Top 10 HR Trends 2021

The pandemic has left us with unprecedented challenges. More than ever, HR is confronted with embracing the future of work and taking the lead in co-creating the new normal. Here is a guide to the most likely trends to affect HR in 2021.

As we leave an unparalleled year behind us, we ask ourselves: What will the future bring? Are we going to turn a corner? What will the new normal look like? How well are we going to adapt?

The stakes could not be higher going into 2021. HR faces seemingly insurmountable challenges, including anything from shaping the future of work to dealing with declining levels of employee engagement and health, from establishing Diversity, Equity, and Inclusion efforts that actually work to transforming existing operating models that ensure the company remains agile.

Here are some key trends to watch out for.
1. Building a Diverse, Crisis Resilient Workforce
2. Commitment to Wellbeing and Mental Health
3. Developing Virtual Leadership Skills
4. Adopting a Startup Mentality
5. Shaping the Future of Work (Beyond COVID-19)
6. Talent Enablement Drives Innovation
7. Putting People Centerstage Remains Uphill Battle
8. New Ways to Engage Employees
9. Fighting the People Debt Crisis
10. Increasing Performance Acceleration Efforts

(Click here to view our previous trends.)

1. Building a Diverse, Crisis Resilient Workforce
   We have asked a lot of our employees. They had to pivot and adapt fast. And together we did our best to navigate the harsh realities of a global pandemic. But with the world continuing to change before our eyes, we need our workforce to be more adaptive and resilient than ever before. A workforce that can flex its muscle is naturally better equipped to deal with constant change. It is not surprising, Agile companies have proven to be more resilient in the face of adversity.
   Building a crisis resilient workforce is more than continuous learning, creativity, and experimentation. It starts by embracing diversity of thought, experience, and personalities, and allowing for more individuality. It makes Diversity, Equity & Inclusion (DEI) initiatives paramount in shaping the workforce of the future. One, capable of pushing the needle on innovation and competitiveness no matter the circumstances.
2. Commitment to Wellbeing and Mental Health
   The pandemic brought unprecedented social isolation and disruption to our personal and professional lives. The considerable degree of fear, worry, and concern has led to elevated rates of stress or anxiety. The silver lining: The pandemic has put a spotlight on an otherwise often underrepresented topic. Poor mental health and stress will inevitably hurt job performance and productivity.
   Companies must learn to support and lead targeted efforts such as providing mental health benefits and establishing more flexible sick leave policies. But we also need to have a renewed look at our work design and working agreements. We need to equip our leaders with the proper knowledge and tools to deal with the various aspects of mental health, well-being, and employee happiness.
3. Developing Virtual Leadership Skills
   Even as we hope and plan for a new normal that will allow us to meet in person again, remote work is here to stay. Leading a virtual or hybrid setting requires our managers to build some extra leadership muscle. They must be able to inspire and coach employees in a way that keeps them engaged, connected, and productive – regardless the setting.
   It requires applying different techniques such as empowering people and teams, communicating with purpose and intent, making work and deliverables visible, celebrating successes and learning from failures, and improving team cohesiveness. For this, responsiveness, accessibility, building trust, respect, and empathy towards team members are just as important as modeling behavior and helping employees establish boundaries between work and life.
4. Adopting a Startup Mentality
   The pandemic illustrated just how much we lived in the famous VUCA (volatile, uncertain, complex, and ambiguous) times. What seemed like an overused statement became all too real in 2020. As we adjusted so many different aspects of the business, many organizations saw clears limits to how quickly and easily they could change their processes and operations. For many, it was a clear wake-up call.
   The need to be as flexible and adaptive is no longer a nice-to-have or only limited to smaller market players. It doesn’t matter if the disruption comes from a pandemic or an unexpected market shift, or game-changing technology. The survival of most organizations depends on their ability to identify and cope with rapid changes.
   Running the business more like a responsive startup than a rigid, over-engineered conglomerate will continue to resonate with leaders. But a startup mentality is only as good as your processes and operating model. Lean-Agile practices are imperative to creating a more nimble business. Continuous and relentless improvement, experimentation, minimum viable products (MVP), co-creation and co-delivery are just some aspects of an agile business operation.
5. Shaping the Future of Work (Beyond COVID-19)
   There is no denying the world is no longer changing gradually. We are in a state of extraordinary disruption, and speed is of the essence. The need for more adaptability and responsiveness is more significant than ever. But with great change come great opportunities.
   Progressive and courageous HR professionals and leaders worldwide work hard to shape the future of work, fit to respond to the myriad challenges. Rapid advancement in technology changes the nature of work. Remote work will outlast COVID-19 but also intensify the need for collaboration and team bonding. Learning and growth must be ongoing and embedded into the workflow.
