It can seem like the responsibilities of human resources teams grow by the day. They have to manage the entire employee life cycle, from attracting the best candidates to conducting exit interviews, all while building an attractive corporate culture and ensuring employee compensation and benefits are competitive.
More recent hurdles include managing a scattered workforce and the fallout around the financial challenges many organizations faced. So how can HR leaders tackle these challenges?
What Are the Most Challenging Issues Facing Human Resources Today?
The volume and nature of the challenges human resources professionals face continue to increase and change. As businesses put more of a premium on overall employee happiness and creating a better employee experience, much of the work falls on HR. Major challenges range from recruiting and hiring strong candidates, to developing leaders and building an effective corporate culture as an increasing number of employees continue to work remotely. Focusing on employees’ health and wellbeing and fostering an inclusive, diverse and equitable workplace have also become a key priority.
The Top 18 HR Challenges of Today
HR professionals can employ their experience, skills and technology to address most of these challenges to drive greater employee engagement, development, satisfaction and improved performance.
More than half of the 5,000 respondents to a 2019 survey say company culture is more important than higher pay in determining job satisfaction. Furthermore, more than 75% of people around the globe would consider a company’s culture before applying for a job. Increasingly, employees prefer to work for organizations whose culture aligns with their values.
There are many ways HR can foster a positive organizational culture. A few ideas include encouraging two-way communication between employees and management, making sure employees understand how their work contributes to the business’s objectives, having executives reach out to individuals for exemplary work, hosting company-wide volunteer days and offering fitness center stipends.
Regulatory compliance has always been critical for HR, but it’s become more complex. As more employees work remotely, maintaining data security regulations has taken on greater urgency. HR teams will need to work closely with internal IT and security teams or outside experts to complete a risk management assessment and ensure company data is still private and secure with remote access.
Additionally, ensuring compliance with overtime and other labor regulations can be more difficult when employees are not in the office. The Employment Law Guide from the Department of Labor can answer common questions and help you remain compliant. Employers whose workers have remained on the job or will be returning to the workplace need to also ensure in-office safety following natural disasters and public health crises.
HR needs to understand the regulations and send out regular communication to employees with the latest information. They may also want to conduct training sessions and develop materials to foster a culture of compliance.
Only half of more than 2,800 respondents to a survey from Gartner, a global research and advisory company, said they are well-equipped to lead their organization in the future.
Human resources professionals can help address this by encouraging leaders to share responsibilities with other leaders who have complementary skill sets—what’s known as complementary leadership. Leaders who use complementary leadership enjoyed a 60% bump in their teams’ performance, Gartner reports.
The pandemic brought far greater emphasis to employees’ work-life balance, and that won’t go away anytime soon. Nearly half of companies have now implemented flexible work schedules.
Revising your policies can help employees better manage work and their daily lives. They can include a focus on productivity rather than hours clocked and regular reviews of workloads to ensure they remain reasonable. In addition, encouraging employees to actually use their vacation time helps counter any unspoken perceptions that working long hours is expected or rewarded.
Health and Wellness
While employees’ physical health remains important, nearly two-thirds of employers are emphasizing employees’ emotional well-being, according to a benefits survey from Gallagher .
Many of the tactics that help employees balance their work and personal lives can, not surprisingly, foster physical and mental well-being as well. They include flexible working hours and the ability to work remotely, at least part of the time. For employees working on-site, offering standing desks, holding “walking meetings” and providing healthy snacks can boost wellness at a relatively low cost.
Cross-Generational Team Building
Today’s workforce often encompasses multiple generations. The upside? Organizations gain a broader range of ideas for solving problems. However, different age groups can vary in their approaches to technology, how they interact with others and their work-life balance. These differences can lead to ineffective communication and collaboration.
HR can take several steps to prevent generational miscues. One is to avoid stereotyping. Not every older employee resists technology and not every millennial is demanding of their employer. Another is using a range of communication tools, such as, email, text and calls, to reach all employees through they’re preferred channels.
Finally, teams should be structured to include employees from various age groups to foster and encourage diversity in thinking and task execution.
Less than one in five HR managers say their workforce can change direction due to shifting needs or priorities, Gartner reports.
One common reason is outdated work design. To address this, jobs need to be designed to fit the way in which work actually happens. Cumbersome approval processes also need to be streamlined to adapt to a company’s current needs. Technology plays a central role here and can make your employees’ jobs much easier.
By working with other departments, HR can foster a culture that helps employees embrace change. Among other actions, this requires including employees in decision-making and communicating the rationale behind changes.
Training and Development
The number of skills required for any job is increasing by 10% each year, Gartner notes. Human resources can work with others in their organization to identify skills gaps and help employees develop the skills needed for current and future roles.
One trend is upskilling, or improving current employees’ skill sets, so they can assume different roles. Upskilling enables organizations to meet evolving needs while also keeping current employees engaged. And, the proliferation of quality online courses allows for cost-effective training.
