At SparkUs, we believe in regularly attending industry events in order to develop close relationships with our peers and stay ahead of the latest developments. This year, we were one of the 120 startups programme attendees at the WEF Annual Meeting of the New Champions, which was a fantastic opportunity to take the pulse of the current business world and determine where the future trends lie.
From our findings, we’ve compiled the top 8 business trends that will affect the future of HR. We hope this will shed new light for business leaders currently creating 2020 HR strategies.
We proudly see that our estimates for HR trends for 2020 were spot on despite the challenges caused by Covid-19. We revisited the content below amid the Covid-19 crisis.
Business Trends That Will Affect HR in 2020 (Covid-19 Update)
1- Political Climate & Trade Wars
Since the HR industry is shaped and influenced by political and economic developments, HR professionals need to also be aware of the changing political climate.
Recently, trade wars have taken place between the US and China, there have been new tax regulations around the world, Brexit is imminent, and many countries have implemented stricter immigration laws. These developments threaten many organisations in terms of their business strategies, overseas investments, and talent management. Many organisations have even been forced to consider restructuring their supply chains and replicate production plants in different countries. To make matters worse, the global political climate has resulted in tighter immigration laws, which has made it harder for talent to move freely between countries.
Covid-19 Update:
Trade war is a cold case due to the current lockdown. However, the division between the Eastern and Western worlds deepened with cultural differences is becoming more apparent in terms of the manner of responding to the crisis as a community
We will see immigration policies tighten as we have foreseen. Moreover, there are new discussions about the role of the European Union in the Covid-19 crisis as well as restrictions on the freedom of movement within the EU. Many Western countries are also rethinking the roles of institutions like the WHO.
On the other hand, there are many businesses closing down and firing employees. We see that the effect of limited talent movement is mitigated by this effect.
Key Areas for HR Leaders to Consider
Recruitment, Succession Planning
2- Disruption & Startups
New technologies paved the way for innovation that would have been considered impossible a few years ago. Many industry giants that were feeling secure in their marketplace dominance have now been disrupted by tech startups. Even tech unicorns are vulnerable to disruption from newer players.
Industry leaders have realised that collaborating with startups is easier than competing with them. Therefore, many big enterprises have started to invest in their own accelerators, incubation programs, and intrapreneurial initiatives. This also triggered a new approach of mimicking startups has led organisations to implement new methodologies, like Design Thinking, Agile Project Management, and Business Canvas.
However, merely implementing these new methodologies is not enough to ensure that the results are successful. Cultural change is the only way to internalise this new way of doing business — and one of the best ways to achieve cultural change is to implement a strong coaching culture within the organisation.
Covid-19 Update:
Remote work culture has become a reality even for organisations that have been resistant to it. These organisations and many others are now forced to work online, and this raises everyone’s awareness of the fact that virtual, remote work is doable.
New productivity and communication tools, which are reserved for the tech-savvy like Zoom, Microsoft Teams, several Learning Management Systems, and OKR’s, are becoming a part of everyday life. A recent 451 survey shows that, as a response to Covid-19, 43% of businesses are spending more on collaboration and communications tools.
We are forced to establish our “distant work culture”. In the urgency of this crisis, we all experienced some kind of breakdown, and yet we managed to get up. Those who face reality and act with agility take the wheel and minimise the collateral damage. The past two months have shown the importance of resilience and other aspects of positive psychology.
Key Areas for HR Leaders to Consider
Organisational Development, Leadership Development
3- Corporate Citizenship & Ethics
Organisations can no longer simply adhere to regulatory compliance requirements. The pressure to implement “corporate citizenship” is increasing, and companies are expected to have ethical, social, and environmental responsibilities — while still maintaining profitability for shareholders.
In order to monitor and manage these corporate citizenship activities, we will see more Social and Ethics Committees within organisations. These committees will be responsible for ensuring the below issues are prioritised:
- Environment, health, and public safety
- Social and economic consciences of the business
- Consumer relationships
- Labour and employment matters
- Company ethics
Covid-19 Update:
Corporate citizenship rises to the occasion of the crisis relief efforts, with focus on company-wide employee support programs, sharing corporate L&D tools with the public, and social responsibility campaigns. All this paves the way for the brand value to increase. Ethics, as well as common sense, are crucial to evade any PR Crisis
Key Areas for HR Leaders to Consider
Organisational Development, Leadership Development
4- Embracing Diversity
Diversity is not only crucial for obvious ethical reasons but also important for fostering creative debate, addressing possible risks in different interest groups, and understanding the markets from a well-rounded perspective. A modern workplace should embrace diversity — not only in terms of race, gender, and religion — but also in terms of diversity of values, educational and cultural backgrounds, geography, mindsets, and experience.
“33% of HR executives believe demographic shifts and increased workplace diversity will have the biggest impact on HR by 2025, yet only 34% of employees believed that management is prepared to lead a diverse workforce.”
HR World Survey
Covid-19 Update:
In these times of isolation, which create a lot of clusters, it is crucial to reach a diverse network in order to stay relevant. We all have our networks to gather information but relying on the same network of sources can be impeding our ability to see outside our cultural bubble.
