Deloitte Human Capital Trends 2015 Report
HR is not keeping up with the pace of change in business
28 April 2015: Deloitte’s third annual Global Human Capital Trends 2015: Leading in the New World of Work report highlights how the majority of organisations are still failing to take action to improve their culture and are potentially jeopardising future growth.
“As demand for talent picks up, the balance of power in business is rapidly shifting from the employer to the employee,” said Andy Peck, Human Capital partner at Deloitte Consulting. “In Australia workers are becoming more mobile, contingent and autonomous and, as a result, harder to manage and engage. In this new world of work, organisations need to re-imagine the way they manage people and come up with new, out-of-the-box ideas to make themselves relevant.”
The report highlighted a gap between what business leaders want and the capabilities of HR to deliver, as suggested by the capability gap analytics found across regions and in different countries (figure 1).
Figure 1: Reinventing HR: Capability gap by region
In addition to workers’ changing expectations of employers, skills needed on the job are changing faster than ever. Organisations are quickly falling behind on developing the right skills across all levels. There’s an urgent need for organisations to re-evaluate their learning programs and treat leadership development as a long-term investment, rather than a discretionary training spend item when times are favourable.
“It all starts with the senior HR leader as their role has radically changed and is more demanding than ever,” said Mr Peck. “Today’s senior HR leaders must be innovative and business-savvy, plus be able to bring the HR team together so it evolves into an integrated business function. Research shows almost 40% of HR leaders come from the business not from HR.”
Figure 2: Respondents’ rating of the organisation’s HR performance
Figure 2 highlights how only 5% of respondents rate their organisation’s HR performance as excellent. Re-skilling HR is a critical business issue that must be addressed confidently at the CEO level. HR and business leaders must have the confidence to re-imagine, reinvent and reinvigorate their talent and HR functions.
As significant shifts take place in the workforce, such as it becoming younger and older, more diverse, as well as increasingly mobile and autonomous, workplaces become more complex, yet they still need to engage with a highly diverse employee base.
“Success in the new world of work means organisations must have the confidence to re-imagine the way they approach talent management by viewing their employees as customers or partners,” said Mr Peck. “They must create an employment brand and a culture that aligns with the values of the talent they want to attract and also flexible and individualised career options, offer ongoing leadership and professional development opportunities.”
Figure 3: The readiness and importance of culture and engagement
Figure 3 details the readiness and importance of reinventing HR and companies can start this by doing the following:
- Design the HR organisation to be an enabler and builder of talent
- Align the specialist capabilities with priority business needs and decrease the effort of generalists
- Harness the wealth of data available to act as a research and professional development capability for the business
- Improve HR capability development around capabilities such as consulting and project management, organisational change and HR analytical skills.
“Once designed primarily as a compliance function, today’s HR organisation must be agile, business-integrated, data-driven, and deeply skilled in attracting, retaining and developing talent,” concluded Mr Peck.
About Global Human Capital Trends 2015 survey
Deloitte’s Global Human Capital Trends 2015 survey was conducted among more than 3,300 HR and business leaders in 106 countries, and is one of the largest global studies of talent, leadership and HR challenges.
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