The gauntlet has been dropped for large consumer packaged goods (CPG) companies. Smaller, nimble CPG companies are disrupting the marketplace by reinventing home dining, delivery, grocery replenishment and health. In fact, 53 percent of reported growth in US food and beverage came from the smaller players, while only 2 percent came from the largest.1

1Amid the FMCG downturn, small manufacturers are tapping big growth; Nielsen, June 1, 2017.

Traditional CPGs need to figure out how to get to market faster with new products, services and experiences that delight today’s connected, engaged and demanding customers. Yet most are not sufficiently flexible or responsive. They are hindered by complexity across their business. CPGs need to become modern enterprises.

Some CPGs are pivoting to new ways of working across their enterprise to drive new innovation and growth. They are “starting their startups," i.e., modeling themselves after nimble digital companies through creating new, agile, self-organizing work teams. These “pods,” “squads” and “circles” foster innovation that leads to business growth, but getting this approach to take hold in traditional organizations has proven to be challenging.

To gain full adoption of this new way of working, and to unlock value, business transformation must start at the top. The CEO, CFO and CHRO need to team to create a fundamental shift in operating model, ways of working and talent.

Three actions can help executives increase the viability of their own company’s startup model.

Adapt the workforce model

CPGs are at various stages of readiness. Many organizations have tried to move to new ways of working by adding “innovation” as an extra project for their top talent. Not surprisingly, this hasn’t led to desired outcomes. To work effectively, the startup approach requires new workforce models integrating employees, machines and freelancers. Some leading companies are successfully creating their Future Workforce models by freeing people to focus on innovation and delighting consumers through the gradual transition of transactional activities to robotics and AI. They are also enabling an on-demand workforce through creation of flexible talent pools.

56%

of CXOs cite the growing skills gap as the top factor for their workforce strategy

Successfully shifting to these new workforce models requires organizations to fundamentally change how work gets done, how teams are organized and how people are measured.

Build new skills and capabilities for a new era

For people and technology to collaborate more closely, companies will need to equip employees, managers and leaders with new skills and capabilities. According to Accenture research, approximately 35 percent of the skills demanded for jobs across industries will change by 2020. And, 62 percent of workers say it’s important to develop their skills to be able to work with intelligent machines in the next three to five years.

Top initiatives CXO’s are taking to prepare their workforce to work more effectively with AI:

25%

are implementing new training offerings to build new skills

22%

are conducting advanced workforce planning taking into account future skills needs

Some of the needed skills will already exist among the core workforce. If not, companies should aim to radically reskill employees. With an “intrepreneurial mindset,” employees will take greater control of developing their skills through continuous learning. Businesses should provide employees easy access to digital learning, experts and learning on the go opportunities. The freelance or adaptive workforce can fill in the gaps, facilitating access to rare or difficult to source talent.

CPG companies must use the inherent strengths of both people and intelligent technologies to create a powerful advantage.

There is a substantial difference between CXO’s perception of their workforce’s readiness to work with AI versus executives who say their company is significantly investing in reskilling their people:

31%

believe their workforce is ready to work with AI, but only…

1%

plan to increase investment in reskilling programs significantly

Make the shift sustainable

All areas of the business—not just HR—must support and organize around the new workforce model. If they don’t, it will likely be stifled or fully rejected. Having a universally understood organizational purpose, supportive operating structure and data-driven guardrails will enhance success. The business leaders must figure out how the “startup” mindset and processes fit in the larger whole, i.e., culture, governance, metrics and rewards.

The culture will only change if leaders are walking the talk, demonstrating new ways of working. It starts with encouraging an innovative and agile culture, that includes:

  • Promoting radical transparency.
  • Removing barriers rapidly.
  • Supporting failure and encourage learning.

CXO workforce related challenges:

32%

say insufficient digital skills amongst top leadership

31%

report difficulty administering change programs

Start today

Consumer goods companies can’t wait to find new avenues for growth. Digital disruptors have already found them. Now is the time to invest in transforming the workforce to deliver value in new ways. Begin by finding an area in the organization where you can test new digitally enabled ways of working. Start small, experiment with new approaches and recalibrate along the way.


About the research

Our research explored the challenges that CXOs and employees face in creating new ways of working.

  • Accenture research surveyed 100+ CXOs from large consumer goods companies in 11 countries.
  • Additionally, 1,600+ workers across industries were surveyed.
  • The research also included qualitative interviews.
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