After two rich years for the HR profession, what are the main HR issues for 2023?
A BCG and ANDRH survey shows that 60% of executives see a growing influence of the HR function in the years to come: it is now a matter of taking advantage of this to move from a "reactive" mode to an "anticipatory" model.
It is already a given that the traditional topics of recruitment, talent retention and leadership will continue to receive attention. Likewise, the issues of CSR, diversity and inclusion, and the facilitation of new forms of collaboration will take on a greater role in the debates. Having completed the 2022 retrospective, we can now look forward to the HR challenges of 2023.
This year promises to be a complex one for leaders.
How to maintain the performance of companies when it becomes necessary to rationalize both human and financial resources?
In a context where the imperative is to do better with less, the company's skills will be honored.
What are the 3 HR 2023 priorities?
We believe that the 3 HR priorities in 2023 focus on the following topics:
- Mobilize skills and internal skills
- Provide the organization with superior adaptive skills
- Streamline the digital sphere and gain expertise
Our reflection is based on both a survey of 113 HR team members and a synthesis of several sources including the Gartner study. You'll find both a summary of the trends in these reports, plus the opinions of the HR teams surveyed.
HR Priority 2023 N° 1: Mobilize skills and internal skills
Among the most frequently cited issues in our 2023 study, career management and employee employability are at the top of the list with 69% and 57% respectively. Shaping careers that meet talent expectations and business needs is the number one priority.
PWC has evaluated the mismatch between skills and the French economy at nearly 3 billion dollars. How can this employability be upgraded?
1. Renewing responses to the shortage of skills
The skills shortage will continue into 2023 and beyond. What factors are driving the shortage at skills ?
- A record number of resignations peaking at 500,000 per quarter since the end of 2021. It is often the most critical skills that leave the company.
- The skills rare, often digital, choose freeancing(+6.7% of freelancers in 2022)
- Recruitment is considered increasingly difficult: +13% compared to 2021, B.M.O. survey
It is clear that the use of recruitment agencies, social networks and programmatic recruitment are reaching their limits. In parallel to this shortage, a gap is growing between the approach of skill , which is limited in companies to Jobs & Skills Management, a formal and regulatory framework, and the day-to-day challenges that require greater reactivity. The year 2023 will therefore see the advent of pragmatic management of skills and, for the most agile companies, the birth of a new form of organization.
What organizational principles are used by the most successful companies?
- Roles or professions are progressively disappearing before the aggregation of skills to carry out the company's activity.
- Skills and potential take preced ence over experience and qualifications in the allocation of resources that have become volatile.
As is often the case in HR, leadership support, budget and challenging habits will be key to initiating the necessary changes.
2. Consider appetite in career management
How did we manage to combine so many simultaneous challenges? Talent attraction and motivation figures have never been lower. Hasn't appetite been too neglected in career management? We think so.
For several years, HR investments have been partly dedicated to working conditions that promote employee well-being. We can boast 80% of employees saying they are "happy at work", but this has not prevented turnover from rising from 13.7% to 15. 1% in the same period. The intensity and sustainability of their involvement is based on something else: the pleasure generated by the activities of the job itself, and, to a lesser extent, the interpersonal relationships.
How to define appetite?
Palatability is a natural tendency by which a person successfully mobilizes one of his or her resources while experiencing a sense of pleasure.
This concept may seem abstract, even ideological. It should not overshadow the level of skills and experience in recruiting or designing mobility, but it should be an integral part of the system for building the career paths offered by the company.
Pole Emploi reported in 2019 that young working people will change jobs 13 to 15 times in their lifetime. Companies must adapt to their decision matrices:
- The "working conditions" component.
- The "business" component.
- The "interpersonal relations" component.
- The "activity content" component.
This is why we insist on the importance of knowing the skills of candidates and employees in the development of careers.
In a context of optimization of resources and budgets, the skills have two other significant assets:
- They create bridges between relatively different professions.
- They accelerate memorization and learning, training on skills which represent a source of pleasure is the HR development scheme to be favored.
3. Adopt the common language of business performance: the skill
The raison d'être of the company, its performance, is today undermined by two phenomena.
- First of all, the mismatch between skills and the needs of companies. According to Capital magazine, this central economic problem stems from a misdirection of talent towards the fields and careers that contribute to France's productivity.
- Secondly, the obsolescence of the job-centered organization. Indeed, the formal nature of job descriptions does not correspond to the reality of managers. In addition, the evolution of functions is subject to constant changes in know-how, essentially technical.
A major challenge in 2023 is to structure the HR approach around a common language, that of skills. We believe that it is the best way to respond to productivity needs, recruitment issues, commitment and collaborative work.
How can we get this common language adopted?
