How AI Is Reshaping Leadership (and Why Agility Matters More Than Ever)

David Rice: How do values and culture actually reinforce confidence in sort of high pressure moments?

David Jones: The disruptive fact of AI is gonna take all the routine and the mundane and the predictable work away from human beings.

David Rice: What should leaders do different?

David Jones: You are gonna have to demonstrate judgment almost on day one of your career, because I'm not legally liable because I'm an AI bot.

David Rice: Most organizations don't really suffer from a lack of leaders, right? They suffer from a lack of aligned followers. What's the biggest cause of that?

David Jones: We are seeing elites over production to much of a focus on leadership. We forget that 93% of our organization and its performance is dependent on the other people, the followership.

David Rice: Welcome to the People Managing People Podcast — the show where we help leaders keep work human in the era of AI. I'm your host, David Rice. And on today's episode, I'm joined by David Jones. He is the CEO and a Partner at Mercer Assessments and a labor market economist with decades of experience studying how people work.

In this conversation, we unpack what leadership agility really means in a time of rapid change from dark matter analogies in the night sky, to how AI is reshaping careers before our eyes. David shares a fresh framework for modern HR leaders to focus on productivity, positivity, people, and purpose, while challenging the overproduction of leadership at the expense of followership.

We also get into what's broken about traditional career ladders, how talent assessments are evolving to become GPS systems for skill building, and why employers must rethink their role as educators in a post-industrial workforce. So that's a lot to unpack. Let's just get straight into it.

All right, David, welcome!

David Jones: Thank you David. Great to be on on the podcast.

David Rice: Absolutely. Hey, you're in the UAE, correct?

David Jones: Yeah, I'm based in Dubai.

David Rice: Now, where are you from originally?

David Jones: So I'm from the UK from a region called the West Country.

David Rice: Oh, okay. Yeah. Devon and all that.

David Jones: Somerset, Devon. You got it, yeah.

David Rice: Okay. How was that adjustment from Devon to the UAE?

David Jones: Yeah, interesting. Well, I've lived here almost 30 years, so I've probably forgotten. But I think the great thing about Dubai is it's a very multicultural place. And so I think there's a sort of natural curiosity and a natural sort of mixing of food and culture and I think it's always an interesting place.

It's got many layers to it. If you've ever visited Dubai, you'd have seen some, but there's always something new to discover, sometimes Surprising.

David Rice: That's interesting. Yeah. I mean, 30 years you've seen Dubai change a lot then?

David Jones: Yeah. Massive.

David Rice: Well to to get the ball rolling for us, you know, I first wanna ask a question that will hopefully just sort of set the table for where this conversation goes, and that is because we're talking leadership agility.

What does agility look like in the context of modern HR leadership and what's driving its rise right now?

David Jones: I think for me, there's probably four anchors to the agility, if that's not a contradiction, because I think if you as an individual or an organization can have a very clear view of some of these aspects.

It helps you to be agile around that. Just the same as if you're doing tai chi or yoga, right? You need like a strong center and then you can build the agility around that. And I think it's very important to understand as an organization, if you are HR professional or people professional, what does productivity mean today and tomorrow, not necessarily yesterday.

So I think productivity is one p in the mnemonic from my perspective, which is really important, and I think you really have to constantly question that as a professional because that is changing from customer base, from your colleagues, from a demographic perspective, many different aspects to that.

Increasingly, I think we are seeing that people are choosing whether or how they want to work in a way that's probably different to previous generations. So I think. Understanding as an individual and an organization about what supports your positivity, I think is the other aspect. Because if you understand that, then you can seek examples and instances and situations that are gonna help you to thrive in your productivity and your positivity.

So I think that's important. I know is one of your themes, but I think people is the third P, right? I think in the past, I think as a profession, HR or people professionals have focused too much on the sort of resourcing side of the equation and not so much on the humanity side of the equation. And I think if you take a step back and try and be philosophical about this work, especially the way we've worked in the last 150 years in the Western world, is a human construct, right?

We've created these organizational structures and these processes and these best practices, and we've done that for a reason, and that reason has been very clear in the past. If it's still clear today, great, let's carry on and do that. But if that's not necessarily relevant for today or tomorrow, then I think we need to make our organizations more people focused.

And then finally, I think individuals and organizations, if our lives are getting longer, if technology is sort of taking over a lot of the routine aspects of work, then often we get to question what is the purpose of doing this? Right? So I think fundamentally that's gonna be the most important of the four Ps.

