There’s no shortage of obstacles for small businesses. But as work has evolved from “somewhere you go” to “something you do”, recruiting and retaining talent has long been one of the largest challenges for companies of all sizes. And although salary certainly plays a significant role, there are other factors at play to keep employees satisfied and engaged in their work. And an agile approach from human resources can help address your company’s talent management techniques.
Companies are becoming more focused on employee experience. The business case for improving employee satisfaction to keep turnover down and engagement up is unmistakable. In a field like talent management that’s constantly evolving, it’s vital to stay on top of some of the leading trends to boost employee satisfaction and engagement.
What Is Talent Management?
It’s the way your company hires and retains the best employees possible. Talent management policies help you find high performing employees, help them excel and find a place in your company to meet current and future needs.
Employers are doing more to keep employees—or the talent—at the center of many decisions. The emphasis is finding the best employees and helping them grow, mentor others, accomplish personal career goals and take on leadership positions.
Why Track Talent Management Trends?
Employee turnover, retention and hiring costs affect your company’s bottom line. The ability to attract high performing workers also impacts your business. And with an increasingly mobile workforce, it takes a concerted effort and plan to address these issues. Tracking talent management trends helps your company’s HR team adjust to new challenges and boost talent management key performance indicators (KPIs) like employee satisfaction, employee engagement and turnover.
15 Current Talent Management Trends for 2023
Efficient and robust talent management isn’t just good for employees—it helps your business grow. In fact, organizations with effective talent management routinely outperform their competitors. But to do it well, talent management requires a thoughtful and methodical approach.
Here are some of the major trends that recruiting, human resources, managers and executive leadership should consider this year.
Talent analytics/workforce analytics:
From applicant tracking to onboarding, retention and data-driven decision making, human resources initiatives are increasingly informed by analytics. Even small businesses can benefit from human capital management (HCM) software to record, gather and report the data you need to improve productivity. Powerful cloud-based HCM software is accessible from anywhere and can integrate with other vital business platforms, such as accounting software. HCM solutions also include features that make it easier for your team to focus on strategic initiatives. Some of the features to watch for include the following:
- New hire requisition approvals
- Time-off request automation
- Budgeting and planning
- Applicant tracking system connections
- Global employee record tracking
- Government IDs and certifications
- Onboarding workflows
- Real-time data access
- Built-in dashboard and reporting
With the aid of HCM applications, you make it easier for employees to access important information. And by speeding up and streamlining time-consuming processes like hiring, time-off requests and even promotions and job changes, your company becomes more efficient, freeing up time for employees to focus on other projects. Advanced features also let you find problem areas and create action plans to overcome issues like high employee turnover or delayed hiring times.
Employee education, training and reskilling:
A billion jobs—approximately one-third of the world’s workforce—will be transformed by 2030 thanks to things like automation and AI. Training and reskilling are good for your workers, as well as your business. A LinkedIn survey found companies with better training had a 53% lower attrition rate, which reduces hiring costs and improves productivity. Employees need to learn new skills and businesses need to stay on top of the latest technology, which is why training and reskilling is vital.
And many of the same technologies that are transforming the makeup of the workplace can be used for novel training purposes. For example, augmented reality can give employees a better, more realistic experience than a traditional video or book.
Diversity, equity and inclusion (DEI):
The power of DEI goes beyond good public relations. By focusing on the qualities and backgrounds that make individuals unique, such as race, age, religion, disabilities and ethnicity, your company can provide a more holistic view and approach to everything from customer service to marketing and problem-solving. That diversity becomes an asset that you can leverage in support of business objectives.
DEI is a strategic and financial advantage for businesses and it’s fast becoming a priority for people when choosing where to work. For instance, Glassdoor now has a rating for workers' satisfaction with DEI. And nearly three-fourths of companies that describe themselves as having world-class talent management programs are focused on gender and global diversity, according to a study from HR consulting company Deloitte.
Different perspectives and life experiences can be valuable to your business. Discussions become richer, the decision-making process is better informed, and your company will be stronger because of a diverse makeup. In fact, diverse companies were 33% more likely to outperform their competitors, according to data from McKinsey.
