Karen Mangia
Today on Success from Anywhere, we'll discover the secret to sustainable workforce diversity and how to mitigate the risks of transient talent from a CEO who's literally invested three decades in discovering what counts. Please join me in welcoming to the show, the former Global Advisory and consulting CEO for PricewaterhouseCoopers and current CEO of MBO partners, Miles Everson. Welcome to the show.
Miles Everson
It is lovely to be here today. I’m looking forward to our discussion.
Karen Mangia
Because we are talking about the world of work, I like to ask each guest, what was your first paid nine-to-five job? And how did that job influence your career trajectory?
Miles Everson
My first full time job was actually with PricewaterhouseCoopers or Coopers and Lybrand, at the time, back a few decades ago. My first job was working for my father in his family business. I started young, and it kind of just continued. That would be a good way to describe it.
Karen Mangia
What was the family business?
Miles Everson
An upholstery shop in Jamestown, North Dakota. I've come a long way from my days of North Dakota.
Karen Mangia
Given the current supply chain issues, currently, you might take that up as your side hustle.
Miles Everson
That's right.
Karen Mangia
I was thinking back to my first experience with MBO partners. it was when I was a senior leader at Cisco. You were an important part of us having access to a flexible workforce. My team partnered closely with you to make sure we had enough talent to listen to our customers when we were bringing new products to market and had the right people at the right time to meet customer demand. Your business may be new to some of our listeners. Tell us just a little bit more about MBO partners as a whole.
Miles Everson
What we do at MBO partners is make it possible for enterprises to access what is an increasingly large portion of the US and global workforce, which are people who are choosing to be independent professionals. And so when I think about it from the independent, professional side, these are people that have decided to be effectively entrepreneurs and run their own business. Some are solo entrepreneurs, sometimes they run small, professional services firms. They kind of come in multiple shapes and sizes. And we love that. What we're trying to do is make it easier for people to find a way to do what they love to do and for enterprises to access that segment of the workforce. It's actually quite rewarding because it's beneficial to both sides, the talent or the professional as well as to the enterprise. By the way, Cisco continues to be a great customer. So thanks for setting the foundation.
Karen Mangia
In our team, we were a center of excellence and contract workforce helped us expand and contract and shift skills very easily. I like what you said there about entrepreneurship framing the thought of being in an independent workforce, even if you ultimately contract for a company as large as yours as an entrepreneurial choice. Sometimes I think we hold these myths or misconceptions that people who are doing contract work aren't serious about their careers, or it was the default because something else doesn't work out. What other myths and misconceptions might people hold about a contract or flexible workforce that are stopping them short of addressing the talent challenges in their own organizations?
Miles Everson
It's always dangerous to paint things with a unilateral brush, but in many cases, there's this perception or myth that in order for me as a company to establish and maintain institutional knowledge in my organization, I need to have all full time employees. That was the case three decades ago. Those days are over. The reason they're over is that the duration for which people stay as full time employees at companies has dropped dramatically. If you're under 45 in the United States, you change companies every 4.1 years. If you're under 35, you change every three years. So by definition, you don't have an institutional knowledge base and your full time workforce the way you used to. Having contractors or professionals that might work 500, 1000, sometimes 2000 hours a year on projects in your company and doing that for 20 or 30 years can create more institutional knowledge of what you've done to create the company you have through the independent workforce. It's counterintuitive, but it's not the employers choice anymore. It's the workers choice. The balance of power has shifted to the worker, because we have, despite all this automation and AI. etc., we have a human capital scarcity issue, not an excess of human capital when it comes to the work to be done.
Karen Mangia
Let's talk about a little of the tension that exists around those words you used for institutional knowledge. I can recall getting these detailed messages of whether this kind of a townhome meeting is appropriate for a contractor or not. This is only for the full time workforce. I find sometimes organizations stopped short of engaging a more flexible workforce because of concerns about intellectual property, knowledge transfer risk. what would you say to those organizations?
Miles Everson
There have been far more leaks, or loss of intellectual property from the full time workforce than there has been from an independent one. When you think of privacy breaches, you think of stolen secrets, etc. Much, much more has been stolen by the full time workforce than by the independent. That's not even a comparable comparison. It is another big myth.
It's a myth, because even most of the most significant security breaches occur from an insider or full time worker. When somebody is going to do something dishonorable and illegal like that, it doesn't matter the contractual arrangement you have with them. Your contractual arrangement just gives you what you can enforce after the act has been done. And interestingly enough, you have more action you can take against a contractor than you can a full time employee. You can actually get better protections out of this.
