2023 Global Human Capital Trends has been saved
2023 Global Human Capital Trends
New fundamentals for a boundaryless world
The boundaries that were once assumed to be the natural order of things are falling away as disruption and discontinuity challenge traditional models and assumptions about work. Organisations and workers must traverse this new landscape together, calling on a new set of fundamentals to navigate the boundaryless world.
In a boundaryless world, work isn’t defined by jobs, the workplace isn’t a specific place, and many workers aren’t traditional employees. Those who partner with workers and experiment with what’s possible will create sustainable work models and elevated outcomes—making work better for humans and humans better at work.
For the past century, we have been governed by a mechanistic view of work. We have assumed that work is fixed and repeatable, readily organised into discrete tasks, and grouped into well-defined jobs. Transformation efforts focused on cost and productivity—how to deliver the same outcomes through faster, more efficient methods. But in recent years, those models have been challenged as organisations and workers grapple with a greater degree of discontinuity and disruption than ever before.
The boundaries that were once assumed to be the natural order of things—that work can be organised into clearly defined processes; jobs can be categorised and contained wholly within the organisation; work occurs within the four walls of the workplace; and organisations can centre their decision-making around shareholders and the bottom line—are falling away. The implication for organisations is that they are traversing a new landscape as they lose those traditional boundaries that kept things packaged and orderly, and gain permission to experiment, pilot, and innovate to define new fundamentals. Similarly, for workers, the rules of engagement with organisations are shifting, opening doors for greater and more meaningful collaboration and cocreation with the organisation.
Human instinct is to feel overwhelmed or hesitant as boundaries fall away; 10,000 respondents in this year’s Deloitte Global Human Capital Trends survey said their greatest barrier to achieving organisational outcomes is being overwhelmed by too many changes at once. However, the dissolution of boundaries creates new opportunities for organisations and workers who are prepared to show up in fundamentally different ways. This means no longer simply reacting to stimulus in the marketplace by deploying new strategies against the categories and boundaries of the past. Instead, organisations and workers should challenge prior assumptions and adopt a new set of fundamentals built for a dynamic, boundaryless world rather than the stable, compartmentalised one we are leaving behind.
These new fundamentals require organisations and workers to frame the challenge differently, thinking like a researcher in how they approach their business and workforce strategies, treating every new roadblock as an exciting experiment from which they can learn, adapt, and improve. They call on organisations and workers to chart a different path, cocreating their relationship in pursuit of new and evolving purpose, innovation, and reimagination. And they require organisations and workers to design for impact, prioritising human outcomes and approaching strategies from a human lens—for humans and by humans.
Framing the challenge: Think like a researcher
To lead in this boundaryless world, organisations and workers should activate their curiosity, looking at each decision as an experiment that will expedite impact and generate new insights. Differentiation and winning will come not from always believing you must have the right answer at the start, but by being able to challenge orthodoxies, operate with humility and empathy, and learn from new information so you can refine as quickly as possible. Our 2023 Global Human Capital Trends survey data shows that 59% of respondents expect to focus on reimagination in the next 2–4 years, which represents a 2x increase from prepandemic levels (as reported in our 2021 report).
Three of the trends in this report exemplify the need for organisations and workers to think like a researcher.
- Navigating the end of jobs. The boundaries that delineated job from job, grouping tasks and categorising workers into narrow roles and responsibilities, are now limiting organisational outcomes such as innovation and agility. Many are experimenting with using skills, not jobs, as the baseline for how workforce decisions are made. When unboxed from jobs, workers have the opportunity to better utilise their capabilities, experiences, and interests in ways that advance organisational and worker outcomes.
- Powering human impact with technology. The boundary between humans and technology as separate forces continues to disappear as new technologies are entering the workplace that not only automate and augment the work done by humans, but actually enhance human and team performance. Forward-leaning organisations are exploring how to use technology in ways that encourage humans both to be their best selves and to do better work.
- Activating the future of workplace. Digital and virtual technology advances and the emerging role of the metaverse are redefining the concept of the workplace as a physical space. Now, greater interconnectedness and the blurring boundary between home and on-site work give organisations a unique opportunity to experiment with, not “where,” but “how” work should be done. Location and modality become secondary to the needs of the work and the workers.
Charting a new path: Cocreate the relationship
To be successful, organisations and workers will need to learn to navigate this new world together, cocreating new rules, new boundaries, and anew relationship. That means ownership models and value must shift. Organisations should abandon former illusions of complete control and recognise the role they play in living, evolving ecosystems, as workers assume greater influence and accountability for organisational and societal outcomes, leading hand in hand with the organisation.
In the Deloitte 2023 Global Human Capital Trends survey, organisations with higher worker involvement in designing and implementing organisational change were more likely to experience positive outcomes. Specifically, those that said they cocreate with their workers stated they were 1.8x more likely to have a highly engaged workforce, 2x more likely to be innovative, and 1.6x more likely than their peers to anticipate and respond to change effectively.
