10 Challenges HR People Are Facing Right Now
I’ve attended multiple HR conferences and events in the last quarter to find and speak to HR professionals. Here’s what I learned about what’s keeping them up at night.
Over the last few months I’ve been on a pilgrimage to find out what makes HR professionals tick. I want to understand: what do HR professionals do all day? What do they enjoy doing? What holds them back, what tools do they use and what trends are they facing right now?
My aim has been to find out what core messages HR people need to get across to the rest of their organisation and how we at ScreenCloud can help with that.
Some of the events I’ve attended have included:
- Unleash in Amsterdam
- DisruptHR in London
- HCM User Groups
- AgileHR events
- Employee engagement events
- Employee reward & benefit events
….and many more. (Yes you could say I’ve been around a bit).
There is a general feeling that HR shouts but isn’t heard.
There is a shared frustration amongst most of the HR professionals I spoke to that they feel like they are not listened to within the wider organisation. They are seen as the blockers in companies, the bureaucracy that you have to jump through hoops with, to get any change made. Senior Management will often bypass HR in terms of hiring decisions or new policies, which is disastrous when trying to ensure compliance. This is just one of the challenges this workforce are facing, and that they’re beginning to take action to reduce.
With that in mind, here are the 10 biggest challenges HR people are facing right now — and what they’re doing about it.
1. It’s harder to hire — so hard we’re taking people out of retirement
It struck me that it’s becoming harder for companies to hire the people they want. The HR pros I met explained two key issues they were coming up against; firstly they want candidates who have the right skills and secondly that they want candidates who are a good cultural fit.
It’s that second point that surprised me the most. When I hear “cultural fit” I think of startups in Silicon valley, but the people I was meeting at these events were representatives from large industries like Telecoms, Automotive and Manufacturing. If you compound the problem that these companies are hiring something like 2000 new employees each year, then finding people with the right skills and that are a good culture fit is a near impossible task.
The first point is a tough one to solve as in both US and Western Europe we are getting close to modern day full employment, with just a 4% unemployment rate in the US, 4% in the UK, 3.4% in Germany and 3.9% in the Netherlands..
Therefore we’re quickly going to get a crisis in skills shortage and available workers to fill vacancies. This makes the market even tougher for companies who want to get not just any worker, but the “right” worker.
Although this is a massive problem I’ve heard two interesting solutions:
- Out of retirement: because skills are becoming harder to find, especially in North America and North Europe, companies are now encouraging those engineers who have retired to come back to help teach the younger generations. It’s not just engineers either — I heard of a successful campaign by GLL gym operator who got more candidates for their lifeguard positions by targeting an older demographic.
- Referrals: The saying goes that “A players hire A players and B players hire C players”. Companies recognise this and thus are encouraging their current staff members to recommend those people they have worked at previous companies to help stem the gap in the candidate pool. It’s also shown that candidates who come through referrals typically have higher retention, better quality and are cheaper compared to traditional hiring methods.
2. Staff retention is low — and expensive
Not only is it hard to hire new candidates it’s also become a struggle to keep those you already have working at the company. Now we’re seeing the emergence of “EX”, which stands for “employee experience”, very similar to UX user experience which is all about making a great experience for your customers. So why not do the same for your employees?
Companies know that two big problems are facing them, firstly it’s expensive to replace workers who leave. It’s estimated that it costs up to 150% of the initial salary to replace an employee.
The second issue is that employees are wanting more out of their jobs. They want to be recognised, and those who don’t feel recognised are twice as likely to quit. They want to develop and grow within companies with, according to research, 23% of employees leaving companies due to the lack of development and training opportunities.
3. Recognition is important
Companies are making a big effort to recognise their employees and employees who aren’t recognised are more likely to leave which is supported in other evidence.
Employees want to be recognised for the hard work they’ve been doing, they want it to be instant, accurate and they want it to be explained to them. This spans across all types of employees and industries. What you’re seeing as a result is the rise of employee recognition tools whether it’s Bonusly or TerryBerry, where managers and employees can recognise the hard work that other employees are doing.
4. Feedback that goes both ways is key
Typically you have a yearly performance review with your manager where you understand what you’ve done well, what you can do to improve and any grievances they may have. What I’m seeing as a trend is a move towards having more frequent feedback from Managers on a weekly basis.
Employees want to have constant feedback from their managers, they want to know how they can improve but also what they feel the business needs to improve on. It’s been shown that 72% of employees said their performance would improve if their managers would provide corrective feedback.
Companies are implementing tools like Glint, Officevibe and Peakon which are essentially tools that run regular surveys that are quick and easy to fill out. It’s an opportunity for employees to give a snapshot of how they feel and for the business to discuss improvements that can happen every week, rather than waiting for a whole year.
The biggest surprise for me was the uptake in this. The people I’ve spoken to say they’re getting 70% or 80% uptake on surveys across companies that have thousands of employees around the world. This is great. There is some evidence to suggest the uptake is slower amongst those of older generations, with the millennial generation driving more feedback.
One insight I’ve gained is that it’s not all about feedback on performance either. I heard from a large cosmetics company how employee feedback led them to pivot on a new initiative. They’d installed a future-esque lift service but it had failed in its actual task of taking employees up or down and thus this was represented heavily in company surveys. Management reverted the lift back to an older version so it worked for employees. Without regular feedback, they might never have known.
5. Learning and development is a growing industry
Employees want to learn and grow with companies, they want to know that the company will give them the skills to progress to new heights and be able to do the job they want to ensure the promotion. It’s been suggested that as many as 58% of those in work feel “trapped” in their current role due to a lack of training. Therefore HR professionals are trying to ensure that employees can get hold of the knowledge and specific skills to do their job better and improve their performance.