I've spent countless hours with attorneys going over this point because it's still legitimate. I understand why people ask the question. I'm not dismissing the question. But there needs to be more education on why I'm saying that traditional thinking is a myth.
And there's an opportunity. The thing about the opportunity is companies are not going to have a choice today in the United States. 28% of the company's workforce is independent contractors. This is growing in excess of 20% a year; it's not the company's choice.
It is not a choice for a number of reasons. In 1980, two thirds of their workers in private companies were private workers. Employees had defined benefit plans. Today, it's less than 10%. Corporate America broke the promise that said I will take care of you for your career and post career. It was over when that promise got broken and when you combine that with what has come into people's consumer life on mobility, freedom of choice, freedom of control of what I do—all that has contributed to people saying that when it comes to my work and my career, I'm going to take control. I'm not going to leave it up to an individual company or an individual manager that I report to. I'm going to have the freedom to do what I want, when I want to do it. And that's not going to get turned back. The ship has sailed.
Karen Mangia
We do bring our consumer experiences into our corporate and career expectations. Normally, this comes up in the context of something like simplifying a user experience or a contracting process. People will talk about the Amazon experience. You're highlighting something powerful about how it affects our perception of promises. This is a very human desire for flexibility, autonomy and choice. When you and I first met for the Authority magazine interview, you said something that sticks with me about the mindset shift that we need. You said that employers must embrace employees as workers in a workforce, not just as employees of their company. What's it going to take for organizations to make that kind of a mindset shift? And when we do, how do we need to operate and engage with our workforces differently?
Miles Everson
I think there's some companies that are making it or have made that shift. In the work that I've done in looking at the companies that get a superior valuation in their sector, they have a higher relative share of independent workers to full time than their peers. And I'm not suggesting that that's causal, but I think there's correlation. It's a mindset of how you operate and run your company.
When I think of this it is more prognosis. COVID didn't change the trend that was moving towards independent work, but it accelerated the acceptance of remote work, making a correlation between remote work and the use of independents.
When you start thinking of remote work you have to factor in that you also have a workforce that by definition is more isolated from the rest of their co-workers. Two important points here. Back in the days of the Gallup organization, who may have the most research and data on the workforce and why people stay at jobs, etc., the number one reason people stayed at companies is because they don't want to let their friends down. Every company does exit interviews that ask the people leaving, why they leave. They don't ask the people who stay why they stay. If they did, they would find out that they stay because they want to be with their friends.
We have people in the workforce today that have never really gone to the office. They've only known working remotely. Isolation creates a connectivity problem, which says how am I going to create an environment that gives people an opportunity to become fulfilled and have purpose, not just company purpose, personal purpose. And this is where the organizational and operating models of companies need to change to be much more project purpose, short term purpose, and project outcome base, so you can get a sense of achievement and fulfillment and feel that I'm not just doing a role, I'm achieving and creating successful outcomes that are rewarding.
The millennials and even more so Gen Z's have started to embrace the idea that I'm not going to wait 30 years to define my career. I want my career defined by the successes that I'm having along the way. And that's why we're going to go to this project based, more outcome based operating models for companies. We're seeing it happen today, in a number of companies in different areas. You've certainly seen the world of creatives. Creatives absolutely focus on what their portfolio's impact is for others, not what their title or role is. What did they create? And what kind of impact are they having?
Karen Mangia
What can you create, and what kind of impact are you having? I think those are great questions. You highlighted this thought about isolation. This is a pervasive topic for people who are working in a home or distributed office, whether they are a full time employee in the traditional sense or working as a contract worker. What strategies do you deploy? Or how do you coach this largely contingent contracted workforce that you support with strategies to combat that isolation, loneliness and finding a sense of purpose in what you do when you might work for a variety of different companies and for a variety of different teams?
Miles Everson
I sarcastically said, when I came to MBO to a client one day, “I can tell you who the independents are in your company. They will just go to the cafeteria. They’ll be the people sitting by themselves.”
Karen Mangia
That's a great test.
Miles Everson
There's an inherent bias in that we have full time employees and independents that they're on two different teams. Now, that's changed in a number of companies. But that's part of it. I think part of it is embracing independence. It's applying the rule that says I'll treat others the way that I would like to be treated. It's engaging them in the discussions. It's letting them know when one of their team members is having a life event. If you send the email that says so and so is getting married next weekend, and you send it to everyone on the team, except the three independents on the team, that’s a problem.
