Organizational Design Tops Deloitte India Human Capital Trends 2016
The new organization: Different by design
The India report has been designed to complement Deloitte’s 2016 Global Human Capital Trends report “The New Organisation: Different by Design”. This country report summarizes the challenges faced by organisations today and the business and HR capabilities to address these challenges.
- Almost 70 per cent of India survey respondents not confident in their leadership bench strength
- Culture is seen as critical, but most companies report they are not ready to tackle the issue
New Delhi, 27 May 2016: Businesses in India are looking to raise the bar for HR and talent in terms of rigor, evidence, and more structured and analytic approaches to delivering business relevant talent solutions, according to Deloitte report “Human Capital Trends 2016 – The New Organisation: Different by Design”. Deloitte in India conducted this fourth annual Human Capital Trends survey, in partnership with National Human Resource Development (NHRD) Network. The India trends report analyses responses from 239 leaders from across India who took part in a comprehensive global survey of more than 7,000 business and HR leaders in over 130 countries in the fourth quarter of 2015.
According to the India report, Organizational Design tops the list of the most important Human Capital Trends in the country, followed by Learning and Culture. Leadership, which was the most important trend last year, fell to number four this year in the ranking with almost the same percentage of importance in the survey (88%). While the relative rank of HR organisations’ capability building dropped 6 places (in the trends ranking), the survey reported the emergence of new priorities and capabilities including organisation design, design thinking and managing the growing temporary and contract workforce (gig economy). Both culture and engagement continue to be critical human capital issues in India today.
“While the respondents this year are generally satisfied with the performance and capabilities of HR, this is paired with a trend towards driving more investment to HR – indicating improving prospects for innovation and development in the function in the coming year,” saidS.V. Nathan, Senior Director and Chief Talent Officer, Deloitte India. “More than a quarter of the respondents, however, reported that there is still significant room for improvement across HR programs and capabilities.”
Compared to 2015, two trends which saw significant increases in importance are Digital HR, which increased 14% between 2015 and 2016, and People Analytics which increased 9% in importance year on year. In comparison to last year’s survey, Indian respondents are optimistic about the future. Most Indian businesses have a positive view on the future of their organization. At the same time, the competitive challenges of India’s knowledge and services economy are driving this shift in focus both in People Analytics and Digital HR.
Mr. Jeff Schwartz, Principal, Human Capital; Global Leader, Marketing, Eminence, and Brand, Deloitte added “At a global level, perennial issues such as leadership, and learning continue to rank high in importance this year, a key shift is under way, as corporate leaders turn a more focused eye towards adapting their organization’s design to compete successfully in today’s highly challenging business environment and competitive talent markets. Executives increasingly recognize the need for a deliberate strategy to shape their organization design and their corporate culture, rather than having it defined for them. Our larger global report, offers important perspective on the future priorities and readiness of businesses in India and around the world to address these critical talent and HR trends.”
According to the report, the leadership challenge remains with 68 per cent of respondents across India expressing concerns about their leadership bench strength. The need of the hour is to invest in and deliver high impact programs addressing the needs of leaders at every level including senior leaders, next generation leaders, women and diverse leaders, and millennial leaders – expanding exposure to challenges including global skills and experiences and rapidly changing technologies.
In India, culture ranked several places ahead of engagement at 88 per cent in terms of importance. More than 8 in 10 organisations in India see culture as being “important” or “very important”. Yet, only 35 per cent of organisations believe they understand their culture well and only 22 per cent believe they are “very ready” to change it.
The report further highlights that over 70 per cent of respondents rate their HR capabilities as adequate, good, or excellent, echoing the positive global consensus about HR performance. India respondents report 57 per cent with plans to increase investments in HR in the next 12-18 months, a more positive response than global aggregate of 49 per cent, but generally at par with global outlook for HR investments in APAC of 52 per cent.
More than a quarter of the respondents, however, reported that there is still significant room for improvement across HR programs and capabilities.
The report goes on to discuss the changing skill requirements for HR, 56 per cent of those surveyed in India reported that they were either already reworking, or actively considering changes in their talent sourcing and recruiting capabilities. More than 41 per cent of respondents in India noted that career paths for HR professionals in their firms were ad-hoc with no clear career models for HR professionals.
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