Top 7 HR trends in 2017 to watch out for

2017 is officially up and running, and analysts and business management globally are determining priorities for the coming 12 months and beyond. It’s a time to look at trends and changes, to review successes and failures from the year past – and a time to make plans.

For those operating in HR, some core responsibilities and challenges never shift.

Recruitment and retention maintain a place at the top table, while 2016’s focus on social and agile workplaces dominated conference discussions worldwide. Widening skill gaps, the corporate glass ceiling and questions of diversity, equality and corporate responsibility continue to echo.

However, each year brings its own unique identity and set of challenges.

Projections for business in 2017 look to advancing technologies, economic and political changes and many more indicators to provide direction on what the next 12 months will hold.

We’ve looked at some of the top discussions taking place to compile our own list of top HR trends in 2017. There are also links to great reports, whitepapers and ideas to help inform and shape your own HR strategy.

What do you think will be the top HR trends in 2017? Take a look and let us know if there’s anything we’ve missed.

1. Consumerization enters the workplace, as we shift from employee engagement to employee experience

Employee engagement was the buzz phrase on the lips of all in 2016, as continued research shows the value of engaged employees for business in terms of productivity, profitability, loyalty and more. Engagement surveys identified the scale of the problem, pushing disengagement to the top of the management agenda.

2017 will see ‘engagement’ morph into ‘experience’, as leaders move from identifying the problem to enabling a solution.

Now, the focus is on strengthening employee experience, defined by IBM as; “A set of perceptions that employees have about their experiences at work in response to their interactions with the organization.”

Part of the process will look at the growth of consumerization in the workplace, a topic covered well by Jeanne Meister for Forbes. Consumers hold high expectations of their home lives, demanding superior experiences when it comes to technology use, social interactions and levels of service. Now, employees expect the same of their experiences of the office.

HR will need to champion the creation of memorable customer experiences for employees, covering everything from the recruitment process to office environment or the quality and access to technology.

If Amazon and Netflix can use algorithms to make recommendations based on our previous choices, employees will begin looking for the same use of technology when it comes to recommending relevant business content.

Alternatively, ‘Tinder style’ staff or intranet directories could help individuals connect to remote colleagues who share the same interests, experience or career objectives – and that’s just the tip of the iceberg.

A word about perks:

Ever since Google triggered a trend with its in-office slide, nap pods and on-site putting green, we’ve seen copy-cat attempts to top the ‘craziest office extras’ list. Some have snubbed the rise of ‘extreme perks’ that flooded the business arena in a bid to attract Millennials, questioning the value in-house dry cleaning services or foozeball tables in the cafeteria.

Perks have their place, particularly in shaping overall experience for employees. However, we’d suggest that 2017 will mark a notable shift away from ‘gimmicks’, focusing more on benefits that will retain employees once they’re already through the door – such as health insurance, flexible working or fitness and well-being initiatives.

2. Agile performance reviews, coaching and performance consultancy continue to rise

It featured highly in HR debates throughout 2016, and is set to dominate discussion in 2017.

The premise is simple and supporting evidence shows it’s a concept that works. We’ve moved from recognition against years of service to daily social recognition, regular conversations and coaching or mentoring, rather than traditional management. Traditional performance reviews are, ironically, getting bad reviews – many accept that it’s time for a change. Only 8% of enterprise companies believe that the traditional performance management process drivers business value.

Younger generations in the office expect instant gratification from technology and social interactions; it’s a trend translating into their daily working lives. What’s more, many organizations face uncertainty and change from month to month or even week to week in their organizations: the idea of setting an objective at the beginning the year and expecting it to remain the same until year-old is outdated as a concept.

Despite many top-name brands including Deloitte and Adobe ditching the formal performance review process in favor of a flexible, agile approach, not everyone is on-board with the concept yet. 2017 is the year to watch for a tipping point, as more organizations abandon formal performance management practices.

3. A workplace demographic shift is under way

The workplace is undergoing another demographical shift, as Millennials continue to make the move into management and GenZers step into the role of new kids on the block.

