APRIL 18, 2023
Here at Evanta, a Gartner company, our exclusive CHRO communities expect an experience that is truly by CHROs, for CHROs. In order to develop agendas that fit this model and serve our communities around the world, we utilize a two-step approach to identify and understand HR leaders’ mission critical priorities and urgent challenges. This includes our annual Leadership Perspective Survey to gather quantitative information and interviews with members to verify the results and source relevant stories.
As we assess the initial results of over 500+ survey responses, there are distinct trends in CHROs’ outlook for 2023 and the actions and investments they plan to take from both an enterprise and functional level.
It’s clear that the economy is having a major impact on what takes precedence for CHROs this year. Here are a few notable trends for CHROs’ enterprise priorities in 2023:
- Driving growth, employee satisfaction and engagement and increasing operational efficiencies and productivity remain the top three enterprise priorities for CHROs this year. As economic conditions and talent issues disrupted the workplace for the majority of 2022, there is still work for CHROs in these areas.
- Increasing revenue rose to #4, up from #8 in 2022. HR leaders have been elevated within the C-suite, and they are increasingly being called to partner across the business on value-add initiatives.
- Optimizing or reducing costs has jumped from the #10 spot in 2022 to #5 for this year. Inflation and other economic pressures are leading CHROs to rethink how they allocate funds.
While some of their enterprise priorities remain the same from year to year, CHROs’ priorities on a functional level have had a major shift across the board.
- The top priority for CHROs in 2023 is Leadership Development and Succession planning. This has risen in importance since 2022 where Current and Future Leadership was #4 and Succession Planning was #7. We hear how retention and upskilling are the buzzwords for 2023, and CHROs are concentrating their efforts on how to forge a path for future leaders within the business.
- Retention remains the #2 priority for CHROs in 2023, while recruitment and onboarding dip. Recruitment, Onboarding and Retention Strategies were combined for the #2 priority for 2022, but this year, we had CHROs evaluate each area individually to get a better understanding of priorities. Retention remained the #2 priority, but recruitment dropped to #6 and onboarding dropped to #13. This correlates with recent Gartner research where “quiet hiring” is named as the top strategy for HR leaders to achieve their workforce and talent goals in 2023.
- Diversity, Equity and Inclusion continues to drop on the list year over year. DE&I was the #1 priority in 2021, #3 priority in 2022 and for 2023 it has moved down to the #5 spot. Through conversations with executives, many shared that they no longer use the term “DE&I,” but instead they aim to embed the principles of DE&I, particularly inclusion, into their organizational culture and employee experience.
In addition to discussing their mission critical priorities, we asked CHROs about their budget and planned spending areas. Here are two of the biggest trends:
1. CHROs’ operating budgets are not going as far in 2023, driving them to be creative with spending. Only 33% of respondents said they have an increase in budget from the previous year, compared to 40% in 2022. Furthermore, 37% saw no change in budget from last year and 25% saw a decrease in budget. When looking at these numbers and also accounting for inflation, it is no surprise that CHROs are prioritizing optimizing or reducing costs across the enterprise this year.
2. Although CHROs indicated recruiting and onboarding are not their greatest functional priorities this year, they are, however, their top planned spending areas. Thirty-five percent of HR leaders are planning to invest in recruiting (up from 29% in 2022) and 32% plan to invest in onboarding.
In closing, this year is all about strategy for the CHRO. They are increasingly being tapped to develop approaches that drive growth, increase revenue for the organization and improve employee engagement and satisfaction - all while enduring constrained budgets and battling competing priorities. To see success, CHROs indicate that they need to be innovative in developing their current workforce for the needs of tomorrow as well as building an organizational culture and workplace environment that boosts retention.
View the complete results from Evanta’s annual Leadership Perspective Survey here, and join your local CHRO community to connect with like-minded peers on these mission critical topics - apply to join today.
by CHROs, for CHROs
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