On March 7th, 2023, CEO and Co-Founder Alexi Robichaux gave the opening keynote at BetterUp’s annual event Uplift in San Francisco. Before a crowd of hundreds of senior leaders, he made the case for human transformation as the necessary (and missing) complement and exponentiator of business investments in digital transformation and other initiatives. He also introduced, for the first time, BetterUp’s Human Transformation Platform. Powered by data and AI, the platform delivers enterprise-wide performance outcomes and analytics at scale by using intelligent workflows around milestone moments to operationalize human transformation. The following article is based on that talk.
The past few years have changed us. What hasn’t changed? Performance still matters. Given the economic uncertainty, organizational performance matters more than ever. As business leaders, we’re on the hook for it, yet driving performance today feels especially challenging.
That feeling is well-founded. Consider three converging trends: soaring wage inflation, decreased labor participation, and declining productivity. Collectively, this trifecta is making our businesses harder and harder to operate. In the people space, leaders are being asked for answers — for certainty — when often, none exist.
The world hasn’t seen this level or pace of change. According to Accenture, 95% of executives across industries believe their customers’ lives are changing faster than they can change their businesses. Companies must be more innovative and agile than ever before, with decisions and actions emerging bottom-up as often as top-down. The organizational performance companies need depends not just on the performance of of their operational systems, but on the performance of their teams and individuals. Enabled frontline workers and managers are the lynchpins for this type of agility.
In this environment, sustained business performance, relevance, and competitive advantage hinge upon people who are, every day, learning, adapting to new tools, innovating new ways of working, and creating differentiated value as the world shifts around them. It depends on people trying new approaches, seeing possibilities, taking on new skills and discarding what is no longer relevant, taking risks and metabolizing the lessons from what fails — all without becoming overwhelmed, exhausted, or cynical from the process. Pushing beyond their comfort zone. Because this level of change, uncertainty, and ambiguity is not comfortable.
When I talk to CHROs, the question they have is: How do I foster a workforce that’s more creative, productive, and agile, but less fragile, in the face of uncertainty? How do I ensure the ongoing performance for the business while helping people flourish as individuals?
How do I foster a workforce that’s more creative, productive, and agile, but less fragile, in the face of uncertainty?
The need for human transformation
Fortunately, new research has revealed what matters most for individual performance. In one of the largest studies of its kind, BetterUp Science Board member and father of positive psychology, Martin Seligman studied job performance across nearly 1 million people over 5 years in one of the world’s most diverse and dynamic workforces, the US armed services, –to understand why some people succeed and others fail in the workplace. What he found (and proved through the data) is revealing: job performance is highly dependent on levels of optimism and well-being. It turns out that the atomic unit of performance and productivity is not a skill; it’s a mindset.
Individual performance and productivity ladder up to performance at the team level as well. The good news is you can cultivate and develop optimism and resilience proactively.
In Fall of 2022, we published a peer-reviewed research study on people who received coaching before and during the early months of the pandemic versus people who did not. Our research found that those with coaching experienced 22% higher productivity and 4x growth in resilience relative to those without. Those receiving coaching also experienced positive gains in well-being, optimism, and even life satisfaction despite being in the most significant collective crisis of our time. In other words, by building psychological capital before the unthinkable happens, we can actually buffer against the negative impacts of crises.
These findings reveal that the super-power to reach peak performance, individually and organizationally, is within our grasp, but the question is: Are we teaching our people optimism? Do they have the mindsets they need to perform, to be agile and not fragile?
Unfortunately, the data show that people aren’t doing well right now. Consider that our own Member onboarding data shows 80% of employees are reporting burnout, and that number is trending upward. Resilience is at record lows and trending downward. For the first time since we began tracking the data, employee burnout will exceed resilience in the very near future. Just when we need them most, when we are asking them to do more with less, to be resourceful, flexible, and persistent in the face of complexity, obstacles, and change, the workforce isn’t ready for it. Their managers aren’t ready for it.
Transformation is what’s required now – from the way we all think about our current challenges and how we’re solving them, to creating continuous and sustainable performance improvement that leads to better business outcomes and better lives for us all.
