Evolving leadership to drive human performance
Organizational leaders and board members can play a critical role in the journey toward driving business and human outcomes.
Yves Van Durme
Corrie Commisso
Jason Flynn
Michael Griffiths
John Guziak
Work has never been more digital, requiring more uniquely human capabilities. Organizations have access to more work and workforce data than ever before and a growing suite of technology, tools, and intelligence that promise to elevate human performance—or the combination of business and human outcomes.
But in the midst of this radical transformation, an unexpected shift is taking place. In a workplace that is increasingly shaped by advances in technology, many leaders and workers are now focusing on a new challenge: not only making work better for humans but also creating value for workers and every other human being the organization impacts.
It’s clear in the trends we’ve explored in this year’s report that while technology plays a role, human outcomes and capabilities are the key drivers behind innovation and organizational growth. Expectations are high for organizations to make progress on human sustainability and for leaders to build trust through taking a thoughtful approach to transparency. Many workers want microcultures that are relevant to the way they work, and they are looking for safe digital spaces to experiment and innovate. Uniquely human capabilities like creativity and curiosity are becoming more important than ever, and the way we need to measure human performance is rapidly changing in response. Taking a boundaryless approach to HR, where people expertise is woven into the fabric of the business, makes human performance a shared responsibility.
It’s also clear that this new focus on human performance isn’t a trade-off. Workers and leaders aren’t looking to make work more human at the expense of business outcomes and priorities, but as a path toward improving business outcomes and priorities. But while 76% of respondents to our 2024 Global Human Capital Trends research say that leaving every human the organization comes in contact with better off is very or critically important to their organization’s success, there’s a gap in how well leaders and executives are prioritizing this. Leaders and executives in our survey ranked this last in importance, behind priorities like reimagining work with digital tools and seeking better ways to measure worker performance.
Workers and leaders aren’t looking to make work more human at the expense of business outcomes and priorities, but as a path toward improving business outcomes and priorities.
What does this mean for those who are responsible for leading organizations through this new way of working that is both high-tech and human-driven?
In last year’s Global Human Capital Trends report, we focused on the new fundamentals organizations need to navigate a world where boundaries are breaking down. In this chapter, we’re zooming in on senior leaders and the board and the influential roles they play as their organizations begin to embrace these new realities. Even as traditional top-down leadership evolves into a more distributed model in many organizations, board and C-suite leaders play a pivotal role in navigating through this dynamic environment.
These leaders are in a unique position to help their organizations successfully embrace human sustainability. While our research indicates that most leaders are confident in their ability to scale human capabilities and people skills, measure engagement, and meet ESG goals, they may be overestimating their progress, and relying on outdated proxies. Making the shifts necessary to truly prioritize human performance will not be without its challenges. According to our research, for example, one-third of executives are still managing their functions independently, collaborating occasionally on ad-hoc initiatives and partnerships. To achieve desired human and business outcomes, leaders should consider leaning into more integrated, cross-functional leadership, examining and evolving their own mindsets in ways that may not be comfortable or familiar. It will likely require new and different measures of leadership accountability across the organization.
And it will likely require leaders at every level to not only embrace new ways of working but to model them for the rest of the organization. This is where a boundaryless approach to human resources becomes imperative, infusing people expertise at all levels of leadership across functional areas.
Orchestrating human performance from the top
Our research shows that leaders are already keenly aware that these shifts need to happen. But few are making real progress in this transition—just 10% of all respondents say their organizations are succeeding at making the shift toward human sustainability: the degree to which an organization creates value for people as human beings, and a key to unlocking human performance. Although executives have a slightly more positive view of their progress than workers (22% of executives say they are doing well versus 10% of workers), it’s clear that there is much work to be done.
It’s likely that the push needed to close the gap between knowing human performance should be a priority and doing the work to make it a reality will come from those holding the decision-making reins. Senior leaders have access to the organizational levers that can either help or hinder efforts to change: finances, governance, process, organizational values, and priorities. They are also in a position to model and drive a purpose-driven vision that supports human sustainability.
While worker expectations can inspire action—and are, for many organizations—transforming an organizational mindset requires leadership engagement and support beyond grass-roots efforts. According to Kerrie Peraino, chief people officer at Verily Life Sciences, “It is not the workforce that is resisting the change. It is often leaders who are resisting the change because we're applying old paradigms to our new reality.”1
As we look across the 2024 Global Human Capital Trends, we see three key areas emerging where leaders have an opportunity—and a responsibility—to help their organizations create new paradigms geared toward human performance: Resetting organizational priorities, evolving governance structures, and fostering psychological safety for their teams. Leaders who fail to act on these issues may put their organization’s progress toward achieving human performance at risk.