Work is supposed to fulfill a need that we have as human beings, right? So what is that need? Let's understand that. How does that satisfy us? In a broad sense. And is that something which is pro-social or you know, pro health individual? You know, all these things I think are very important. If we understand those, then I think we can actually be much more agile.

David Rice: So you bring up the humanity piece there and I couldn't agree with you more obviously, because like you said, it is one of our themes. Well, there's this case for recentering HR on humanity over process. I'm curious. Take me through what you think we mean when we say that, and what does it take to operationalize that without sacrificing consistency or compliance, a lot of the things that HR has always been focused on?

David Jones: I mean, I think we have to be realistic if you are in aviation or you are in heavy engineering type of environment and safety and compliance in all sorts of fields is obviously critical, right? That's got to be something which is allied to your sense of purpose and to your productivity, and you as an organization and your culture or individual and your personality needs to be matched.

That I think there is a, from having human resources focus a lot on processes, policies, practices, to thinking, okay, let's try to create more resourceful human beings. Or to promote the creation of more resourceful human beings by giving really great, challenging, stretching, fulfilling job opportunities or task opportunities rather than just to focus on the traditional sense of human resources.

David Rice: Absolutely. Refocusing on leadership here, you know, leadership gets a lot of the airtime, right? We talk about 'em all the time. Absolutely. And they're the ones making the news a lot of the times, but. You kind of hinted that most organizations don't really suffer from a lack of leaders, right? They suffer from a lack of aligned followers.

So I'm curious, what's the biggest cause of that? And is part of it, that company is kind of overindexed on celebrating individual ambition sometimes at the cost of collective accountability. Right.

David Jones: I think in, whether you're in the US or you're from a Western cultural background generally, then we are quite individualistic, generally speaking.

Well, no, it's a bit of a stereotype, but I think there's a foundation of truth behind that. The way that I think about it is I, in my spare time, I'm a astronomer, right? Living in Dubai. In the winter time when it's cool enough, you get to go camping in the desert or mountains, you get a fantastic view.

And what's really interesting, astronom, I think this can also apply at organizations as well, is that in the last couple of decades, astronomers realize that not 3% of the known universe is made up of what we call dark matter. So this determines the behavior of the entire osmos, including our planet. But we know virtually nothing about it because what we do in astronomy for centuries and for millennials do what we do in organizations is we focus on the bright, shiny things in the sky, right?

Or we focus on the loud leaders who tend to take the focus of attention, right? And we create all sorts of constellations and all sorts of myths around this. And what we forget, and maybe five years ago during COVID, we got a sort of sharp wake up call. We forget that 93% of our organization and its performance is dependent on the other people, the followers.

So working in a multicultural place like Dubai especially as well, I think creating followership is just as important as creating leadership. Right? And this combination of the two I think is really critical. I think the other aspect to your question, which I think was really interesting, I just finished a book last week by a guy called Peter Turchin.

He's a ecologist by background, so he used to study insects and their population rise and fall, and he became a political anthropologist. And he looked at history right over millennia and he said, look, there's two factors by which you can predict the rise and fall of nation states or tribes or empires throughout history around the world.

One is what he called elite overproduction, and I think that phrase elite overproduction might apply to leadership hierarchies in some organizations. It occurred to me that it might anyway, right? If you create a long career ladder, if you create a very busy hierarchy, if you focus on these aspects, then it can create an elite overproduction within the organization.

And then relatively speaking to that elite overproduction, he talked about this other factor called the mass immiseration, which sounds really terrible, but if relatively speaking to the leaders, you are not focusing enough on resources and reward and recognition for the 93%, then you can create a cultural problem within the organization.

And these tensions create the background for competition to have an increasing likelihood that they would yeah, take your market or take your geography and you know, you would be likely to predict the problems going forward. So I think that's another way to think about it. So yes, I think that historically there has been too much of a focus on the top of the organization.

I think some of what's happening in talent assessment, which is sort of my area of expertise at Mercer assessments. We're trying to use technology to democratize talent assessment and talent development in a way that was not possible before, but I still think there's a long way to go.

David Rice: I love the astronomy analogy. That was great. You must have a good view of the knights guy out, but I couldn't agree more that I love that term mass immiseration. I'm gonna have to borrow that one because I think we, we see this not just, you know, stealing your market, but stealing your talent and your people. We hear a lot about sort of, all these studies coming out, you know, and people are unhappy at work, and I think that creates a scenario where they'll only take so much of it after a period of time.

They're gonna either look for something else to do, or they're gonna look for another outlet for their creativity, their productivity, all of those things. That's a huge factor in what I think isn't driving results today. Kind of going back to productivity now, you said to me before this when we were chatting that confidence and confidence are often the biggest barriers to productivity.