Start with better communication. Get a pulse on where your company stands and implement DEI measures in recruitment and retention and try to diversify your candidate pool. Send employee surveys, start employee resource groups and hold town halls on the topic.
Baked into many of the other talent management trends, such as employee experience and celebrating strengths, empathy is an essential ingredient to thoughtful and well-rounded talent management.
Align benefits with employees’ values. Embrace flexibility, offer generous leave policies, provide training and growth opportunities and recognize accomplishments. Workers consistently say in-person communication is the most impactful form of communication, so talk to your employees and make connections. Get to know them and encourage their managers to get to know them personally and try to better understand their career goals.
Focus on employment strategies for non-traditional occupations:
The U.S. has a shortage of truck drivers. In an industry traditionally dominated by men, logistics and trucking companies were leaving out millions of potential drivers who would be attracted to the promise of predictable schedules and good pay—women. By changing that focus in 2010, the number of women truckers skyrocketed nearly 70% from 2010 to 2018 and helped address that shortage.
Non-traditional employment is the term for an occupation in which one gender compromises less than 25% of the workforce. For example, male dental hygienists, social workers and early education teachers. Or women heavy equipment operators, carpenters or pilots. People who choose their career paths based on interests and abilities—and not gender stereotypes—are more satisfied and engaged with work. In short, they make better employees and are more likely to stick around. Develop strategies to attract a more gender diverse workforce improves your candidate pool.
The employee experience is made up of all the encounters and observations people have throughout their tenure at an organization. It’s essentially how an employee feels about a company. It starts with the first recruitment touchpoint and continues through onboarding and ends with offboarding and exit interviews. It includes everything from personal encounters to physical spaces and workplace culture.
HCM software can help you greatly improve the employee experience with initiatives like mapping out professional journeys, improved onboarding and soliciting employee feedback and tracking surveys and reviews. Employee engagement takes the experience a step further and looks at how you can work with employees to align their goals with desired business outcomes.
Employee health and well-being:
Common workplace health and well-being benefits include on-site gyms and subsidies for memberships, increased mental health coverage and financial penalties on insurance premiums for unhealthy habits like smoking. Remote working and flexible schedules also appear to carry mental health benefits, but they are often the norm for many companies post-pandemic. Consider employer-sponsored mental health days, therapy coverage, and family assistance programs. Employees may be skeptical, so whatever direction you choose, be genuine and make concerted efforts. And each business’s needs will be different. Ask your employees what changes they’d like to see. And it may benefit your bottom line with a healthier workforce, as health insurance premiums continue to be one of the top financial concerns for small businesses.
First impressions are huge. And setting the tone and helping improve the welcoming and training process has never been more important. Onboarding is much more than just filling out the required tax paperwork. It’s a formalized process of helping new employees begin their training, setting them up with a support system and mentor and personalizing their experience. Onboarding can include getting employees excited by sending them swag before they even start. And it can extend months into their employment with regular check-ins. With HCM software, you can set up formalized and customizable onboarding processes to help speed up the process and have new employees reach full productivity even faster. In fact, a study by Glassdoor found companies with strong onboarding processes improved new hire retention by 82% and early productivity by more than 70%.
Adjust employee benefits with COVID-19:
If the pandemic has taught us anything, it’s that we’re able to be more flexible that we ever realized. From adjustable schedules to accommodate helping children with online schools, to shifting to remote work nearly overnight, employers are finding ways to be more flexible and employees are learning to be more efficient. In fact, 94% of employers said that productivity was the same or higher after switching to remote work and 83% said they plan to continue to offer flexible leave policies, according to Mercer.
During times of economic downturn, making changes in compensation may not be possible for many organizations. Instead, look for other creative ways to address employee satisfaction concerns.
- Recognize high performers.
- Develop low cost or free employee wellness plans.
- Focus on ways to improve employee autonomy and flexibility.
- Create a culture of cross-training and professional growth.
- Start an employee holiday or celebration for meeting key performance indicators.
Along with optional measures, there are some state and federal policies in place that can affect your workforce, such as the Families First Coronavirus Response Act. Some restrictions and requirements vary by state or locality, so be sure to familiarize yourself with the rules of all the areas where you have employees.