Key Areas for HR Leaders to Consider
Recruitment, Organisational Development
5- Getting Ready for an AI and Robot-Supported Future
New technologies disrupt the way we work. In the future, all repetitive tasks and no-brainer decisions will be performed by Artificial Intelligence (AI) or robots — and not just blue-collar work. However, this means many time-consuming jobs that require full-time employees will be extinct.
“In the banking industry, the time to perform some tasks are reduced by up to 90%.”
Accenture
However, on the bright side, machines will take over the most dangerous jobs. And jobs will shift towards a new set of skills, like creativity, emotional intelligence, generating insights, setting meaningful goals, and more. Therefore, our jobs are secure as long as we continue to upskill and/or re-skill in order to meet the new needs of the market.
“38% of businesses expect to extend their workforce to new productivity-enhancing roles, and more than a quarter expect automation to lead to the creation of new roles in their enterprise.”
WEF, ‘The Future of Jobs’ Report
“Across all industries, by 2022, growth in emerging professions is set to increase their share of employment from 16% to 27% of the total employee base of company respondents.
WEF, ‘The Future of Jobs’ Report
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Covid-19 Update:
We are currently focusing on tools that can relieve the effects of our current crisis. But the real disruption will kick in when the supply chain starts to show delays and even breakdowns. The popularity of automation will rise in tandem with its success to keep the “shelves full” once empty. Remember the notorious example of toilet papers.
Key Areas for HR Leaders to Consider
Organisational Development, Learning & Development
6- Going Beyond Big Data
Collecting big data isn’t the end goal anymore. What’s more important is to understand the data, generate actionable insights, and develop recommendations that align with business goals. This is a set of new muscles that we need to train.
As we employ machine learning, we start to encounter new challenges, like the ethical collection and classification of data, ensuring privacy for data owners, overseeing algorithms made by machines, and developing the skills to assess AI projects on management boards.
Big Data, HR Analytics, Soft Data, and Artificial Intelligence has allowed the HR world to take measurable actions based on data. However, in order to understand, interpret, and gain actionable insights from data, advanced HR skills are required.
Strategic HR thinking will be needed in order to generate actionable insights from the data and implement an innovative and diverse corporate culture.
Covid-19 Update:
With day-to-day updates and the rise of science as the base of decision-making, we became acquainted with big data. At the same time acting on data requires bringing stakeholders to an agreement and persuading them to act accordingly. The difference between failure and success to mobilize resources is deeply connected with the trust and resonance we entice. We also recognize that people are now more open to share their data to ensure their health security, which may change the perception and behavior of data sharing among employees in the near future.
Key Areas for HR Leaders to Consider
Learning & Development, Recruitment
7- Talent Deficit & Employee Engagement
Employees who passionately embrace the business’s strategic goals will ensure the organisation stays ahead of the competition. And organisations need a lot of talented people to keep up with competitive markets. However, the definition of talent evolves with market needs.
The future market will prioritise forward-looking people with tenacity and quick adaptation skills. Unfortunately, this type of talent is very scarce. There is huge competition between companies to add this talent to their teams. This means the power lies in the hands of the talent.
Companies should relook their workplace and employee experience in order to attract these people. For example, companies can highlight their focus on changing the world to be a better place as part of the ‘weQ’ over ‘IQ’ movement, which is appealing to talent who seek a higher purpose to their work.
“Supporting what employees value, not just what they need, increases employee performance by 20%.”
Gartner
Covid-19 Update:
Acting as “we” is the key element of productivity. Being and acting as part of the team will definitely make a difference in going out of limb and finding a way to generate value. We know that resilience and stamina are related to seeing the dire situation realistically and still acting with motivation and belief in a better outcome.
Key Areas for HR Leaders to Consider
Talent management, Organisational development, Recruitment
8- Leadership 4.0: Redesigning Workforce
With the emergence of Industry 4.0, the new focus is on digitalisation and innovation. However, you need talented leaders to develop innovation and drive a company into the digital era.
Deploying new technologies is meaningless without a workforce that can take advantage of its added value. Unfortunately, the traditional ways of management and leadership are slowing down innovation and technological development within companies. Companies need a new leadership model that will motivate and identify innovation-focused talent. This new model also needs to address the issues of ethics, as well as the internal dynamics of multi-disciplinary teams.
Leadership 4.0 puts the leader in the role of a facilitator — they are now responsible for the collective performance of the team. The leaders of this new Leadership 4.0 model are expected to be:
- Ethical
- Team-Oriented and Facilitating
- Agile
- Transparent
- Competent in Technology and Innovation
- Data-Driven
- Equipped with Business Coaching and Mentoring
“Organisations expect more than 40% of leadership roles to be significantly different within five years.”
Gartner
Covid-19 Update:
This is the core of this post. We were spot on regarding the qualities that were necessary for effective leadership, and they are shown to be imperative to overcome the crisis we are enduring.
Being a part of ‘we’ as aforementioned indicates a quality of a good leader.
Key Areas for HR Leaders to Consider
Leadership development
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