From adapting to flexible working to leveraging technology such as AI, employers are embracing new HR practices in 2024
We’ve said it before and we’ll say it time and time again: a well-executed HR strategy is pivotal to a company’s success, driving innovation, growth and resilience in today’s competitive business environment. Your employees are your greatest asset. So, are you doing everything you possibly can to prioritise their welfare and help them realise their full potential?
Here to support us in navigating the HR landscape is Victoria Abbott, HR consultant at Kent HR, the sister company of Maidstone and Canterbury-based law firm Brachers. Victoria stresses that effective workforce planning allows SMEs to strategically prepare for their future needs, enabling them to develop an agile workforce capable of managing the ever-changing business demands of an unstable economy.
This comprehensive approach includes forecasting talent requirements, identifying skill gaps, enhancing transferable skills and implementing robust succession planning. “Such proactive measures ensure that SMEs have the right talent in place to meet their long-term objectives,” Victoria asserts.
Currently, South East-based SMEs are grappling with several prominent HR and recruitment challenges. Adding to this complexity is the looming uncertainty of the upcoming general election. Victoria considers how the cost-of-living crisis has notably shifted employee priorities, explaining: “As an HR practitioner, I firmly believe that while financial incentives are important, non-financial rewards are a company’s most valuable asset. However, given the current economic climate, many employees are focusing on increasing their earnings through higher salaries and bonuses or cutting expenses by opting out of salary sacrifice schemes and embracing hybrid working to reduce commuting costs.”
Victoria notes that recruitment remains difficult, with vacancies taking an average of 38 days to fill, according to the 2023 HR Metrics that Impact report. This process often reduces productivity due to the need to train new hires. Furthermore, skill shortages and an ageing workforce compound these issues. “While I support and encourage employers to allow flexible working where they can, they need to be mindful of the fact that such flexibility can reduce skills being transferred in the workplace. Our younger generations must acquire the valuable expertise that the older workforce has developed over decades. This transfer of knowledge is crucial, especially from those who have spent many years with the same company.”
But it’s not all doom and gloom; amidst challenges, opportunities emerge for adaptable employers. In today’s fast-paced business landscape, leveraging technological advancements is essential for sustainable growth. Victoria advocates for this: “Now, with the mainstreaming of artificial intelligence (AI), businesses should capitalise on their digital tools and platforms to streamline processes, such as using cloud-based HR software.” She underscores the transformative power of automation, noting it can significantly enhance efficiency and reduce administrative burdens, freeing up people teams to apply the ‘human’ to HR.
Victoria also proposes incorporating apprenticeships into HR strategies. “I believe that any effective HR department will need to consider apprenticeships – they create opportunities for the new generation, who bring fresh perspectives on company processes, reflecting the views of upcoming customers, clients and consumers. Recent reforms announced by Rishi Sunak, including a £60 million initiative, aim to simplify the Apprenticeship Levy system and create up to 20,000 new apprenticeships. These reforms will cover the full cost for apprentices under 21 at small companies and allow increased funding transfers for businesses paying the levy.”
Of late, recruitment specialist HRGO has witnessed a 300% increase in the average number of candidates applying for a vacancy with its clients. “With this enormous volume, driven by increased labour supply, market forces and increases in AI and automation, clients are finding it challenging to keep up with the supply and to screen, sift and communicate with all the applicants,” says HRGO CEO John Parkinson. John recommends partnering with a recruiter who can efficiently identify and manage talent using advanced technology platforms. This approach, he explains, allows businesses to stay focused on their core operations.
As far as challenges go, John recognises that skill shortages remain in some sectors such as engineering, manufacturing and some high-tech industries. He encourages business owners to explore a skills-based approach to hiring, which can broaden a company’s talent pool. “The labour market is brimming with candidates whose skills may not directly align with traditional roles, but with open-mindedness and creativity, these individuals can become exceptional assets. The skills we need in our businesses change constantly. An approach focussed more on skills, potential and fundamentals can deliver brilliant results. Hiring for resilience, conscientiousness and adaptability has proven particularly successful.”
John commends the South East’s educational institutions for their role in fostering talent, stating that his personal experience with local colleges and universities has been brilliant. “These institutions are passionate about nurturing talent that meets the needs of SMEs in the region. Building relationships with schools, colleges and universities has delivered great results for HRGO, both internally and for our clients.”
Instead of criticising the education system for not teaching the skills businesses need, John urges businesses to get involved and become part of the solution. “You’d be amazed at what brilliant people you get when you ask educators to send their top talent your way. We’ve hired many brilliant, engaged and talented individuals this way.”
HRGO’s final piece of advice is to “concentrate on the ‘why’ of your business,” so that when you are attracting talent, you are hiring people who align with your mission. John elaborates: “It’s less important to candidates now that their career follows a linear path and increasingly important that they are joining an organisation with purpose and a clear mission and vision for the future. At HRGO, we want to leave everyone better than we find them. A clear message to the market about what you’re about will make a big difference: it feeds into talent, policies, culture, values, performance and decision-making.”
Doswell Law Solicitors, based in Ashford, Kent, specialises in HR and employment law. Heading up operations is partner Henry Doswell, who explains: “At Doswell Law, our main focus for our business clients is protection from costly and time-consuming disputes. Most clients employ us on a retainer basis. This means you will always be up to date with your contracts and procedures, and we are always available to give advice on any tricky or urgent employment issues.”
In addition to legal support, Doswell Law offers extensive HR consultancy services tailored to the needs of SMEs. These services include setting up people frameworks and functions for SMEs with no HR, supporting with employee relations issues, and collaborating on culture, engagement and change management.
Henry suggests thinking of HR strategies as part of business strategy – rather than standalone. “Everything HR is doing needs to add value and help businesses to achieve its goals,” he says. “Establish and embed effective, legally compliant HR frameworks, such as employment contracts and staff handbooks, so that systems and processes run smoothly, and enable a focus on culture and employee experience to attract, develop and retain the right people to achieve business goals.”
Clearly, AI stands as a prominent theme in the realm of HR, with Henry urging firms to harness this new technology to enhance and streamline internal systems and processes, thereby reducing administrative burdens and offering data-driven insights for improved decision-making. Other opportunities he identifies are focusing on workplace culture and employee experience to boost performance, engagement and growth, and valuing flexible working arrangements to help employees maintain a healthy work-life balance, which is crucial for retention and satisfaction.
Henry also advises investing in upskilling employees to meet evolving business needs, especially in roles that could be affected by AI advancements. “This investment not only enhances retention but also boosts employee engagement and motivation,” he says. “Finally, I would encourage SMEs to consider alternative talent models, such as hiring freelancers and contractors for specialised skills on a project or temporary basis. Such an approach provides greater flexibility and cost-effectiveness, particularly for businesses with fluctuating requirements.”
In a rapidly evolving and competitive business landscape, HR strategies emerge as the linchpin of success. The key takeaways: Prioritise your workforce’s welfare, embrace AI and other new forms of technology, and foster a culture of resilience and innovation to thrive amidst challenges and seize opportunities for growth.
