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Top HR Trends for 2023 and Beyond

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Written by:
Stephan Miller - Guest Contributor

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5 min read
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New technologies and strategies to help HR teams adapt to evolving workplaces.

HR leaders are tasked with attracting, keeping, and developing top talent, creating a positive work environment, and ensuring compliance with all applicable laws and regulations. But these aren't statically defined responsibilities. They change with the times and trends affecting the industry.

An example of these changes is the hybrid work model. By 2019, only 10% of companies had a formal hybrid work policy.[1] Now, after the pandemic, as per Gartner research, 66% of organizations are implementing hybrid work models.[2] Almost overnight, companies had to adapt HR policies, procedures, and technologies to create a partially or completely remote workforce.

Now that we've made it through that transition, three prominent trends are reshaping the way organizations approach their HR strategies this year:

  1. The increasing use of AI to streamline HR processes

  2. Continued investment in diversity, equity, and inclusion (DEI) initiatives

  3. The prioritization of HR technology

More HR processes are being streamlined with AI

Rather than performing repetitive administrative tasks, HR professionals can now leverage AI to streamline workflows for recruiting, onboarding, training, and more. This liberates HR teams to focus on more strategic initiatives such as talent development, workforce planning, employee engagement, and corporate culture enhancement that improve overall employee experience and foster a high-performance work environment.

Here are some notable positive findings from Capterra's 2023 HR Chatbot Survey*:

  • Three out of four HR workers use ChatGPT for work: Seventy-three percent of HR workers have used chatbots like ChatGPT on the job and 83% have used them to generate HR content for their employers.

  • Feedback from using ChatGPT is overwhelmingly positive: Ninety-one percent of HR professionals rated chatbot responses as "good" or "excellent" and 97% agree that chatbots help them save time.

  • Interest in HR chatbots is on the rise: Fifty-two percent of HR workers report that employers are already using a chatbot specifically designed for HR purposes and 41% are thinking about implementing one soon.

But there is also room for improvement, as shown by these findings:

  • Less than a third of HR workers ask chatbots to cite their sources: Only 29% of HR workers consistently request chatbots to provide the sources for the answers or content they provide.

  • Not everyone is always happy with chatbot performance: While HR workers generally rate chatbots favorably, 49% have received at least one complaint from an employee about chatbot performance.

What this means for HR leaders

HR leaders need to be prepared to embrace AI and leverage it to accelerate innovation in their organization's HR function. Therefore, developing a clear understanding of how AI can be used to support their goals and objectives is imperative. It also means investing in the right AI technologies and training their employees on how to use them effectively.

Here are some best practices for implementing AI in HR taken from Gartner's Top Strategic Technology Trends for HR Leaders[3]:

  • Identify the areas of HR that can benefit most from AI: Work with your IT team to understand how other companies are leveraging AI in their HR processes.

  • Research different AI technologies: Look for vendors who openly share details on how their models work, as well as disclose any potential issues or biases that may arise and the rules for handling them. AI-based biases can affect many stakeholders within the organization and can result in unfair treatment and discrimination.

  • Pilot AI Solutions before rolling them out to your entire organization: Start with the most mature uses of AI in HR, like candidate assessment and sourcing. Pilot programs will help you identify any potential challenges and make any necessary adjustments.

  • Train employees on AI usage: By providing employees with the knowledge and skills to validate the answers and content provided by chatbots, organizations can enhance the accuracy and reliability of their AI tools.

Organizations continue to invest in DEI initiatives

Diversity, equity, and inclusion (DEI) remains a top priority for organizations as they invest in an initiative to foster an inclusive workspace. Despite prevailing narratives, most employers have not scaled back their DEI efforts in 2023 according to the results of Capterra's 2023 DEI Cutbacks Survey**. This reflects a growing recognition that DEI provides a competitive advantage that can't be sacrificed in difficult times.

Top findings in the DEI Cutbacks Survey relevant to HR include:

  • Most companies have remained committed to DEI initiatives: Only 8% of companies with a DEI budget reduced their budget this year and only 23% of companies decreased the number of existing DEI positions within their organizations.

  • Companies are investing even more in DEI: More than half of HR leaders (58%) are giving DEI a higher priority this year than they ever have before and nearly all of them (91%) expect to meet or exceed their DEI goals.

  • The Supreme Court's decision on affirmative action has affected DEI priorities: Employers are under additional pressure to increase DEI, according to 86% of respondents, following the Supreme Court's decision to outlaw affirmative action in college admission decisions.