This is the simplest way of saying that proper management of the work lives of human beings, of the way in which they earn their living, can improve them and improve the world and in this sense be a utopian or revolutionary technique.
Human transformation — mindsets + behaviors + skills — is the missing piece of the business performance equation. Many companies have already invested in digital transformation, but the workforce needs transformation, too. Human transformation is about a human being going into their own values, motivations, aspirations, and limitations to build and strengthen the mindsets, skills, and behaviors that help them achieve their full potential.
Yet our ability to help our teams unlock their performance potential feels inadequate.
The paradox of personalized change at scale
While we now know which mindsets, skills, and behaviors lead to peak performance and human flourishing, and — from 10 years of data from over 2.3M coaching sessions across 750 organizations — we know how to affect growth in those areas, developing them is a deeply personal process. Each person has a different context, different strengths, and different levels of readiness for change. And, it’s not just about what’s urgent today but also about preparing for tomorrow. What people need in order to perform in their role today is different from what they will need in three weeks, three months, or three years. Transformation that spans the enterprise at all levels, starts from deeply personal change at the individual level.
Yet leaders need to scale this transformation to thousands of managers and tens or hundreds of thousands of employees. They have to do it en masse and in sync with their corporate strategy and change agenda to drive the overall organizational transformation. This requires a level of understanding and personalization — which managers and teams are performing or not and why, what type of coaching or practice will create the conditions for people to excel and help others get back into the game — for every single person, team, and cross-functional working group.
The problem, as most HR leaders have discovered, is that what is personalized tends not to be scalable to impact the organization, and what’s scalable doesn’t touch people at a personal level to impact the individual — if they even get used.
A unique opportunity to make the impossible, possible
We stand now at a unique moment in history where advancement and pressure are converging. First, we now have the behavioral science to deeply understand how to reliably change the mindsets, skills and behaviors of our people to help them unlock greater human and organizational potential. Second, the advent of usable and helpful AI models can now manage the near infinite permutations of human transformational experiences required to action the science with what we call precision development at scale, based on individual mindsets, skills, and behaviors. Third, organizations have made meaningful progress in their digital transformation journeys to create a shared data landscape that provide a clear picture of employee data, tenure, ratings, engagement, and more.
At the same time, companies are challenged now more than ever to drive robust, sustainable bottom-line growth. Every company is in pursuit of business performance improvement, under pressure to become more profitable, more productive, and more innovative.
To date, most companies have done this by digitizing, implementing digital transformation platforms like HCM, CRM, and ERP systems to operationalize key business processes.
These digital platforms were the important first step, however, according to McKinsey, only 16% of organizations report an increase in business performance due to the investment in digital transformation platforms. Most of us have probably experienced some version of a multi-year “agile transformation” only to realize that while we adopted agile language and tools, our people, teams, and business aren’t actually that much more agile.
What we’ve learned is that the transformation to drive peak business performance is dependent not just on business technology, but on the growth, potential, and capacity of our people.
The people using new systems and tools need the skills to use them, of course. However, the real performance-driving value comes when leaders and their teams start viewing new technologies, operating models, and market shifts as opportunities to work differently or better understand and deliver what their customers need. Are we scared and resistant or do we welcome change as a starting point of innovation and imagination, new ways to go to market, or career opportunities for our employees? This is the mindset and behavior shift needed for organizations and individuals to channel the forces of change in the new economy.
Developing a workforce that’s more creative, productive, and agile requires more than a new tool. Yet, with digital transformation, we’ve essentially pushed powerful technology into the hands of our workforce and expected it to lead to business transformation. For it to work, the humans have to have the capacity to learn, a willingness to take some risks, motivation to be part of a community of practice, and commitment to master a craft. The difference maker isn’t technology; it’s mindsets.
The final human frontier of transformation
Technology and human capabilities working together are key to changing our workforce to thrive in extreme change and unlocking our business performance. We know that the right mindsets and behaviors can unlock peak performance in today’s world of work and drive key business outcomes.
That’s how we close the gap between where our people and businesses are performing today and our performance potential. When you combine tools and process, and unlock individual growth, you get business results.
