Jeffrey Erickson | Tech Content Strategist | April 27, 2023
Over the last three years, world events have conspired to put the chief human resources officer (CHRO) in the spotlight. From the sweeping workforce changes the COVID-19 pandemic brought and the Great Resignation of 2021 to the tech layoffs of late 2022 and a looming recession, CHROs across industries have been tasked with overcoming a growing set of unprecedented challenges. And 2023 will be no different. This year, CHROs and their human resources (HR) teams will continue to manage workforce disruption—even as they work on best practices to help their organizations manage increasingly hybrid and geographically dispersed teams.
Through it all, CHROs will also need to improve the overall employee experience—and thus employee retention—by helping a diverse workforce build a culture that enables all employees to find meaning in their work lives.
So what should CHROs be watching for in 2023? There are 10 key challenges that leaders who direct people policy will need to contend with in the coming year.
CHROs who successfully build a flexible, hardworking hybrid culture will not only raise productivity but also have a hybrid work story that can help attract and retain talent—a critical asset in a market where, according to LinkedIn’s 2022 Marketing Jobs Outlook survey, 87% of employees want to remain remote most of the time.
Here are three steps that can help CHROs create a successful hybrid work model.
By now, most CHROs know that diverse perspectives make for better ideas and stronger teams. And their experience is backed by a recent report from for the 2022 World Economic Forum meeting, which suggests diverse teams significantly outperform homogeneous ones over time in terms of profitability and employee engagement.
The challenge in 2023 is to make diversity endemic to the organization. For that, a CHRO will need good data on workforce diversity, including analysis on how diversity, equity, and inclusion (DE&I) affects talent acquisition and employee attrition and retention. To acquire these kinds of insights, CHROs will need human capital management (HCM) software that helps them understand their organization’s DE&I status. More than tracking ROI, it should also make it easy to show compliance with local and national regulations around DE&I and help the organization create a DE&I culture that attracts and retains workers.
In 2023, potential recruits will look beyond compensation to the culture they’ll be joining if they sign on. In this environment, the employee experience can no longer be a by-product of talent strategy—it must drive talent strategy.
CHROs should look to build organizations that foster deeper connections among employees and recognize their hard work and their social impact.
One of a CHRO’s chief responsibilities is to find and keep the right people in the roles needed to meet an organization’s goals. But recruiting challenges are growing and competition for labor remains fierce. Economists polled by Reuters found that going into 2023 there were still 1.74 jobs for every unemployed person in the US.
To keep pace in this competitive environment, CHROs need to reach beyond traditional hiring and recruitment practices—such as internal recruitment, job postings, and college outreach—and explore new methods.
For example, more HR organizations are embracing remote recruitment events and hiring practices. Virtual hiring events are particularly helpful for reaching large groups of people. And since enabling hybrid and remote work is also a best practice for 2023—according to researchers at Wharton—virtual events allow the HR team to reach less-competitive markets where untapped talent may live.
A good enterprise recruiting system will help the HR team promote online events, track registrations, and prescreen attendees to help identify great candidates. Their human capital management system should give HR teams a platform that helps them interact with new talent and pass promising applicants through to hiring and onboarding platforms.
According to a report by remote staffing firm OutStaffer.com, analysts believe the global skills shortage will continue through 2023—with 75% of employers continuing to report challenges finding skilled and qualified employees to fill vacancies. One solution: Develop talent internally. Give employees a path to learn new skills and the resources to succeed.
Upskilling and training managers can have the greatest pay off in terms of employee happiness and retention. Leaders and managers must be trained and empowered with tools and strategies to help them build a positive, supportive workplace. These can include simple things such as regular check-ins with team members or facilitating learning and growth opportunities. An HCM platform can serve as a knowledgebase for managers that guides them to relevant learning and development opportunities—for themselves and their team members—both within and outside of the organization.
CHROs know that engaged employees are the backbone of an organization that performs well; an engaged workforce can lead to 17% higher productivity and 21% higher sales, according to a recent Gallup poll. And 2023 is the year organizations stop waiting for things to “return to normal” around the office and start building an HR organization with remote and hybrid workers in mind.
When an employee is engaged at work, beyond merely satisfied, they’re emotionally invested in their own performance and that of their team. In short, they’re willing to go the extra mile to serve their colleagues and customers. Here are three ways CHROs can help employees, whether they’re remote, in the office, or in the field.
As social and work environments continue to evolve in 2023, CHROs must help their HR teams adapt. Improving remote hiring processes and workflows can help organizations overcome the ongoing skills shortage. The CHRO should help their HR teams design and implement hiring processes that avoid practices such as adding unnecessary assessments, judging gaps in an applicant’s job history, and posting unrealistic role requirements, all of which can result in needlessly turning away promising candidates—or deterring them from applying at all.