So, big, shiny leaders in the sky. Right. What should leaders do different to nurture both, right? Like how do values and culture actually reinforce confidence in sort of high pressure moments?

David Jones: Well, I think it's really important, right? And I think it's really important for positive reasons and for negative reasons, right?

I think you alluded to some negative reasons, right? I think we can all think, you know, we just go into Glassdoor and we can see those organizations that probably have got. The sort of surveillance or the monitoring or the sort of mass immiseration of their workforce wrong. Right? They've put the focus in the wrong place and they've literally treated humans like resources rather than members of the same species.

Right? So it's really important that we recognize that, right? I think, but also from a positive point of view, and even just from a technology point of view, right? I'm not an expert and I can't predict the future, but one of the things that seems. AI is gonna drive and is already driving is a massive change in the broad structure of people's careers.

Right. So, I dunno how old you are, but I mean, in my career over, you know, several decades and with my friends and my family, there's basically. You know, a commonly held or commonly expected structure, right? You start off in a junior position, you do the grunt work, whatever that might be, whether you're a blue collar, white collar, but you do a lot of very mundane routine, labor intensive jobs, and you are inducted into a culture, or you have to prove yourself that you can go through that.

It's almost like a hazing process in many way, in some professions. And if you thrive or survive that process after several decades, slowly you get to manage other people to take responsibility for things to get to set more priorities, and the most focus is on, okay, that's a really well trodden path to build competence.

But what's actually happening at the same time is you're building confidence. You're saying, okay, yeah, I've got this many years experience. I've dealt with this situation before. I've built judgment. I've built a portfolio of experiences, and now I can be trusted by my clients, by my colleagues, by my organization, to do the right thing.

The disruptive fact of AI in many organizations, not in every type of role, but it's gonna say, well, we are gonna take all the routine and the mundane and the predictable work away from human beings. And what does that mean? Well, that means that if you are human being, you are gonna have to demonstrate judgment, demonstrate confidence, be able to use analytical skills, make decisions.

Almost on day one of your career, because you're gonna be confronted by a lot of automated reports, which say, you know, you need to sign off on this because I'm not legally liable because I'm an AI bot, but you are the human being and you are getting paid salary, so you have to sign this off. Now, I'm not sure whether I would be ready to do that when I was 18 or 21, you know, starting my career because I would have no basis of competence.

But also more importantly, I think in the future, or just as importantly, is gonna be this confidence level. So I think the only way we can deal with that as human organizations or. Increasingly hybrid organizations is to say, well, we need to build a culture which is supportive. We need to build a culture, which is a learning culture.

We need to create the right level of positive challenge at the right time based on people's strengths and their skills and their competence to be able to build that and sustain that for the future.

David Rice: It's a fascinating time 'cause we're like, we are in this place, where're like not. How do you build your career?

How do you gain new skills? How do you showcase them, to be honest? Like even just going out and looking for a job, right? We're getting to a place where we all sort of have to package what we're doing differently and staying with that idea that you mentioned there about how we build expertise and how we, like you said, people are gonna have to show up day one and be able to exercise judgment and make decisions.

So I wanna shift into that and talk about talent development and how leaders can build agility across functions. Right. So when we spoke before this, you kind of described talent assessments to me as like a GPS for careers. In a world where AI is changing how people do things, so how do we help people navigate when really the map, it feels like the map itself keeps changing right now, you know?

David Jones: Yeah. Your question made me think about living in Dubai, right? 'cause literally the map does change all the time. Like if I go on a business trip or if I go on a holiday for a couple of weeks and I come back to Dubai, like literally there's a new building or a new road or something's changed. So it made me think about it in a sort of very practical way.

And I think as individuals, if we are gonna be questioning these commonly held. Sort of expected structures and beliefs that we've had around the world of work for quite some time, then we are gonna need a GPS to navigate. Right. And I think the best tool we have right now are talent assessments more broadly to enable people to do that.

Now we need to use talent assessments in innovative ways, because I think in the past they've been too secretive. They've been too. I dunno, non practical, they're not really able to demonstrate practical next steps in the flow of work. So I think there's lots of steps that we're trying to take to trying to improve that situation.

But essentially what you need to know is, okay, what am I good at? What do I want to achieve? What satisfies me? What helps me to survive and thrive in my working environment. And as that changes and it will change, I think increasingly quickly, and at Mercer, we think there's gonna be an increasing shift away from roles into more sort of atomistic skills as being really important in people's work going forward.

