How HR can create magic in 2023

It feels like we’ve said this every year but phew, 2022 was quite a year. Wasn’t it? The restrictions due to the pandemic are (hopefully) firmly behind us but the Covid effects on our workplaces certainly aren’t – and likely won’t ever be.

COVID brought changes that aren’t getting back in the box. Now the heart-pounding giraffe-on-ice stage is over, we have a chance to reflect. What’s working? What’s not? How have our working dynamics and workplaces really changed, underneath everything?

We’ve (of course) been watching closely over the year just gone, and we have some good ideas what HR leaders might be focussing on over the year ahead. Not least because we’re already seeing forward-thinking organisations making great strides, as they lean into their people and glean crucial insights to guide HR decision-making.

(Like Mary Stevens Hospice, who increased their eNPS by 131% in a year by, among other things, shifting their approach to learning and development based on employee feedback).

Based on the hundreds of HR leaders we interact with regularly, and our own experiences and data over the year, here’s what we expect the most successful HR teams to be focussed on over 2023.

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5 focus areas for HR teams in 2023

1. Make a success of hybrid work

Employees overwhelmingly support hybrid working. ADP’s global study of more than 32,000 employees found that 64% of the workforce would consider looking for a new job if they had to return to the office full-time. More than half (52%) would even take a pay cut in exchange for a hybrid working arrangement.

In light of such strong preferences, employers would be risking a big misstep to force employees back to the office full-time.

Especially given the continued surge in global turnover: mid-way through 2022, the World Economic Forum reported that 40% of workers globally were considering leaving their jobs in the near future. And 71% of global employees told ADP they’d considered a major career move in 2022.

Likewise, skills shortages remain one of the biggest threats for organisations into 2023 – so working on keeping your great people in-house looks like a no-brainer. (And on the flipside, doing anything that risks mass exodus looks like poor decision-making).

These factors combined suggest one thing: hybrid work is very much here to stay. But as the word hybrid suggests, this set-up involves both office and remote work. To make this a success, businesses need to evaluate and be clear on when it can also be more beneficial to get together in person rather than to only meet online. Smart HR leaders will make 2023 the year you banish teething problems and make hybrid working a success story.

We expect to see many organisations taking a step back, reviewing their end-to-end people processes to ensure they fit this new world of work. We’ve got a decent chunk of learned experience under our collective belts by now. If 2021 forced our hands, and 2022 was about racing to catch up, 2023 brings some breathing space to review, evolve, and grow.

Questions to reflect on and work with:

• How do we facilitate true connection between remote teams?

• How do we protect and grow our culture?

• How can we make our processes fairer and more inclusive?

• How can we optimise collaboration and productivity?

• How do we maintain visibility over a less visible workforce?

• How do we protect retention in a hybrid workplace with new challenges?

• How do we ensure remote working doesn’t impact equality?

Given Gartner predict 25% of people will spend at least an hour in the metaverse daily by 2026, forward-looking businesses might even see 2023 as an opportunity to take hybrid work further by developing a metaverse presence.

SHRM describe the metaverse as “an immersive alternate reality” – advancing beyond current digital technologies like video interviewing or onboarding into full virtual reality worlds.

There’s potential to create a huge competitive edge here, as early adopters start to build a talent brand around exciting, innovative remote recruitment and careers experiences.

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2. Retain your best people with great professional development

Spiralling attrition has been a major issue throughout 2022. Even a year on from the Great Resignation, IDC found that 32% of European employees are actively looking for a new job, for example. Experts predict that by 2030, there’ll be a global talent shortage of more than 85 million people.

Against this backdrop, retaining your best people is urgent – and empowering them to thrive and grow with your organisation.

We think training and development will prove a huge part of that in 2023. Some 94% of employees say they’d stay with a company longer if it invested in their career development: compelling numbers.

Improving your training offering is a win-win situation because it boosts engagement and retention while also building capability. You can then promote from within, instead of turning outwards to an expensive and challenging hiring market.