Those kinds of communications can be shared easily, and should be shared easily. Because people go through seasons, and those seasons are frequently driven by their life events, but they spill over into their career. They might want to be a full time employee; they might decide they want to be independent; they might come back and be a full time employee. We embrace that at MBO. We think that's great. That's called life and the way things work. If we can be helpful to individuals to facilitate that kind of change in seasons during their life, that's fantastic. Companies just need to be prepared to embrace that. Not just for their full time workforce, but for their total workforce, otherwise, they're going to sell themselves short in terms of access to high quality resources.
Karen Mangia
Your story reminds me of a friend I was just having dinner with who had unexpectedly reached a crossroads with barely a moment's notice of a parent needing care. She didn't see it coming. She got an emergency phone call.
We were having this conversation about being at a career crossroads of can I really sustain the kind of work I'm doing now and be present for a parent who really needs me? How's this going to work? So I like what you said about seasons of life. And we've all had a season of life, together with the pandemic. And what you're doing with your workforce gives me that sense, that you probably have an incredibly diverse talent pool available to organizations. Yet, I still watch organizations struggling, They'll ask me questions like where did all the women go? Or we're struggling with finding underrepresented minorities. What will it take for us as organizations to make the shift to see this as a strategy, engaging a contract workforce as a way to bring diversity into our organizations?
Miles Everson
It's interesting because at the start of the pandemic the largest exodus of full time workers out of the workforce was women on a percentage basis. But the largest percentage of increase in the number of independents is women.
Karen Mangia
Why does this seem to be such a well kept secret? Once, a CEO of a large company said to me,
“Well, we can't hire any women, women aren't working anymore.” And I said, “women are working, they just aren't working for you.” So maybe the better question is, why is that? And where do we need to look differently to access this more diverse talent pool? It's not that everyone unilaterally stopped working.
Miles Everson
They didn't. They just changed the form in which they decide to engage with companies. I'll make a statement that if you want somebody who's extremely proficient and efficient—I hope that it is not inappropriate—have a woman who's trying to run a household with a few kids in it. It will be one of the most efficient workers you'll ever come across because they don't have a choice.
Now you can probably say the same thing for men that are doing that in fairness, but if we're honest, more often than not the woman carries more of the burden. I don't know, if it's a burden, raising your kids, but more of the household responsibility. I've seen it, you know, over my 30 years of work. The most efficient execution is when you have people that are there and focused and doing what needs to be done. And they have other things that are important to them in their life.
Karen Mangia
You talk about being on a mission to combat system bias inside of organizations. Tell us what that is. I think it's kind of related to what we're talking about.
Miles Everson
It's kind of ironically humorous. Companies go out and say we're going to we support diversity, we're going to hire diverse people, however they define that across multitudes of considerations. And then the first thing they do is they send everybody to a training class to standardize them.
Karen Mangia
I went to Catholic school, so I'm just picturing the minute where you get the uniform. And so now, you go to training and they're like you will not belong, you will blend and here is the corporate program that we send you through and on the other side you come out with the equivalent of the corporate uniform.
Miles Everson
That's exactly right. The way I think about it, and I'm not a psychologist, I think it's about finding people that have relatively and largely a common set of human values and embrace a common set of behaviors. One of the behaviors might be that I believe everyone in the room should have a voice and it should be their voice, not just a voice of agreement. That's a behavior that we embrace, certainly in MBO that I want to hear those differing views. That's one example of embracing some diversity. If I say you must embrace the methods that we use, then you're more rules based than values and behavior based. Successful companies figure out how to put more emphasis on values and behaviors and less emphasis on rules. When you get this breakdown of values and behaviors people will default to putting in more rules. And that's just a deep spin cycle into a dysfunctional company.
Karen Mangia
I'm curious, you're a CEO, you're a visible leader, you have your newsletter—I think that it comes out on Fridays—where you're highlighting values and beliefs and relationships. As a CEO, how do you make time to reflect on your values? Or what might need to be reconsidered? I mean, how do you create space for that? How do you communicate and shift your own organization when you realize something might be out of alignment that starts with you as a leader?
