2020 was a year full of new challenges for everyone, both in our personal lives and at work. Businesses had to quickly pivot to working remotely and when the demand for flexibility could not be met, weaknesses in work structures became apparent. As HR leaders, we were thrown onto the front line to protect employees, adjust to new ways of working, and support leaders and employees alike to find their new modus operandi. In the wake of 2020 -HR has never been more important.
Commercially, last year created a fog for many organisations, both public and private, with uncertainty week to week, let alone quarter to quarter. Investments, product design, cost management, growth targets, and community expectations all became increasingly ambiguous. High degrees of judgment coupled with the right levels of risk management were needed to orient out of 2020 into 2021. Many made it. Some did not. However, those who did, now face another set of challenges, driven less by ambiguity, and more by a need to capitalise on the learnings found amongst the rubble, so that they can emerge and create opportunities to move forward in new ways.
Three Stages of Action
With change happening so rapidly and thrust upon us without planning or foresight, we are seeing tension in the system, between imperative changes and challenges that are now faced, and significant opportunities that lie on the horizon. We’re seeing this play out for organisations in three stages:
Stage 1: Respond: We are in the midst of a pandemic and responding to the crisis. “We have been acclimatising to something new and working to capture the data that can drive the opportunity ahead.”
Stage 2: Recover: We’re thinking through what needs to be considered in the mid-term. “What will we keep from pre-pandemic days? What did we love about how we operated through the pandemic? What do we want to create as our next normal?”
Stage 3: Thrive: And then there is the future vision – innovating and creating so that we can embrace opportunity and thrive on the other side. “How do we go forward with all that we have learnt? How does change create new growth for us?”
Most of our clients are in a highly innovative and creative space now – which has allowed for us to pause and consider the 2021 priorities for HR leaders. Overwhelmingly we can see that adjustment to the next normal, as well as striving for a better future, are foundations for goal setting that will dominate for many this year.
Unpacking the new HR Priorities
Recent research (Gartner Report: Top 5 Priorities for HR leaders in 2021) indicates there are several key steps that HR leaders can take to shift the dial. These are:
- building critical skills and competencies,
- creating a flexible work structure,
- implementing diverse and competent leadership,
- adapting to the new reality of work,
- and improving employee experience.
Addressing these key areas will ensure that businesses continue to prioritise growth while also meeting the need for cost optimisation as well as increasing expectations from their people. The challenge is keeping people at the forefront of the organisation’s mind as they map out their plan, leveraging what they have learned while moving toward a future-ready model.
Likewise, in their article Organizing for the future: Nine keys to becoming a future-ready company McKinsey proposed some key people priorities (see above image) to becoming a future-ready company. Structure, culture, values, learning and talent are all critical parts of the ecosystem where HR needs to influence, create and progress the agenda.
Below we have broken down what we see as key take-aways from this framework for HR leaders this year.
- Build an organisation of motivated learners
Ongoing changes to the work landscape mean that the number of skills required to do a single job is increasing annually. This increased demand is also dynamic, with current skill requirements gradually becoming obsolete. The COVID pandemic has made this need even more prevalent (see below image McKinsey ‘Rethink Capabilities to emerge stronger from COVID19); many people have had to quickly reskill to deal with working remotely or to transition into entirely new roles to allow for business transformation or support of critical tasks. One great example of this is the quick implementation of new call centres by banks to support clients unable to make mortgage payments, staffed by traditional bank employees.
To keep employees up-to-date, organisations need to implement dynamic reskilling, wherein leadership partners with HR to determine where and when training is needed – this is not an annual exercise, but now an ongoing one. Dynamic reskilling also involves empowering employees to actively seek out training when they feel it necessary. According to research presented in the Gartner report, a dynamic approach results in 75% of skills actually being used, an improvement over traditional methods. Additionally, a purposeful approach to professional development will accelerate your ability to thrive. Consider if your employees know how the business makes money, serves the community, and is managed? Or if they know how they add value and are expected to behave? (See image below McKinsey Are you building employee capabilities across these four critical areas?) Here we can see that based on an employee’s engagement level in each quadrant, we can drive activities to create a wider understanding of our business imperatives but also their personal contribution to them.
- Create a flexible work structure and embrace/adapt to the future (now) of work
Traditional work structures are optimised for efficiency, we have all experienced an efficiency orientated work structure, which functions well in certain situations, but can’t cope when quick changes need to be implemented, creating friction within the workforce. The demands of 2020 highlighted just how ill-suited to flexibility and agility an efficiency-oriented approach is.
