In an Uncertain Economy, People Strategy is Key to Future Success

S&P Global’s economic report suggests increased downside risks for the U.S. despite its resilient economy. For 2023, the U.S. economic climate is expected to experience a decline in GDP growth alongside a sustained high inflation rate and tight labor market. However, recent reports forecast a looming and unprecedented talent shortage across industries globally. According to Korn Ferry’s projections, the global labor shortage may reach up to 85.2 million individuals by 2030, potentially costing companies trillions of dollars in lost economic opportunities.  

In short, the future is murky at best, turbulent at worst.  

With this economic forecast in mind, how can businesses strengthen their performance and support growth in the long term? It’s simple. Focus on people strategy. The center of any organization’s agility lies not with its product or service, but its people.  

And in an era of pressure to increase revenue and ROI without adding similarly to headcount, organizations must get savvy on their people strategy – maximizing use not just of full-time labor, but their contingent staff as well, with a laser focus on articulating current and future needs, role types, and key project types.  

Act Now 

As the great Winston Churchill once said, “I never worry about action, but only about inaction.”  

In uncertain times, it’s often thought that a freeze or pause makes the most sense, to avoid costly mistakes. But when it comes to people strategy, businesses can’t afford to wait. The ability to build in the future depends on having enough people and the right people in the right roles. Understanding future needs now and building towards that as quickly as possible will save organizations from costly mistakes down the line.  

Begin with Data  

First and foremost, organizations must begin with data, an exercise we call a skills assessment. The three-pronged process is simple and includes an inventory, budgeting analysis, and simple data visualization to show which skills are most often needed from both a strategy and frequency standpoint.  

In doing so, organizations identify what types of roles are most commonly needed and which offer the most value, thereby speeding up and simplifying the hiring process and maximizing budget resources.  

Mind the Gap 

Data not only shows organizations where their strategy must go, it also shows organizations where their strategy is lacking. enterprises should conduct a gap analysis to identify the areas of their business which need further development. With that data in hand, enterprises can ascertain the most suitable workforce configuration for their operations. This means a strategic formulation of a talented team of professionals dedicated to solving this issue cross-functionally, as well as a clear articulation of what types of skills and roles should be filled by each type of worker, allowing organizations to determine how best to leverage things like talent pools and direct sourcing. Such candidate sourcing strategies can help enterprises build a talent pipeline and remain competitive in the market.  

This approach will help organizations attract and retain the skilled workers they need to thrive in today’s competitive business landscape. 

Trending Topics: 

• Since hybrid work is a double-edged sword for both companies and employees, many organizations are finding ways to enhance their returns to offset the negative effects of this work setup. According to a Forbes Councils Member, employers can revamp their hybrid work programs by fortifying teamwork and listening to feedback. 
• The emergence of hybrid work resulted in more women experiencing poor work-life balance. With this, the survey results of Deloitte argued that the term “flexible work” should be reinvented as “agile work” since this could potentially diminish the stigma, demonstrate impact, empower decision-making, and foreground clear work principles, especially among female workers. 
• The demand for soft skills is on the rise as AI technology continues to shape the future of work. In a machine-based future workplace, employers will look for individuals with new marketable skills, such as empathy, management, and effective communication. 
• The rise in loneliness and other mental health concerns in the workplace calls for companies to take action. According to a U.S. Surgeon General, creating opportunities for individuals to connect with one another is crucial. To cultivate a healthier and more productive workforce, businesses should prioritize building meaningful relationships among their employees, especially for those who work in remote or hybrid setups. 
• A working paper written by researchers from The Federal Reserve Bank of New York, University of Iowa, and Harvard University has shed new light on remote work. According to the study that was conducted on engineers of a large technology company, it was found that while remote work bolstered the productivity of senior engineers, the setup also reduced the amount of feedback that junior or younger engineers received.   

Today’s issue was guest authored by Cori McKee , MBO vice president of enterprise solutions and leader of MBO’s technology and healthcare verticals.