Today, 58% of companies have a directory of each of the skills : the repository. The difficulty is not in creating it, but rather in getting it adopted. The repositories must no longer be used simply to establish salary scales and manage career development. On the contrary, the notion of skill is integrated into the employee's profile from the moment he or she is on-boarded and in each of his or her actions. Each of the company's opportunities, whether it be mobility, a short-term project, the construction of a career plan or a training suggestion, is fed by the common base represented by all the company's skills categories.
Therefore, the number one priority for HR in 2023 will be to structure an approach skills that can systematize the use of this common language. From their detection, development and adaptation, the company can easily reposition the employees in a perspective of flexibility.
Here are additional resources on this first 2023 HR priority:
- Individualize career management
- The organizational model around the skills
- Successful internal mobility: instructions for use
HR Priority 2023 #2: Provide the organization with greater adaptability
Continuous adaptation and its share of change management have damaged the morale of managers and their teams, to the point of fatigue and lack of continuity in collective action. It seems that the only way to adapt is to decree a restructuring, whether organizational or cultural, every two years. This appropriation of uncertainty could, on the contrary, come to life as close to the field as possible through a natural empowerment. And what if facing uncertainty did not mean accepting it first and considering it as an opportunity?
1. Accepting uncertainty
Is uncertainty more present today than in the past? Eteinne Klein, a philosopher of science, in her presentation to the Humania Circle on October 4, believes that it is our relationship to uncertainty that has changed. Indeed, our illusory quest to control it is justified by a need for visibility, yet Julia de Funès believes that this quest for control runs counter to the unifying dimension created by this common risk in the company.
If it is neither possible nor desirable to eliminate these external factors, what about the factors internal to the company? To respond to uncertainty, a company like VINCI has adopted a decentralized organization advocated by its CEO, Xavier Huillard. Based on trust and the "inverted pyramid", this organization has encouraged innovation and creativity among employees in order to better understand the constraints.
The usual responses to economic downturns, such as the one we will experience in 2023, are often to limit autonomy and increase reporting. We are convinced that being adaptive is not only an organizational issue but also a cultural initiative.
2. Arm ourselves to adapt to tomorrow's jobs
During our Webinar focused on the sustainability of skills on September 29th, several issues were raised by the 80 participants:
- Anticipating news skills
- Limit the loss of skills
As a central HR planning mechanism, Jobs & Skills Management has both strengths and limitations. It always identifies the retirements and therefore the skills that will be passed on, but it struggles to highlight the emerging skills and too often obscures the impact of internal development wishes.
What are the weapons for adapting to changes in the professions?
Measuring employee aspirations
We are becoming aware of the treasure trove of employees' aspirations in order to identify the skills and professions to which they are attracted. Structuring the Jobs & Skills Management approach with these elements, collecting them and seeing their evolution helps us to envisage the professions where attrition will be low and those towards which there will be more desertification.
The skills transverse
Defined as assets that can be mobilized in several roles and several sectors, the skills cross-functional skills are highlighted in the high-potential programs of large companies. The internal mobilities that will mark the year 2023 can be based on the transversal faculties of several individuals and cultivated by the HR development policy of the company.
The Strategic Workforce Planning
Being agile in times of change takes preparation, yet today resource planning is, for 51% of companies, a single issue of number of people or "FTE" (source Gartner 2022).
On a day-to-day basis, workshops follow one another to define staffing forecasts in terms of volume and to qualify the impact of transformations on employment and skills. Far too much time is spent on developing a vision of the existing situation and compiling data; this is what undermines the use of the major HR tool that the SWP represents.
In a context where there will be a potential freeze on recruitment and its impact on the maintenance of key skills , the risk of departures caused by the scarcity of opportunities for internal evolution, it will no longer be possible to continue like this. Having a snapshot of the skills projections to be passed on due to retirements, opportunities for redeployment of resources, potential empty chairs in key functions, is within reach with a SWP tool.
C. Democratize the use of HR data
HR data management is one of the 3 challenges for 48% of our panel of respondents. Priorities are still given to securing and protecting the confidentiality of data before using it for decision making. However, the tightening of companies' room for maneuver implies the use of a reinforced HR management control. But that's not all, the gap is widening between expectations and the skills Data of the company; it is the role of the HR team to be trained on this field and to maintain the employability of employees.
The Data invites itself in many professions
Our October 20 webinar, "Integrating Data into your business", in partnership with The Wagon for business, reveals that skills data analysis and exploitation are no longer the sole preserve of data scientists. The treasury and finance businesses see data skills increase by 76% between 2021 and 2022, purchasing by 44%.
It is not only a question of skills but also of soft skills, in this case we associate the phenomenon of data literacy (acculturation to data) with faculties such as :
- Communicate with impact
- Cooperate across the board
- Learning to learn
With this in mind, it is now essential to provide the means to acquire these skills for the populations concerned. Artificial intelligence makes it possible to exploit the differences in skills to formulate training recommendations adapted to each individual. 2023 will see major reskilling campaigns, particularly on this Data dimension.
