The broad but important topic of “transformation and evolution” captured top billing from HR leaders recently asked to identify the most pressing concerns for their organization in 2024, according to a report on the survey by Cornell University’s School of Industrial Labor Relations Center for Advanced Human Resource Studies.
“Given all the disruption that companies have been facing, both in their business and from the broader environment with geopolitical issues, I wasn’t really surprised to see transformation on the top of the list this year,” says Cornell’s Brad Bell, professor in strategic HR and director of the center.
More than two-thirds (67%) of HR leaders identified transformation and evolution, defined to include HR transformation, culture evolution and hybrid work evolution, as top issues, according to the survey released last week. In 2023, transformation and evolution ranked No. 3, cited by about 45% of respondents.
Business disruptions due to geopolitical forces and changes in the workforce are driving up concerns about transformation and evolution, the survey shows. HR leaders are specifically focused on transformation within HR, such as keeping their companies agile and increasing efficiency and operational excellence, Bell says. The conflict in the Middle East and the ongoing war in Ukraine are limiting employee mobility in those regions and, separately, generally slowing some HR transformation efforts, he notes.
A heightened focus on organizational governance issues, including shareholders’ rights to have a say on executive compensation, is also tempering HR transformation, he adds, because such efforts can limit recruiting efforts.
In addition, Bell says that rapid organizational culture change, survey participants reported, is making it difficult for employees to connect and develop a shared purpose, especially in today’s dispersed work environment. In response, HR leaders are frequently updating their hybrid work models, which can stall culture evolution by hurting inclusivity or other related targets.
Rounding out the top five concerns were talent management, technology, employee experience and leadership and succession planning.
Technology is new to the top five this year, largely driven by HR’s interest in AI, Bell says. In previous years, the topic was embedded into other categories, such as the digital employee experience. Total rewards, which ranked No. 4 last year, dropped off the list.
“Every year, there seems to be a new topic that shows up on the top 5 list,” Bell says. In 2023, total rewards was a new addition, driven by high inflation and organizations seeking to provide economic relief to their employees, he says. But this year, inflation is slowing, and fears of a recession are easing, which can reduce employers’ concerns in this area for 2024.
Are DEI and wellbeing still HR priorities?
Despite their absence from the top five, DEI and wellbeing remain among HR leaders’ top concerns, Bell says. Like last year, they ranked sixth and seventh, respectively, for 2024.
“HR leaders talked about wanting to maintain the progress they’ve made so far in DEI or even wanting to take these efforts to the next level,” Bell says. “For example, they’re not thinking about just diversity and inclusion but thinking about how do we drive equity and various talent practices.”
He notes, however, that some companies are pulling back their DEI efforts. These actions are reflected in cuts to DEI budgets and layoffs of DEI officers following last year’s ruling by the Supreme Court on affirmative action.
Similarly, employers’ focus on wellbeing is waning, he says.
“Post-pandemic, there was a lot of concern about employee health and wellbeing,” Bell says. “I think it has somewhat subsided. I don’t think it’s getting the same degree of attention as some of these other topics we saw in the survey.”
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