The sheer volume of research, advice and fuss surrounding the integration of Millennials into the workplace has dominated workplace discussion in recent years. Changing priorities and demands have transformed organizational structure, recruitment practices and the employer offering.

Now, one third are already operating in management roles, a trend set to continue; and 2017 will mark the first full year for Gen-Z in the workplace.

“36% of millennials have a manager title or above, yet the Harvard Business Review found that only 7% of companies have accelerated leadership programs to nurture them. The focus needs to shift from attraction to progression and development of this demographic.”

Early research shows that while the latest generation mirrors its Millennial predecessors in some respects, such as prioritizing career development and work-life balance, there are fresh challenges in the road ahead.

A greater focus for Gen Z on finding a “dream job” over and above financial security, favored by Millennials entering the workplace during the financial crisis, will make for a pickier recruitment market. Writing for Inc.com, John Boitnott argues this may actually breed a more loyal workforce than the Millennial generation:

“Gen Z is most interested in working for a cause or company that they are passionate about, and may be willing to be paid less to do so. If they are genuinely interested in promoting what your company has to offer, you can bet that they will be hardworking, loyal, and a good investment.”

The focus upon cultivating cultures driven by a strong mission and values as part of an attractive employer brand will rise from a ‘nice-to-have’ differentiator to a core, underlying principle of HR strategy. In line with the ‘instant gratification’ trend in agile performance management, HR will need to consider short-term benefits that focus on the newer generation. Progression and career development are top of the list of priorities, and will require tailoring and customization for a personalized experience.

Increasingly connected through technology, Gen-Z will also continue the pressure for high-performance, accessible and connected tech in the workplace. With more and more individuals opting to ‘bring your own device’ (BYOD) or accessing work systems outside of office hours, HR representatives will need to work closely with IT to define and manage security and usage policy, protecting both organization and individual.

4. Blended workforces are approaching tipping point

Fieldglass reported in 2015 that the average company workforce was already distinctly blended in nature, and in 2017, the scales would tip to less than half (41%) of workers being traditional, full-time employees.

The revelation and concept of blended workforces isn’t new, but this tipping point does represent some fresh challenges for HR in 2017.

Organizational design and the structure of job titles or hierarchies will need a complete re-think; Deloitte discovered that 80% of businesses who responded to its survey were currently or had recently completed “deconstructing” their organizational hierarchies. The shift from individuals to teams, to networks of teams is set to increase.

Then, it’s a matter of how to engage and integrate those employees.

How can we establish strong organizational cultures without walls and connect individuals from a vast range of backgrounds, skill sets and even time zones or countries? How can you create productive, collaborative partnerships between colleagues who may never meet face-to-face?

5. Skills, not silos: the rise of “unicorns” and the gig economy

Closely tying into the themes of agility and personalization, there’s a shift on the horizon around the very idea of what a career path or role is.

The rise of ‘comprehensivists‘ (or, if you prefer the more casual term, ‘unicorns‘ – not the tech kind, but the people kind) is beginning to become widespread, as organizations increasingly embrace a ‘gig economy’ of part-time or contingent workers to achieve their goals.

Individuals aren’t defined by a single role or career goal. They don’t have a single skill or role to bring to the table. Furthermore, boundaries between defined departments are becoming more and more blurred, as organizations move from structured processes to projects that require a multitude of skills. The result is businesses hiring or leveraging people without a defined place, who will move with fluidity to where their skills are demanded.

HR is a prime example. What used to be a silo comprising of HR professionals conducting processes such as absence booking or performance management is now a series of ‘projects’ that can demand the skills of design, marketing, IT and more. (Consider the scale of a project to implement an intranet, for example; a key HR tool, but requiring multiple skillsets to get up and running.)

Organizations originally responded by deploying flexible or freelance resource to match their project needs, creating a rise in this workforce demographic. However, there’s a suggestion that ‘in-house freelancers’ could present an alternative solution.

