Creating People Advantage: The Future of People Management Priorities

Related Expertise: People Strategy, Digital HR, Digital Transformation

Creating People Advantage 2021

The Future of People Management Priorities

By Jens Baier, Jean-Michel Caye, Rainer Strack, Philipp Kolo, Amit Kumar, Fang Ruan, Bob Morton, Anthony Ariganello, Jorge Jauregui, Lucas van Wees, Trent Burner, Wilson Wong

Since 2008, Boston Consulting Group has partnered with the World Federation of People Management Associations on a series of comprehensive people management surveys, called Creating People Advantage. The 2021 report includes responses from more than 6,600 participants in 113 countries, along with interviews with more than 30 people management leaders at organizations around the world.

Identifying the Most Urgent People Management Topics for Creating People Advantage

Respondents rated 32 people management topics according to their organization’s current level of capability and each topic’s future importance. Combining those two dimensions yields the 12 topics requiring the most urgent action. They fall into three broad categories:

  • Digitization. Most companies are struggling to digitize their HR departments. Compounding the challenge is the fact that employees are accustomed to streamlined digital experiences and intuitive interfaces in their personal technology, so they want modern solutions at work as well.
  • Talent. The competition for talent—especially digital talent—requires a state-of-the art approach to finding, managing, and cultivating high-potential employees. The emergence of the gig economy requires organizations to manage a hybrid workforce of contractors, gig workers, temporary workers, and traditional employees. At the same time, HR must strategically identify skills that the company will need in the future, along with developmental approaches to close any gaps.
  • The Future of Work. Emerging from COVID-19, companies are pushing HR to take a more active role in redefining how and where work gets done. Initiatives such as redesigning the physical work environment, implementing a new organizational structure, and enabling transformational change will become priorities.

Five Priorities for People Management Leaders

The results point to five key actions for people management leaders to take to stay one step ahead of the evolution of HR in 2021 and beyond.

Put employees at the center. At the macro level, companies need to create personalized experiences in the form of more customized career paths for employees. At the micro level, they need to move beyond rigid, one-size-fits-all processes and interactions to enable personalized solutions on a day-to-day basis. In our survey, 85% of respondents said that focusing on employee needs and expectations is the key success factor in the competition for talent—the highest level of consensus in the entire study.

Shape the future of work. In the wake of COVID-19, remote work and flexible schedules are becoming the norm. Companies need to define a smart work strategy, rethink employment options and workforce structure, and foster affiliation by sharpening the organization’s purpose and culture to inspire employees.

Accelerate in digital. HR must step up its capabilities in digital, IT, and analytics to future-proof the organization’s workplace, improve employee experiences, and play a more strategic role. Only about one-third of survey respondents said that HR has digital tools that offer a seamless, personalized experience; slightly fewer said that their organization has a strong HR IT system to bundle and analyze employee data. To improve, companies need to get the IT basics right, focus on digital priorities that make a difference to employees, and increase people analytics maturity.

Set new paradigms for skills and employees. As the evolution of HR continues, organizations need to have the right people with the right skill sets—both within and beyond HR—so they can adjust to the new reality and win in the 2020s. This entails adequate workforce planning, sophisticated upskilling and reskilling opportunities, and a holistic talent management approach.

Transform the people management function. With employees at the center and sound digitization support in place, HR must become the motor of a continuously changing organization that serves employees. Specifically, people leaders need to develop and follow a clear HR and people management strategy with defined principles and priorities, rethink the target HR organization, and transform managers into real people leaders.

Download the full report for a detailed discussion of this year’s findings on building competitive advantage through people.

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Creating People Advantage 2021