Workforce 2020: Are You Prepared?

At this time of year we are all busy planning for the year ahead. All business functions are considering what their strategy will be, what they want to achieve, how they’re going to get there, what the gaps and risks are. Shared services functions are no exception. For HR, one of the key thoughts is around whether you have the right people in the right jobs to help drive the outcomes the business requires. However, for forward thinking organisations the thought needs to be way beyond simply planning out the year ahead. What about 2, 3, 5 years ahead? With huge changes afoot in the way people work, where people work, the global nature of business, increasing speed of innovation and the impact of this on skills and significant shifts in workforce demographics, is your business really prepared for the workforce of the future? New research from Oxford Economics, supported by SAP, confirms that companies are not addressing their workforce strategy for 2020 with sufficient urgency. The study found that only one-third of the 2,700 executives surveyed believe that they have made significant progress in meeting workforce goals. The findings lay out what HR, as well as C-level executives need to change in order to manage the diverse, mobile and multi-generational workforce they will have to drive their business in the future. It’s time to rethink your people strategies. Here are the top insights from the study which may help you in your preparation for your workforce in 2020: HR knows it needs to be a strategic business partner and develop their workforce strategies, but progress is slow. Whilst over half of executives responded that workforce issues drive strategy at the board level, still 25 percent, indicated workforce issues are often an afterthought in business planning. The 2020 workforce will be increasingly flexible, with 41 percent of executives suggesting that their company is increasingly using temporary, freelance ‘contingent’ workers. However, our research suggests that an alarming number of companies don’t have the structure, strategy, culture, leadership and resources needed to manage a diverse, contingent, and multigenerational workforce. Revamping your talent strategy and addressing leadership gaps are clearly necessary for success. But leaders also need to engage the workforce and relate what people do day-to-day to the outcomes the business desires. This is where HR plays a critical role – HR is uniquely qualified to ensure that people strategies support the chief executive agenda throughout the business. Gaps in leadership capabilities spell trouble for future growth. Guiding, engaging and ultimately maximizing the opportunities presented by this rapidly changing workforce require specific leadership skills. Perhaps the most concerning finding from the study was that many executives suggest that a lack of capable leadership is one of the top factors hindering their ability to build the workforce they need for the future. Only about half (52 percent) of executives say their leadership has the skills to effectively manage talent or inspire and empower employees. But why, you may ask? It is evident that many companies are not cultivating leadership from within their organisation. Executives suggest that employee loyalty and longevity are negatively impacting their workforce strategies and goals, yet nearly two-thirds (64 percent) of employees surveyed suggest that succession plans and commitment to continuity in key roles is not being addressed by leadership. Companies don’t understand what their employees want. Exclusive gym membership and free food may look good on paper when developing a benefits ‘package’, but our research shows that these and other workplace perks are not as high on the priority list for employees as some HR departments may think. Unsurprisingly, when it comes to satisfied employees, yes, you’ve guessed it, compensation matters. A lot. Yet, only 39% of executives say that their company offers competitive compensation. This misalignment is certainly one to consider for future workforce strategy. A shortage of skills is already being felt and will continue. Despite the global talent pool, companies are finding it increasingly difficult to acquire the skills they need to drive their business strategies. At the same time, they are not investing enough in developing talent from within their organisation. Demand for skills in analytics, cloud and programming/development is slated to grow sizably over the next three years. However, less than half of employees expect to be proficient with most of these technologies within that timeframe. For employees, skills obsolescence is a bigger concern than layoffs, with 40 percent of employees of all ages saying that this is their top concern. To help employees build the skills needed, companies should work to establish and nurture a culture of learning. Only 41 percent of employees believe their company offers them opportunities to expand their skill sets. With roughly half the executives interviewed agreeing that their company is capable of retaining, updating, and sharing institutional knowledge, still only 40 percent responded that their companies offer formal programs, such as job rotation and shadowing. So, during your 2015 planning, be sure to key your eye on what lies further ahead. HR will play a pivotal role in helping the business to address new ways of working, communicating, collaborating, and innovating. Are you ready? Is your business addressing these issues and preparing for the workforce of the future? To learn more about how your company can better prepare for the workforce of 2020, download the full research results. [eventpdf] [Note: if you liked this article, please use the buttons on the left side of the screen to share it across your LinkedIn groups – and contribute to this discussion by posting your thoughts in the comment section, below. Thank you for being part of SSON's community - Barbara Hodge]

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