What this means for HR leaders

The last year has been an exceptional year for DEI programs and this means that HR leaders need to take a strategic approach to develop a DEI program that drives real change. As per Gartner, DEI not only provides a better environment for employees but also drives better business outcomes.[4]

HR leaders can take the following steps to drive this change in their organizations:

  • Assess and address DEI gaps: Conduct a thorough evaluation of your organization's past and present DEI initiatives. Seek input from all employees through various channels like town halls, surveys, and focus groups to understand your workplace from their perspective.

  • Establish goals for bridging DEI gaps: Define clear, measurable objectives and action plans that directly address identified issues and are aligned with business priorities. Make sure goals are designed to promote equity of opportunity, a sense of inclusion, and belonging for all.

  • Define rules and communicate responsibilities: Clarify ownership for strategy execution by outlining responsibilities in a formal document. Communicate roles across the organization and provide training where needed.

  • Engage key change agents: Work with both internal and external partners who can help champion these changes. They should possess the passion, expertise, and influence to mobilize support and inspire others.

  • Integrate DEI goals into existing processes: Look for opportunities to embed DEI aims within existing workflows and processes. Modify practices and policies to advance diversity and inclusion. A great place to start is with your hiring practices.

HR technology is the #1 priority for HR leaders

HR technology has emerged as the top priority for HR leaders, securing its position at the forefront of HR investment for two consecutive years, as per Gartner.[2] Implementing digital transformation not only requires significant funding but also demands a substantial reallocation of time and resources. However, it offers the most effective means to enhance the efficiency of HR functions which, in turn, reduces cost.

Additional findings from Capterra's 2023 HR App Sprawl Survey*** shed more light on the current state of HR software usage:

  • HR software stacks are small but often redundant: HR staff reports that while most use less than five HR applications, 50% of this software has overlapping features.

  • Much HR software does not receive regular usage: Only 66% of HR software is being used regularly.

  • Consolidation of software is in the works: To deal with redundancy, most businesses (66%) are going to consolidate their HR software stacks within the next year.

What this means for HR leaders

HR technology can enhance efficiency, reduce costs, and drive better decision-making. However, the success of these investments relies on more than just the adoption of new tools. To maximize the benefits of HR technology investments, HR leaders can take the following actions:

  • Evaluate current HR technology: Assess the effectiveness and alignment of existing HR technology with organizational goals. Identify any redundancies or inefficiencies in HR software systems.

  • Validate investment success: Use appropriate HR metrics and analytics to measure the impact of HR technology on operational efficiency and organizational performance. Verify if the current tech investments are delivering the desired outcomes.

  • Identify opportunities for consolidation: Evaluate HR software stacks and identify areas where consolidation can be implemented. Address redundancies and overlapping functions to streamline processes and reduce costs.

  • Explore emerging HR technologies: Stay updated on the latest trends in advancements in HR technology. Seek new solutions that offer enhanced functionalities and improved user experiences.

Transforming HR: Next steps for success

As you navigate through the ever-changing landscape of the workforce, it is important to embrace new technologies, incorporate AI, and prioritize DEI initiatives. By doing so, you can improve your HR processes, drive business success, and stay ahead of the curve.

If you take the steps outlined in this article, you can expect to see a more efficient and effective HR department, with employees who are engaged, satisfied, and committed to the company's success. This will result in a more attractive workplace culture, enhanced talent management, and, finally, a positive impact on the bottom line.


Methodology

*Capterra’s 2023 HR Chatbot Survey was conducted in March 2023 among 300 HR employees at U.S. companies to understand how they're leveraging chatbots in their current job.

**Capterra's 2023 DEI Cutbacks Survey was conducted in August 2023 among 445 HR leaders at for-profit U.S businesses to learn more about how investment in and prioritization of diversity, equity, and inclusion (DEI) programs have changed in 2023. Respondents were screened for employees who work in HR at the managerial level or higher.

*** Capterra's 2023 HR App Sprawl Survey was conducted in March 2023 among 199 HR employees at small or midsize businesses with fewer than 1,000 employees and $500 million or less in annual revenue in the U.S. to learn more about their experiences with software application overlap and redundancies. Respondents were screened for influence over software purchase decisions (respondents must be a decision maker for their company's software purchases or have significant influence over software purchase decisions at their company).


Looking for Talent Management software? Check out Capterra's list of the best Talent Management software solutions.

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About the Author

Stephan Miller Headshot

Stephan Miller is a freelance writer and software developer specializing in software and programming. He has written two books for Packt Publishing.

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