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Workforce Challenges Ahead

  |  July 30, 2004   |  Comments

High-level executives express concern about whether their workforces are prepared for a more competitive business environment.

Numerous factors drive business success, but many companies are coming up short in one of the more critical elements – the workforce. According to an Accenture study that examined high-performance workforce issues, many companies don't feel prepared to compete in an improved economic and business climate.

Just 17 percent of the 244 high-level executive respondents described the overall skill level of their entire workforce as "industry-leading," and the respondents indicated that the war for talent would have a greater impact over the next 12 months. Just 6 percent said that the war for talent is currently having a severe impact on their company, compared to 13 percent who expected to feel the severe impact in the coming year.

While 65 percent rated "developing effective leadership capability" as very important, only 8 percent said their company performed very well in that area. "Creating an organization and culture that adapt effectively to change" was considered very important to roughly half the respondents, yet only 8 percent gave their companies high marks in that regard.

The study found that organizational shortcomings often originate with the human resource department's training programs, and large disparities were evident between priorities and progress.

Key Human Resource Training Practices
Rated as
Important
Satisfied
with Progress
Aligning learning strategy with business goals 77% 11%
Ensuring learning content meets
workforce requirements
75% 16%
Boosting workforce productivity and agility 72% 9%
Measuring learning function against objectives 66% 9%
Improving the efficiency of training operations 55% 11%
Source: Accenture

Accenture partner Jim Benton anecdotally eliminated one particular area as the root cause. "...based on my personal experience, there are numerous causes of poor employee performance and it is rarely, if ever, due to a single cause such as a poorly trained HR department."

Goals that were unmatched by results were evident among the initiatives that the respondents deemed as important. Improving worker productivity was the initiative with the highest priority for more than two-thirds of the respondents, yet only a scant few were satisfied with their progress on this initiative.

Key Human Resource Initiatives
Rated as
Important
Satisfied
with Progress
Improving worker productivity 69% 6%
Improving the adaptability of the
business to new opportunities
68% 11%
Facilitating organizational change 66% 12%
Improving employee engagement
with/advocacy for the company
65% 11%
Improving the delivery of HR services 64% 14%
Source: Accenture

Respondents were mostly C-level executives and senior human resource executives and the survey found that the severity of the workforce problems differed according to the position. C-level respondents were more optimistic than HR respondents when asked about employees' understanding of company goals and strategies, and nearly twice as many C-level respondents said their overall workforce was "industry leading" than HR executives (24 percent compared to 13 percent).

Employees' Understanding of Company Strategic Goals
C-Level Execs
in Agreement
HR Execs
in Agreement
Three-quarters or more of the employees
understand the company's strategic goals
26% 20%
Three-quarters or more of the employees
understand how their jobs contribute to
the company's ability to achieve its
strategic goals
30% 20%
Source: Accenture

The research, conducted across the U.S., UK, Spain, France, Germany, and Australia, and representing 17 different industry segments, identified 38 companies that were better positioned to address imminent marketplace challenges.

Accenture found similarities among the group of human performance leaders: stronger overall financial performance; more likely to be planning to grow their businesses in the coming year; see human capital-related capabilities as more important to addressing critical marketplace challenges; use IT effectively to support HR and training; and regularly measure the link between HR and training investments and business results.

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