2024 Human Resources Key Issues Research

February 20, 2024
Season 5, Episode 14

Human resources leaders are expecting to feel increasing pressure in 2024 in the face of global economic uncertainty and possible labor and skills shortages, and are turning to technology to help them improve efficiency and effectiveness. A discussion of findings from The Hackett Group’s 2024 HR Key Issues research, with Senior Research Director Tony DiRomualdo

Welcome to The Hackett Group’s “Business Excelleration Podcast,” where week after week we hear from experts on how to avoid obstacles, manage detours and celebrate milestones on the journey to world-class performance. This episode is hosted by Gary Baker, Global Communications director at The Hackett Group. Today’s episode will discuss the latest research on human resources (HR). Gary is joined by Tony DiRomualdo, senior director at The Hackett Group.

To begin, Tony shares the five key concerns that were expressed in the HR research, including inflation, recession, high interest rates, shortage of skills and workers, and competitive environments. Many of these key concerns are the same ones expressed the year before. There is also angst over building technologies and services. The enterprise business objectives

include revenue growth, margin improvement protection, and talent and workforce management. Businesses are expected to emphasize top of mind process efficiency, working capital and consolidation. They need to focus on the bottom line and getting more efficient and productive, which means running the operational ship as tightly as possible. This study confirms what we already know – that companies need to find a way to do more with less. HR workloads are expected to increase by 7%, and the rate of increase is decelerating but still accelerating at the same time. Technology spending is expected to rise by 4%. Workloads won’t go up quite as much, and there will be more technology to deal with this work. Head counts are expected to decrease by an average of 2% and operating budgets dropping by 1%. There is greater emphasis on automation, self-service and global business shared services, with an expected increase of 4.7% for work handled by automation.

Next, Tony discusses how these objectives have changed. They focused on the top 10, but they had 35 different objectives for the year and asked people to rank them in terms of importance. The No. 1 objective is developing effective leaders, while No. 2 is creating and maintaining a high culture. The leaders can greatly impact a company and culture is really a stress test for friction, volatility, change, and pressures of a company. The companies with better cultures tend to be most successful. The challenge around culture is high performance, but one that can be sustained. There are many cultures where burnout is normal, and HR has a huge role to play to sustain high performance. Another important objective is coaching leaders and also HR policies and programs that drive performance. The third objective is strategic advisor to the business and how leaders perceive HR. They need to align their business strategy to business planning and have planning capabilities and processes in organizations. There needs to be a clear connection between having a chore and robust planning process with strong business and talent outcomes. The issue of alignment is now top of mind and connects to other issues related to talent, which needs to be attracted and retained. There are also acquisition challenges in improving how they hire, onboard, manage and develop in the organization. They also want to improve employee and candidate experiences. The last objective is leveraging technology to improve efficiency and effectiveness of HR services. More technology allows HR to focus on all these other issues, which creates a more satisfied employee and manager base.

HR leaders are not as confident as they would like to be in achieving these goals. They see significant gaps between how important HR executives rank them and how confident they are in executing them. They need to take steps toward progress and capabilities. Tony’s guidance for HR leaders in meeting these objectives is to create good leaders because they create healthy cultures. Leaders are effective in helping organizations and navigating change, and they also need to help leaders adjust, adapt, and adopt new skill sets. Leaders need to have the ability to manage across remote and hybrid workforces, be flexible, and give good praise and appreciation. This study revealed that HR needs to adjust the methods that it uses to develop leaders and leverage more with new tools like simulations, virtual reality, and training tools. Those who have tried this had tremendous results. Leaders need to also improve their strategic workforce planning capabilities and have a process that’s standard and clearly laid out.

In closing, Tony also states that it’s important to upscale HR staff to be more comfortable and advise with data. We need to be more prudent in how we deploy the technology and use it to be more efficient and productive, and improve the experience. Technology can perform more tasks and drive down the costs. Leaders need to start with existing platforms to determine whether or not they are getting the most out of what’s available and then look for funding for new tools.

Time stamps:

0:46 – Welcome to this episode hosted by Gary Baker. 

1:45 – What HR is expecting in 2024.

6:28 – What are HR leaders expecting in their field?

9:44 – How has that changed from the year ahead?

18:35 – How confident are HR leaders in achieving these goals?

19:46 – What guidance can you give HR leaders on how to improve in meeting these objectives?