sustainable living commonplace, because now we impact so many more people and so many more homes. If we can help every consumer out there make more sustainable choices with how they eat, how they clean, how they use plastic, how they use water, then we can have a massive impact, positive impact, on the planet and society, and that’s good for business.” That was the business model that we’ve ascribed to. So we hire on it. We are tracked on it. We develop on it. It’s definitely part of the way things get done here.
BRIAN KENNY: Bill, let me turn back to you for a second. The FMCG sector is fast moving, as it indicates. What are some of the forces that are putting pressure on that particular sector these days?
Bill Kerr: Yeah. The case outlines three forces, and let me walk through those and also say a little bit of, before I do that, why we think this sector’s amazing to watch. If you want to have a kind of front row seat as to how the future of work may play out in other sectors, I often direct them towards the fast moving consumer good sector because the technology forces, the demographic forces, the gig workplace force that we’ll talk about are all happening already. They’re deep into this sector, so we can learn a lot from it. So, the first one is clearly technology that links through all the way to our opening conversation. There’s many ways in which the touch points between consumers and the outlets and last mile delivery and drones possibly dropping off future packages reverberates all the way up through the supply chain to Unilever and its suppliers above. A simple kind of easy metric is, think about the speed that we now demand or expect of our package delivery. It’s no longer that we’re going to go to the store and pick this up and the store can replenish itself over a week-long horizon. It’s going to be, I just pressed the button in the app and I’m expecting it in the next five minutes to be handed to me. That puts a lot of demands on how an organization needs to function, and also increase the expectation about the customization and the personalized products that consumers will require. So, the technology requires Unilever to think differently. The second is a broader force, but equally as impactful, and even more predictable for the future, which is the role of aging populations and demographic change in the workplace that is quite different than the workplace of the 20th century, where many of the large companies today kind of got their grounding. One of the early kind of points that it makes is that, in the UK, about a third of the workforce currently is over the age of 50, and that’s true in most every advanced economy, as well as also, increasingly across East Asia and elsewhere, that we have older populations. We have workforces that are going to span many more generations in the workplace. And then the third one, which in our project, Managing the Future of Work, we think of as kind of an outcome of tech and demographics coming together is the gig workplace. Paddy talked about the extended workforce beyond Unilever, and the case tries to unpack some of the ways they’re approaching bringing people to work that aren’t the traditional full-time jobs that most companies got built up around. And the gig workplace is activated by that technology that lets us schedule and involve people in gig works. And also, as we think about low unemployment rates and older populations and tacked out and so forth, the degree that we can, as a company, attract in people that are currently not working or at the edge of working and tempt them to come work for us on projects is a very valuable labor supply to these organizations.
BRIAN KENNY: Paddy, you’re in it, literally. So what are you seeing as some of the things that have shifted over time?
PATRICK HULL: So, when I started, I’m going to give my age away here a little bit, but back in the 1990s, I remember us talking a lot about, how could we get direct to the consumer? Back in those days, we sold everything through big box retail, and it was all about maintaining those relationships, making sure you had great store shelf positioning and great relationships with those buyers. One of the most massive shifts is that direct to consumer is the channel now. Bill spoke about how we all just order stuff off Amazon directly. We don’t have any advantage anymore in terms of getting to consumers. You and I, any little startup, can throw some ads on Instagram, speak to a few influencers and start sending their products out. So the whole game has changed in terms of how are we reaching people.
BRIAN KENNY: And I can already imagine, just based on the examples you’ve both given, I’m already seeing areas where there would be churn in the workforce around some of these developments. So let’s talk a little bit about Unilever’s Future of Work plans. And there’s a framework that goes along with it. I wonder if you could describe that and talk about the three pillars that support that framework.