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3. Stop burnout smouldering

One of 2022’s big challenges has been the rise of burnout. For example, Microsoft conducted a huge global study looking at 20,000 people in 11 countries and trillions of data points and found that 48% of employees claim they are already burnt out at work.

Burnout is a big deal. Ultimately, it makes your people less productive and less engaged. And, bringing us back to the turnover problem, less likely to stay with your organisation. Not good, on any count.

For 2023, HR leaders must urgently turn their attention onto this burnout problem. But we also expect a progression in how organisations attempt to move the needle here.

In 2022 we saw a massive emphasis on workplace wellness as an antidote to stress and burnout. Employee wellbeing is still super important – especially as a mechanism to keep remote teams connected – but it’s not a silver bullet.

In reality, HR leaders must empower managers to spot and address burnout in their teams before it escalates. If the early signs of burnout (like stress, distrust, and lack of purpose) are allowed to smoulder, they’ll turn into huge fires.

Prioritising burnout will almost certainly involve an uptick in investment into employee feedback software, to empower managers with these sorts of insights easily. Through the pandemic we saw how strategic investment into smart places protects future growth: technology that increases visibility into your people’s sentiment is one of those smart places. Especially as remote and hybrid working making visibility a bigger challenge.

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4. Design your culture

2022 brought the start of a major shift in perspective, from seeing culture as something that just happens organically to seeing culture as something you design, build, measure, and refine. We were recently lucky enough to co-host a webinar with Principal Analyst with Forrester, Katy Tynan, where she talked about exactly this:

“A lot of senior leaders make the mistake of thinking culture just arises somehow, magically. Culture can be measured. Culture is about a series of decisions we make every day about how we interact together as people. It’s the way things get done around here. Intentionality is so important – and then the ability to measure those specific KPIs that matter for your organisation.”

In the webinar, Katy talks about how leaders are emphatically coming to realise the value of their people resource – and acting accordingly, to grow the value of that resource.

Through 2022 we saw how the most successful organisations are already way ahead of the curve on this stuff. But we expect this transformation to accelerate fast as stragglers start to lose talent to leaders in the culture wars.

Through 2023 we expect to see major HR and engagement investment, as organisations race to build workplaces that don’t just empower productivity but engage, inspire, and retain.

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5. Provide fair compensation  

The latter part of 2022 has brought massive financial upheaval, practically everywhere.

• In the UK, recession could spiral into a “lost decade” with rocketing inflation, negative growth, falling productivity and business investment.

• In Europe, inflation is predicted to linger for years to come, with abundant underlying price pressures.

• In the US, recession hasn’t yet arrived but the biggest banks are bracing for a worsening economy into 2023, as inflation continues to rise.

This brings major challenges for businesses – and for your people.

Rising costs are already triggering mass layoffs, which bring huge challenges for HR. In the US tech sector, for example, more than 88,000 workers were laid off in 2022. The very public scenes unfolding with Twitter’s badly-handled workforce losses are most HR professionals’ worst nightmare.

And strike action is violent and unprecedented across much of the world: testament to unhappy employees who feel they’re being treated unfairly.

As 2023 starts to unfold, these are the challenges HR leaders must confront head-on. You’ll likely be kept busy with questions like:

• What financial education and support can we provide?

• How do our people feel about their compensation?

• Is there pay equity between new and established hires?

• How will we handle any layoffs kindly but compliantly?

You can’t do much about global financial markets, but you can support, educate, and protect your people as best you may. Or watch financial worries become a major driver of turnover.

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This time next year, where will your workforce be?

There’s a reason the global employee engagement and feedback software market is predicted to grow at an astonishing 14.7% compound annual growth rate to 2030.

As workforces become increasingly spread out and face a heap of evolving challenges, truly understanding your people’s needs is essential. To develop smart HR strategies that move the needle on your important people metrics, you need better people data. Then you’ll be equipped to react fast, whatever 2023 throws up.

Winningtemp’s employee engagement platform is the easiest way to visualise, listen and act on employee feedback. Because culture only changes when people feel heard.

Watch the Forrester webinar to learn why true culture change is essential for 2023.‍‍‍