What is clear though from a HR perspective, is that this isn’t coming cheap and companies are spending hundreds of thousands on new training systems and courses. You can see why the e-learning market is massively growing, said to be worth over $65billion by 2035 as companies rush to get in on it. There are a number of interesting companies already established in this field including Docebo, Desire2Learn and Cornerstone on Demand.
6. Rewards and perks must be measurable
When we think of great offices we often think of Google right? Free food, slides, nap pods. However this is no longer just for large tech firms, it’s a trend for many employers — and the perks are beginning to extend past just the trendy.
Many are offering rewards ranging from the classic free food and gym memberships to reward programs that give vouchers at Amazon, flexible working and even mental health and wellness programs.
It’s clear though that is not a fad or a gimmick with research suggesting that 37% of people would be more motivated if offered perks at work.
Although the offering varies, what is clear from HR professionals is that they are unsure if it has any affect on employee motivation or employee retention which is worrying especially as these offers aren’t cheap to implement. Not knowing the effects could be costly to firms.
HR professionals want better exposure on the effects of these offerings but also greater awareness of what employees are entitled to as well.
7. Joined-up software systems will prevail
Technology is a recurring theme that comes up a lot at these events and is discussed often amongst HR professionals. I can summarise this in a few key trends:
Firstly if you have a problem then there is software out there that can help you simplify it, whether this is to do with payroll, recruitment, training, recognition or feedback.
The HR technology market is massive, it’s suggested worth is $400 billion with over 1000 technology partners in this space (which yes, is too many). It is been predicted that we will start to see convergence in this industry. A big driver for this is that when you speak with HR professionals they don’t want one tool to do the payroll, one tool to do the survey feedback and one tool to do recruitment. It’s expensive and disconnected. We should be taking the silos of information and bringing them together.
You can see this trend already happening with the growth that the large Human Capital Management (HCM) tools are having with Workday, Oracle HCM, SAP Successfactors and ADP which do a lot of the jobs you might need.
What is clear from speaking with users of the larger HR tools is that the onboarding process takes time. If you have a company with 50,000 staff across multiple locations around the world, implementing payroll functionality is a year’s project in itself.
8. The robots are coming
Artificial Intelligence (AI) gets mentioned everywhere when it comes to HR technology, and typically when I hear tools that have AI my default is to switch off as few people truly understand AI and even fewer companies are actually using AI.
However there have been a few interesting companies coming out of the woodwork including Mya which uses natural language processing to help teams source potential employees by screening candidates.
Another great tool is HireVue which uses AI to assess candidate videos for facial movements, word choice and intonation to create thousands of data points for recruiters to use to analyse the best candidates.
What was recurring though is that although AI is a big feature in HR technology, there is an element of worry that biases will carry over in the tech. As humans, we have biases built in and we, of course, are the ones programming AI.
Another key theme is automation, speak to any HR professional and they will tell you they are time poor, responsible for everything from onboarding, to recruiting, to HR policies, dealing with harassment cases to working out pay negotiations. If you offer a tool that can reduce the workload, then HR professionals are sold.
9. 9-to-5 is just for Dolly Parton
A work trend that has come up a lot is that the workforce is becoming more flexible — no longer is it about trying to stay at work from 9.00am until 9:30pm at night. Employees want more flexibility in their working life and companies are starting to realise this, by giving more flexibility in terms of how often they come into the office or if they want to leave or start at different times. It’s shown that employees who are offered more flexible working opportunities are more likely to be motivated and happier than those who don’t.
HR professionals are writing up policies and encouraging an environment where employees can have the right balance between work and life.
10. HR is getting an agile makeover
HR is having a agile makeover with HR professionals being at the forefront of company change, focusing on improving a number of things in organisations.
Agile HR is helping organisations to remove barriers to employees, improving employee experiences and journeys, helping to get things done faster and improving the overall quality of the staff member experience.
Now dubbed “EX” for Employee Experience, HR professionals are using methods typically reserved for UX researchers such as surveys, focus groups, interviews, journey mapping, test and learning, to improve the processes we use every day at work. Whether it’s making it easier for employees to claim back expenses, helping hiring managers hire the right person so they can add value straight away or improving how third parties are managed.
At the same time, HR professionals are realising that the best way to get management buy in is to use analytics to show that the work of HR is having a massive impact on the company.
It’s suggested that although you probably collect a number of analytics around absenteeism rate, engagement rate, cost of training, etc the best course of action is to find the north star metric most important to your organisation. Not only does this focus your mind but it also allows you to align the work you’re doing in HR, allowing you to show your true value to the organisation.
How can ScreenCloud help?
Having spent a long time with those in HR, understanding the latest trends and pain points, we are better positioned than ever to make ScreenCloud the internal communication tool for those in HR.
ScreenCloud helps teams to better communicate the important messages by bringing the information that is in silos and different systems like engagement messages, recruitment software, e-learning videos, holiday calendars, analytics and perk platforms, all together. Using business logic to collect information and showcase it up on screens around the office, ultimately creating better work experiences.
Using screens to surface information that will be seen and absorbed, rather than ignored and hidden in emails and systems.
Do you want to tell me more?
There are a number of HR events I’ll be going to in the coming months so if you’re interested in meeting up and discussing some of the things here, or how ScreenCloud can help optimise your internal communications strategy, let me know! Next I’ll be at the Engagement Excellence Summit London on the 13th of February and Unleash London 19th/20th March.