PATRICK HULL: Yes, our three pillars are: change the way we change, ignite lifelong learning, and redefining the Unilever system of work. And I’ll explain a little bit about each of those. So changing the way we change. The first one is, what we’ve realized is that change is continuous. Disruption is continuous in our organization. It’s not about standalone moments where we see that, oh, we need to shut down a factory or change something because of a dramatic shift. Change is happening all the time. All of our factories are rapidly automating all of our office processes, so we can’t stick to the old traditional model of change, which was a very slow moving consultative approach, and also, where management held its cards close to its chest until sort of the last moment and then announced, “This is happening.” We’ve realized that, really, to be true to our purpose around making sustainable living commonplace, we need to enter into a far more open, early, proactive dialogue with our people around the change that’s affecting our organization, and how to help start preparing them well in advance of any actual impact on them in terms of how they can prepare for that change. So that’s the first one, changing the way we change. The second one around igniting lifelong learning is about engaging with our people to make sure that they’re all equipped to thrive, both now and into the future, and that we are showing them a bit of what that future looks like and where they need to be focusing their attention. And then the third, redefining the whole system of work is a bit of what Bill was mentioning earlier. Here, we really want to embrace this notion of accessing talent rather than owning talent. We’ve felt that if we just keep on trying to hold onto all our FTEs and compete against everyone else with talent, we are never going to have the people and the skills in our organization that we need to take us forward into the future. So we really want to redefine new models of working, so it’s not just you’re either fixed or you’re a gig worker, but how can we find some flex in the middle that helps people transition out of this traditional life cycle of work, the kind of 40-hour, 40-week, 40-year traditional employment pattern, and help get them future fit for a hundred year life, where they may want to slowly move into retirement, where they may want to spend some time looking after their kids, where they may want to set up their side hustle. How do we create that sort of flexibility?
BRIAN KENNY: There’s definitely, and understandably, a lot of emotion involved with some of these things. And I’m wondering if maybe you could give our listeners a sense, based on all the research you’ve done in the initiative, about what kinds of jobs are going to go away, and what kinds of skills you think are going to be most important for people to think about in the future?
Bill Kerr: Well, Brian, I come back with, that we don’t think of jobs really going away. And I think it’s important to instead think of jobs as a collection of tasks. And certain tasks will be taken over by the machine and require less human input, as the technology gets more advanced. And that could be in a very manual kind of sense. It could also be with ChatGPT in a more cognitive relationship. And perhaps, the thing that we’re experiencing right now that’s very front and center in the world of work is, lots of ways that technology is coming in towards more cognitive tasks that are complex, they’re non-routine. They were not able to be done by the computer before, but artificial intelligence machine learning and so forth are able to take those off. So if you think about how supply chain forecasting will happen at Unilever, that’s going to be done in a fundamentally different way than it would’ve been even 10 years ago.
BRIAN KENNY: Sure.
Bill Kerr: But we always think about new tasks emerging, and it’s hard to predict exactly what those tasks will involve. When you think about the skills, we know that having digital fluency and also social skills are the two biggest things that you can put money on, bank on, those being important enough for the future. But there’s also going to be judgment, and there’s going to need to be innovativeness. So even if the computer starts to do a really good job at predicting about how salespeople should arrange the shelves or how they should approach consumers, you still have to think about, as an organization, what data are we feeding into the system? And where could Unilever develop a proprietary data advantage? And how would we collect those data streams and put them into it? So the technology will be there, it’s going to take over evermore parts of work as it has been for 150 years at this point, but there’ll also be places where humans will be complementing and helping to achieve the goals of the company.
BRIAN KENNY: So that’s an optimistic viewpoint, Paddy. And I’m wondering what the response is from people when you start to talk about these ideas with them. And how do you move them beyond just their own insecurity and concern for themselves, to really embrace learning new skills and thinking about a different way of working in the future?
PATRICK HULL: This is a fundamental dilemma facing us, Brian. I’m so glad you asked me that question. And whilst I don’t know if we’ve cracked it, I think we’ve got a really good hypothesis around what helps this. One of the things we know is, the way not to motivate people to learn new skills is to tell them, “You better re-skill or the robots are going to take your job away.” So we’ve taken the view that if we can help people to discover their purpose, what makes them unique, how do they approach work in their own way, and then start from that point and say, “Okay, when you are at your best, you are doing these things. How do we make sure that you are developing the skills in line with that, that are going to keep you future fit in an environment that is changing around you in terms of the nature of your job and how you work?” And we’ve found that when people come from that place of purpose, they do feel far more agency over it. They are far more motivated to learn new skills, to continue to be relevant, but it’s coming from a much more positive place. It’s not coming from that fight or flight or freeze sort of mode. It’s coming from a place of agency. And in fact, we partnered with some academic institutions to measure the impact of starting people thinking about purpose and then creating future fit plans from there. And we’ve found that it does lead to people being 25% more engaged in thinking about the future, in going the extra mile, in having this intrinsic motivation to take it on. And they’re 22% more productive, which is another great benefit to us.