Resetting organizational priorities aligned with what’s most important
Leaders bear the responsibility of making the most pivotal decisions and relying on outdated proxies can jeopardize decision-making. We identified some of these proxies in the report introduction, such as using productivity as the primary measure of worker activity without considering quality or intended outcomes. Clearly defining and measuring organizational priorities can empower an organization to shift from talking about human performance to taking concrete actions and allocating resources accordingly. The following actions can help senior leaders and board members embrace the shift away from old proxies and move toward a new model of human performance:
- Operationalizing human capabilities as part of overall business and workforce strategy. Begin by ensuring your leadership team understands the level of human capabilities—creativity, empathy, curiosity, etc.—already present in its workforce and identifies any capability gaps. Commit organizational resources to hiring initiatives that seek out these capabilities; rewarding workers who display them; and creating, monitoring, and nurturing safe spaces where these uniquely human skills can be developed and practiced.
- Tying leader and manager incentives to human sustainability metrics. Making progress on human sustainability requires that leaders are held accountable. Organizations should set goals to advance on key human sustainability outcome metrics and drivers and attach incentives to achieving them. Many companies are already doing this: Almost three-quarters of S&P 500 companies now connect executive compensation to achieving key sustainability metrics,2 and some organizations are passing these incentives on to the entire workforce. Mastercard, for example, recently announced it would tie a portion of bonuses for all employees to achieving organizational sustainability metrics.3
- Replacing outdated metrics with new metrics that matter. New kinds of work often require new kinds of metrics. The human performance metrics that matter most to an organization will vary based on industry and workforce, requiring some experimentation to find the right balance of business and human sustainability outcomes. But leaders can take steps to collaborate with workers on cocreating what should be measured—not just what can be measured. In a call center, productivity is typically measured by things like amount of time per call or number of sales made. But when human performance becomes the primary focus, traditional business metrics like customer satisfaction, retention, and upselling need to be combined with human sustainability metrics like worker well-being and skill development to give call center managers a better picture of how their workers are actually performing.
When it comes to defining what’s important, consider the following actions for each trend in our report that are unique to senior leadership.
Be prepared to evolve and adapt organizational governance structures
Successfully shifting away from old paradigms to a focus on human performance means being willing to forgo old approaches to organizational governance as well. Many of this year’s trends highlight a need to increasingly include all levels of the organization in decision-making and adopt cross-functional governance approaches: less micromanagement, more autonomy. Fewer top-down dictates and more cocreation. Consider the following actions in leading your organization toward shared ownership as a human performance organization:
- Integrating human sustainability governance into the board and C-suite. HR has historically been the primary catch-all for people-related issues, but human sustainability crosses all functional boundaries. HR alone shouldn’t be tasked with this responsibility, thereby suggesting a boundaryless HR approach in which the board defines human sustainability goals and provides oversight to ensure the C-suite is meeting them. With the board holding them accountable, C-suite leaders can then take ownership of achieving human sustainability goals for the organization by, for example, connecting the dots between functions.
- Empowering managers to improve human performance. Many workers say that managers have a significant impact when it comes to human sustainability issues: in fact, in one global study, respondents said managers have as great an impact on their mental health as their spouses.4 Managers are in a unique position to influence human performance, but simply adding new responsibilities to roles that are already struggling with overwork will likely fail. Instead, leaders can empower managers to prioritize tasks related to improving human performance and help clear organizational obstacles, such as company policies, heavy workloads, and unsupportive cultures. Taking a boundaryless HR approach by giving managers the training and resources they need to build the people expertise necessary to elevate human performance can also help.
- Let microcultures flourish. For some leaders, embracing a new mindset that encourages worker autonomy in the way they work can be difficult. Leaders and executives are often held accountable for delivering on objectives created for an existing paradigm and may balk at the idea of decentralizing control over how work gets done. But there is a growing recognition that empowering individual workers and teams is a great way to generate the results leaders want for their organizations. Just over half of the executives in our survey (56%) say they are leading or expanding their efforts to focus on individual teams and workgroups as the best places to cultivate culture, fluidity, agility, and diversity. Organizations that understand the value that worker autonomy and choice have on building organizational trust will reap the benefits. Our research shows that workers who trust their employers are highly motivated, more satisfied with their jobs, healthier, and less likely to be on the lookout for new employment opportunities.5
Governance is a domain that is unique to senior leadership, and the following guidelines may help leaders navigate governance issues across the trends.
