HR is continuing to mirror the rapid evolution of business, with a growing pace of change and new technology trends and social issues rising to the forefront of the HR landscape. These are some of the key trends our consultants have been observing that will continue to evolve for HR leaders in 2019.
Whole-of-Life Employer Responsibility and Mental Health
As the lines between work and home life become increasingly blurred, organisations are recognising that they need to take a whole-of-life responsibility for their employees, and extending support to areas that have been traditionally considered beyond the scope of the workplace. In particular, as the economic costs to businesses relating to poor mental health continue to rise, mental health is becoming one of the critical new frontiers for employee engagement and support, as well as organisational productivity and success. In the United States, the National Alliance on Mental Illness estimates that one in five adults will experience mental illness in any given year, with an annual cost to the economy of USD 193.2 billion in lost earnings. HR leaders are spearheading programs to increase support for those with poor mental health far beyond the traditional employee assistance programs, and are becoming much more proactive in building preventative approaches. Supporting employees to manage their stress levels and work life balance, improving managerial and leadership approaches to support this, and employer-provided mental health services, are all critical components of these approaches.
New Workforce Models
In 2019, HR leaders are continuing to embrace new ways of working and different organisational models, scaling up from what started off as smaller trials to rolling these approaches out right across the business. Dispersed Management Models Some organisations are embracing holocracy and highly dispersed management models, as well as a ‘democratic meritocracy’ approach. These models emphasise increasing employee responsibility at all levels to help improve engagement, innovation and responsiveness to customer needs, and reflect a broader societal shift towards a more broad-based, democratic model of leadership and change. Agile Working As workplaces and technology continue to evolve rapidly, HR leaders are recognising the need to permanently adopt an agile way of working rather than just confining this approach to specific projects. Whilst many businesses are still trialling agile in relevant pockets relating to technology, organisations such as ING have recognised the value of this approach being embedded right across the business. This has an impact for HR leaders in terms of both the structure of the organisation as well as the way people work, with a shift away from permanent structures to teams comprised of ‘floating’ specialists that come together for specific projects. The Gig Economy Companies are shifting to take advantage of the new gig economy, and the opportunities it provides for both employers and employees to respond to rapidly shifting needs. However, this then creates challenges for HR leaders in terms of how to immerse short-term workers within an organisation’s culture and ways of operating. Some are also grappling with how to ensure these workers have the protections and support they need in order to not inadvertently create further inequalities for this group of their workforce. Whilst some organisations embrace the gig economy, larger organisations will also continue to emphasise highly mobile internal workforces, giving employees more opportunities to move between different areas of the business or globally to improve engagement and help retain talent. This includes self-designed career paths with more opportunities for re-skilling and lateral shifts.
HR Leaders as Business Leaders
As businesses change rapidly, how employees adapt and lead the way will have a huge impact on future business success. This is reflected in the highly competitive market for talent, but also in the growing shift of HR leaders to become the driving force for business transformation. HR leaders are increasingly playing a critical role in transformation projects including digital/technology transformation, agile working and improvements in business performance. They are also stepping up into COO and CEO roles or moving onto boards, as boards and CEOs continue to recognise that their people hold the key to taking their organisations into the next era. We are also seeing a growing demand for CHROs that can also think like a CFO, CMO or COO, have an in-depth understanding of the business and its financial drivers, and can act as a key interface with the board and broader marketplace. Our new podcast with Carin Knickel, former Vice President of HR for ConocoPhillips and current director on a range of boards, provides CHROs with insights on how to build stronger board relationships and how to position yourself for a future board role.
Sharper Focus on Social Impact and Sustainability
Building a Sustainable Workforce HR leaders are taking a long-term view in the sustainability of their workforce, and building longer-range strategic plans, particularly for talent acquisition and development. This includes:
- mapping broader external talent landscapes including talent pools that are adjacent to their traditional space, and building long-term talent pipelines
- more in-house training programs and a continuous, lifelong learning approach
- personalised career mapping that reflects a grid rather than a ladder, with a range of development opportunities along the way
- a shift to building new types of skill sets, rather than purely technical competencies, which focus on agility and innovation, as well as creativity and collaboration for complex problem solving.
However, in 2019 HR leaders will also continue to have to balance this with immediate requirements and pressure from the business to rapidly hire the best talent in a competitive market, and quickly upskill their broader workforce to respond to changes in technology. Social Impact as a Differentiator Businesses are continuing to look to differentiate themselves in the marketplace for both consumers and employees by evaluating their focus on social impact, and this will continue to rise to the fore of business considerations in 2019 and beyond. HR leaders are driving this charge through their emphasis on diversity and inclusion programs, pay transparency, a living wage and personalised benefits, particularly in countries like the US where companies often lead the way for workplace changes rather than government regulation. HR is also increasingly taking responsibility for CSR over traditional PR functions, both as a vital talent acquisition and employee engagement tool, but also as a lever to help achieve greater business results and build sustainability into an organisation’s long-term business plan.
Fulfilling the Promise of the Next Generation of Technology
There has been a lot of hype over data and new technology, such as AI and automation. At present, HR applications tend to focus on the use of AI in talent attraction and selection. This includes using word meanings or clusters of words to help select, categorise and rank people in application tracking systems. AI is also being used to reduce bias, for example tools such as Textio and Ellpha can review job advertisements, websites and candidate portals to help remove bias and increase the diversity of the applicant talent pool. On the automation front, we are seeing more basic scheduling applications, such as using chatbots to help set up interviews and onboarding programs, as well as self-service HR for common queries such as payroll, insurance and leave. In the future, we may see AI programs expanded to areas like predictive analytics to help predict workforce needs and employee behaviour, as well as personalisation of employee engagement. In turn, this will continue to raise privacy questions for HR leaders relating to the availability of employees’ data, such as their mental health needs. Additional questions relating to technology/AI and its impact on existing issues, such as gender and whether particular applications reduce or reinforce existing biases, will continue to surface and need to be worked through. 2019 holds exciting promise for HR leaders, with a range of strategic opportunities as HR takes a more critical role in businesses than ever before. However, this comes with a host of new issues for HR leaders to grapple with, in amongst existing daily business challenges provided by a competitive global marketplace. We look forward to continuing to discuss our ongoing insights into HR current issues and trends with you at our ChapmanCG HR leaders roundtables throughout 2019.