From hiring to assessing performance, through the entire employee experience, an enterprise human capital management platform can help a CHRO redesign the HR function around best practices. It might, for example, guide an HR team to seek candidates based on soft skills rather than undergraduate degrees or re-examine roles to see if traditionally in-person jobs—a field technician, for example—could complete paperwork remotely. The HCM application can also guide the interview process, helping schedule interviews with candidates, from early “job fit” interviews to deeper skills test interviews, and providing transparency with regular communication along the way.
If recent history is any indication, CHROs will continue to grapple with challenges and uncertainty in 2023. HR leaders can take proactive steps to deal with uncertainty and create processes that ensure stability for their organization. Here are two ideas for how a CHRO can help their organization ride out uncertain periods.
Use data and analytics to make quick decisions. A CHRO with a trusted analytics team can combine business intelligence, market research, predictive analytics, and even employee feedback to understand which sources yield the best candidates, how long it takes to hire a candidate, and what it costs to attract, select, and onboard each new hire. And thanks to technologies such as artificial intelligence and machine learning, which are often built into enterprise HR software, a CHRO has an unprecedented opportunity to be proactive, rather than reactive, in uncertain times.
Ensure employees are engaged and ready to think on their feet. CHROs are expected to provide continuity and respond with agility to ongoing change. But incomplete, complex, and siloed systems prevent visibility, slow decision-making, and make it difficult to roll out businesswide changes. A single, comprehensive solution in the cloud can provide a full view of the business and give HR teams the ability to make changes quickly, tailor the system to meet employees’ evolving needs, and access new functionalities when they need them.
HR teams use a lot of software, from a selection of modules in a core HCM platform to separate best-of-breed software packages for project and document management and many other functions. Before new technology can begin paying off, however, it needs to be onboarded and accepted by the organization.
The CHRO should be at the heart of the process. Start by defining exactly what the module or piece of software must do and make sure it does it. Next, engage employees who will be using the software, and consider creating a task force of team members to help you identify any customizations required to meet the needs of specific business functions.
Once the software has been implemented and the task force members are satisfied, it's time to get buy-in from the rest of the organization. This step will take time and persistence; consistent messaging, official training, ambassadors who can share their experiences, and, eventually, recognition and even awards for regular participation can help fully embed the technology throughout the organization. Only then can the CHRO start measuring and celebrating the ROI.
According to a late 2022 survey of HR benefits managers by BenefitsPRO, the competition for talent will continue in 2023. As a result, more employees at every level are weighing their professional options and, in some cases, choosing to move on, sometimes with very little warning. As the head of HR, the CHRO plays an integral role in identifying promising individuals and preparing them to assume leadership roles.
In 2023, the CHRO must balance several factors when forming a succession plan, such as understanding workforce dynamics in remote teams, developing criteria to evaluate potential successors in different geographies, and gaining leadership buy-in. With a well-rounded strategy and transparent procedures, businesses can ensure smooth transitions and find candidates that are ready to fill executive positions now and in the future.
To meet the HR challenges of 2023 and beyond, modern CHROs will rely on human capital management (HCM) software. An HCM platform provides HR teams with industry best practices and sophisticated data analytics to help them make decisions about hiring, compensation, retention, and many other functions. They’ll find tools to help automate administrative tasks during the hiring and onboarding processes and a platform to help them deliver a better employee experience for the diverse modern workforce—whether employees are remote, hybrid, in the workplace, or in the field. .
What is considered the top CHRO challenge for 2023?
This year’s top CHRO challenges will be driving business outcomes (profitability and performance) through a productive workforce and meeting employee expectations for total well-being, belonging, and growth.
What’s new for hiring and retaining talent in 2023?
Look for the growth of remote events and remote hiring. For example, virtual hiring events are particularly helpful for reaching large groups of people from different geographical areas.
How can CHROs promote diversity, equity, and inclusion in 2023?
CHROs can use a mix of industry and internal data to understand their organization’s own DE&I experience, then design programs that demonstrate real commitment to DE&I and be transparent about their progress.
Why will CHROs be asked to promote cultural values in 2023?
In 2023, potential recruits will look beyond compensation and focus on culture, choosing organizations that foster deeper connections between employees and recognize both hard work and social impact.
Why is upskilling and reskilling employees a core challenge of 2023?
According to HR benefit managers, the global skills shortage promises to continue through 2023. Upskilling and reskilling is a way to proactively plan to fill vital roles in an organization quickly using current employees.
What HR technology will be key to CHRO success in 2023?
Technology that provides a comprehensive data source with full visibility across the organization will allow HR to create personalized employee experiences and tailor the system to the changing needs of the workforce.