The Future of Human Resources: Navigating the 2024 Workplace Transformation
Andy Caldicott, CEO at Boostworks, explores five key strategies for HR success in a rapidly evolving business landscape
As we stand on the cusp of a new year, British businesses face a crossroads. The challenges and lessons of 2023 pave the way for what promises to be an even more transformative 2024. For HR professionals, the implications are clear: the manner in which we recognise, reward, and engage with our employees will dictate the trajectory of our success.
With that in mind, here are my thoughts on what business leaders and HR professionals need to care about and why they should act swiftly to address these challenges in order to attract and retain top talent within their organisations.
DIVERSITY, INCLUSION, AND SUSTAINABILITY AT THE FOREFRONT
The incoming workforce, influenced by figures like Greta Thunberg, will hold businesses accountable for their DI&S policies. The next generation will demand more than previous ones, driving companies out of their comfort zones. HR will play a crucial role in listening to this new generation, moving quickly to implement practices that reflect these values.
Today's businesses cannot afford to compromise or dilute their ESG and DE&I policies to appease investors. Failing to build an organisation that attracts Gen Z workers will lead to an unmotivated and unproductive workforce, a critical concern for HR professionals and business leaders. With 4.3 million Gen Z now in the workforce (compared to 3.71 million Baby Boomers and 11.4 Gen X), businesses cannot risk alienating highly skilled talent with poor decisions. Recent headlines underscore the consequences of neglecting ESG and DE&I policies, not only affecting their attractiveness as employers but also signalling to other companies that they can do the same. This is when organisations must fully commit to their ESG and DE&I promises; mere compliance is insufficient, and the repercussions are significant.
Unilever and Lego serve as examples. Unilever, a pioneer in sustainability reporting and goal-setting, has recently downplayed corporate purpose, labelling it an "unwelcome distraction" for some brands This shift in focus away from sustainability efforts could undermine their long-term reputation. Furthermore, Unilever's continued operations in Russia amidst geopolitical tensions may raise questions about their ethical stance. Lego, on the other hand, is facing scrutiny for returning to oil-based bricks despite initially exploring recycled plastic alternatives. How Lego manages its sustainability efforts moving forward will be closely watched by consumers and employees. It will be interesting to see how these behaviours impact attrition as well as recruitment across their people, especially amongst the younger members of the workforce. I suspect hindsight will leave leaders shaking their heads at some point in the near future!
THE RISE OF FLEXIBLE AND HYBRID WORKING
HR will face unprecedented challenges as employee expectations evolve. The traditional work environment will be reshaped, with a greater emphasis on flexibility and hybrid models. This shift will demand HR professionals to be not only facilitators but also innovators of change, crafting policies and cultures that accommodate diverse working styles and locations.
While successfully implementing hybrid work for all may present challenges, the benefits extend far beyond alleviating the daily commuting grind. One example, is that it opens doors to assist working mothers in establishing post-maternity leave work patterns, facilitating their transition back to work. This flexibility also empowers fathers to share responsibilities harmoniously, reducing home tensions—an advantage that would have undoubtedly appealed to Baby Boomers during their time as new parents. Despite the recent FT report highlighting continued discrimination against expecting parents in some businesses, we live in an era where technology and tools should render such attitudes obsolete.
Furthermore, as hybrid work becomes the new standard, HR and facilities management teams must work together to rethink the office environment. Traditional open-plan offices are no longer suitable, requiring HR to ensure that the workspace is not only functional but also reimagined to accommodate a blend of in-person and online interactions. HR needs to master both intangible flexible work policies and the physical workspace, creating an appealing and practical setting for hybrid meetings, leaving makeshift setups in coffee shops as the least desirable option for flexible work.
ORGANISATIONAL AGILITY AS A NEW HR MANDATE
Once known for its rigidity, HR has proven its capacity for agility during the COVID-19 pandemic. Moving forward, HR departments will be expected to maintain this agility permanently, becoming proactive agents of change and adapting quickly to shifting business landscapes. HR's role will expand beyond traditional functions to encompass transformation and agility expertise.
In the post-pandemic business landscape, aligning values with actions and offerings is crucial, especially concerning employee rewards and benefits. Personalisation is key to making these offerings resonate on a deeper level, solidifying the company's purpose and fostering a valued workforce. A broader strategy that considers roles, teams, and geographical differences ensures meaningful impact for all employees.
Technological advancements, such as AI, are vital in personalising employee experiences and meeting the expectations of digital-native employees. HR's role is evolving from a traditional 'do-er' to a strategic visionary, with the pandemic accelerating this shift. HR professionals must, therefore, remain adaptable and innovative, crafting holistic experiences that engage every member of the workforce.
To succeed in the future, HR professionals must acknowledge individual employee needs and effectively communicate the value of rewards and benefits. Embracing empathy and analytics, HR plays a pivotal role in creating environments where businesses and employees thrive amidst ongoing change.
DATA-DRIVEN HR (PEOPLE ANALYTICS)
In the next five years, HR will need to speak the language of data daily, using people analytics to inform decisions and communicate with key stakeholders. The HR function will transition from data reporters to strategic advisors, embedding analytics into every facet of their work, from recruitment to employee engagement, making HR a central pillar in driving business impact.
As the recent HR in 2030 report by Sage reveals there is much work to be done: “94% of business leaders told us in our recent research that they have access to some form of People data from HR, but 60% of the c-suite say they’re also not using HR data to drive any kind of decision-making.”
Undoubtedly, this transformation is rapidly approaching, and HR professionals must swiftly cultivate numerical acumen, sharpening their skills in planning, forecasting, and data analytics. The era of HR relying solely on intuition is behind us, and like other business disciplines, HR is poised to evolve into a more strategic function. For those who embrace this change, it heralds an exhilarating era where their role can profoundly impact their organisation.
AUTOMATION AND THE EVOLUTION OF HR TECHNOLOGY
As Open Banking revolutionised the financial sector, automation and advanced HR systems will transform HR operations. Legacy systems will be replaced with innovative, flexible solutions that support HR's new agile approach. This technological transformation will enable HR to move beyond transactional tasks and focus on strategic initiatives, including employee experience and talent development.
The global HR technology market is poised for substantial growth, projected to reach $38.17 billion by 2027 with a notable CAGR of 11.4% from 2020 to 2027. This surge is accompanied by a significant influx of tools and technology transforming HR processes. While this presents exciting opportunities, HR professionals and business leaders must exercise diligence by collaborating with IT to formulate a coherent HR digital strategy. In this dynamic HR landscape, it's imperative to curate this transformation carefully, selecting technologies that are future-proofed to align with the evolving role of HR. A clear understanding of the market offerings and your business's specific needs is paramount for achieving success.
These challenges underscore a future where HR transcends its traditional boundaries, embracing technology and data while staying grounded in the human elements that define its purpose. As we move into a new year the HR function will become a dynamic blend of empathy and analytics, fostering environments where businesses and employees can thrive amid constant change.
Undoubtedly, this transformation is rapidly approaching, and HR professionals must swiftly adapt, becoming agile agents of change in an ever-evolving business landscape. By embracing these changes and aligning HR strategies with organisational goals, businesses can thrive in the dynamic landscape of 2024 and beyond, securing a prosperous future.