With the rapid changes taking place in the workforce, and the ever-evolving workplace, the professional life of an HR leader is never dull. In addition to the myriad day-to-day challenges that come from managing a workforce and being a business partner to the functional leaders of the company, HR professionals must also keep an eye out for what is coming next.
Following are some emerging trends, and their corresponding challenges, for HR leaders to consider over the next 12 months.
- Millennials Have Arrived, and Now Need to Make Room for Generation Z
Over the past few years there have been countless articles and discussions about the Millennial generation, how they’re different, and the challenges of integrating them into a multi-generational workforce. That discussion is now outdated. In 2016 the number of Millennials in the workforce officially passed the Baby Boomers.
On the heels of this gigantic demographic shift here comes another: The Millennials need to begin making room for Generation Z. It is interesting to note that there is still an active debate as to when this generation actually begins, however most demographers define it as including those born after 1994-1996. Therefore the oldest members of Generation Z will be turning 21-23 this year and likely entering the workforce in large numbers as interns or entry-level employees.
For HR professionals some of the challenges to consider include:
- Making sure the Millennials are prepared to step into more senior level roles as the Baby Boomers accelerate their exit from the workforce.
- Understanding what it takes to recruit and retain Generation Z.
- Preparing Millennials, and other generations in the workforce, to lead manage and lead this new generation.
- Company Culture and Ethics Move to the Forefront
In the past year a number of high profile workplace scandals took place in the US. Companies like Volkswagen, Wells Fargo, and Zenefits suffered from serious ethical and transparency lapses, which were widely publicized in the press. Most of these serious transgressions were ultimately borne from weak cultures, which allowed, if not encouraged, unethical business practices to happen. A common theme was that company executives and upper management set impossibly high standards, which led employees to cut corners (or worse) in order to reach them.
Recent research (conducted in joint Columbia and Duke University study) found that corporate culture drives profitability, acquisition decisions, and even whether employees behave in ethical ways. When companies emphasize performance metrics over people considerations, they unwittingly encourage unethical behavior. As professor Shiva Rajgopal of Columbia Business School explained, “Our research provides systematic evidence—perhaps for the first time—that effective cultures are less likely to be associated with “short-termism,” unethical behavior, or earnings management to pad quarterly earnings.”
Takeaways for HR professionals:
- Consider how to measure annual (or shorter term) performance metrics along with the measurement of broader (evergreen) cultural norms like integrity, honesty, transparency.
- Revisit your annual performance review process and methodology to make sure you have a balance between short-term business objectives and longer-term cultural goals.
- Make sure you have a broad “listening post” across the company. Creating an open, honest, ethical culture requires companywide input – not just from the executive or HR ranks.
- The Non-Employee Workforce is Growing, Companies and Teams Must Evolve to Accommodate Contingent Workers
Many industry experts have predicted that the non-employee, or contingent, component of the US workforce could approach 50% of the total by 2020. This dynamic transformation will have far-reaching implications for organizations of all sizes and shapes, across every industry. TalentWave is at the forefront of this trend, helping to safely and cost-effectively engage thousands of workers each day that our clients have direct sourced.
Many HR practitioners have heard about the concept of Total Talent Management, which is the strategy of optimizing a workforce that includes traditional employees and contingent workers into a cohesive blended workforce. One emerging challenge is the diversity of contingent worker categories (freelancers, independent contractors, consultants, gig-workers, interns, etc.) each of which brings its own sub-challenges of sourcing, compliance risk, and engagement.
A few implications for HR leaders to consider:
- The very definition of work, and how gets it done, is changing. In order to define the workforce of the future, HR leaders need to make holistic decisions about what type(s) of workers are best suited for what tasks and deliverables across the company.
- Instead of job descriptions and responsibilities, think more broadly in terms of roles and outcomes. Progressive organizations will begin to think more about the best worker to achieve a specific result.
- In addition to thinking about workers, many HR leaders are also thinking about how the workers are organized. A broader, more cross-functional, organizational structure that can flex and morph as the company needs change, is proving to be a viable approach for managing a blended workforce. Hollywood production companies have been an innovator in this ad-hoc team-based approach to achieving work objectives.
- Consider how best to attract and retain this new total workforce, and how to make sure the culture of the company can accommodate non-employees in order to harness the full potential of a blended workforce. What are the best sources of supply? How best to engage and manage the total workforce.
- How will you be an “employer of choice” for traditional workers and a “client of choice” for all non-employee workers?
Conclusion
HR leaders face workplace and workforce challenges on a daily basis. This article highlighted three significant trends – the emergence of Generation Z, a greater focus on culture, and the growing contingent workforce – which we believe will have an impact in the next 12 months.
