Topics: Corporate Governance,Strategy
Topics: Corporate Governance,Strategy
October 6, 2022
October 6, 2022
The pandemic has transformed how, where, when, and even why we work. It accelerated workplace redesign as offices closed, entire industries were upended, and employees had to do their jobs remotely if the nature of their work permitted them to do so.
As COVID-19 shifts to an endemic state, don’t bet on a return to pre-pandemic norms. This is a one-way trip toward an uncertain future along a winding road of trial and error as workers are empowered with options rarely seen before. The companies, and boards, that figure out how to best navigate the needs of their employees in performing their jobs will likely be winners in the future.
The University of Oxford and Protiviti conducted global research that determined that 7 in 10 business leaders expect their companies will be embracing a hybrid work model in 10 years’ time, up from 22 percent pre-pandemic. A significant majority of business leaders (86 percent) believe that the work people will do over the next 10 years will be different as emerging technologies drive a fundamental shift in the nature of work. What is the board’s role in this transition? Below are eight questions for directors to consider.
Is the stature of the chief human resources officer (CHRO) role sufficiently elevated and recognized within the organization to enable performance to expectations? It is difficult to envision a time when the CHRO role has been more important to an organization’s continued success than the present. Having the right person for the job and the appropriate human capital management capabilities in place are vital to creating and supporting a robust people and culture strategy that underpins the business strategy. To engender confidence, the CHRO must relate to the CEO and engage in strategic conversations.
Have we assessed whether the available talent pool enables the company to meet short- and long-term business objectives? Leading human resources (HR) functions conduct quarterly assessments of human assets and compare these evaluations to the skills needed to execute the strategy. They evaluate talent inventories against longer-term objectives and develop strategies to address gaps.
Are we refining our talent acquisition and retention processes to address current and future market realities? With the intersection of work and home, many employees are less willing to go “above and beyond” as they separate their professional and personal lives. The bottom line is that employee engagement is low. According to a global poll, only 21 percent of employees are engaged at work. With tightening talent markets worldwide, employers must compete for hearts and minds.
Integration of talent and business strategy requires new talent assessments, talent metrics, reskilling approaches, and board reporting. It involves the deployment of innovative labor models and sourcing strategies. The widespread pursuit of digital capabilities in all industries has resulted in a scarcity of technological talent that will likely linger for years. Focusing on cognitive and critical-thinking skills rather than specific fields of study and experience may become more important, meaning that the types of people companies have historically recruited may not be their sole source of talent in the future.
Are we innovating the employee experience? Hybrid and work-from-anywhere models have blurred work and personal lives. Organizations differentiating their employee experience are addressing the well-being of their people more comprehensively. They offer flexible work arrangements and other benefits as well as company-supported and company-led employee networking groups that promote physical, mental, social, and financial well-being.
However, questions remain for directors to consider. How are leaders communicating in a hybrid environment? How is performance recognized and rewarded without disadvantaging those who opt to work remotely? How are the organization’s facilities, training programs, and other resources enabling employees to obtain the most value out of in-person interactions in terms of fulfilling their responsibilities and developing new capabilities and skills?
How are we enhancing our culture as the workplace transitions? Boards have significant responsibility to ensure that the corporate culture enables the strategy, is aligned with core values, and functions as a magnet for talent. Directors should make it a priority to get to know the executive bench of aspiring leaders to gauge their quality and gain insights regarding the company’s culture.
How are we modifying our human capital management processes to address emerging workplace realities? Both generational imperatives and diversity, equity, and inclusion (DE&I) initiatives are linked to talent acquisition and retention. A granular understanding of specific goals and aspirations of the various generational classifications is key to tailoring HR programs. DE&I initiatives should be tracked to ensure continued progress. Performance evaluations and reward systems should address the evolving hybrid work environment. Inclusiveness for and fairness to all are the goals.
Is the evolving work environment impacting our leadership development and succession planning? The emergence of collaborative and virtual technologies combined with the rapid evolution of DE&I initiatives has increased the focus on nontraditional leadership competencies. Leading with empathy builds trust and loyalty among employees because it acknowledges value in the contributions and points of view of others. Highly effective in fostering employee empowerment, resilience, and flexibility during the pandemic, these attributes are invaluable in an environment of disruptive change requiring responsiveness, agility, and speed to market. They offer a foundation for training current and future leaders in managing a remote workforce.
As for succession planning, high-performing HR executives are devising and testing knowledge-transfer processes and leadership development plans prior to losing senior leaders. This approach reduces the high costs and stress associated with reassigning roles and responsibilities in a reactive manner following unexpected departures.
Are we managing the talent implications of high-risk “corporate stances” as well as we should? A survey focused on the role of trust in human capital management disclosed that, when considering a job, 60 percent of employees expect the CEO to speak out publicly about controversial social and political issues that they care about. Employees are choosing and leaving companies based on whether their personal values are aligned with the values of the organization. This reality coupled with contentious political discourse and the power of social media are forcing executive teams to choose sides on issues affecting employees, customers, other stakeholders, and the bottom line. CHROs play an important role in facilitating side-choosing decisions and subsequent actions—including internal communications—by monitoring workforce sentiment on sensitive issues and assessing the associated risks.
The need to align talent strategy and business strategy is straightforward. But rapid technological advancements and the increasing frequency with which external disruptions and volatility force companies to pivot strategically suggest that the talent and skills needed to sustain the business are likely to change as well. That is why the above questions merit consideration in the boardroom.
Jim DeLoach is managing director of Protiviti. DeLoach is the author of several books and a frequent contributor to NACD BoardTalk.
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