In wake of COVID-19, 61% of executives now focused on transforming work, double pre-pandemic levels has been saved
In wake of COVID-19, 61% of executives now focused on transforming work, double pre-pandemic levels
2021 Human Capital Trends Press Release
Executives focus on re-architecting work by optimising human potential through designing work around workers’ strengths
Malta, Dec. 10, 2020 — Amid unprecedented workforce disruption from the COVID-19 pandemic, organisations are enacting radically new ways of working and operating – and the C-suite is taking action to reimagine the future of work with human capital issues at the top of their agenda. Executives are shifting preparedness strategies from planning for the familiar and are instead synchronising across the C-suite to develop human-centric strategies that allow organisations to better adapt to ongoing disruption.
Deloitte’s 2021 Global Human Capital Trends report, "The social enterprise in a world disrupted," examines how organisations and leaders can leverage the lessons of this pandemic to fundamentally reimagine work, shifting from a focus on surviving to the pursuit of thriving.
Completed by more than 6,000 respondents in 96 countries, including Malta, Deloitte's Global Human Capital Trends report included 3,600 executive-level responses, with more than 1,200 C-suite executives and board members, in addition to other management functions. For the first time in the report’s 11-year history, business respondents (56%), including 233 CEOs, outnumbered HR respondents (44%) in the survey – underscoring the growing importance of human capital in organisational decision-making.
“Similar to the international sphere, as shown in the survey results, the local Human Capital arena has and is still experiencing a paradigm shift; with the main objectives of mitigating disruption of work, ensuring high engagement levels and the well-being of employees,” said Adrian Mamo, Human Capital Leader at Deloitte Malta. “The digitisation of processes through the implementation of Human Capital Management solutions are now, more than ever, being explored and executed and are resulting in processes that are accessible to all employees through modules such as employee self-service. Furthermore, despite the various challenges, some local organisations are still investing in the learning and development of their workforce via virtual methodologies, with the ultimate aim of reskilling with the right competencies to re-architect work in a more agile and effective manner.”
Reimagining preparedness and workforce potential
The report shows that human capital issues are at the center of leaders’ thinking as they shift organisational views on preparedness. In the 2021 report, 17% of executives said that their organisations would focus on planning for unlikely, high-impact events moving forward, as opposed to just 6% before the pandemic. Nearly half (47%) of executives said that their organisations planned to focus on multiple scenarios, notably up from 23% pre-pandemic. To effectively deal with multiple possible futures and unlikely events, the importance of real-time workforce insights and data as they set new directions has become even more critical.
However, the most important factor in making that preparedness shift is unleashing worker potential through a new focus on capabilities. Almost three-quarters (72%) of executives identified “the ability of their people to adapt, reskill and assume new roles” as a priority for navigating future disruptions. However, only 17% of these same executives said that their organisation was “very ready” to adapt and reskill workers to assume new roles, pointing to a substantial disconnect between leaders’ priorities and the reality of how their organisations support workforce development.
“The COVID-19 pandemic revealed the resilience of the workforce. When workers were asked to expand their roles to accomplish whatever was needed, they rose to the challenge,” said Erica Volini, principal and global human capital leader, Deloitte Consulting LLP. “No longer are human capital issues relegated to HR. Amid disruptions, organisations either sink or swim based on their workforce’s capabilities like collaboration, creativity, judgment and flexibility. It’s clear that workforce and human-centric matters are top priorities for C-suite and board leaders.”
C-suite collaboration is critical to set new workforce direction
HR is beginning to embrace the new critical role of re-architecting work and setting a new direction for the workforce itself. Due to HR’s adept handling of COVID-19’s challenges, the percentage of HR executives who are very confident in the department’s ability to navigate future changes in the next three to five years has doubled from 1 in 8 in 2019 to nearly 1 in 4 in 2020. Among business executives, the proportion that were “not confident” in HR dropped dramatically from 26% in 2019 to 12% in 2020.
With the CHRO at the helm, propelling this level of organisational change requires collaboration and leadership across the entire C-suite. In fact, survey respondents identified leadership as the top factor that drives change. However, as executives of large organisations begin to re-architect work, they have identified some barriers that they will need to overcome, such as too many competing priorities (57%), lack of readiness (43%) and lack of future visioning (27%).
“The global pandemic has brought the best out of many leaders and organisations, as much of the C-suite has demonstrated a level of transparency and empathy almost never seen before,” said Volini. “Continuing to build on this new level of leadership collaboration, capitalising on uniquely human capabilities, and using real-time data to re-architect work will enable organisations to develop and sustain long-term growth.”
Integrating humans and technology to re-architect work
The report shows that executives are increasingly shifting away from the optimisation of automation and moving toward re-thinking how to best integrate humans and technology to complement each other and drive organisations forward. Sixty-one percent of executives say they plan to focus on reimagining work in the next one to three years, compared to only 29% before the pandemic. COVID-19 has heightened leaders’ awareness of the potential benefits of this approach, including higher productivity, increased agility, and greater innovation.
During the pandemic, organisations utilised team structures to enable greater adaptability, which allowed them to better survive an unpredictable year. Leaders are increasingly recognising the value of “superteams,” combinations of people and technologies designed to leverage complementary capabilities and pursue outcomes at a speed and scale that would not otherwise be possible. Executives in this year’s survey recognised that the use of technology and people is not an “either-or” choice, but a “both-and” partnership. The top three factors for transforming work were organisational culture (45%), workforce capability (41%) and technology (35%) – factors that must all work together for an organisation to assemble effective superteams.
“It’s not about replacing humans with technology. When deployed thoughtfully and effectively, technology can change work so that it makes the most of workers’ distinct capabilities and gives team members new methods to learn, create, and perform in ways that achieve new outcomes,” said Jeff Schwartz, principal and U.S. future of work leader, Deloitte Consulting LLP.
Integrating well-being into work
As the lines between work and life blurred even further during COVID-19, leaders moved from prioritising work-life balance to designing well-being into work — and life — itself. In fact, 69% of executives reported they implemented policies during COVID-19 designed to empower workers to better integrate their personal and professional lives. Among executives, 7 in 10 said shifts to remote work had a positive impact on well-being.
Looking ahead to the next one to three years, however, executives ranked improving well-being as their second-to-last ranked priority in the context of transforming work, yet workers ranked improving well-being within their top three priorities. This points to an ongoing debate about how the focus on well-being will be sustained in a post-pandemic world.
“Organisations that integrate well-being into the design of work at the individual, team and organisational level will build a sustainable future where workers can feel and perform at their best,” said Volini. “The pandemic has shown us that human-centric work strategies are not just a nice-to-have, but a need-to-have. Moving forward, those leaders who address human capital holistically and build business decision-making around human potential will thrive.”
The social enterprise in a world disrupted: Leading the shift from survive to thrive
In today’s world of perpetual disruption, it’s time for organisations to shift from a survive mindset to a thrive mindset. Making this shift depends on an organisation’s becoming—and remaining—distinctly human at its core, because today’s environment of extreme dynamism calls for a degree of courage, judgment, and flexibility that only humans can bring.