The Future of Work and the NEW Employee Experience Andrea Walsh and Amy Futerfas September 14, 2017

Stand-up if you utilized Artificial Intelligence this morning… Will you tomorrow? © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

Our world is changing Always online Connected Ready access to information Everything is personal Technology is everywhere © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

And the pace of change is unprecedented 75 Years 38 Years 13 Years 4 Years 10 Days © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

If Facebook were a country, it would be the third-largest in the world. Source: facebook.com. © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

The number of text messages sent and received in one day exceeds the population of the planet. Source: wikipedia.com. © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

Demographic shifts are happening Baby Boomers Generation X Generation Y Generation Z Age in 2017 53 – 71 Peak population size (U.S.) 79 million (1999) Individualistic Loyal Career-focused 38 – 53 66 million (2018) Entrepreneurial Self-reliant Globally minded 22 – 37 81 million (2036) Group-oriented Idealistic Socially conscious 7 – 21 Peak population size (U.S.), estimated 60 – 70 million (2052-2055) Realistic Aware Technology native * 1946 – 1963 1964 – 1979 1980 – 1995 1996 – 2010 Z Y X Source: Pew Research Center tabulations of U.S. Census Data; WTW estimates © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

Baby Boomers are retiring at the rate of one every 9 seconds between now and 2029 Source: USA Today Money © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

The average U.S. student today will have 10 to 14 jobs before age 40. Source: U.S. Department of Labor. © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

And there are talent shortages and surpluses around the world The gap between the growth in demand and the growth in supply of talent, 2011 to 2021 Trend deficit Trend surplus Broad balance Source: Oxford Economics © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

Work is evolving Features: Features: Features: FOURTH INDUSTRIAL REVOLUTION/ SECOND MACHINE AGE THIRD INDUSTRIAL REVOLUTION/ FIRST MACHINE AGE SECOND INDUSTRIAL REVOLUTION Features: Underpinning for Coase’s theory of the firm Companies as social institutions Organization of work into jobs Jobs as careers Features: Technology enablement and the web Companies as the nexus of contracts Streamlining of jobs to enable outsourcing Features: Mobile, sensors, AI and machine learning Companies as platforms Disaggregation of work into activities Talent on demand 1960s – 1990s “Nikefication” and core competencies Late 19th – early 20th century “The assembly line” 2000s – “Uberization” © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

Robots and Artificial Intelligence are displacing certain types of work © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

While new jobs and work are emerging AI Ethics Evaluator Robot Trainer Virtual Culture Architect Data, Talent and AI Integrator Cyber Ecosystem Designer Source: CHREATE Consortium © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

What percentage of children entering school today will end up in jobs that do not yet exist? Answer: 65% Source: Scott McLeod and Carl Fisch, quoted by World Economic Forum Future of Jobs Report, Davos, 2016 © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

Traditional employees Artificial Intelligence There is a plurality of means for getting work done and the use of non-employee talent is rising Traditional employees Outsourcing Artificial Intelligence Robotics Free agents Talent platforms Volunteers Alliances © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

CALL TO ACTION: work to be done, the skills needed, and how we match talent to work is continuing to change The OLD… © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

A whole eco-system for finding work, skills and talent exists outside of our companies The NEW… #Bot Excel C# Java Cloud Python © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

THE OPPORTUNITY: Can we create this ecosystem inside our companies? AT HOME (LinkedIn, Glassdoor, etc.) AT WORK #Bot Excel C++ Java Cloud Python © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

With all of this comes People Risk The trends we’ve discussed impact talent productivity and quality… 1 2 3 Skill Shortages Contingent Workforce Alternative Work Arrangements 4 Workforce Wellness © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

The future of work requires that we continue to modernize rewards Who Where/How When Digital skills, millennials, part-timers, contingent Remote teams, virtual collaboration & AI Always on How do we compete for this talent? What programs do they need and want? How do we create consumer grade experiences? How do we enable remote teams to be productive? What programs do we need to support people in remote locations? How do we manage “always on” stress and productivity? How do we help the workforce balance work and life? © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

Top Ten Total Rewards Themes Strategies to drive engagement and reduce risk . Align to Worker Value Proposition Expansion of digitization in total rewards delivery and experience Pay for work vs. Role More tailored total rewards with increased choice for workers Renewed focus on financial wellness Continued focus on wellness Expansion of Voluntary Benefits Measuring what matters with total rewards analytics Rebirth of variable pay Emphasis on work environment To reduce talent risk: treat employees like consumers. 70% believe their organization should understand them to the same degree they are expected to understand external customers. © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.

Contact Information Andrea Walsh, FSA Texas Practice Leader, Talent Line of Business 811 Louisiana Street, Suite 2200 Houston, TX 77002 T 832.525.2697 E andrea.walsh@willistowerswatson.com Amy Futerfas Senior Consultant – Talent & Rewards 500 North Akard Street, Suite 4100 Dallas, TX 75201 T 214.530.4208 E amy.futerfas@willistowerswatson.com © 2017 Willis Towers Watson. All rights reserved. Proprietary and Confidential. For Willis Towers Watson and Willis Towers Watson client use only.