BRIAN KENNY: Yeah. So, Bill, we’ve been through situations like this before. If you look back over the long arc of history, we’ve had movement from an agrarian society to an industrial society. We’ve had manufacturing sector turned on its head when a lot of manufacturing jobs have gone overseas. And I think each time we’ve done that, there’s been a portion of the workforce that’s just not been able to make the leap to the new mode of doing things. Unilever is talking about ensuring that 80% to 100% of their workforce can be transitioned in the right way. Is that too big of a promise to make?
Bill Kerr:
Well, to their credit, I believe they stayed at the pretty top end of that range so far. And I think the workshops and so forth that Paddy just outlined are best in class for trying to stay up there. I do think, Brian, you see organizations, and I’m spanning out from Unilever at this point, that are trying to set a new contract with workers, both explicitly and implicitly, that says, “Our part of the bargain is, we’re going to give you great clarity as to what roles we see the company needing in the future, and help you kind of think about where you are today and what you would need to acquire skill-wise to get to that future point. And we’re going to give you the platform to acquire those skills. But your part of the bargain has to be to put the time and the investment in to be having those skills when that time comes.” And so I think we’re seeing a shift in a bit of the, we want to be a great place for you to have worked and developed your career, but we’re not going to be guaranteeing a lifelong employment. We’re going to focus on the skills that are needed and help you make the investments and choices that should be made.
BRIAN KENNY: Yeah. And what does that start to look like at Unilever, Paddy? What are some of the ways that you’re sort of redefining the systems of work there?
PATRICK HULL: So, one of the big initiatives that we’ve undertaken was this whole idea of, how do we help people create more flexibility in their roles, so that they can discover new ways of working, discover new skills, grow in new and different ways? And I mentioned to you earlier that we thought there’s this sort of gridlock that, on the one hand, you’ve got full-time employees, you’ve got lots of security, but no flexibility in terms of how and where they work. And on the other hand, you’ve got gig workers, freelancers, lots of flexibility, but not much security in terms of guaranteed income. And we’ve set ourselves a challenge of, how do we create this responsible alternative to the gig economy? And our idea was something called U-Work. U-Workers no longer have a job title. They work on gigs and projects in Unilever, but they are still 100% Unilever employees. They are not gig workers, so they’re not contractors or anything. In fact, they’re an internal pool of contractors, if you like, but they remain Unilever employees. They get a guaranteed retainer. They get a package of social care, pension benefits, healthcare benefits. And they get a learning stipend. But in return for that, they then only need to work on projects. They can set up their own business on the side. They can look after their kids or aging parents, or they can gradually move into retirement. And I think it’s this kind of thing that we need to continue to explore, as we see in the impact of automation and digitization, and also this trend or this desire for people to have more flexibility to choose how and when they work.
BRIAN KENNY: Yeah. It actually sounds kind of appealing. So you also get variety that goes along with that. You get to move from one project to another, and you’re not sort of locked in on the same kinds of things, all the time.
PATRICK HULL: And, Brian, the one thing, just to emphasize on that, people get very locked into the thing of, ah, does someone have the skill I need for the job? In fact, what we found is, one of the most important skills is knowing the organization. So U-Work is great because they are Unilever employees. They know the organization. They know how to get things done in Unilever. And we must never underestimate the power of that skill
BRIAN KENNY: Bill, it seems like anytime that we enter into one of these huge labor market transitions, manufacturing jobs, take it on the nose. And so I’m wondering, as you think about the implications for jobs in the future, what are the implications for manufacturing specifically?
Bill Kerr: Well, I think, Brian, we’re already been seeing that in motion for a while. Manufacturing has been at the forefront of technology adoption for decades. I think time will tell how it will continue to evolve. I would anticipate more skilled, more advanced, more technology enabled, but there could also be some interesting twists. It’s not the current case study that we’re talking about, but there’s another case study at Harvard Business School, done by Raj Choudhury, our colleague, with Unilever that’s about remote manufacturing. So how can the remote workforce be connected into the manufacturing sector? So we’ll see a lot of innovation towards the future.
