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To lead this shift toward the new organization, CEOs and HR leaders are focused on understanding and creating a shared culture, designing a work environment that engages people, and constructing a new model of leadership and career development. In competition for skilled people, organizations are vying for top talent in a highly transparent job market and becoming laser-focused on their external employment brand. Executives are embracing digital technologies to reinvent the workplace, focusing on diversity and inclusion as a business strategy, and realizing that, without a strong learning culture, they will not succeed.
First, demographic upheavals have made the workforce both younger and older, as well as more diverse. Millennials now make up more than half the workforce, and they bring high expectations for a rewarding, purposeful work experience, constant learning and development opportunities, and dynamic career progression. At the same time, Baby Boomers working into their 70s and 80s are being challenged to adapt to new roles as mentors, coaches, and often subordinates to junior colleagues. Also, the global nature of business has made the workforce more diverse, demanding a focus on inclusion and shared beliefs to tie people together.
Fourth, a new social contract is developing between companies and workers, driving major changes in the employer-employee relationship. The days when a majority of workers could expect to spend a career moving up the ladder at one company are over. Young people anticipate working for many employers and demand an enriching experience at every stage. This leads to expectations for rapid career growth, a compelling and flexible workplace, and a sense of mission and purpose at work. Today, contingent, contract, and part-time workers make up almost one-third of the workforce,1 yet many companies lack the HR practices, culture, or leadership support to manage this new workforce.
Culture and engagement are also a major concern for the C-suite. This reflects, in part, the rise of social networking tools and apps that leave companies more transparent than ever, whether they like it or not. Top executives increasingly recognize the need for a conscious strategy to shape their corporate culture, rather than having it defined for them through Glassdoor or Facebook.
As companies strive to become more agile and customer-focused, organizations are shifting their structures from traditional, functional models toward interconnected, flexible teams. More than nine out of ten executives surveyed (92 percent) rate organizational design as a top priority, and nearly half (45 percent) report their companies are either in the middle of a restructuring (39 percent) or planning one (6 percent).
This new structure has sweeping implications, forcing programs such as leadership development, performance management, learning, and career progression to adapt. Challenges still remain: Only 14 percent of executives believe their companies are ready to effectively redesign their organizations; just 21 percent feel expert at building cross-functional teams, and only 12 percent understand the way their people work together in networks.
Compared to last year, companies appear to be making strides in adopting new technologies and embracing new learning models. The percentage of companies that feel comfortable incorporating massive open online courses (MOOCs) into their learning platforms rose to 43 percent from 30 percent last year, while the percentage who said the same about advanced video tripled from 5 percent to 15 percent.
For the first time in the four years of the Global Human Capital Trends report, there are real signs of change and progress: HR teams are learning to experiment with new ideas; they are making significant steps to upgrade skills; and a new generation of younger, more business-savvy and technology-empowered people is entering the profession.
As technology makes data-driven HR decision making a possibility, 77 percent of executives now rate people analytics as a key priority, up slightly from last year. In response, companies are building people analytics teams, rapidly replacing legacy systems, and combining separate analytics groups within HR into one strategic function. In 2016, 51 percent of companies are now correlating business impact to HR programs, up from 38 percent in 2015. Forty-four percent are now using workforce data to predict business performance, up from 29 percent last year.
This year, 74 percent of executives identified digital HR as a top priority, and it will likely be a major focus in 2016. The trend is moving rapidly: 42 percent of companies are adapting their existing HR systems for mobile, device-delivered, just-in-time learning; 59 percent are developing mobile apps that integrate back-office systems for ease of use by employees; and 51 percent are leveraging external social networks in their own internal apps for recruitment and employee profile management.
When it comes to meeting heightened talent needs, top HR organizations must increasingly learn to integrate and leverage the part-time and contingent workforce. More than seven out of ten executives and HR leaders (71 percent) ranked the trend as important or very important.
Operating effectively in the gig economy poses a number of questions. How can companies best use and schedule external staff to improve the productivity of their own workers and increase profitability? How can companies leverage contingent workers to access some of the most talented and highly skilled people in the workforce?
Many companies are struggling with the challenge. Only 19 percent of executives surveyed believe their companies fully understand the labor laws that govern contingent workers, and only 11 percent have complete management processes for the contingent part of the workforce. This suggests that companies need to take a more deliberate approach as the size and scope of the contingent workforce continues to grow in the coming years. Workforce management will also have to address the tremendous growth in cognitive computing and other smart technologies that are likely to eliminate jobs, create new jobs, change the nature of work, and disrupt the workforce.
Taken together, the 2016 Global Human Capital Trends report sketches out a vast and varied series of changes and challenges. As the pace of change accelerates, business and HR leaders who move aggressively to address these trends will likely gain an advantage over their competitors and find themselves on the winning side in the global competition for talent.
Global Human Capital Trends 2016 is the result of the efforts of a global team working over the past 12 months, including hundreds of contributors from across the global Deloitte network as well as the counsel and input of our clients.
Julie May for overall direction of the Global Human Capital Trends program throughout the year. You guided us in handling the hundreds of details and decisions, including managing dozens of country champions and an editorial team with a myriad of authors and contributors, that go into delivering a global survey and report. We appreciate your focus on the many activities needed to produce a global report of this scope and complexity. Your insights and editorial pen are evident in every chapter of the report.
Junko Kaji, Matthew Lennert, Sonya Vasilieff, Kevin Weier, and the remarkable Deloitte University Press team, led by Jon Warshawsky, for their editorial and design skills. You continued to push us to sharpen our thinking and writing to produce (we hope) insightful and actionable messages.
Katrina Drake Hudson and Andrea Sacasa for leading our integrated marketing program, developing a series of initiatives to share the global report and survey through a growing web of digital, traditional marketing, and social media channels. Thanks as well to Melissa Doyle for managing the public relations programs.
And last but not least, a special thank you to Brett Walsh and Jason Geller, the global and US leaders of our Human Capital practices. We are grateful for your support and encouragement every step of the way in producing this report.
A principal with Deloitte Consulting LLP, Jeff Schwartz is the global leader for Human Capital Talent Strategies and Marketing, Eminence, and Brand. A senior advisor to global companies, his recent research focuses on talent in global and emerging markets. He is a frequent speaker and writer on issues at the nexus of talent, human resources, and global business challenges.
In an early scene, Solo revealed that Han's surname is no family affair; it's just something he was handed by a terminally bored Imperial flunky who got uncreatively playful with our favorite Star Wars scoundrel's lack of a traveling companion. I groaned about it in the moment, and ever since. That's the vibe you're signing up for when you sit down to watch The Book of Boba Fett on Disney+.
Something's happened to Star Wars stories in recent years. Solo and The Rise of Skywalker had it most of all on the movie side, but the worst offenders have been our now-two Disney+ live action series, Boba and its predecessor, The Mandalorian. I'm talking about the prevalence of winks and nods.
It's a thought that crystalized for me when The Book of Boba Fett paid a visit to Tatooine's Tosche Station. You remember that one, right? It's the place a young Luke Skywalker whined about not being able to visit in the first Star Wars movie. The iconic line actually ties to a deleted scene from A New Hope where Luke did go there and meet up with some locals, including "friends" Camie and Fixer (they're both kinda just dicks to Luke).
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