Across organizations and in general, there is a growing realization that people are probably the most important investment that any organization can make. Get the people right, and the rest will follow. Buy the most expensive technology, the whizziest headquarters, the smartest tools in the world, but without the right people, you will never realize the full benefit. This is perhaps particularly pertinent in a world where skills shortages are becoming routine, and large numbers of today’s teenagers are expected to be doing jobs that do not even exist at the moment.
There is no question that human resources pose significant questions for many organizations. According to one survey of more than 10,000 HR and executive leaders across 140 countries, the top five challenges for their organization were all talent- and HR-related. They were talent acquisition, performance management, redesigning organizational structure, employee experience, and careers and earnings.
Talent acquisition, management, and retention are top issues
It is not surprising to see talent acquisition in that list, because it comes up over and over again in HR surveys. For example, in a survey by Deloitte, 31% of respondents said that talent acquisition was either important or very important. Getting the right people through the door is essential: without that first step, none of the other issues or challenges is at all relevant.
Similarly, talent management and talent retention also matter: an overwhelming 94% of recruiters expected hiring to become more competitive last year. This trend seems likely to continue, and that means it is probably best to avoid having to recruit if possible, by holding onto your best staff. Many organizations are therefore also considering the use of flexible working, as a way to retain employees who are, for example, forced to move because of a partner’s job situation, or wish to work part-time to support the family or other commitments.
Performance management is linked to talent retention and is concerned with getting the best out of employees, and also getting rid of those who do not perform effectively. No organization wishes to be paying for presenteeism, and nor does anyone want unhappy employees spreading the word about their unhappiness on social media. Performance management, and the linked issue of employee experience, are key to this. Employee engagement can also help, with plenty of evidence that engaged employees are better organizational advocates, and are also less likely to leave.
It is interesting that many organizations were concerned about re-designing organizational structure. The received wisdom is very much that ‘moving the deckchairs’ is not a helpful response to hitting the iceberg. On the other hand, there is also plenty of evidence that the organizational structure and hierarchy do actually matter, because they set the tone for the organization, and give at least some expectations of how the power will operate. Organizational structure, and its redesign, should probably be closely linked to redefining the workforce and ensuring that everyone is able to do their jobs effectively. This includes breaking down silos and making the structure operate properly.
These issues are linked to a number of other HR challenges, including career development and learning development. In a fast-moving environment, everyone needs to be committed to learning new skills and developing both themselves and their careers. However, no organization wishes to support development, only to have their employee leave. For many years, therefore, employee development has been a personal issue, done in spare time unless it was absolutely job-specific. There is now, however, a growing understanding that there are no jobs for life, and everyone benefits from increasing the skills in the workforce.
This includes developing leadership capabilities. Another survey, by Harvey Nash, found that recruitment, developing leadership capability and employee engagement were all top priorities. This suggests that growth, both in terms of headcount and development of people, is high on the agenda.
Process challenges are also important
The final area of challenges relates to HR processes. Automation of processes, from recruitment through to performance management, is helping to improve process management. The use of robotics and cognitive computing, including artificial intelligence, is also increasing. This can help with both performance metrics and people analytics, and these, in turn, help to ensure that the organization becomes and remains diverse, supporting improved performance.
It is important to unpick HR challenges, and really understand what is driving organizational HR choices. Sometimes the obvious challenge is underpinned by other issues that may be even more important, but which are going unaddressed. Getting to the bottom of the issue is essential.