BRIAN KENNY: And how is Unilever thinking about that, Paddy?
PATRICK HULL: So actually, the whole genesis of this future of work framework was done together, well, co-created together with our European Works Council actually, so our manufacturing representatives coming together with management to think about, how is the future of work impacting the manufacturing environment? So actually, our whole framework came from them. So, we very much see this as a critical way of addressing the impact of digitization and automation in the manufacturing environment. We’ve found some fantastic examples where we’ve started people thinking about their roles in future. And what we’ve found is, there’s quite a strong correlation between some of the skills our manufacturing workers have and lab assistants in our R&D labs. And funnily enough, we tend to have quite big R&D centers right next to our factories. So we’ve seen quite a bit of movement of people being able to re-skill from manufacturing environment into R&D labs in a way, a more sustainable future environment, all because they’ve identified, what’s the work that they really enjoy doing, what are they really good at, and then what are the skills required to go into the future?
BRIAN KENNY: Yeah. That’s a huge win-win, right? For the worker and for the firm.
PATRICK HULL: Correct.
BRIAN KENNY: This has been a great conversation. I’ve really enjoyed it. I’m wondering if… I’ve got time for one question for each of you left here. So, I’m going to start with you, Paddy. How is Unilever going to know if they’re succeeding in this? Is there a sort of an end game in mind here?
PATRICK HULL: The big goal is obviously that we are proving that our sustainable business model is more effective than others in terms of driving superior performance. So the big number is still, how are we doing as an organization? I would say the key input metrics are things like, how well are we able to re-skill our people for the future? We really believe that re-skilling is the way forward. We know it’s cheaper than recruiting from outside. It’s better for our people. It’s a way of getting people who know our business to continue to do good things. So we do measure that. How many people are we helping to transition? And then it’s about, how attractive do we continue to be as an employer for new recruits and for the people within our organization? So we’ll track the traditional input metrics like engagement, attrition, our employer brand, how well people are collaborating going forward.
BRIAN KENNY: Yeah. It sounds like you’re off to a fantastic start. Bill, I’ll give you the last words, since you wrote the case. If there’s one thing you’d like people to remember about this case, what is it?
Bill Kerr: Well, let me go back. We started with the cold call, so let me tell you how I end the class. There’s a video of one of Paddy’s colleagues, Nick Dalton, who is quoting President Kennedy, who was in turn quoting an Irish writer named Frank O’Connor. And Kennedy was speaking about the space mission, and Frank O’Connor was describing, as a kid, when they would come to this orchard wall that was too high for them to climb over. They had no idea how they were going to do it. They would take their hats and they would throw them over the orchard wall, so that they just committed themselves to figuring it out. And Nick basically thought of the Unilever program as a bit of, “We’re throwing our hat over the wall. We don’t know exactly how we’re going to climb over this future of work wall, but we know we must do it. And this is our public commitment to making that happen.” And the thing I’d come back to listeners around this is, the future of work is scary. And we talked about job transitions and how quickly the new technologies are coming. This time last year, we had no thought of ChatGPT as being part of this Cold Call podcast, but now, it’s what we lead with. And so, hopefully, people can unfreeze a little bit and can start thinking about, regardless of what the twists and turns may lie ahead, they need to begin a journey with their employees. And Unilever is showing, here’s how we’re approaching that. Now, let’s all work on it together.
BRIAN KENNY: Yeah. Well, I suspect I’m not alone when I say we’re rooting for you. We hope that you get this right. There’s a lot at stake.
PATRICK HULL: Thanks, Brian.
BRIAN KENNY: Thank you both for joining me.
Bill Kerr: Thanks.
BRIAN KENNY: If you enjoy Cold Call, you might like our other podcasts, After Hours, Climate Rising, Deep Purpose, IdeaCast, Managing the Future of Work, Skydeck, and Women at Work. Find them on Apple, Spotify, or wherever you listen, and if you could take a minute to rate and review us, we’d be grateful. If you have any suggestions or just want to say hello, we want to hear from you. Email us at [email protected]. Thanks again for joining us. I’m your host, Brian Kenny, and you’ve been listening to Cold Call, an official podcast of Harvard Business School and part of the HBR Podcast Network.
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