   This change requires more than an improvement of existing processes. Future-proofing the organization takes a transformation on all fronts, not least the leadership approach and underlying mindset.
   HR must join forces with leaders and organizations to redefine the operating model and shape a work environment that allows for adaptability and responsiveness while providing the necessary stability and profitability.
6. Talent Enablement Drives Innovation
   Learning and development is a central theme to any organization faced with rapid change and the intense pressure for continued innovation. The ability to grow and develop employees is becoming an organizational priority. They are accentuated by the fact that the capacity and capability for ongoing coaching and mentoring is turning into a competitive differentiators in the war for talent.
   Programs for microlearning and continued up- and re-skilling are necessary, but building more transferable skills and competencies, understanding and valuing the different ways in which people contribute to team success is equally important. It improves the organizational ability for learning, creativity and innovation. Hence, organizations are amping up initiatives to establish more personalized learning and multi-faceted development paths. As part of it, HR and people developers partner up to help individuals reach their potential faster than they could independently. It all leads to a shift from traditional learning and development to talent enablement (TE).
7. Putting People Centerstage Remains Uphill Battle
   In organizations rooted in efficiency and cost-cutting, it is all too easy to lose sight of the human side of the operations. But the company is no longer a machine that we can approach with a process mindset. Instead, it is becoming a complex, adaptive ecosystem.
   For some time now, we have quietly moved into the human economy. On top of that, the heightened sense of urgency on racial injustices and inequality issues accelerates the need for organizations to take more social responsibility.
   The organizational approach that made companies great in the past loses its effectiveness and relevance. It puts increasing pressure on long-established leadership practices and, more importantly, the underlying mental models and believes.
   Humanizing work is not just about social responsibility; it is also about the thing you need to do to thrive in the new economy. Organizations need to start by caring about people and putting them first.
8. New Ways to Engage Employees
   The importance of Employee Engagement and its impact on productivity and profitability is undisputed. And yet, related efforts are all too often reduced to isolated HR initiatives and a few surveys, with limited success. Furthermore, the pandemic has significantly increased the amount of stress and frustration across the board.
   Organizations need to find ways to understand and proactively manage employee engagement levels. Technology can help identify and monitor different aspects of engagement. But data alone is not enough.
   Action is needed, especially by leaders and managers. They are at the core of connecting employees to their work, their team, and the overall organizational purpose. Their continuous interaction and guidance will make a difference, especially as remote work is highly likely to outlast the pandemic.
9. Fighting the People Debt Crisis
   Organizations face a widespread and often hidden crisis of their own making, one that can no longer be ignored: People Debt. People debt is the implied costs and risks of neglecting the human aspect of agility and forgoing the necessary investments in people and HR topics. People debt is often dismissed (e.g., people development) or not recognized as an impediment (e.g., MBOs that undermine innovation, meritocracy with pay-for-performance practices that lead to inequality and lack of opportunities). But if ignored, people debt will erode the organization’s resilience and survivability.
   Tackling people debt takes an unwavering focus on people. After all, people are the most critical asset of any human-centric, agile organization. Not only is investing in an HR and people approach aligned with agile values, principles, and practices the right thing to do, but it will elevate and ensure your continued success. It’s the key to achieving Business Agility.
10. Increasing Performance Acceleration Efforts
    Rigid, process-driven approaches give way to a more nuanced and holistic approach. Rather than focusing on managing performance, the real focus should be on ongoing efforts to improve and lead individuals and teams to peak performance.
    In today’s fast-paced world, performance management must be a real-time, continuous, and integrated process. On the one hand, technology is opening up new opportunities to leverage performance analytics in a way that helps our workforce to identify areas of improvement, provide fast feedback/feed-forward, and convert weaknesses into strengths.
    On the other hand, the definition of performance and what goes into it is changing. The meaning of performance is becoming much broader than just hitting a specific number. Willingness to experiment and be creative, adapt quickly, and take calculated risks are valuable traits in a high-performing person or team and need to be encouraged. Modern performance management approaches reflect that employee well-being, team dynamics, and diversity of thought are crucial parts of high-value delivery. It takes a strong collaboration between HR, managers, and employees to enable peak performance.

Are you ready to embrace the 2021 challenges? We’d love to hear from you. Click here to reach out for comments or questions.

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