By Tom Jackson, originally published in SBAM’s Focus Magazine
Gartner, the world’s leading information technology research and advisory company, surveyed more than 800 Human Resources (HR) leaders across 60 countries and all major industries to identify their priorities and challenges for 2023. The largest share of respondents put “leader and manager effectiveness” on their list, but many HR leaders also prioritized organizational design and change management, employee experience, recruiting and the future of work.
So, what is driving these priorities? First, executives are faced with a triple squeeze which includes:
- Rising Inflation: 90 percent of executives expect it to remain high or rise over the next 12 months.
- Scarce and expensive talent: 50 percent of HR leaders expect increased talent competition over the next six months.
- Global supply constraints: 48 percent of CFOs expect supply chain shortages to continue well beyond 2022.
These factors are setting the stage for significant HR challenges. The money and resources needed to address many of the internal HR issues facing companies in 2023 will be considerably more constrained if the economy falls into a recession or goes through a contraction.
From HR’s perspective, this means that trade-offs need to be made while navigating through these volatile times. Not only does HR have to manage investment in people but they will have to increase investments in technology to continue their digital transformation. This will allow them to integrate their company data and perform the necessary analytics to drive company performance and the employee experience.
In years past, the battle to balance cost savings versus talent investment, or business requirements versus employee needs, would be handled relatively easily. There are hundreds of case studies that have been created over the last 50-60 years that effectively addressed these dynamics, but it is different now as evidenced by the struggle to get employees to report back to brick and mortar or to stay engaged with the organization. Clear examples of this problem of “returning to normal” can be found in the social media technology sector.
Employee expectations are different, and they are impacting the tried-and-true formulas of the past. To attract and retain employees in this new enlightened business environment, HR leaders must now factor in:
- Flexibility: 52 percent of employees say flexible work policies will affect their decision to stay at their organization. This can be demonstrated in the struggle at Twitter.
- Shared Purpose: 53 percent of employees want their orga- nizations to act on issues they care about. In the past two and a half years, there are many examples of companies that have become more active in social issues than in previous years. Some examples are successful, and some are not.
- Well-being: 70 percent of companies have introduced new well-being benefits or increased the amount of existing well-being benefits. This increases employment costs for the company.
- Person-first experience: 82 percent of employees say it’s important for their organization to see them as a person, not just as an employee.
Because of these paradigm shifts in what employees are looking for and what they want from their employer, HR will have to rethink what their organization looks like and how it supports its employees.