The future of work is now. The massive changes in how we work, where we work, why we work, who we choose to work with, and the technologies we use daily have landed on the shoulders of every leader. My article in Harvard Business Review, 21 HR Jobs for the Future, was a call to action for chief human resource officers (CHROs) to become central C-suite players just as CFOs did following the financial crisis in 2008.
Our moment has arrived. Executive Networks' Global CHRO of the Future research reports 93 percent of CHROs agree that the impact of the HR team on business results is just as important as the finance team. Here are four key findings from this research:
#1. Talent Attraction and Retention is the Number One Challenge for CHROs
According to our research, eight in ten (83 percent) of CHROs report facing a significant talent retention issue and half said retention was particularly an issue among in-demand roles. Last year 47.8 million workers quit their jobs, an average of nearly 4 million each month. The real issue, however, is not the high quit rates; instead there is a need to examine why this is occurring.
The Global CHRO of the Future research found voluntary turnover rates varied widely by industry, with professional services having the highest rates--up to 20 percent for knowledge workers and 40 percent for direct patient care nurses.
Our research probed the contributing factors to voluntary turnover, and they run the gamut. They range from employee stress and burnout as number one, followed by lack of transparency in career growth and work life balance issues. Interestingly, only 18 percent believed employees are leaving because they want more compensation.
For example, Microsoft is expanding their people analytics function beyond measuring employee engagement to focus on how well their employees are thriving at work.
Microsoft Work Trend Index Data shows workers around the world have what Microsoft is calling a new "worth it" equation, with 53 percent of respondents—particularly parents (55 percent) and women (56 percent)—saying they're more likely to prioritize their health and well-being over work than before the pandemic. One way Microsoft is addressing this is with an initiative called Microsoft Cares, where employees can access in one platform 24x7 professional mental health counselors and wellness coaches along with a host of legal, financial and dietician resources. Taking this holistic approach to well-being and embedding it into the fabric of the company is a critical step to nurturing well-being.
#2 Redefine Employee Well-Being and Mental Health From a "Perk" To a Mission-Critical Business Strategy
Gallup's State of the Global Workplace reports that people around the world are stressed out, with 44 percent of employees saying they are experiencing a lot of stress during the previous day. And what may be even more troubling, fewer than 25 percent said they felt their employer cared about their well-being.
Our research found that 42 percent of CHROs said their budgets for employee well-being programs increased up to 9 percent in past the year, with another 21 percent saying well-being budgets increased up to 19 percent.
Employee Well-being Budgets Increasing. But just spending more money is not the answer to addressing increased employee stress and burnout. First, companies must view well-being holistically as encompassing physical, emotional, financial, career, and social well-being and commit to well-being as a business strategy not just an HR perk. PwC is building well-being and flexibility into the fabric of the firm. Workers now have the option to select where, when, and how much they work.
Employees can choose in-person, virtual, or hybrid work, plus the opportunity for customized options such as reduced schedules, paid leaves of absence, and the potential to work from anywhere. In addition, PwC is increasing mental health benefits, including increasing the number of free visits with a mental health professional from six to twelve annually and increasing the reimbursement for out-of-network mental healthcare from 70 percent to 90 percent.
#3 Prepare for More HR Issues on the Board Agenda
Given the great resignation and increased need for companies to report their ESG (environmental, social, and governance) metrics, it is not surprising to see HR issues increasingly on board of director agendas. As more companies are embedding ESG into business practices and strategy, they are seeing ESG and DEI not just as reporting tools but as ways to attract and retain talent.
According to the 2022 Edelman Trust Barometer, societal leadership is now a core function of business. Six out of ten respondents said when considering a new job, they expect their CEO to be visible on social issues.
Cisco's 2021 Purpose Report covers the company's ESG efforts in a wide range of areas. In regard to sustainability, this includes creating smaller, lighter, and more efficient packaging and products; engaging partners, suppliers, and customers; embracing hybrid-work solutions; and setting aggressive net zero goals for greenhouse gas emissions.
As Fran Katsoudas, Cisco EVP People, Purpose and Places emphasizes, "Our commitment to ESG demonstrates how our technology can not only provide our customers with the fastest speeds and the most secure products, but also help them to solve their own issues from a sustainability perspective."
#4 Prepare for the Human/Digital Workforce
By 2025, our research sample predicts a significant change in the composition of the workforce, with less reliance on full-time employees and an increase in part time workers, gig workers and a greater use of digital automation assistance (bots).
The future of work is not about humans being replaced by bots, rather, it is about building a new "blended workforce" of humans working in partnership with bots. A study by Honeywell International suggests over 60 percent of US companies are willing to invest in automation to cope with the challenges brought on by the global pandemic.
DBS Bank is using its chatbot "Jim" to review resumes, assimilate candidate prescreening interview responses, ask questions, assess responses and pass these along to the human recruiter. The use of the chatbot has led to a drop of candidate abandon rates from 15 percent to 3 percent. As Jim expands, DBS sees a new position emerging, Chatbot Coach, to work with DBS human recruiters ensuring Jim continues to answer candidate questions accurately and allows human recruiters more time to focus on the strategic areas of their job.
Moving Forward: Four Actions To Take Now
Build A Culture Of Well-being And Belonging. The data from the American Stress Institute shows three in four adults regularly feel stressed, according to the American Psychological Association survey "Stress in America." Workers who feel burned out, cite multiple stressors, including COVID pandemic, rising inflation, the Russia-Ukraine crisis, the lack of separation between work and home and worries over job security, money and the economy. As disruptions continue, more workers are reporting symptoms of prolonged and acute stress.
Employers pay a price. Job stress and its negative effects on mental health cost U.S. employers nearly $300 billion every year, according to the American Institute of Stress.
As Kathleen Hogan, CHRO of Microsoft, shares, creating a culture of empowerment and inclusivity is critical so every employee can see their work as meaningful and themselves as a mission-critical component of the organization. This type of connectedness sends a powerful message to employees that their employer is committed to nurturing their well-being.
Embrace a Test-and-Learn Approach To Building Flexibility In the Workplace. This starts with leaders admitting they do not have the answers to best way to return to office, facing head on the new ways of working and proposing experiments in building workplace flexibility. We need to use the muscle of experimentation we learned during the pandemic and build this into our HR playbook. We have a model here: the software development framework of test, discover, design and develop to re-imagine many of our people processes from onboarding to learning and development.
Remember To Nurture Your HR Team Members. Check in with your HR team members regularly as they have been on the frontline of massive changes in the workplace. In just the past two years, HR's role has expanded well beyond people management to dealing with business continuity plans, mental health, return to office plans, furloughs and expanding well-being from a "perk" to a critical business strategy. It's no wonder, LinkedIn data found HR had the highest turnover rate in the past 12 months (higher than sales, IT and engineering). Globally, HR had a turnover rate of almost 15 percent while the overall average turnover rate was about 11 percent.
Finally, Let's Not Forget Working is a Human Experience. Humans spend one third of our life at work, calculated as 90,000 hours over a lifetime. As writer Annie Dillard famously said, "How we spend our days is, of course, how we spend our lives."
This article was written by Jeanne Meister from Forbes and was legally licensed through the Industry Dive Content Marketplace. Please direct all licensing questions to email@example.com.