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3 trends in human capital management you can’t afford to ignore in 2023

In 2023, organizations are facing a multitude of challenges that are forcing them to adapt quickly. These include economic instability, geopolitical uncertainties, cost-of-living crises, skills shortages, and sustainability concerns. To stay ahead of these threats, businesses must be agile and implement new strategies for human capital management (HCM). In this article, we highlight three key trends that will shape the future of work and have a significant impact on HR strategy and practice.

Trend 1: Anticipating Future Skills with AI

Artificial intelligence (AI) is rapidly transforming human resources. By analyzing job postings, training materials, and employee skills profiles, AI can predict the skills that will be in high demand in the future. For example, AI can help the automotive industry match the skills needed in battery technology with people, training content, and job titles. Similarly, it can assist petrochemical companies in identifying the skills required for developing new sustainable energy solutions. HR professionals in the financial services sector can use AI to find the right skills to respond to emerging business opportunities, such as sustainable finance and cryptocurrency. Companies that implement AI-driven, skills-based systems for recruitment, internal mobility, career guidance, job tasks, and compensation will outperform their competitors.

Trend 2: Aligning HR Strategy with Business Realities

To respond to transformative trends such as disruptive innovation and the cost-of-living crisis, HR departments and business leaders must collaborate to create a coordinated response. However, there is a significant gap between employers providing new skills to employees and employees’ confidence in the company’s ability to develop their skills. In 2023, HR leaders will increasingly adopt a skills-first approach to training and talent, identifying skills gaps and developing relevant and engaging pathways for their people to acquire new skills. This will create a future-ready workforce that is better aligned with the realities on the ground.

Trend 3: Improved Retention Programs

Employee retention is becoming increasingly important, especially as younger generations demand more from their employers. In 2023, businesses will place even greater emphasis on employee retention by providing empowered professional development, real-time performance feedback, and continuous lifelong learning. High-performing organizations that score high on employee development, diversity, inclusion, and other factors enjoy the greatest success in employee retention. It’s essential to empower employees with the right skills, so HR professionals must establish training and development programs that focus on equipping their employees for the future.

In conclusion, staying on top of the latest people and workplace trends is essential for HR professionals. By understanding the growing adoption of AI, the increasing importance of skills development and retention, and the changing expectations of employees, businesses can prepare themselves for the future of work. The EMEA Trends 2023 report by Cornerstone provides a rigorous, in-depth perspective on tomorrow’s workforce and jobs, making it an indispensable resource for forward-thinking organizations. The time to act is now, so start implementing strategies that will equip your employees with the skills they need to thrive in the future.

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