So you're gonna need increasing acuity of the GPS to be able to say, look, you know, you've just done this today. And this was how you performed against a standardized benchmark. And this is something which you can improve on if you want to, if this is something you're really dedicated to or this is something that you could shift towards in a different function where those skills could have equal or greater impact.

So I think having a more flexible approach, something which is in the flow of work, something which is more like a sort of meaningful personalized. Avatar, which helps you to understand, and it's yours, right? It doesn't belong to your organization or to the gig work provider or to, you know, your current educational institution or whatever, whoever might be paying for it.

It belongs to you as an individual and it's gonna help you to understand yourself, build self awareness, but also, again, around your theme of agility help you to make better decisions more quickly.

David Rice: Yeah, it's an interesting time. I mean. You mentioned it there, and it's something that I keep coming back to, like the traditional career ladder, the old contract that we always had, right?

It's gone, it's disappeared, and then what's replacing it, right? I guess how can we equip people for non-linear skills first career? It doesn't rely on 20 years of working your way up anymore. Right. And the people aren't as impressed by your experience. I mean, this is an important question, even for mid-career people like myself, like now, my experience isn't quite as important.

It's really how am I gonna showcase what I've been doing for the last 20 years?

David Jones: Yeah, right. Yeah. I think it's interesting, right? Because it hasn't gone away, right? Like. For the majority of people, you still end up signing or agreeing to or accepting some terms and conditions or an employment contract or something, which has a sort of legally binding aspect to it.

And essentially the core structure is still the same, right? It's whoever is your employer, or whether that's exclusive or whether that's a series of micro employers. They've basically said, look, we are gonna pay you X amount. For either a certain number of hours, so renting a certain amount of your time.

Okay. If you are in a traditional sort of core employed status type of job, or we are gonna pay you a certain amount for producing a certain amount of X, right? Whatever that might be. So fundamentally, that contractual arrangement's not changed, right? And I don't think. This is part of the challenge, I think.

I don't think a lot of legal structures or institutions, educational environments are able to change fast enough to recognize the facts that actually the experience has changed quite dramatically. So I think it's a little bit like archeology. The foundation is still there, right? Like there's still, it's not like we've fundamentally taken away what was there before.

We've just built on top of it. And that when you're in a workplace where you've got people with different generations or different cultures. That can often inform different expectations, which can be really interesting or very challenging depending on the situation. That's one aspect. I think the other aspect is I think there's probably a narrow path to navigate, right?

Whether that's from the organizational perspective or whether that's from the individual perspective. 'cause on the one hand you want to have that type of arrangement and that type of mutual expectation, the psychological contract that we are committed to each other and you know, we're going to expect some emotional labor from you and we are going to give you, in return some loyalty or this magical thing called a career.

If that is clear and that's called out, then that's great. That's really good. Right? And there are still lots of people who have that type of arrangement. But I think it needs to be more transparent and I think the way that work is changing, the way it's focusing much more on these micro skills rather than here is a role that we expect to exist in perpetuity and we're gonna write a job description in 1993 and expect it to be relevant in 2025 or 2035.

You know, that is certainly being challenged.

David Rice: Yeah, absolutely. Well, you mentioned another piece there that I want to touch on. How we educate right? Education seems to be losing ground around particularly real-time skills acquisition, right? So what does that mean for employers and what systems or tools do you see sort of stepping in to help us close that gap?

Is it time for employers to essentially become educators themselves?

David Jones: Probably the short answer is yes. I think it's more complicated than that. I think it's one really important example of where, as we mentioned earlier, the sort of institutions or the legal frameworks are not changing fast enough to sort of stay relevant.

Unfortunately, education as a whole, again, you know, there's a whole spectrum. It's not like this is true of all education, but as a whole is really struggling to keep pace with that. And I think it's not black and white. I think this sort of traditional academic type of credentialing that education used to perform, I know from our clients, part of the reason why they want to use our services is it's not fit for purpose anymore, right?

They're saying, okay, we wanna hire graduates. Yes we do. And we wanna hire graduates that have completed this type of study. But their certificate or their projects that they worked on, that's not good enough, right? That's not helping us because the questions or the assignments that were set, were not set for the questions that we are dealing with today or tomorrow.

So they need to have something which is more agile, which is more relevant to their priorities. I think a lot of individuals, a lot of young people are also wanting that. They're wanting something which seems more relevant and doesn't seem so didactic and so sort of curriculum driven. They're much more focused on use cases that are relevant to their experience rather than the traditional sort of textbook type teaching.

I think what's really interesting and where the most flexibility is the, in the vocational space, so in the UK we have this called apprenticeship. So you can say, look, I'm not gonna take the academic route. I'm gonna take the sort of vocational route. And that can be recognized as the same, although culturally, probably not.