To meet the demands of a changing landscape, work structures need to be designed to rapidly adapt and foster organisational resilience. This includes clarifying the boundaries of the work design to alleviate overwhelmed teams, moving resourcing decisions closer to the user to allow for faster implementation, and formalising how processing can be made more flexible to remove permission roadblocks.
Additionally, flexibility in 2021 may mean moving towards a hybrid model where much of the workforce will be working remotely at least some of the time. For example, offices may now be used solely for innovation and brainstorming, collaboration, team bonding, and onboarding or training. A second corporate space might be used as an alternative, more convenient location for employees to complete individual work. Finally, the home may provide an opportunity for flexible, individual work, where concentrated effort can be expended while also allowing for family or parenting commitments to be easily fulfilled.
Based on our longstanding experience, this can seem unachievable in the long-term, which can mean as leaders we are guilty of believing in the myths of a hybrid workforce (See Gartner Future of Work Campaign ebook 2020), which then prevents adoption of this new paradigm. Common beliefs include:
- “Our existing remote work strategy will work for a hybrid workforce”
- “We need in-person contact to sustain our culture”
- “Employees are less productive outside the office”
- “Hybrid workforce models hurt diversity, equity and inclusion strategy (DEI)”
- “We need to monitor and measure what employees are doing”
- “A hybrid workforce model duplicates our IT infrastructure”
- “Our jobs just can’t be done remotely”
The future of work will look quite different from what we have been used to, and in fact dramatically different to what we were doing even a year ago. The pandemic accelerated trends that were already changing the work environment, such as the push for more flexibility, but other trends include increased use of employee data, a greater role of employers to act as a social safety net, and wider use of contingent workers.
Determining which trends are relevant can act as a barrier for initiating proactive action, as the task may seem overwhelming. However, it is important to ensure workplace readiness for what will be, in many cases, a societal shift in how we see work. To begin the process of proactive adaptation, HR can first narrow the options of all future-of-work trends by screening for relevance, impact, and opportunity.
- Boost diverse and compassionate leadership
To be a resilient, flexible business, able to best respond to new demands, strong leadership is required. This can be met by ensuring adequate diversity among mid and senior levels of leadership, who are ready and capable. Failure to ensure strong leadership, including a lack of diversity, contributes to reduced confidence among employees. According to Gartner, only 44% of employees have confidence in their leadership’s ability to handle a crisis well.
Leadership diversity can be promoted with growth-focused diversity networks (which include a diverse range of participants across skillsets, career levels and experience) that assist in responding to the existing barriers. They do this by helping to clarify career pathways and steps for advancement, improving exposure to senior leaders, and providing mentorship or career support.
Of course, a good crisis response requires compassion, both from the leader with respect to themselves and for the broader team. Compassionate leadership is not a ‘soft’ ideological approach: compassionate leadership creates an environment where learning and quality improvement are the norm. Compassionate leadership is fundamental to high-quality, high-performing systems and drives improvement in performance. “You are leaving capability on the table if you’re not managing compassion in your culture. It’s too costly to ignore it.” Monica Worline PhD Stanford.
As a leader, it is critical to manage self-compassion and self-care as a starting point, and balance that self-compassion with compassion for others to truly excel. This is highlighted in the diagram above (taken from The ACE in your hand by Michael Jenkins).
- Map your culture across the employee experience
Given the new hybrid model, where work will be conducted dynamically among various locations, HR leaders must consider how to maintain company culture and meet the expectations of employees without face to face connection. Strategies that help facilitate the new model include shifting to online onboarding, using goal setting and performance rather than direct observation to manage employees, adjusting reward schemes and recognition strategies, implementing technology to help facilitate communication and connectivity between remote employees, and updating talent development for a hybrid environment. Additionally, think about continuity across the entire employee lifetime – as shown in the diagram below.
Employee expectations have also come to include less traditionally work-related aspects of life such as mental health, and social responsibility. Given that we spend the majority of our lives at work, it has come to be recognised that work must encompass more of life than has conventionally been considered relevant to employers.
2021 will present new challenges for HR leaders, while everyone adjusts to the next normal. However, optimising the work environment for employees and the business as a whole is an ongoing task that should be embraced as an opportunity for continual growth. Think about where your organisation is – are you responding, recovering or thriving? And what’s your role in shifting the focus in the right direction?