Managing a remote workforce:
Working from home is here to stay for millions. Maintaining and motivating employees who work remotely presents new challenges. And some employers say company culture is more difficult to establish and maintain. New collaboration tools and tactics, such as file sharing, communication tools and time management applications can help with your strategies for how to manage a workforce where some employees work remotely and some who cannot.
Flexibility can be rewarding for both employers and employees. Start by revamping the talent management strategies from attracting the right candidates, to giving recruiters the right tools to vet them. Consider how to adjust your plans for remote onboarding, training and performance management. HCM software is more critical than ever as it assists with each of these tasks and makes it easier to track and report, as well as provides a user-friendly portal for employees and helps them be more effective remote workers.
Evidence-based talent management practices:
Can your team picture themselves sitting in a room circa “Moneyball” and putting together the best roster for your business using data? The practice featured in the popular film “Moneyball” is a good example of evidence-based talent management. Decisions based on instinct and what’s been done in the past aren’t as effective as decisions based on evidence.
That evidence can include scientific evidence and organizational data to inform talent management policies such as recruitment, benefits and promotions/raises. HCM software, especially platforms that integrate with other business solutions, such as accounting and payroll platforms, can put data to guide evidence-based decisions into a single cloud-based solution. From important financial ratios to storing and tracking yearly reviews, it can power your strategic decision making.
Speedier talent management processes:
Making the talent management process more agile starts with getting people into the right roles and deploying them quickly. To do this well, you need clear and concise communication. Consider an iterative approach to evaluating talent needs and constantly collect and evaluate feedback from and about employees, rather than just doing quarterly or annual reviews.
Create a formal internal hiring program and encourage managers to inform employees about open positions that might be a good fit. Sometimes managers are reluctant to encourage their employees to leave their teams, but it’s better to keep the talent in the organization than have them look elsewhere, as there is 41% longer employee tenure at companies with high internal hiring. Promotions and transfers can help employees avoid burnout and take advantage of training opportunities.
You’ve heard of internships, well the latest trend of “returnships” is similar but comes with a twist. Rather than students or recent graduates, the latest addition to the workforce are people who have taken extended time off or previously retired. But before you start thinking of it as charity work, consider that nearly 9 of 10 talent professionals say a multigenerational workforce makes a company more successful. Carefully and intentionally hiring a workforce with a range of experience is a powerful business tool that can strengthen teams.
More integrated hiring practices to boost HR agility and adaptability:
It’s common for recruiting, human resources, hiring managers, training departments and executive leadership to be siloed in their functions. Shared goals are key to overcoming these silos. Knowing what you want to achieve as a business can guide decisions informed with insightful data. Measure success and adapt to dynamic conditions with the aid of HCM software that can serve up real-time reports and dashboards. Identify problem areas such as high employee turnover or lag time in new employee training and develop strategies to address the issues.
HR and Payroll
Improve Your Talent Management Strategy With NetSuite
HCM software, like NetSuite SuitePeople, streamlines communications and goals for teams and individuals. NetSuite SuitePeople Performance Management allows employees to create performance metrics using NetSuite operational data or manually set goals. Rather than passing spreadsheets back and forth through email, communication is streamlined, and performance reviews become fluid. They incorporate changes in the business environment or the company’s broader goals and include information for personal career and professional progression.
When it comes time to review annual compensation and bonuses, it’s easier for committees to track individual progress and how that employee maps to others in their department or the company as a whole. What’s more, HR leaders can easily track the performance review process by running reports to see overdue reviews, rating distribution and an employee’s performance review history.
Talent management constantly evolves with workforce changes, economic pressures and technology advancements. And NetSuite SuitePeople adapts with those changes to help you provide the most current and powerful performance management tools in the market.
Successful and efficient talent management is about more than just paying employees well. It’s about considering their needs and treating them with dignity, respect and fairness. Not only is it the right thing to do, it helps retain employees, improve employee engagement and can even impact sales and customer service. Fostering a culture of respect helps employees and companies succeed through hard work and creativity.