Given recent economic instability and uncertainty, it’s no surprise that compensation has come into focus lately. Roughly 43% of organizations planned salary freezes for managers and executives, while 42% planned freezes for non-management workers, per Gallagher.
While most workers have some understanding of their employers’ financial situation, HR professionals can find other ways to motivate workers in the absence of salary increases. They can accommodate requests for flexibility and remote work, offer training and provide development opportunities.
Also, expect to see a greater focus on initiatives to close gaps in compensation between employees of different genders or races, as well as greater use of variable pay tied to performance.
Organizations continue to do all they can to ensure the benefits they offer are helping employees, while remaining cost-effective for the business.
Nearly 60% of employers are considering tools that can help reduce health care costs, according to one human resources consulting firm. These include telemedicine (44%), chronic condition management (29%) and prescription drug management (24%).
As companies eye continued growth, an effective recruiting strategy is imperative. One step is meeting potential candidates where they are. This requires recruiting using multiple social media and job posting sites and holding remote interviews via video conferencing applications.
HR teams also need to present a consistent and compelling message. A range of communication tools, including a quality human resource management system (HRMS), scan help. An HRMS can automatically post your open positions to job boards, manage resumes and track applicants.
Staffers are spending less time at companies than ever before. At any time, nearly three-quarters of employees are open to new opportunities, and about one-third are actively looking.
To improve employee retention, most organizations need to boost employee engagement. The top drivers are typically opportunities for learning and development, a clear link between employees’ work and the company’s strategic objectives and recognition for exceptional work. All of these can be accomplished at a modest cost.
Nearly 91% of organizations have experienced at least one damaging cyberattack over the past two years, and almost 60% had two or more. Those attacks could compromise HR records with sensitive personal information about employees.
To reduce the risks and costs of cyberattacks, organizations need to identify the operations and assets most vulnerable to attacks, and focus on making them more secure. The HR team might also work with IT to develop clear data security standards and rules, and could lead a training about how these standards affect employees and the importance of them.
An HRMS or Human Capital Management (HCM) solution can boost cybersecurity by limiting access to those in certain roles and requiring two-factor authentication.
Diversity, Equity and Inclusion
Approximately 90% of organizations have a diversity recruiting strategy for the college class of 2021. Most will focus their initiatives on hiring African-Americans, Hispanic-Americans and women. These organizations understand that diversity and inclusion aren’t simply feel-good initiatives, but help boost organizational performance.
Companies in the top quartile for racial and ethnic diversity are 35% more likely to have above-average financial performance compared to industry peers, according to consulting firm McKinsey. Diverse firms more closely represent the changing population. And, a mix of diverse employees can draw from a wider range of experiences, leading to more informed decision-making.
To boost diversity and inclusion, organizations should communicate to current employees the importance and benefits of any diversity initiatives and focus on diversity in the recruiting process, among other steps.
A positive employee experience—which refers to the employee’s perspective of his or her interactions with the organization—can drive engagement. Higher engagement can boost productivity, sales and other performance metrics.
Organizations can improve the employee experience by soliciting and listening to feedback and investing in employees’ career development. A strong culture goes a long way toward improving the employee experience, as well.
Organizations with more mature onboarding processes see improved new hire engagement and retention, among other benefits.
A few steps can help employees feel welcome and prepared, even when they onboard virtually. One is simply welcoming them with a personalized message. Another is ensuring they have the proper equipment and technology to perform their jobs effectively. Finally, company schwag, such as a company sweatshirt or water bottle, can help new employees feel like they’re part of the team, even when they’re working remotely. HR software can also help you organize and improve the employee onboarding process.
Managing Remote Workers
Thirty-five percent of organizations will have at least half their workforce continue to work remotely after many employees started working from home in 2020.
While many employees are productive remotely, it does bring new challenges. The lack of face-to-face interaction can lead to misunderstandings. Employees may spend more time hunting for information that previously was easily accessible.
But HR teams can take several steps to help manage remote workers . These include scheduling regular check-ins in with employees and using multiple communication methods, such as email, real-time or instant messaging, phone and video, for meetings. Additionally, leaders who communicate a belief that the organization and its employees will get through difficult times together can help calm fears and instill confidence.
Measuring HR Effectiveness
HR professionals especially need to ensure they’re adding value to the organization, and one way they can do that is by tracking key workforce trends and KPIs.
A starting point is monitoring HR metrics like absenteeism, recruiting conversion rate, employee turnover and employee satisfaction. HR departments need to establish the KPIs that are best suited to their business, gather those metrics and compare them against industry benchmarks and the company’s past performance.
HR and Payroll
Overcoming HR Challenges With Software
As human resource professionals strive to meet the challenges confronting them, technology can support their efforts. Human resources software can help engage candidates and employees, safeguard data and systems and develop leaders. It can also streamline employee onboarding and help monitor and excel employee performance management. Ultimately, software can mitigate many of the issues HR leaders face and give them a more powerful voice within the business.
By leveraging their experience, skills, and technology, HR professionals can meet the challenges that linger ahead. In doing so, they can drive greater employee engagement, development, satisfaction and improved performance.