Global engagement crisis looming warns Deloitte report

Lack of employee engagement is the top issue currently facing 87 percent of HR and business leaders (up from 79 percent last year), according to Deloitte’s third annual “Global Human Capital Trends 2015: Leading in the New World of Work” report.

However according to the report, the majority of organisations are still failing to take action to improve their culture, potentially jeopardizing future growth.

The survey was conducted among more than 3,300 HR and business leaders in 106 countries, and is one of the largest global studies of talent, leadership and HR challenges. The number of HR and business leaders who cited engagement as being “very important” doubled from 26 percent last year to 50 percent this year. Sixty percent of HR and business leaders surveyed said they do not have an adequate programme to measure and improve engagement, indicating a lack of preparedness for addressing this issue. Only 12 percent of HR and business leaders have a programme in place to define and build a strong culture; while only 7 percent rated themselves as excellent at measuring, driving, and improving engagement and retention.

Josh Bersin, principal and founder of Bersin by Deloitte, Deloitte Consulting LLP, said: “As demand for talent picks up, the balance of power in business is rapidly shifting from the employer to the employee. Moreover, workers are becoming more mobile, contingent and autonomous, and as a result, harder to manage and engage. In this new world of work, organisations need to re-imagine the way they manage people and come up with new, out-of-the-box ideas to make themselves relevant.”

Leadership, learning, and skills gap take centre stage

Leadership gaps – last year’s most critical issue – continued to be top of mind for HR and business leaders, 86 percent of whom cited it as a top issue this year. However, the number of respondents who said this was a “very important” issue jumped from 38 percent last year, to 50 percent this year. Interestingly, according to the “Deloitte Business Confidence Report 2014,” only 49 percent of C-level executives surveyed indicate that they are committed to developing leadership skills at all levels of the organisation.

Recognising the fact that a general lack of skills is likely to impede business growth, 85 percent of HR and business leaders ranked learning and development as a top issue, compared to 70 percent last year, making this the third most critical issue in this year’s survey. Meanwhile, 80 percent of respondents cited workforce skills as a top issue (up from 75 percent last year), and 35 percent rated the lack of skills in HR as a “very important” problem, up from 25 percent last year.

Brett Walsh, global human capital practice leader, Deloitte Touche Tohmatsu Limited, said: “There are significant shifts happening in the global workplace that business must actively manage. In addition to workers’ changing expectations from employers, skills needed on the job are changing faster than ever. Organisations are quickly falling behind on developing the right skills across all levels. There’s an urgent need for organizations to re-evaluate their learning programs and treat leadership development as a long term investment, rather than a discretionary training spend item when times are favourable.”

Businesses are struggling to simplify the workplace

In addition to the challenges of employee engagement and leadership, the Deloitte report shows that companies are struggling to decrease workplace stress, simplify business processes, and reduce complexity. In fact, 66 percent of respondents believe their employees are “overwhelmed” by today’s work environment; and 74 percent cite workplace complexity as a significant problem. While more than half of the surveyed organisations have some type of simplification programme, 25 percent have no plans to implement a programme.

Bersin said: “Simplification is a new theme emerging from this research. Engaging and supporting employees today requires fresh design thinking about how work gets done.”

Cognitive computing is changing the way we work

According to the report, the increasing cognitive power of computers and software is challenging organisations to rethink the design of work and the capabilities their employees need to succeed. Fifty eight percent of leaders indicate that “redesigning work with computing as talent” is an important trend. However, while many executives are concerned, few have a strong grasp of the impact of cognitive computing on talent. Only 5 percent of executives surveyed say they have a strong understanding of what computing will do to their workforce.

Bersin added: “There is a need to redesign the workplace to integrate technology. By leading the process of ‘job redesign,’ developing hard-hitting training programs, and working with technologists on the implementation of new technology, talent and HR leaders can help ease the transition of these technologies into the workforce and, ultimately, improve productivity and engagement.”

Organisations are missing the growth opportunities presented by analytics

The Deloitte report reveals that analytics is one of the areas where organisations face a significant capability gap. Three quarters of respondents cited talent analytics as an important issue, but just 8 percent believe their organisation is “strong” in this area—almost exactly the same as in 2014.

To gain further insights into the report, including detailed information on specific countries or industries, click here to access the Deloitte Global Human Capital Trends 2015 Dashboard.

Access the full report here and infographic here.