Thriving in change: balancing immediate needs and future growth 

As organisations grapple with evolving economic pressures and constant advances in technology, HR and talent leaders face the dual challenge of managing labour costs while ensuring workforce efficiency and engagement. Simply hiring more employees isn’t always the best solution but there are other things you can do.

Shift focus from cost to value

Many companies focus on hiring the lowest-cost employees to drive the highest returns. But this approach risks overlooking the efficiency and strategic value each hire brings. Simply hiring more people in a bid to drive growth is not the solution for everyone, particularly when you're in a complex environment with multi-regional or multi-country scopes to consider, alongside different levels of hiring.

Adopting a value-driven hiring strategy involves prioritising candidates who offer strategic benefits such as flexible work options to support employee well-being and can contribute to long-term growth – even if it means a higher initial investment. Conducting thorough skill assessments is essential to ensure both existing employees and new hires align with business needs and enhance overall efficiency.

Look beyond hiring

Beyond hiring, it’s vital to engage in strategic workforce planning. Workforce plans should align with your long-term business goals and include talent development, succession planning, and a skills gap analysis.

Key questions to consider:

• Are we identifying the future skills our business needs to stay competitive?
• How can we align talent development with our strategic objectives?
• What steps are we taking to prepare for leadership transitions?
• Are we effectively analysing and addressing our skills gaps?

An integrated approach, involving collaboration across departments, ensures that workforce planning supports overall business strategy. For example, talent acquisition (TA) leaders must partner with learning and development (L&D), and those responsible for talent management, to create effective upskilling and internal mobility initiatives. Indeed, 84% of recruiters in LinkedIn’s Future of Recruiting 2024 report emphasised the need for closer TA and L&D partnerships, up from 78% in 2023.

Maximise returns on labour

Identifying where labour costs yield the greatest returns allows you to generate revenue that can be reinvested into your workforce. This could mean upgrading technologies for increased automation or improving areas that have become stagnant and need a fresh approach. The goal is to align your talent strategies with business objectives, ensuring that investments in people yield the highest impact.

Analyse performance metrics, employee engagement scores, and productivity data to inform your investment strategies.

Put employees at the center

Employee engagement and satisfaction are critical components of high returns on labour costs. Employee turnover typically costs organisations 1.5 to 2 times an individual’s annual salary, so it’s not surprising that talent retention and engagement have become top priorities for global organisations today. Employers can gain a competitive edge by focusing on existing talent.

Prioritising engagement makes solid business sense: companies with higher engagement levels experience 23% higher profitability compared to those with lower engagement levels.

Curating a compelling, meaningful employee experience and developing employee-centric approaches that prioritise well-being, work-life balance, and career development helps you to create a positive work environment. Having recognition and rewards programs that acknowledge high performance, and innovation can also boost morale and productivity.

A people-centered approach ensures the human sustainability component is actively prioritised. This approach helps you manage talent effectively and consistently, ultimately contributing to true workforce sustainability.

Be the vanguard for change

In light of the last few years, it's clear that change is now a constant, so finding a balance between short- and long-term strategies is a must for any talent and HR leader. While it’s sometimes necessary to implement immediate cost-saving measures, they shouldn’t overshadow strategic long-term planning.

Focus on sustainable strategies that can flex and scale as needed by investing in innovation, infrastructure, and talent. This allows you to address current challenges while also positioning your organisation for growth and resilience in the years to come.

Want to learn more?

Get notified about future workforce sustainability content from top industry leaders.