HR in 2022: 7 key trends that will affect employee experience (and how to address them)

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People analytics will play an important role in buy-ins for HR policies. At the same time, managers will need to be hired, trained, and promoted with the mindset that they do not need to know all the answers.

An HR leader HRO interviewed in 2020 once said: "It’s an understatement to say that COVID-19 caught us off guard. In a business-as-usual environment, HR is a trusted partner to the business but, in a pandemic, we are leading the fight."

Today, her words continue to ring loud and true — with countries moving out of the pandemic stage to settle into an endemic, HR continues to play the most important role in understanding the workforce needs in order to take them forward.

In fact, according to a recently-published report by EngageRocket, titled The HR 2022 Outlook, after the initial positive stance and “best foot forward” period of 2020, employees' resilience levels, mental health, and employers have dipped in 2021, with 17% fewer employees in APAC feeling confident in their organisation’s future between 2020 and 2021. Burnout has also increased by 9% in the year, the report noted.

Thus, "the onus is now on HR to stem the tide and formulate forward-looking policies that place the employees squarely at the centre," it added.

In line with that, the report highlighted seven key trends that will impact the employee experience in 2022 — how mental health and resilience will propel growth, the role of people analytics in fueling buy-in for HR policies, and more; as well as focus areas to address these in the year ahead.

Trend #1: 'New Work’ will manifest in new and unexpected ways

In a New Work paradigm, a person views their work as more than gainful employment. In addition to the transactional exchange of labour for compensation, there is a focus on purpose, fulfilment, and wellbeing. Unfortunately, the report highlighted, most organisations are yet to fully acknowledge and appreciate the import of this approach.

For instance, a recent Gartner survey found that 75% of leadership believe that they run a culture of flexibility, but only 57% of employees agreed. The same percentage of leadership also felt that they incorporate employee voice in decision making, while 47% of employees agreed. 

There is, evidently, a disconnect between HR policies or the leadership strategies propelling them, and employee sentiment on the ground — emphasised by the shift of New Work needs, impulses, and aspirations among the workforce. Companies need to tailor their strategies accordingly to make this shift work for them, not against them.

The report thus highlighted the following areas for HR to focus on in 2022:

1. Develop a two-way communications strategy: Listen to the voice of the employee (VoE) and base future communications on employee input. The feedback can help shape follow-up actions, creating a closed feedback loop.
   
   
2. Deploy continuous listening: If you haven’t already, start by conducting employee lifecycle surveys and pulse surveys along with 360-degree reviews.
   
   
3. Enable more frequent check-ins between employees and managers: This will help you to detect and address problem areas early on.

Trend #2: The talent war is quickly becoming a 'zero-sum' game

There are a handful of companies – large and small – that are widely known as top employers in a region, and companies not investing in the talent war are getting left behind. This results in a “winner-takes-all” zero-sum game due to limited talent availability in the short term, the report noted.

As a result, HR will need to double down on efforts towards talent acquisition and retention in 2022, creating an employer brand and work environment that is attractive to both existing and new employees.

Focus areas for HR in 2022:

1. Formulate clear and transparent career paths and succession plans: Foster two-way communications between employees and managers, prioritise diversity & inclusion, and do not restrict career progression to only managerial roles.

2. Encourage just-in-time recognition, engagement via non-work activities, and the ability to disconnect after work: This will help to boost engagement by making every employee feel like they are more than the sum of their productivity outcomes.

Trend #3: Employee mental health and resilience will propel growth

In 2022, mental health and resilience will no longer just be buzzwords. Companies will be forced to invest real money in uplifting employee wellbeing and ensuring that they stay resilient and confident in the face of new challenges and opportunities. This will, indeed, be a key area of importance for HR to address.

Areas for HR to focus on in 2022:

1. Build a climate of psychological safety: Create a culture where everyone feels safe to voice their opinion regarding work and career-related conversations without risk of reprimand. This priority needs to be made explicit and instilled at all levels within the organisation.

2. Craft policies for stress mitigation: Policies such as employee assistance programmes and flexi-work where employees can take a
   day off for a breather are some of the ways HR can explore to foster wellbeing and resilience.

Trend #4: HR will become decentralised, spurring new management skills

According to the report, the typically centralised HR function must give way to a “hyper-local model” where HR can outsource the last-mile connectivity with each and every employee via the managers. This can apply to different elements of the HR function — from strategy and policy-making, to events and engagement.

The usual approach to manager evaluation and promotion also needs to change, it added. Instead of selecting "task orchestrators" for managerial roles, companies will have to promote those with leadership and coaching/mentoring skill sets. These properly selected, equipped, and trained managers will help to mobilise organisational talent without centralised and top-down control by HR.

The following focus areas for HR to note in 2022 were revealed:

1. Revisit manager evaluation KPIs: Encourage managers to focus on talent and skill development instead of only aptitude for operational execution.
   
   
2. Abandon the mindset that managers can and must have all the answers: Managers need to be hired, trained, and promoted with the mindset that they do not need to know all the answers. Only with this mindset can they pivot from being a performance manager to a nurturing coach. Senior leaders need to model and champion this mindset to drive the company-wide shift.
   
   
3. Empower managers with tools and data: Amplify the effects of better manager selection and training with the right technology tools. They should be able to leverage digital channels to survey employees, provide feedback, analyse data, communicate/collaborate remotely, and make decisions.

Trend #5: Diversity & inclusion will be a major competitive differentiator

According to McKinsey, companies in the top quartile for gender diversity in leadership were 25% more likely to have above-average profitability than their bottom-quartile counterparts. Unfortunately, many organisations are yet to fully invest in diversity & inclusion (D&I) as a key cultural as well as operational tenet.

Areas of focus of HR in 2022:

1. Communicate the D&I agenda to all layers of the organisation: Use data-backed insights to strengthen your case for D&I, as research suggests that employees are mostly unaware that the organisation collects and analyses D&I data to build an inclusive workplace. A clearly communicated plan will ensure timely buy-in and appropriate execution.
   
   
2. Lead by example when it comes to D&I: Actively incorporate D&I into manager selection and training to address gender equality in leadership roles.

Trend #6: People analytics will fuel buy-in for HR policies and change

In 2022, organisations can no longer put off people analytics implementation. While there are moves in the right direction, there is more work to be done. Analytics, virtual working technology, and upgraded learning platforms are among the top priorities for HR. However, per a survey cited, HR’s confidence in their ability to use data and analytics has declined by 3 percentage points since 2019.

What areas should HR focus on in 2022?

1. Embrace a mindset shift from intuition to data-driven: Intuition, past experience, and a general gut feeling have played a major role in organisation-wide policies. With people analytics, HR and leaders can make informed decisions with more confidence.

2. Train HR teams in analytics, strategy, and value generation: 60% of CEOs and EVPs consider HR to be an administrator than a value-driver, but 74% of CHROs disagree. People analytics training and implementation can help bridge this divide.

3. Ensure that there is a culture of continuous listening: Transparent communications and getting organisation-wide buy-in for continuous listening is a way to reap the benefits from your people analytics investment.

Trend #7: New productivity KPIs will be needed to assess employee performance 

In 2022, HR and business leaders need to consider productivity measures better suited to 'New Work' and remote/hybrid working. Collaboration, communication, positive work-life behaviour, and coaching mindset might be better indicators of performance.

The following areas HR can focus on in 2022:

1. Adopt a closed-loop model for performance reviews: This comprises feedback, calibration, and compensation.
   
   
2. Combat the risk of bias in light of the new metrics: An anonymous, multi-rater review system increases the reliability of performance ratings and mitigates the judgemental bias from a single person.

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