LAS VEGAS, Sept. 10, 2014 /PRNewswire/ -- Businesses are
facing the most diverse work environment that the world has ever
seen with five different generations working together, across
geographies — each with different skills, experiences and work
habits. More of these workers will be freelancers and long-term
contractors. All of this represents a major opportunity for
productivity, talent development and employee engagement, but
according to new wide-scale research from Oxford Economics, most
companies are unprepared to capitalize on it.
As revealed in Workforce 2020, an independent, global
study by Oxford Economics with support from SAP SE (NYSE: SAP),
most companies recognize the importance of managing an increasingly
international, diverse and mobile workforce. However, the majority
lack the strategy, culture and solutions to do so. Oxford Economics
surveyed more than 5,400 employees and executives and interviewed
29 executives in 27 countries, finding that two-thirds of
businesses have not made significant progress toward building a
workforce that will meet their future business objectives. The
announcement was made at SuccessConnect 2014, being held
September 9-11 in Las Vegas.
"To gain advantage in the future, businesses must understand the
workforce of tomorrow and its importance to bottom-line success —
today," said Edward Cone, managing
editor of Thought Leadership at Oxford Economics. "Our research
shows that the C-suite is out of touch with HR on business strategy
and priorities, and workers are not getting what they want from
their employers in terms of incentives, benefits and training."
Top Six Workforce Issues Facing Companies
The study's
findings challenge the prevailing wisdom and highlight the most
critical issues facing HR professionals. At the top of the
list:
1. Compensation Matters Most
According to Workforce
2020, competitive compensation is the most important attribute
of a job to two-thirds of respondents — 20 percent higher than the
next highest benefit. Retirement plans, flexibility and time-off
rank well ahead of amenities such as fitness centers, daycare and
subsidized food.
If compensation is what motivates employees, what they are most
afraid of is being left behind as a result of insufficient skills
and inability to keep up with the latest technologies. "Becoming
obsolete" is the biggest concern for today's worker, twice as
concerning as being laid off.
2. Millennials are Misunderstood
Although 51 percent
of executives say that millennials entering the workforce greatly
impacts their workforce strategy, fewer than one-third say they are
giving special attention to millennials' particular wants and needs
— primarily because executives do not understand how they think.
Much has been written about how millennials are different in their
use of technology and their attitudes toward work than past
generations of workers; however, the Workforce 2020 study
shows that they are surprisingly similar to their non-millennial
coworkers when it comes to workplace priorities:
- Millennials and non-millennials alike cite compensation as the
most important benefit. Additionally, 41 percent of millennials and
38 percent of non-millennials say higher compensation would
increase their loyalty and engagement with the company.
- Contrary to popular thinking, millennials are no more likely
than non-millennials to leave their jobs in the next six
months.
- Millennials and non-millennials have similar priorities in
areas such as meeting career and income goals and meeting goals for
advancement. The two groups have similar views on the importance of
corporate values and achieving work/life balance.
"Millennials are a major challenge for companies. As the single
largest and most tech-savvy workgroup, they also represent a
significant opportunity," said Mike
Ettling, president, HR Line of Business, SAP/SuccessFactors.
"Companies that can excite millennials about work, train them to
fill in gaps on experience and adapt to their style of working can
build a workforce that can successfully execute on the objectives
of today and adapt to drive advantage for the business of
tomorrow."
3. The Talent Gap is Widening
Few companies, however,
are properly supporting their workers, including millennials. Less
than half of employees surveyed as part of Workforce 2020
say their company provides ample training on the technology they
need, and less than one-third say their company makes the latest
technology available to them.
The need for skills like analytics and programming/development
will grow sizably over the next three years, but employees doubt
the opportunity to gain proficiency in these areas. While
executives cite a high level of education or institutional training
as the most important employee attribute, only 23 percent say they
offer development and training as a benefit. Incentives for
pursuing educational opportunities are also uncommon.
4. Leadership is Lacking
Unfortunately, supporting
growth among employees is creating a leadership void. Lack of
adequate leadership is cited by executives as the number two
impediment to achieving their goals of building a workforce to meet
future business objectives. Almost half of those surveyed say their
plans for growth are being hampered by lack of access to the right
leaders within their organizations.
Only 31 percent of executives interviewed say that when a person
with key skills leaves they fill the role from within the
organization. Surprisingly, less than half indicate that their
leadership team has the skills to effectively manage talent or
inspire and empower employees.
5. The Workforce is Changing
As the economy evolves to
a state where nearly everything can be delivered as a service,
companies are increasingly tapping external expertise and resources
they need — and on an as-needed basis — to fill skills and resource
gaps and to accommodate rapidly changing business and customer
demands. That means more temporary staff, more consultants and
contract workers, and even "crowd-sourced" projects. In fact, of
those companies surveyed as part of Workforce 2020, 83
percent of executives say they will be increasing the use of
contingent, intermittent or consultant employees.
6. Compensation Models, Development and Technology Must
Change
This changing nature of employment is affecting
workforce strategies. Of the companies surveyed:
- 46 percent say they will require changes in compensation
plans
- 45 percent say they will require increased investment in
training
- 39 percent say they will result in changes to technology
policies to support mobility, bring your own device, etc.
Additionally, 41 percent say they will drive new investments in
HR technology that can better support their changing strategies and
needs. Investments in HR technology will move beyond traditional
core HR systems designed to manage the employee record and drive
compliance toward emerging technologies that support recruiting,
talent and performance management, learning and enhanced employee
engagement.
- While more than half (53 percent) of executives say workforce
development is a key differentiator for their firm, they do not
have the tools and organization to back it up.
- Just 38 percent say they have ample data about their workforce
to understand their strengths and potential vulnerabilities from a
skills perspective, and 39 percent say they use quantifiable
metrics and benchmarking as part of their workforce development
strategy.
- Only 42 percent say they know how to extract meaningful
insights from the data available to them.
"When it comes to preparing for the future of work, knowledge is
power," Ettling said. "Tomorrow's workforce will be more diverse
and work differently. Companies must understand this and develop
new strategies that support diversity and foster a new level of
employee engagement and collaboration — or they will ultimately
remain stuck in the past."
To learn more about the global results of Workforce 2020
and the future of work, visit
http://www.successfactors.com/en_us/lp/oxford-economics-workforce-hub-pr.html.
SAP will share more detailed views of the findings from a regional
perspective and at the country level over the coming weeks. Follow
the #futureofwork conversation on Twitter with @successfactors.
For more information, visit the SAP News Center. Follow SAP
on Twitter at @sapnews.
About Oxford Economics
Oxford Economics is the world
leader in global forecasting and quantitative analysis for business
and government, and the most trusted resource for decision-makers
seeking independent thinking and evidence-based research.
Headquartered in Oxford, England,
with offices in London,
New York, and Singapore, and elsewhere around the globe, the
firm employs more than 90 professional economists, industry experts
and business editors—one of the largest teams of macroeconomists
and thought leadership specialists.
About SAP
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software, SAP (NYSE: SAP) helps companies of all sizes and
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storefront, desktop to mobile device – SAP empowers people and
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insight more effectively to stay ahead of the competition. SAP
applications and services enable more than 261,000 customers to
operate profitably, adapt continuously, and grow sustainably. For
more information, visit www.sap.com.
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