Three chapters of this report exemplify where organisations and workers must cocreate their relationship:
- Negotiating worker data. The boundary between the organisation and the worker’s ownership rights—the binary categories of worker-owned data or organisation-owned data—is becoming irrelevant. And beyond ownership alone, conversations about what is workforce data, the transparency of that data, and the mutual benefits of data-driven insights are on the rise as data is becoming a new “currency.”
- Harnessing worker agency. Traditional work, workforce, and workplace models that assume organisations have sole decision-making authority are fading as workers demand more meaningful work, flexible workplace models, and more personalised career paths. Whereas worker agency might have previously been seen as a threat, leading organisations are finding ways to leverage worker motivation and cocreation to drive mutual and elevated benefits.
- Unlocking the workforce ecosystem. The value of fostering diverse workforce ecosystems is enormous, but many organisations are still stuck in old patterns of talent access and management because they’re not giving workers of all types (gig, freelancers, contractors, employees, etc.) any say in where, how, and for whom they work. Organisations that adapt their strategies and practices to fit the real-world talent pool, which is far more complex and increasingly comprised of nontraditional workers, will gain access to skills and experiences to accelerate growth, innovation, and agility.
These new ownership models require a large shift from how many work today, so it’s no surprise that organisations were least ready to address trends that require cocreation with workers. According to our survey, only 19% of organisations said they’re very ready for data ownership, 17% for worker agency, and 16% for workforce ecosystems. This readiness gap will be critical to overcome for organisations to capitalise on the innovation and improved individual, business, and societal results these trends could drive.
Designing for impact: Prioritise human outcomes
The final fundamental for a boundaryless world relies on collective aspirations. Organisations should create impact not only to their business, their workers, or their shareholders, but to the broader society as well. Over half of organisations surveyed this year aspire to create greater connections with the society they work in, indicating that the social enterprise, as we defined in the Deloitte 2018 Global Human Capital Trends report, continues to be a pivotal force in the world of work.
It’s no longer enough to build discrete programs that will create value around the edges of important topics like climate, equality, or human risk; they are fundamental to an organisation’s ability to thrive in this new world of work. In the Deloitte 2023 Global Human Capital Trends survey, more than 80% of organisations reported purpose; diversity, equity, and inclusion (DEI); sustainability; and trust as top focus areas.
Three chapters of this report exemplify how organisations and workers are prioritising human outcomes.
- Taking bold action for equitable outcomes. The idea of diversity as a metric is dissolving in place of the notion that organisations need to be looking at DEI as outcomes instead. Those outcomes will focus on equity in how organisations access talent; enable talent through development programs, methods, and tools; and how they advance and promote talent at all levels of the organisation. Organisations will be held accountable less for their activities and efforts and more for their ability to achieve equitable outcomes in support of larger societal goals.
- Advancing the human element of sustainability. The boundary of the organisation as a fully autonomous entity, with interests that can be separated from the interests of society at large, is blurring. As such, organisations are facing mounting pressure to address sustainability issues from governments, global coalitions, their communities, and, not least, their current and future workforce. That workforce is demanding that organisations move past rhetoric about sustainability in favour of delivering observable outcomes. As a result, organisations must focus on the human elements, which have been largely absent in their strategies and actions to date, by “hardwiring” sustainability into the workforce and work itself.
- Elevating the focus on human risk. Organisations have traditionally thought of human risks through a narrow lens—the potential risks that workers pose to the business. In the new world, organisations should expand their view of human risk beyond compliance and reporting to consider how a broad set of risks are significantly affecting and are significantly being affected by humans. These risks, which can have a material effect on a company’s long-term viability, must be fully understood by all executives, with ultimate accountability sitting with the board.
Leading in a boundaryless world
For those who get it right, the boundaryless world becomes one of infinite possibility instead of chaos and confusion. As old boundaries shift and disappear, organisations and workers can deploy these fundamentals to set new guidelines, create more autonomy, imagine new possibilities, and achieve mutual value for the organisation, the workforce, and society. But doing so requires them to employ new mindsets, letting go of the work, workforce, and workplace operating models of the past to embrace a more fluid and more human future, focused on speed, agility, experimentation, and innovation.
New leadership capability is needed at all levels of the organisation to mobilise workers and teams for achieving new outcomes. Yet only 23% of organisations in the Deloitte 2023 Global Human Capital Trends survey say their leaders have the capabilities to navigate a disrupted world. They point to concerns about leaders’ ability to manage the evolving workforce, with less than 15% of organisations saying their leaders are very ready to inclusively lead an expanding workforce or to consider broader societal and environmental risks when making workforce decisions. They also express concerns about the design and execution of work itself: Only 16% say their leaders are very ready to use technology to improve work outcomes and team performance, and only 18% say their leaders are very ready to develop the right workplace model for their organisation.
A new brand of leadership will be required—one that focuses on where you show up and how you show up, and the mindset you adopt to drive work forward. More specifically, you will need to:
- Use experimentation to inform better solutions, foster learning, and accelerate value.
- Cultivate deep and intimate relationships with the workers across your broader ecosystem through cocreation.
- Widen the aperture of your decision-making to understand its full impact with the human agenda in mind.
Those who partner with their workforce and experiment with what’s possible will be able to create sustainable models of work, making work better for humans and humans better at work.