Placing people with the right skills in the right roles at the right time is a trend that may signal the end of departmental organization structures altogether. It will present fresh opportunities and flexibility, helping organizations grow.

It will also come with fresh challenges.

These individuals may have one manager, or several, or none at all; but they still need performance management, advancement opportunities and day-to-day management. It will implicate on how those individuals are recruited and how they are supported in connecting and collaborating with colleagues, outside of a defined team space.

The concept is explored in Fast Company in the article, ‘Why High-Skilled Freelancers Are Leaving Corporate Life behind’.

6. Work cultures will continue to evolve, prioritizing health and happiness

We’ve touched on the value of work cultures in shaping employee experience and attracting Gen Z talent, but there are recognized shifts in what constitutes a ‘positive’ workplace culture in recent years.

The focus on work-life balance will continue, but with a stronger emphasis on employers supporting mental and physical health.

“Fewer than half of American workers say that their company supports employee well-being and helps them maintain a healthy lifestyle. Compared to last year, health-related employee benefits have increased by 58% and wellness by 45%, which will continue into 2017.” (Source: Forbes)

With reports showing one in four people experience a mental health issue in any given year, a fresh approach to well-being programs and supportive workplace cultures is key to combat the growing crisis, alongside its detrimental implications for both individual employee and the organization.

Ninety-one million working days a year are lost to mental ill health.

We’re already seeing the growth of wearables focus in some organizations, with ‘workplace monitoring’ on the rise through companies such as Humanyze, which has already been adopted by some big brands including Deloitte and the UK’s NHS. There are insurance programs that offer discounts according to your activity levels or lifestyle choices. Thanks to this latest source of Big Data for organizations, HR functions can have access to unique insights that may help direct future strategy.

“You can identify pockets of innovation that need support, clogs and limitations to communications, promote collaboration and teamwork, and design and orient physical space in the interest of a healthier and more productive work environment,” argues Chris Brauer, director of innovation at the Institute of Management Studies at Goldsmiths.

The shift in parental responsibility is increasing pressure on employers to do right by fathers – and we’d suggest 2017 needs to be the year the US steps up on paternal leave and rights for new or adoptive fathers. Research by the Organization for Economic Cooperation and Development shows the US falls far behind the curve.

Finally, there’s a subtle change on the value of cultural hiring, which saw an increase in popularity in recent years. For all the focus on finding talent that would ‘fit’ in with the organization, the market may have done itself an injustice – with hiring managers invariably recruiting individuals in the same image, who don’t contribute anything new or different to the organization.

2017 marks the shift to ‘cultural add’: hiring individuals who will complement, rather than mirror, existing cultures and introduce diversity and innovation to the mix.

7. HR technology will offer greater insights and data

The use of Big Data to inform hiring, performance management, organizational structuring and to identify employee behavior, such as engagement or flight risk, is well-established.

However, 2017 marks a change in the way that data is applied. Rather than relying on reactive data for retrospective analysis, advances in technology will allow for new prediction models. The result will be more strategic, data-led approaches to ensure better hiring outcomes, optimization of current employees and lower attrition rates.

There are more sources and forms of data, too; as we’ve highlighted above, employee data from fitness devices will couple the increasingly popular ‘pulse’ surveys and culture or engagement analysis, giving a more comprehensive overview of the organization.

The challenges with these developments will lie in data collection from multiple sources, analysis and interpretation and governance around ownership and usage. HR professionals should expect to work more closely with IT to leverage insights and ensure technology continues to be a help, rather than a hindrance.

2017: the year of the ‘new’ HR professional

We’ve already seen an evolution of the HR professional from process-led administrators to vital strategic partners, championing change at leadership level. Changes within the industry mark the continued growth of HR to encompass additional skills, spanning knowledge of people analytics, internet marketing, branding and technology.

To deliver on business objectives and drive growth and success, HR will play a pivotal role. They must work in partnership with multiple departments, coordinating projects and resources to maximize productivity and returns. Whatever 2017 holds in store, it’s clear it will be a year for change.

Are there any trends you think we’ve missed? Leave us a comment below!