Be unequivocal about creating trust and psychological safety
It only takes a quick skim of the latest headlines to understand that organizational trust is under threat from any number of internal and external factors. An increasing focus on trust and transparency in the relationship between workers and organizations was the top response from board members, directors, and C-suite respondents of issues important to the organization’s success. Yet only 16% of workers responded that they have a very high level of trust in their employer. Leaders carry a heavy responsibility to not only build trust with their workforce, but also to create the psychological safety within their organization necessary to elevate human performance.
The following actions can help leaders build trust and psychological safety with their workforce:
- Inviting workers to cocreate alongside leadership. Our research indicates that while workers are often invited to provide feedback, organizational strategy is still a very top-down activity. Only 30% of C-suite leaders say their organization’s leaders are involving their workers in cocreating the organization’s strategies and solutions often or all the time. And less than half (43%) of individual contributors believe that their organization is helping them imagine how their job may change in the future. One of the most powerful means of building trust with your workforce is to invite them to participate in creating the organization’s future in a more meaningful way. To create value for individuals, organizations need input from individuals. As we introduced in our 2023 Global Human Capital Trends report, cocreation is essential for operating in a boundaryless world. Leaders can establish safe digital spaces where workers are invited to cocreate and reimagine their future and the future of the organization. For example, they can cocreate solutions for human performance efforts, establishing new metrics, responsible data practices, and evolving organizational structures, policies, and relationships.6
- Establishing strategies for responsible use of data from new transparency technologies. Organizations have access to more work and workforce data than ever before, leading to unprecedented transparency in every corner of the organization. And as leaders begin to focus on new metrics for human performance, it may be tempting to tap into this resource before having a strategy in place for responsible practices around its collection and use. But according to Deloitte’s Quantified Organization research, a lack of strategy for the use of workforce data was directly related to workers’ lack of trust.7 Consider strategies like voluntary data sharing agreements, which allow workers to opt in or out of sharing optional data with their organization, as these are linked to increased worker openness to data-sharing.8 Leaders and the board have a responsibility to create responsible practices for workforce data and AI–not just customer data and AI—and will need to create governance structures to do it.
- Planning now to address tensions around use of emerging technologies for data collection and monitoring. Deloitte’s Quantified Organization research shows that most workers are relatively comfortable with data collection from known technologies like email, calendars, and other traditional technologies. But workers see data collection from emerging technologies like wearables and XR headsets as crossing a line, which could create a friction point for trust as a majority of leaders surveyed said they expect to be implementing these technologies for data collection in the coming years. Don’t wait until emerging technologies are posing ethical and trust issues in your organization: Strategize ways to build trust with employees, address worker privacy concerns, and hold the line between professional and personal data monitoring.
Trust and psychological safety need to be created and embraced at the highest levels of the organization to be successful. Consider these actions across the trends in establishing psychological safety in an organization.
Leading an organization toward optimizing human performance can seem like an overwhelming challenge for leaders. Shifting organizational mindsets can be just as difficult as making the operational adjustments needed to support a new way of thinking and working. The key to making the shift from knowing to doing in a boundaryless world is to start where you are, with what you have, and continue to build strategies that take your organization closer to its human performance goals. While focusing on short-term progress can help move the needle, making the shift from a traditional mindset of work to a human performance mindset of work can be a much longer-term play, helping drive the organization’s continued success for generations to come.
Research methodology
Deloitte’s 2024 Global Human Capital Trends survey polled 14,000 business and human resources leaders across many industries and sectors in 95 countries. In addition to the broad, global survey that provides the foundational data for the Global Human Capital Trends report, Deloitte supplemented its research this year with worker- and executive-specific surveys to represent the workforce perspective and uncover where there may be gaps between leader perception and worker realities. The executive survey was done in collaboration with Oxford Economics to survey 1,000 global executives and board leaders in order to understand their perspectives on emerging human capital issues. The survey data is complemented by over a dozen interviews with executives from some of today’s leading organizations. These insights helped shape the trends in this report.