Miles Everson
The first thing would be to appreciate and understand that I or any other person, CEO or not, we're perfectly imperfect. So, make sure that we understand that we're not perfect either and embrace the fact that we can always continue to do better and get better. The way you ask the question is interesting because I think having values and behaviors is what creates space and capacity. I don't have to spend a lot of time making transactional decisions when you have a set of beliefs and behaviors. In MBO, we have our behaviors, and then we have our principles of success. The principles of success guide us in transactional decisioning. The behaviors guide us in the environment and what will create our culture because culture is an output of your behaviors; it's not what you put on a piece of paper. What you put on the paper is aspirational, what you'd like it to be. But what it really is the combination of the behaviors that happen every day. When you get those down, it gives you the capacity to say yes or no in terms of where you're going to spend your energy much more quickly. Because in some things you just say, no, we don't do that. That's not what we do. So, we'll move on. Very quickly.
Karen Mangia
Values as your guiding principles are the operating manual. What you highlighted there is when you are clear, individually and collectively about your values and principles, you have a filter to prioritize instantly what you say yes and no to without having to put a lot of thought or have a lot of meetings in the moment. It's already sort of pre-decided.
Miles Everson
Weekly, at least within MBO, we share examples of where the behaviors and the principles of success are being applied either successfully or unsuccessfully in the company.
Karen Mangia
That's a powerful practice. When we were talking earlier you referenced Gallup. I know you do some of your own research and your newest research revealed that independent workers are happier, healthier, and wealthier than their traditionally employed counterparts. And in fact, the research said, 68% feel more financially secure. How is that possible? It strikes me as a paradox that you are working independently, and have never felt more financially secure, That doesn't always go together for people.
Miles Everson
Correct. What I think about it is that in the world of finance, there's the concept of portfolio diversification. If you look at it from a downside risk perspective, if I'm a successful, i.e., a competent, relevant, independent professional, and I can create a half dozen income streams from different companies, I am no longer captive to one manager deciding that I'm the person that's getting laid off on Friday. I might lose one project, but I'm not gonna lose all six at the same time.
Karen Mangia
And you're not beholden to that annual performance review. And the raise that goes with your ranking either.
Miles Everson
You're not, and if you're good at what you do, the market has become sufficiently liquid. Over 20% of the workforce is independent. So in a liquid market, if you're really good at what you do, you can get paid a fair price for what you do. Many of the independent professionals are very proficient, efficient, very productive people. They're not time wasters and so they're productive at what they do. Consequently, their net return on the time their spending is high. But in addition, they've diversified this income stream. They're not really concerned about the downside, because there is less downside, by definition.
In the private industry, the idea of a defined benefit plan has almost completely disappeared, only 10% of private companies have them anymore. So nobody's taking care of you post retirement. You better take care of yourself. Part of the reason they're wealthier, their financial acumen has to be higher. They have to know how they're going to feed the family next week. Where's that money coming from? It's not just that they're going to get their paycheck; they have to go get another contract sign. That creates a discipline and a set of behaviors that's very well suited to help drive your financial wealth. I'm not surprised by it when you sit back and reflect on it. And I think maybe one of the key things in this is that part of the reason this has happened is that increasingly more people are becoming independent by choice, instead of by happenstance or by circumstance. They are just choosing to be independent professionals. When they do that they can create those income diverse diversified income streams.
Karen Mangia
By choice, that's such a great phrase. And because we are talking about evolving how we see our workforce and metrics and measures, what are some of the measures you would encourage employers or organizations to put in place now to measure the effectiveness of their workforce? How do we measure what matters now as the definition of a worker or an employee continues to evolve?
Miles Everson
The first thing is they need to be getting feedback from all of their resource pool, the human capital that's needed to power their business, whether it's a full time employee, whether it's a third party services firm, or whether it's independent professionals. What do each of those constituents or cohorts think of the company? What's their experience with the company? My challenge to an organization would be, why are you potentially either knowingly or unknowingly choosing to want higher engagement, higher loyalty, higher satisfaction from one cohort than another? With the employees, a lot has been done for employee satisfaction, employee programs; I think that's great. I'm not disparaging that at all. When it comes to non-employees, though, there has been for many companies a transactional mindset. I'm the customer, you're the vendor, I will dictate to you. This instead of we are partners, in a transactional arrangement, and I want you to be happy and productive when you're doing work with me or for me, not just that you're doing it because I'm going to use a contractual lever or a behavioral system on you that is punitive or not so friendly. I'm being polite right now, frankly.
Karen Mangia
And all humans prefer and respond better to meaning over mandates.
Miles Everson
100%
Karen Mangia
Anytime someone says, "I'm going to tell you what to do”, we all have this thing that rises up inside and goes, “You can't make me.” It puts us in this mindset of win or lose, us versus them. We lose our humanity in that.
