HR Professionals Cite People Challenges and Talent Gaps as Biggest Business Obstacles

Survey Respondents Say Workforce Planning, Reskilling/Upskilling and AI Adoption Are Most Important to Future Performance, While Capabilities in Those Areas Are Lacking

November 22, 2023

In a new report, the World Federation of People Management Associations (WFPMA) and Boston Consulting Group (BCG) found that people managers must shift their focus to better align their strategies with their most critical business challenges. “Creating People Advantage 2023: Set the Right People Priorities for Challenging Times,” the third installment in an ongoing joint study conducted by WFPMA and BCG, found that while people leaders clearly recognize that improved strategic workforce planning, upskilling and reskilling, and AI adoption are important to the continued success of their companies, they also assess their firms’ current capabilities in those areas as lacking.

The survey asked respondents to rank 32 people management topics by future importance to their organization and by their organization’s current capabilities. Among the key findings:

• Though smart, proactive investments in digital technology will continue to be necessary to business performance, just 35 percent of HR professionals believe that their people management functions are using relevant digital technologies.
• While 72 percent cite people challenges and talent gaps as the biggest obstacle they currently face, only 30 percent agree that HR is using data and analytics to anticipate people challenges – and strategic workforce planning ranked only 18th overall among the 32 topics in terms of current capabilities.
• Despite widespread concerns about a talent gap, respondents’ ranking of upskilling and reskilling fell five places this year from the 2021 results to 9th in future importance and to 17th in current capabilities.

“People leaders have the opportunity now to shift their focus to building up the capabilities that will best deliver for their companies in the long run,” said Anthony Ariganello, President of WFPMA. “By continuously prioritizing talent development and the digital transformation, HR professionals can achieve wider goals such as greater efficiency, improved service levels and a better employee experience.”

The report outlines five recommendations for people leaders to adopt to prepare for challenging times:

• Leverage data to accurately plan for talent supply and demand.
• Get better at talent acquisition.
• Invest in upskilling and reskilling the current workforce.
• Unlock value through AI.
• Focus on change management and organizational development.

This third installment is based on a survey of 6,893 people leaders in 102 markets (93.5 percent of whom perform HR functions). The first edition was published in 2008, and the most recent one prior to this year’s appeared in 2021.

About WFPMA:

The World Federation of People Management Associations (WFPMA) is a global network of professionals in people management, founded in 1976 to aid the development and improve the effectiveness of professional people management all over the world. Its members are predominantly the continental federations which are made up of more than 90 national human resource associations representing over 660,000 people management professionals.