2022 was a volatile year for HR & workforce
The volatility of 2022 was partly because the global economy was gradually slowing down. All the big players, such as Microsoft and Google were talking of slowdown and also layoffs. So, when people put all those things together, they realised something was seriously wrong, and that it is best for them to be careful. It dawned on them that the smartest thing to do is not rush into things. And that’s exactly what they did. And therefore, the volatility that happened in the beginning, gave way to a lot of circumspection, which is why we will see a little more stability in the second half of the year.
2023: Will it be a turmoil again or peace?
In 2023, HR people are going to feel like they are on a seesaw. Just when they think everything is going well and they’re going up, they’ll suddenly start going down. The whole experience will be sinusoidal, like a wave, for HR.
In the beginning we are going to face the headwinds of the world economy. Does that have anything to do with India? Yes. Is India doing well? Yes. That’s why I say that it will be staccato. One time not so good and another time smooth and consistent, because we will follow the global queues.
Two things are surging in India — domestic consumption and manufacturing. The China Plus One strategy is working in India’s favour — a big positive indeed. So, clearly, on one hand there will be a high and on the other hand, there will be a low.
The technology companies that are so dependent on the global market will begin to feel the pinch. The Indian market will continue to do well, especially the services. So overall, it will be a plus / minus for people who are in HR.
Engagement is important for the simple reason that it has a very positive correlation with productivity
HR’s attention on deskless workers or in-office workers
It’ll be a mix of both. I don’t think we can give more or less attention to one than the other. There will have to be equal attention all around. To say that people working from home need more attention would be rather premature and wrong.
2022 was the year of ‘connect’, while 2023 will be the year of ‘engagement’.
‘Connect’ is when people want to make sure that they are connected with each other, either virtually or physically, in their offices. This urge to ‘connect’ was intense in 2022. It did not go beyond that, but we need to take it beyond that.
I strongly believe this is the year when people will focus on ways to engage. Engagement is important for the simple reason that it has a very positive correlation with productivity.
And productivity is definitely important because currently the margins are shrinking, while costs are rising. Although we keep saying inflation is low, in reality, inflation is not low. It is just lower than the rate of growth of inflation compared to the world. However, the truth is that inflation is a reality, and costs are still rising. And we have no option but to put up with this.
We are yet to reach a stage where we can say that we have passed the acid test. We have to look at costs, and realise that we cannot just keep sharing costs.
Also, we have to look at engaging the workforce. If the workforce is engaged, they are likely to stay longer with us. It is important that employees stay on because the cost of recruitment has now gone through the roof. In most cases, the people who leave are only just looking at the next company to fund the higher rate of interest that the banks are charging. So, we have to move forward with great care.
If we manage to do a good job of engaging the people, they will stay on. Not everything is about money. People will still stay with the same company for long periods of time if they feel engaged.
How can they feel engaged? One, they feel engaged when there is a purpose. Two, they will be engaged if there is a very clear correlation between what they do and what they believe their strengths are. Three, they will remain engaged if they get to learn and develop in their organisation. Finally, they’ll also stay if their work and efforts are recognised and rewarded. Therefore, these are the four things that we should be focusing on in 2023.
Balance between rising inflation and changing employee expectations
I think we need to pay attention to a simple thing called ‘communication’. If we do a good job of communicating, and taking our people along with us, we will be in a much better position.
Communication is important because people need to know that the world is not getting better; that the grass is not always greener on the other side. Of course, they know this intuitively, but somebody will have to tell them in clear terms. When this is communicated to them, the music changes completely. They realise and understand how serious things are.
By the way, all ships rise and go down with the tide. So, someone has to speak to the people. If things are not communicated in the right manner for people to understand, we may have a problem on our hands.
If employees get to learn and develop in their organisation, they’ll stay longer
Looking beyond work output & outcome
It is true that organisations wish to be closer to their people, but what do the employees want? Employees, currently, are agnostic to organisations. They seek a platform or a podium, which will help them with their own growth and development.
They don’t care very much whether they are given a good place, a good job, a good salary, and good role. They are just fine. What they really seek is self-growth and development.
Earlier, people thought Google was a great company. However, while it is still definitely so, and has a great culture, the truth is that its culture is a little bit about ‘hire and fire’ as well. Therefore, a high-paying job may also be fraught with risks.
I feel 2023 is a year when organisations need to focus on mass career individualisation. That means, if I have 20 people in my team today, then I should be able to say what motivates each one of them. Some people are motivated by work, others by praise. Employers need to look at what the employees really seek. I don’t think we have all the answers, because if we do then we will be doing a phenomenal job of engaging people.
By the way, the only year when employees and employers drifted apart was in 2021 and early 2022. Why? Because in the year of COVID, even though the companies were helping them as much as they could, the employees were disappointed that their employers were not giving them the compensation for the year. That hit them very badly. Therefore, in some sense, they lost their connection with their firms. With the entire headwind of the economy bang in their face, companies could not afford it. Many companies saw their senior officers taking a 25 per cent pay cut just to make sure that the people on the front lines got paid.
In 2023, while organisations will begin to look at what their employees really want or are looking for in their careers, employees themselves will look at what they can maximise from their firms. The year will also be marked by a significant drop in attrition.
The bargaining power of what I call the ‘mad’ 2022 will come down dramatically. Sanity will set in and the wind will change. Employers will need to be cautious, because this kind of music can change in an instant. The beats can change any moment, and we should be prepared to act accordingly.
33 leaders predict the upcoming trends for 2023. To find out more click here.
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