Companies have tried to address the people part of the performance equation through other levers. For example, leaders regularly tinker with job descriptions, titles, span of control, and responsibility as the needs of the business change. While important, they don’t inspire, shift mindset, or reliably drive performance. Similarly, compensation changes — shifting the mix of base and bonus, equity, benefits, and other extrinsic rewards — tend to have a short-lived, fragmented, and diminishing impact on motivating performance. Finally, talent strategies such as downsizing, automating, shifting location, and increasing talent density, can impact the bottom line, but, alone, can’t drive improved performance over time and may even hurt it.
The traditional levers can’t get at the deeper, more intrinsic, and more powerful drivers of sustained human performance, especially in the new normal of rapid change and uncertainty. The complex work of breaking apart, breaking down, and rebuilding that is at the heart of realizing human potential doesn’t come through one-off point solutions, no matter how good. And it especially doesn’t occur when these solutions are not linked to a central system of record. That makes them hard to manage across the enterprise, impossible to link to business outcomes and ROI, disconnected from the person’s experience and possibly redundant.
We need a human layer – a way to unlock performance potential that leverages behavioral science, AI, and all the foundational investment in digital transformation. This is where BetterUp comes in. We build, enhance, and multiply the capacity and performance of the employee population across any organization — securely, seamlessly, and at scale — while continuously feeding insights back to leaders to make sense of and quantify the impact on the business.
We do it by making available the world’s first Human Transformation Platform.
The Human Transformation Platform
Today, we finally have the opportunity to realize human transformation at scale, to automatically deliver the right solution at the right time for every person across the organization and create powerful ripple effects on performance by enabling your teams in the flow of work. What we didn’t have before — visibility into needs and context, the evidence-based behavioral science, the granular results, measurement, and integrations — we now have. That’s what makes the organizational transformation driven by individual transformation at scale possible.
In order to do this, we’ve drawn from millions of data points to encode the right mix of ingredients that drive human transformation for peak performance. It comes down to three key clusters:
- Leadership effectiveness. Managers are the connection point between individual and organizational performance. They can inspire, enact, and amplify human transformation – so we must begin with their thriving. Our own research reveals that what makes an effective manager has changed over the past few years – today focus, alignment, and strategic planning are most important for leading through uncertainty and change. When a leader is strong in all three, teams have 53% higher performance. The definition of effective management can be both unique to the context of the business and also to the market and world.
- Mental fitness. Proactive practices that build resilience and optimism create better managers who lead healthier, higher performing teams —31% higher performance according to research from BetterUp Labs. At an individual level, mental resilience is what determines whether or not a person rises to the occasion. And organizations with high resilience see 42% higher return on assets, 3.7X higher return on equity, and 3.2X higher year-over-year growth.
- Connection and belonging. 4 of out 10 people don’t feel a sense of connection to their co-workers and those with low levels of belonging have a 313% stronger intention to quit. People need 5 friendly coworkers to feel connected, 7 to feel belonging, and they are 5% less likely to quit for each work-friend they have. When people experience more connection, they like coming to work more and want to do better work.
Our Human Transformation Platform delivers enterprise-wide performance outcomes and analytics at scale by using intelligent workflows around milestone moments to deliver against these three key drivers of peak performance. It is powered by data and AI to optimize the experience at an individual level. It also provides you with new intelligence so you can operationalize it against your business strategy to drive performance.
Our 2.3M+ coaching sessions and decade serving business customers come to bear in this unique combination: 1.) our expertise in driving scale through whole-person behavior change to really move the “needle” on the mindsets and capabilities you need most; 2.) our ability to showcase measurable business outcomes; 3.) a new level of integration with your systems of record — including Workday, Salesforce, and more to come — for ease of deployment and management.
We’re building the future of human transformation, one that offers support in key moments of change and integrates coaching into your moving life so that every person has the tools they need to reach their full potential, and leaders have a new level of insight to drive a culture of performance across their organizations.
This is just the beginning of what’s possible with the Human Transformation Platform.
Together we can create high purpose, high performance cultures starting at the individual and cascading to the team and organizational level. This is our moment to push the boundaries of human performance to build a better future for our people, the way we work, and our businesses.