CEOs and CHROs began 2023 facing exceptional challenges. A weakening economy, a stubbornly tight labor market, persistent inflation, banking instability, war and a new cultural dynamic in which workplace talent is dispersed globally make the job of managing modern workforces exceptionally turbulent. Navigating these challenges requires an honest, hard look at talent strategy. Those willing to make hard and sometimes significant changes can emerge from 2023 in a position of strength. Here are six practical tips for leaders to consider:
- Offer flexible work arrangements to attract and keep talent.
- Review workforce needs often to help prevent layoffs.
- Challenge employees to identify and nurture top performers.
- Build resilient leadership to help your company thrive.
- Constantly communicate with employees to foster trust.
Consider Existing and Emerging Lower-Cost Hubs
Areas like India, Mexico, Spain and Southeast Asia are investing in building infrastructure to support global businesses. Within these regions, talent hubs have been developing for decades, allowing knowledge companies to outsource a number of jobs that were once exclusive to their traditional headquarters. Many countries offer attractive tax incentives to lure potential employers, and the move to diversify global talent and supply chains outside of China is also accelerating.
Embrace Flexibility
Many CEOs are mandating workers back into the office. While face-to-face time is important for core staff, reducing a business’s overall office footprint can save costs. Companies with flexible work arrangements are more likely to attract talent, keep talent and mitigate accelerating salary inflation. Embracing part-time workers, retirees or contractors can address needs that don’t require a full-time commitment. These workers can often help identify other areas of efficiency, bring additional reference points from other companies, and test out talent the company leadership might want to bring on full-time.
Regularly Re-Evaluate the Hiring and Workforce Plan
Many companies determine their hiring plan at the beginning of the year and execute for 12 months, only to re-evaluate when they plan for the next fiscal year. During turbulent times, it may prove valuable to review headcount plans every quarter and add additional processes to ensure each hire is in line with current needs. The last thing companies want to do is bring on talent only to discover they aren’t needed.
Plan for the Future Need of the Organization
When market forces change, companies need to re-evaluate their business strategy, product plans, product market fit, and marketing approach. CEOs and CHROs should integrate talent plans from the beginning of these strategy reviews. These questions will help leadership evaluate the implications of these shifts on the business’s workforce:
- Do we have the capabilities today to deliver these new products or business plans? When will we need these capabilities?
- Where are the main gaps?
- What is our plan to close these gaps?
- Do parts of our organization now have skills we don’t need? Can staff be retrained for the areas we will grow? How will we do that and what will it cost?
- If not, how can we provide the right solution over time to reduce this portion of our workforce?
- What does this mean for those we consider our talent peers, and, as that shifts, how should we change our recruiting approach and recruiting structure?
Emphasize Performance Measurement
Top performers, according to Marc Effron of the Talent Strategy Group, can be anywhere from 50 to 900 percent more effective than average. The best way to identify and quantify high performers is through a rigorous and challenging goal-setting process. Businesses that don’t have a formal goal-setting or OKR process set up for their employees should build one.
It’s important to make sure the goals are challenging enough, and that they are:
- aligned to the business’s go-forward strategy,
- meaningfully contributing to the year-end goals for the company and its respective departments, and
- regularly reviewed and cascaded appropriately.
Businesses might want to train their managers to help them identify high performance and distinguish it from potential. To further reinforce a performance-oriented culture, businesses need to ensure their rewards and recognition processes properly support performance assessment. Talent reviews should be established to ensure a clear line of sight to the top 10 to 20 percent of employees, and ensure they get the right time and attention from the leadership team and the organization overall.
Train Leadership to Be Resilient
A McKinsey study indicates that organizations rated in the top quartile for resilient behaviors were 50% less likely to go bankrupt over the next two years than those in the bottom quartile. Building resiliency takes time, training, and can incorporate some of these tactics:
- Skill-building in active listening to understand what’s really happening on teams.
- Minimizing bureaucracy and unnecessary meetings to make sure people have the time, space and authority to get things done.
- Giving employees time to think, with meeting-free days and other time-saving tactics.
- Ensuring leaders are clear on how decisions should be made by establishing a matrix for who handles higher-risk decisions (and how), and empowering less risky decisions to be made quickly at lower levels.
- Teaching leaders about self-sufficiency and self-care so they can de-stress, be as effective as possible and instill that behavior in their teams.
Build Trust and Dedication
Only 32% of employees say they “trust senior leaders at my organization to do what is right.” Only 46% trust their direct manager, according to a recent study of nearly 14,000 leaders by global consultancy DDI. The best way to close the trust gap is through constant communication. Businesses should consider providing regular business updates on strategy, plans and progress, or regular Q-and-A sessions. Live Zoom presentations will allow more employees to attend. Short-form video clips with updates on new programs might be easier to consume than long emails.
Jesse Meschuk is a career and human resources expert and a senior advisor with Exequity. Meschuk has more than 20 years of consulting and human resources experience and has worked across a wide variety of industries, including technology, entertainment, gaming, retail, hospitality and sports. His work has spanned across the Americas, Europe and Asia.
