Vast majority of HK businesses planning to restructure, but only 4% believe they are digital-ready, Mercer research finds
94% of companies in Hong Kong are planning organizational changes in order to keep in step with ongoing digital innovation, however, on 42% of companies feel confident in reskilling the current employee base and only 4% of organisations are “digital ready” (4%), according to Mercer’s 2018 Global Talent Trends Study – Unlocking Growth in the Human Age.
As the ability to change becomes a key differentiator for success in a competitive global climate, the challenge for organizations is to bring their people along on the journey, especially as one of the top asks from employees is for leaders who set a clear direction.
“After years of talking about disruption, executives are determined to turn talk into action. This year we saw palpable excitement from executives about shifting to the new world of work. They are pursuing an agenda of continuous evolution – rather than episodic transformation – to remain competitive,” said Ilya Bonic, President of Mercer’s Career business. “They recognize that it’s the combination of human skills plus advanced digital technology that will drive their business forward.”
“In Hong Kong, it’s a given that digital disruption means companies must change, but the how is a vastly more complex proposition,” said Jackson Kam, Regional Practice Leader at Mercer. “Our research shows that speed of change remains the number one challenge for Hong Kong businesses, very few of whom believe they are agile enough to embrace the required changes,” he added.
In pursuit of new technologies, executives must focus on the “human operating system” to power their organization. Mercer’s study identified five workforce trends for 2018: Change@Speed; Working with Purpose; Permanent Flexibility; Platform for Talent; and Digital from the Inside Out.
Change@Speed: How companies prepare for the future of work depends on the degree of disruption anticipated. Those expecting the most disruption are working agility into their model and placing bets on flatter, more networked structures (31% are forming more holacratic work teams). However, HR leaders in Hong Kong feel unprepared to reskill existing employees (only 42% are confident that they can do this well) or to hire from the outside (43%). As almost two-thirds (63%) of executives predict at least one in five roles in their organization will cease to exist in the next five years, being prepared for job displacement and reskilling is critical for organizational survival. Yet, only 34% of companies are increasing access to online learning courses and even fewer (25%) are actively rotating talent within the business.
Working with Purpose: Three-quarters (75%) of thriving employees globally, those who feel fulfilled personally and professionally, say their company has a strong sense of purpose. To find purpose, employees crave movement, learning, and experimentation. If not received, they will look for it elsewhere – 60% of Hong Kong employees satisfied in their current job still plan to leave due to a perceived lack of career opportunity. In addition to purpose, the new value proposition includes health and financial wellbeing. Employees on average spend 11 work hours per week worrying about financial matters, yet only 19% of companies have policies in place to address financial health. Fairness in rewards and succession practices are also top of mind – only 47% of employees say their company ensures equity in pay and promotion decisions. “Organizations that help employees worry less about basic security needs and invest more energy on their career aspirations will be rewarded with a workforce that has more pride, passion, and purpose,” said Mr. Bonic.
Permanent Flexibility: Individuals are vocal in their expectations of work arrangements that put them in control of their personal and professional lives. Employees want more flexible work options, and organizations are listening – 83% of Hong Kong’s executives view flexible working as a core part of their value proposition. Only 1% of executives consider themselves industry leaders when it comes to enabling flexibility – the lowest country score along with Singapore – and 46% of employees fear that choosing flexible work arrangements will impact their promotion prospects. “The lack of flexible work arrangements hurts women and older workers disproportionally, leading to absenteeism, lower energy levels, and burnout,” said Mr. Bonic. “As the skills gap widens and human competencies become more important, making sure that a diverse pool of talent can participate in the workforce at all life stages is both a business and a societal imperative.”
Platform for Talent: Organizations realize they must expand their talent ecosystem and update their HR models for a digital age, given 81% executives expect an increase in the competition for talent, two in five companies plan to “borrow” more talent in 2018 and 81% of employees would consider working on a freelance basis. “Gaining greater access to talent through a broader ecosystem is part of the solution.
Companies also need to deploy talent faster and with precision to unlock the potential of their workforce,” said Kate Bravery, Global Practices Leader in Mercer’s Career business. “Adopting a platform mentality to talent requires a radical mindset shift, embracing the notion that talent can be accessed for the benefit of all rather than ‘owned’ by one manager, department, function, or even organization.” Executives agree, reporting that improving the ability to move jobs to people and people to jobs is one of the talent investments that would have the most impact on business performance this year.
Digital from the Inside Out: Hong Kong’s companies lag on delivering a consumer-grade experience – only 4% consider themselves a digital organization today (compared to 15% globally). While 57% of employees say that state-of-the-art tools are important for success, just 37% say they have the digital tools necessary to do their job and only 26% have digital interactions with HR. Business leaders are confident in HR’s ability to be a strategic partner in setting the course for the future, with 62% of executives reporting that HR aligns people strategy with the strategic priorities of the business. “In turbulent times there is a tendency to hold on to the rafters. Intuitively, we know success involves riding the crest of change and this requires a healthy risk appetite and a willingness to break and re-make talent models,” said Ms. Bravery. “When we are living digitally, working flexibly, and being rewarded uniquely, we will unlock growth in the Human Age.”
Mercer’s study shares insights from over 7,600 senior business executives, HR leaders, and employees from 21 industries and 44 countries around the world. The report assesses the new drivers of the future of work, identifies critical disconnects concerning change, and makes powerful recommendations to capture growth in 2018.
For more information or to request the full 2018 Global Talent Trends Study, visit http://www.mercer.com/global-talent-trends.
Mercer delivers advice and technology-driven solutions that help organizations meet the health, wealth and career needs of a changing workforce. Mercer’s more than 22,000 employees are based in 44 countries and the firm operates in over 130 countries. Mercer is a wholly owned subsidiary of Marsh & McLennan Companies (NYSE: MMC), the leading global professional services firm in the areas of risk, strategy and people. With nearly 65,000 colleagues and annual revenue over $14 billion, Marsh & McLennan helps clients navigate an increasingly dynamic and complex environment. Marsh & McLennan Companies is also the parent company of Marsh,which advises individual and commercial clients of all sizes on insurance broking and innovative risk management solutions; Guy Carpenter, which develops advanced risk, reinsurance and capital strategies that help clients grow profitably and pursue emerging opportunities; and Oliver Wyman, which serves as a critical strategic, economic and brand advisor to private sector and governmental clients. For more information, visit www.mercer.com. Follow Mercer on Twitter @Mercer.