Are you interested in diving into the 9 most prominent human resources (HR) trends for 2023 to see what practices and techniques companies often use to understand and meet employee needs, add value to the business and align specific functions with commercial demands? Let’s have a closer look!

Part 1

HR TREND 1:

LEADER AND MANAGER EFFECTIVENESS

The Great Resignation, coupled with unprecedented talent shortages, has encouraged organisations to promote their high performers into managerial positions. As a result, the leadership pipeline is now filled with new (less experienced) candidates. According to a DDI report, 55% of CEO’s list developing next-generation leaders as a top challenge – with only 11% of companies having a strong leadership bench, this is a strategic priority for almost all organisations.

Additionally, we are also seeing the need for a new type of leader: the human leader. Self-awareness, empathy, listening, resilience, and other “soft skills” are fast becoming the currency of those leaders who rise above the rest.

• Clearly articulate what it means to be a good leader, with clear expectations regarding leadership behaviours and rhythms.
• Help leaders become more self-aware to identify the specific leadership development areas that need to be accelerated to be successful as a leader, using feedback mechanisms, 360 assessments, psychometric assessments, coaching, and regular self-reflection opportunities.
• Actively invest in the corporate development of skills such as empathy, active listening, resilience, cultural intelligence, and entrepreneurial thinking.
• Review traditional leadership development methods to adopt more innovative development methods that allow for accelerated development.
• Look into blended methods that incorporate on-the-job learning, mentoring, various forms of coaching, micro-learning, immersive learning, and skills rotation experiences will be needed.
• Pay special attention to building the resilience of leaders; with 2023 likely to bring continued pressure and tough times, this will be a must. Refer to trend nr 2 for more information on this point.

According to a McKinsey study, the impact of the pandemic has seen burnout levels reach an all-time high, with 25% of all employees struggling with symptoms of burnout. Interestingly, this seems to be especially significant for HR professionals, with Workvivo research reporting that a staggering 98% of HR professionals reported feelings of burnout at some point in the last six months.

Employee well-being will continue to be a key focus in 2023 and companies will need to intentionally address the impacts of burnout if they want to see employee productivity and innovation return to healthy levels.

• Firstly, overcome its own burnout crises.It is critical that HR models healthy working behaviours, effective coping mechanisms, and high levels of resilience for the rest of the organization.
• Integrate mental health and well-being programs into the entire employee life cycle, thinking about ways to include well-being in attraction, onboarding, development, performance management, and retention.
• Find ways to encourage employees and leaders to call out and address toxic behaviours at work
• Remove the stigma around mental health and provide multiple support initiatives for those struggling with mental health issues. These could include regular wellness surveys, training initiatives, leveraging tech, optimising employee assistance programmes, hosting regular wellness conversations, incorporating wellness into measured goals, etc.

HR TRENDS 3:

SOLVING FOR HYBRID WORK ENVIRONMENTS

Although most companies have now adopted some form of hybrid working, there seems to be a widening disconnect between employers and employees on whether hybrid working helps or hinders productivity levels. A study by Microsoft revealed that 87% of employees reported being productive in a hybrid environment, and only 12% of leaders reported having complete confidence in their team’s productivity.

We see flexible work starting to become a non-negotiable for most in-demand talent, with 64% of employees reporting that they would consider quitting if they were expected to return to the office full-time. With skills shortages reaching an all-time high, remote work is here to stay. So, getting new flexible work models right will continue to be a big priority for HR in 2023.

A Nature Human Behavior study found that the collaboration of Microsoft employees dropped by 25% and became more siloed in a remote working environment when compared to pre-pandemic levels. This is also a concern that HR will need to address in 2023.

• Actively address leaders’ productivity concerns of hybrid working environments collaboratively – using modern technology, regular 2-way conversations between managers and employees, training leaders to lead remotely, and the redesign of work methods and performance management processes.
• Work closely with leaders and employees to define how, where, and when remote work should be done.
• Facilitating regular internal conversations on the topic to explore different workplace strategies, options, and experiments in the pursuit of defining what works for their organisation.
• Implementing intentional and creative collaboration rhythms, tools, and initiatives that require teams to enhance collaboration, relationship-building – and (where possible) more in-person interactions.
• HR will also need to educate themselves and all employees on managing proximity bias (an unconscious tendency to favour in-office employees over remote workers). This will require a review of performance management processes and measurements to ensure fairness.

Josh Bersin asserted that the post-pandemic era is quickly becoming defined by employee experience. A Gartner survey of HR Leaders found that 47% cite employee experience as a top priority. The experience of employees throughout the entire employee life cycle will continue to be a major priority for HR in 2023. Employee expectations have shifted since 2020, and HR is seeing the impact thereof on employee attraction and retention across all industries. Employees are looking for companies that provide personalised opportunities, flexible working arrangements, a shared purpose, and a holistic approach to well-being. In 2023, employee experience will form a big part of companies’ competitive advantage.

According to the State of EX 2022 report, quality data and measuring the impact of EX improvements seem to be the biggest EX challenges. To get employee experience right, HR will need to learn from its marketing counterparts, tuning in to customers regularly, through employee listening. While 60% of employers have increased in some form of employee listening effort, few are using formal listening approaches, with just  31% conducting employee surveys and 13% conducting focus groups  (Willis Towers Watson).

• Create an employee journey map to help measure employee experience at every stage of the employee journey. This will help HR to visualise each employee’s journey throughout the employee life cycle and identify areas for improvement.
• Understand exactly what would enhance the experience of its employees throughout the employee life cycle.
• Implementing various employee listening channels (e.g. video, voice, text, chat, focus groups) for employees to provide inputs and feedback.
• Review the employee value proposition to include aspects relating to flexible working, well-being, and meaningful work.
• Utilise technology to create personalised employee experiences, from attraction to onboarding and development. Self-service-driven technologies are key to empowering employees to drive their own development, progression, and experimentation in the company.
• Encourage a leadership culture that treats employees as individuals. Leaders need to understand the employee’s unique aspirations, talents, recognition preferences, and values and want to enable a good employee experience.

HR TREND 5:

DEIB MATTERS

According to a recent study by McKinsey, more diverse companies are 35% more likely to outperform their competitors. Furthermore, recent research shows a promising correlation between diversity and increased workplace innovation revenue. Competitive companies will prioritise Diversity, Equity, Inclusion, and Belonging in 2023, not just for the company benefits it would bring, but also because employees are demanding it.  A recent research study by Glassdoor shows that over 74% of job seekers identify diversity and inclusion as determining factors when applying for jobs.

• Cater for various kinds of diversity, including the new generation entering the workplace with a preference towards innovative thinking, flexibility, collaboration, autonomy, and simplified communication. HR will need to adapt the employee experience to suit the needs of Generation Z.
• Ensure that all HR practices foster inclusivity. In 2022, much of the DEIB focus was on recruitment efforts and although 2023 will see a continued effort on the recruitment front, HR will need to look at the entire employee life cycle through a DEIB lens.
• Initiate or improve long-term diversity programmes that are focused on increasing representation among managers through accelerated development programmes.

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Read part 2 of our Prominent HR Trends for 2023.