HR2020, a report by Eversheds law firm and business intelligence expert Winmark, is wide-ranging and challenging. Reading through it you realise the breadth of HR and the opportunity this brings to shape organisations for future success. What other function can influence the business agenda for productivity, talent, diversity, technology and human rights, and have such a wide-ranging impact on organisational performance?
I believe that great HR can really make a difference at an individual and corporate level – but significant challenges remain as we look ahead to 2020. What should HR leaders and functions be doing to improve productivity and diversity, to win the war for talent, and to make sense of the ever-changing retirement agenda? How can we help shape our organisations to succeed in more demanding environments?
HR2020 was launched at an event in February and I chaired a panel that addressed some of these questions. However, the real value of the report will be in how each HR leader responds to it within their own workplace. Although not every issue is equally relevant to all companies, here are some examples of those currently on the agenda at Hitachi:
- A number of macro-economic and political risks are highlighted in HR2020 – for example: economic downturn, political instability in Europe, and British exit from the EU. But the report shows that a number of HR leaders are not taking steps to manage these risks. At Hitachi we are discussing if and how to communicate the company view on Brexit to staff in an appropriate way.
- The report highlights that the war for talent and skills shortages are seen as the key social trends impacting the workplace. It is nearly 20 years since McKinsey’s report on the war for talent but it remains an issue across the UK. We have been focusing on this for several years by implementing a new talent management process, as well as recruitment and development initiatives. However, this is a long-term issue and there are no quick fixes.
- The retirement agenda has seen many changes over the past few years. We now have auto-enrolment and estimates show that this will increase workplace pensions savings by up to £16 billion. The state pension is being reformed; it’s no longer necessary to buy annuities with pension pots and we’ll soon see further changes to lifetime and annual allowances. The latter two changes and others that come into effect in the new tax year are our main priorities as we decide how the company should respond. But there are longer-term issues too for retention and succession planning; as the retirement age increases and we need to balance the trend for staff to work longer with the need to develop young talent for the future.
- Improving diversity is seen as a key effort in the report and it is a strategic priority at Hitachi. We have recently set up a European diversity steering group with business and HR leaders who are identifying key actions to drive further improvement in this area.
There are no quick fixes or easy solutions to these issues. However, breaking them down in this way helps to clarify the journey and challenges ahead. They should fundamentally form part of our plans to meet the future needs of our organisations in the wider context of economic, demographic and other changes that affect us all.
Stephen Pierce is chief HR officer at Hitachi Europe