Wednesday, 2 December 2009

Business changes and HR plans


   I’ve just got a few more posts to do on human capital / talent / workforce planning for 2010.

However, even though I promote the view that the energy for HCM should come from within the organisation (an inside-out perspective), organisations clearly need to take account of the broader and longer-term context too.

One of the inputs that organisations (at least those based in, or with operations in, the UK) may want to use is the CBI’s latest report: ‘The Shape of Business – The Next 10 Years’ (thanks to Alice Snell for highlighting this on Taleo’s blog).

The first part of the report focuses on the reset in the business environment and the effect of the financial crisis and the recession on three existing drivers of change. Here’s my summary (focusing on the themes which are of most interest to me / this blog, and which does not cover the whole report):


1. Increasing importance of, and declining levels of trust

Our expectations of businesses are increasing, and the internet gives us the power to ensure that businesses live up to these expectations, Businesses are under the spotlight and need the trust of their stakeholders to retain current degrees of freedom to operate.

However trust in businesses and the profit motive have declined and are at risk of remaining depressed.

  • 79% of UK respondents said they don’t trust business leaders to put the interests of their employees and shareholders ahead of their own personal interests (Edelman Trust Barometer - supplementary survey)
  • 51% of respondents said UK businesses behave ethically - compared to 58% in 2006 (Institute of Business Ethics, 2008).


To redevelop trust, businesses will need to demonstrate their ethical credentials. This relates in particular to executive pay, environmental responsibility and openness with information (I’m going to have to come back to this with another post).


2. Social and demographic change

Businesses will be challenged to manage four different generations of employees, each with different motivations and expectations.

In addition, although pension problems will force some older employees to work longer, businesses will still need to take action to address gaps in critical skills (including science, technology, engineering, maths and project management).

Businesses will need to capture the knowledge and experience of individuals before they retire –and to retrain other employees, and/or seek new skills from elsewhere.

Businesses will also need to adapt if they are to attract, retain and get the most out of the new generation of employees (an important point and again, the subject of a future post).


3. Further technology change

Digital technologies are fundamentally changing business. Personalised web-based applications, cloud computing, real-time interaction and always-on web features are likely to become commonplace within 5-10 year years. Teleconferences, videoconferencing, webinars and remote working systems are all improving. Generation Y use these technologies in a different way and will expect increased technological capability at work.

Businesses will need to increase their use of Facebook, Twitter and other web 2.0 and social networking applications.

Businesses will also need to invest more in building their corporate cultures as a higher proportion of employees work away from central offices and/or reside in the periphery to the core of permanent staff.

The report also suggests that businesses are concerned about the impact of technology on work / life balance (though this wasn’t seen as a major issue in a recent Google Wave on the area).



More on the business response to these challenges shortly.  But perhaps you’d like to think about how you’re going to respond to them first?


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