Gartner surveyed more than 800 HR leaders across 60 countries and all major industries to identify their priorities and challenges for 2023. The largest share of respondents put “leader and manager effectiveness” on their list, but many HR leaders also prioritize organizational design and change management, employee experience, recruiting, and the future of work.

So, what is driving these priorities? First, executives are faced with a triple squeeze which included:

1. Rising Inflation: 90% of executives expect it to remain high or rise over the next 12 months.
2. Scarce and expensive talent: 50% of HR leaders expect increased talent competition over the next 6 months.
3. Global supply constraints: 48% of CFOs expect supply chain shortages to continue well beyond 2022.

These factors are setting the stage for significant HR challenges. The money and resources needed to address many of the internal HR issues facing companies in 2023 will be considerably more constrained if the economy falls into a recession or goes through a contraction.

From HR’s perspective, this means that trade-offs need to be made while navigating through these volatile times. Not only does HR have to manage investment in people but they will have to increase investments in technology to continue their digital transformation so they can integrate their company data and perform the necessary analytics to drive company performance and the employee experience.

In years past, the battle to balance cost savings vs talent investment or business requirements vs employee needs would be handled relatively easily. There are hundreds of case studies that have been created over the last 50-60 years that effectively addressed these dynamics, but it is different now as evidenced by the struggle to get employees to report back to brick and mortar or to stay engaged with the organization. Clear examples of this problem of “returning to normal” can be found in the social media technology sector.  

Employee expectations are different, and they are impacting the tried-and-true formulas of the past. To attract and retain employees in this new enlightened business environment, HR leaders must now factor in:

Flexibility: 52% of employees say flexible work policies will affect their decision to stay at their organization. This can be demonstrated in the current struggle at Twitter.

Shared Purpose: 53% of employees want their organizations to act on issues they care about. In the past 2 ½ years, there are many examples of companies that have become more active in social issues than in years past. Some examples are successful, and some are not.

Well-being: 70% of companies have introduced new well-being benefits or increased the amount of existing well-being benefits which increases the cost of employment on the company.

Person-first experience: 82% of employees say it’s important for their organization to see them as a person, not just as an employee.

Because of these paradigm shifts in what employees are looking for and what they want from their employer, HR will have to rethink what their organization looks like and how it supports its employees.

If your HR team would like to discuss how ASE can assist your organization with addressing these challenging priorities, please contact your ASE Member Advisor.

Source: Gartner for HR Top 5 Priorities for HR Leaders In 2023