How Is the Future of Work Shaping Human Resource Management?

What is the future of work?

The future of work is here and most organisations and Human Resource Management (HRM) departments are not prepared for it. The concept of the “future of work” is centred around the evolving workforce and workplace requirements influenced by trends transforming business such as digital transformation, hybrid work, and Diversity, Equity and Inclusion (DE&I).

Why is it a challenge for HR leaders and how is it changing the HR function and human capital management?

Research shows that a significant (49%) proportion of HR leaders do not have explicit future of work strategies in place. Part of the challenge for HR is understanding and anticipating which transformations will affect one’s organisation the most, and which ones to prioritise for action? As a result, most HR leaders continue to put priority on improving operational excellence; the “known”, which although important, will soon be outpaced by the need to execute business transformations; the “transformative and unknown”. Research shows that this function has moved up the priority list for HRM globally, and has become the second most important focus area for progressive HR departments. To explain why transformations have become so crucial for HRM recently, and what leaders in the space should be focusing on, the top 3 future of work trends are detailed below:

Trend #1: Digital transformation and hybrid work arrangements

Post-pandemic work trends show that the majority of the workforce (83%) prefers hybrid work environments, which are also linked to better mental health and lower levels of burnout. Contrary to traditional management structures, new research also shows that only a small share of individuals feels disconnected, frustrated and inefficient (8%) at home when compared to the majority (40%) that feel productive and effective anywhere (remotely or onsite) given the right tools and functions that allow. These new human capital preferences challenge traditional HR structures put in place to build connected and collaborative workplaces through physical proximity and reveal the need for more contemporary strategies.

Trend #2: HR is Embracing Corporate social Responsibility Function

Social responsibility and concerns around climate change are increasingly becoming prominent on the corporate agenda. This is creating the need for HRM units to build talent strategies around their organisations’ social and environmental conscience, linking brand values to altruistic human capital beliefs in order to attract and retain top talent.

Trend #3: Delivering on DE&I

The majority (76%) of employees and job seekers have identified diverse workplaces as important when evaluating companies and job offers. Research also shows that diverse and inclusive teams are better at solving complex problems, more innovative and make better decisions 87% of the time. To capture these benefits, HR units need to deliver on DE&I transformations for their organisations to remain competitive and foster innovation.

The above-detailed future of work trends reveal why leading HR business functions are pivoting to executing workplace transformations.  The key question all organisations should be asking themselves is if their in-house HRM business units are equipped to deliver on the above-listed trends? Or whether they need to outsource some of the newer and rapidly evolving HR functions to agencies that have the capabilities and agility to react quickly to keep your organisation competitive and attractive to top talent in line with the newest human capital trends? The post-pandemic workforce calls for a more hybrid, digital-enabled and transformative HRM. SHIFT Advisory Group can help your organisation navigate the evolving human capital needs and supplement the latest HR functions required for the future of work.

Sources:

1. Gartner (2022) Top 5 Priorities for HR Leaders in 2022, available from:

https://emtemp.gcom.cloud/ngw/globalassets/en/human-resources/documents/trends/top-priorities-for-hr-leaders-2022.pdf

2. PWC (2022) The Future of Work: A Journey to 2022, available from: https://www.pwc.com/ee/et/publications/pub/future-of-work-report.pdf
3. World Economic Forum (2022) 6 World of Work Trends Set to Shape 2022, available from: https://www.google.com/url?q=https://www.weforum.org/agenda/2022/01/6-world-of-work-trends-that-will-shape-2022/&sa=D&source=docs&ust=1656349761704465&usg=AOvVaw1xskY-1UO6N-9HXuaaKQ5w.
4. Accenture (2021) The Future of Work: A Hybrid Work Model, available from: https://www.google.com/url?q=https://www.accenture.com/us-en/insights/consulting/future-work&sa=D&source=docs&ust=1656349590475092&usg=AOvVaw0_K8CAGEk3wDkEWZgXbey2
5. Korn Ferry (2022) Future of  Work Trends in 2022: The New Ear of Humanity, available from: https://www.kornferry.com/insights/featured-topics/future-of-work/2022-future-of-work-trends