Miles Everson
When I do talks, I talk about the fractionalization of everything. One of the things that's being fractionalized is trust. People increasingly have less trust in central authorities. We haven't talked about this, but I bet I'm going to be right here. If you're going to try to understand what restaurant to go to, are you going to go look for a food critics article? Are you going to Yelp?
Karen Mangia
Probably Yelp.
Miles Everson
Probably Yelp. When you ask people—back to the Gallup as Gallop has done this for like 25 or 30 years—”Do you like the government you have? Do you trust the government?” “No.” People don't trust central authorities and it's getting increasingly that way. And so if your strategy is to take I am the central authority, and I will tell you what to do and how to do it, you are creating a massive distrust in the constituencies around you, whether they're full time employees, independents or not.
Having a much more open conversation and feedback loops from all of the constituents, if you will, or citizens of the ecosystem is so important. I think companies need to embrace that type of feedback and not just doing it, but understanding what it's telling you, sharing with them what you've heard because people like to know that they've been heard. Sometimes you just need to say, I've heard you, but we're just not in a position to do what you'd like us to do. That is better than ignoring it.
Karen Mangia
When your mission or vision statement includes people first that should be regardless of how you hit the payroll.
Miles Everson
That’s exactly right.
Karen Mangia
We've been talking about human connection. And I like to do a virtual water cooler segment on the show because people say they miss these spontaneous conversations, your independence in the cafeteria notwithstanding. So are you up for a quick five questions that you and I might be able to discuss around any water cooler in any company in the world? First up, when do you do your best work? What time of day?
Miles Everson
My best structural work, the work that I need to get done, is done in first thing in the morning. My best creative work is actually later in the afternoon.
Karen Mangia
If there were no dress code for work, what would you wear?
Miles Everson
We don't have much of a dress code here at MBO. So I usually wear a t- shirt like this. And I live in Austin, Texas, so it's pretty common to see me in shorts and flip flops at work.
Karen Mangia
What's the part of your daily routine you most look forward to?
Miles Everson
That's my first thing in the morning, my workout.
Karen Mangia
If you do any job in the world, maybe you become a contractor at MBO. But if you could do any job in the world, what would you do?
Miles Everson
I kind of feel like I'm doing it. And I'm not just saying that. I had the firm I was with, you PricewaterhouseCoopers is an absolutely fantastic firm. I left there when I was the vice chairman, running a big piece of the business. I say running, some days, I think it was running me But, with just fantastic people, and I left it to go pursue this thing here because I believed in what was happening in terms of the broad workforce. This started with me well before I was left PWC.
I'm really working on my passion right now, making it possible for more and more people to do what they want. There's like a little thread of the American dream in here for me because this country was built by entrepreneurs that took a chance to go build businesses. Small businesses built this country and small families created farms. I think it's important to embrace that individualism, let people have their own identity and go do what they want to do. And so if we can have some small or big part in that, that's fantastic.
I like that's what I'm doing. So I don't know if there's anything that I would be happier doing.
Karen Mangia
Well, now imagine there are 25 hours in the day instead of 24. What are you doing with your extra hour?
Miles Everson
Probably sleeping because I only get about six hours, or seven hours of sleep a night. And one of the things I'm working on is getting more and more sleep, like another hour of sleep a day.
Karen Mangia
I love that you would invest in rest miles.
Where can listeners connect with you? Where can people find you and your expertise?
Miles Everson
Well, they can certainly find me at MBO partners.com. And fortunately, I've spent enough time in the airways that if you Google Miles Everson you will find me pretty quickly on any of the social media platforms, and directly on email. I welcome any and all feedback by the way, I think feedback is a gift.
Karen Mangia
So last question for you. What do you want your workforce legacy to be?
Miles Everson
If I can help make it possible for both people being workers and companies to become more fulfilled. There's a lot of talk these days about purpose, but at times, I think it's just a personal view that purpose is a bit force fed. I think what's important is for people when they put their head on their pillow at night to say today was a fulfilling day for me. For me. Not that it was fulfilling for my boss or for anybody else, but it was a fulfilling day for me. When you can help more people do that, that's a good day.
Karen Mangia
Independent by choice, invest in rest and people are people. The employee experience is a great one when you treat people with equity and dignity regardless of how they show up on your payroll. Thank you so much to Myles Everson, CEO of MBO partners for highlighting that happiness is for hire today on Success from Anywhere because success is not a destination. Success is not a location. Success is available to anyone, anywhere, anytime. Transcript from Success from Anywhere podcast.