But in terms of the academic qualification, the same as an academic qualification. You are also gaining practical experience at the same time, and I think increasing numbers of people are choosing to take the vocational route, particularly in technology and other aspects. I know there was a really interesting study done in the UK a couple of years ago that said, okay, if you take an 18-year-old, and you said, okay, one person is going to train to become a plumber in an apprenticeship with a vocational qualification.

Another person's gonna go the academic route and train to become a lawyer, then talk about elite overproduction. Then the plumber would have more than double the lifetime earnings than the lawyer.

David Rice: Plumbers rule the world. I say it all the time on this show.

David Jones: Well, yeah, absolutely. If you've got a leak, then they definitely do.

But what that illustrated to me is, look, my academic background's a labor market economist is. What we've got to do is try and match the tasks and the roles that we need to get completed with the skills and the aspirations of people. We need to be more efficient. Just like any market, whether it's a stock market or a fish market, the labor market's the same.

What you need is really good quality information in order to help you to make better decisions. That's market efficiency in any market, and that's also true of a labor market.

David Rice: I love that you brought up apprenticeship. You go all the way back to my first episode hosting this podcast. That's where I took over.

The very first thing I did was an episode about apprenticeships. Because it's underused here in the United States, we don't value it enough and I think it's a great way to get. People into the workforce and learning while making a living, which I think is big part of everything right now, so.

Well, David, I wanna thank you for coming on today. This was a good talk.

David Jones: Thank you. No, thanks for the opportunity. It's the questions were very thought provoking. I really enjoyed it. Thank you.

David Rice: Well, before we go, there's a couple things that I wanna do. First is give you a chance to plug anything that you want. It's, you know, tell people where they can find you and learn more about what you're doing.

David Jones: Brilliant, thank you. So, my name's David Jones. I'm the CEO and partner at Mercer Assessments. So you can find us at mercerassessments.com or you can contact me on LinkedIn. David Jones. I think there's a lot David Jones on LinkedIn, but I'm the labor market economist. You'll probably be able to find me there.

So any questions or follow up, I'll be happy to help with that.

David Rice: Excellent. And the last thing that we do before we go sign off every episode is guests get to ask me a question. So I'll turn it over to you. Ask me anything you want.

David Jones: Okay. Brilliant. Thank you. Well, I mean, I know from looking at some of your previous podcasts, I know agility is, as we said before, is a real area of focus for you.

So I guess the question is, apart from agility, so excluding agility, what are some of the things which you are finding as recurring or compelling themes in your discussions at the moment?

David Rice: Well, trust is the big one. Like we, we hear about it all the time because, yeah, I mean, it's hard to be agile and get people to move in different directions if they don't trust you in the be in the first place, and with all the layoffs that have gone on, all the changes that have gone on within orgs, people's roles are changing.

It is just a lot of change surrounding people all the time. Then you're asking them to essentially trust you when they look out in the market, they see a lot of reasons not to. And so, and a lot of leaders don't communicate very well. They don't communicate a grander vision or a sense of community within the organization so that we're gonna help you do this, and this.

You know, it undermines a lot of the agility work that they, the change management work that they want to do, right? Because people just don't quite want to go along. They feel like they're going into a dead end sometimes. So I think that's what probably the big one that I would say is like I hear we get asked about it, we've been asked about it a ton in 2020.

So much so that people that attend our events are like, all right, enough about trust. You know? That's, yeah, because I mean, we've talked about it to, to great length over the last year because it's just kept coming up. So. Yeah, I think that's one the one that I would say stands out the most. There's even like, I'd say like the changing benefits landscape where like getting people to understand compensation structures, like how to communicate that is another one that's come up quite a bit because inflation being what it is here in the US or you know, all over the global economy.

And then you have like cost of living and all these things, and people sort of expect like they're gonna get more money. And that's not necessarily the case, right? That's not the way the business works. So yeah, just even communicating all of that stuff is these are things that we keep coming back into because the economy being so uncertain and sort of the way profit has worked over the last year, like it's fluctuated for some orgs.

And so it's created new challenges in communicating things like compensation or why we made this decision about benefits. Those are things that I see coming up. And then, you know, when those things change, there's, those are the things that like people signed up for.

So, you know, when they change, it sort of changes their view of the whole thing. So yeah, that's what I would say.

David Jones: Yeah. So agility, then trust, communication.

David Rice: Yeah. Well, again, thanks for coming on today and I appreciate your time.

David Jones: Okay, thank you David.

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And until next time, don't just focus on the stars. Remember all the dark matter in between.