Data acculturation of the HR function
Several elements make the HR function the legitimate repository of company data. First of all, the legal indicators to be provided to the administration are more and more numerous, and the quantity of anonymous HR data is very large:
- Team performance data
- Health and stress data
- Data focused on salary elements
- Data from skills, experience and career path
However, as Arnaud Coulon, HR Data Expert at Sopra Steria Next, mentions in his blog, mypeopleanalytics, the Human Resources function has a unique role to play. Indeed, it still needs to develop its own capacity to make its data reliable, protect it, share it and make the most of it. At the same time, it is a key player in developing the skills of the entire organization on Data topics. There are therefore two challenges to be met in order to support the company in the efficient and informed use of particularly sensitive data.
Implementing HR data governance defines the rules and processes related to HR data management. Provides a space to ensure that data is consistent, reliable, secure, used correctly and compliant.
The HR function finds itself in a situation of indispensable acculturation. Understanding individual preferences, whether on learning methods or behaviors towards collaborative work, requires an effort from the function and tools that make them want to go deeper into the subject. The validity of the data, the cleaning of the bass, is an issue that the function faces. The versatility of the function will, once again, be able to express itself within the framework of its tools, and in particular that of its HRIS.
Here are additional resources on this second 2023 HR priority:
- The solutions of Strategic Workforce Planning
- Promote cross-cutting skills
- How to make your HR data more reliable?
HR Priority 2023 N°3: Streamline HR tools
Markess counts 600 HR solutions in its latest study, and the digital solutions expert believes that this offer will continue to expand in 2023. In this environment where six players have 30% of the market share, the inflation of the offer is both an opportunity to benefit from highly specialized solutions but it also represents a lack of readability for HR teams.
The year 2023 will be marked by a rationalization of HR tools, as well as special attention to software interoperability. Finally, the performance criteria for these tools will shift towards the experience of users who are now a priority: employees and managers.
1. Involve users
HR teams need to free up time to focus on employee retention, resource planning and strategic skills development. As a result, since 2007, HR information systems have become more employee-centric, or "self-service". Talent management software aims to empower employees; the progressive integration of artificial intelligence, machine learning facilitates the understanding of individual preferences, user experience and frequency of use. It is also worth noting that this trend addresses the need to improve the HR sphere, which is now the responsibility of managers.
How to facilitate the adoption of an HR application?
Users want to find in their business tool the same codes as in their personal sphere. This means being able to access synthetic information in a minimum of time, to keep track of interactions and performances and to synchronize them with all the modules (objectives, skills, training, annual interview).
According to the equipment of the collaborators we also note the increasing use of the mobile, certain functionalities become essential:
- Preparing for interviews
- Selection of internal positions or projects in a dedicated area
- Engagement questionnaires
All these best practices allow us to consider adoption rates close to 80% depending on the initial digital culture of the company.
2. Put an end to application silos
Whether they are SMEs or large groups, companies need to have a unified environment, to avoid application overload. Very specific solutions still have a bright future as long as they can be integrated into a coherent ecosystem. Driven by this user need, software is moving towards interoperability, whether made possible by APIs (application programming interfaces) or directly within an HR application marketplace.
The next few years will see interconnected suites composed of more or less specialized solutions that HR professionals will compose themselves. The progressive decompartmentalization of HR applications will also help to meet the challenge of HR data homogeneity, a necessary element for the proper use of dashboards.
3. Evaluate the real benefits
According to our partner Tempo&Co, change projects in companies have increased threefold over the last 20 years. The problem: the time allocated to these projects has been divided by 2.
For 3 years now, we have been observing a strengthening of the change management methodology. Delivering the expected promises requires bringing together internal stakeholders, the publishing partner and a consulting firm.
The fatigue of permanent changes observed in companies pushes HR departments to better define the objectives, preparation, implementation of change and measurement of the benefits derived.
What are the indicators of success for an HRIS project?
- Legal compliance
- Efficiency in organizational planning
- Consistency and ease of use of HR data
- The response to business objectives around the adaptation of skills
Your additional resources on this third HR 2023 priority:
- HRIS: developments and prospects for digital HR tools
- Neobrain and the SAP ecosystem
- Involve employees in their HR tool
HR issues for a sustainable transformation
In conclusion, the constraints brought about by an economic slowdown in 2023 will be an opportunity to capitalize on the company's intrinsic assets. Uncertainties are not a reason not to invest in the means of anticipation, but rather an opportunity to explore the greater use of arbitration levers, between recruitment, mobility and external services, for example.
Maintaining the course with limited resources will condition the search for optimizations and in particular in the recomposition of the whole of the tasks according to the mobilizable resources. Detecting, valuing and mobilizing the skills talents commits the company to consolidating adapted development plans (upskilling/reskilling) and thus meeting the needs of the business transformation.
The way in which these challenges are addressed will be just as essential as the concerns themselves. With its newfound aura in a complex world, the HR function's priority in 2023 will also be to address complicated issues with simplicity.