Global research shows Industry 5.0 gathering pace as organisations align digital advances with human capital
Boyden, a premier leadership and talent advisory firm with more than 75 offices in over 45 countries, reports on its annual global executive talent research, showing that innovation, human capital and digital transformation are the top growth drivers. With ‘competing for the right talent’ a top driver of structural change, Industry 5.0 is gaining momentum as organisations strive to align talent with digital advances, particularly AI/robotics/machine learning and tech/cloud/cybersecurity talent.
The global study, Strengthening the human-centric core of Industry 5.0[1], How can organisations thrive in a complex world of risk? explores perspectives on risk among CEOs, boards and other senior leaders, alongside executive talent trends, priorities and investment.
“The merging of human ingenuity with tech and digital capabilities is accelerating the business cycle as organisations strive to address global disruption,” commented Trina D. Gordon, President & CEO of Boyden. “At this time of pervasive uncertainty, we embrace the challenge of helping clients to understand the global environment for talent, emerging skill sets and the leadership needs of their organisation through our insight, market intelligence and original research”.
Core findings show that (i) innovation, (ii) human capital and (iii) digital transformation are the top three drivers of growth over the next two years. Confidence in organisational growth potential is high, with 70% very confident or confident, but greater alignment of talent is needed: confidence in having the right talent to align with strategy is at 59% confident or very confident. This confidence is impacted by risk. The top external risks are identified as (i) inflation, (ii) global economic volatility and (iii) supply chain disruption. The top three internal risks are: (i) rising business costs, (ii) employee burnout and (iii) the need for different executive skill sets.
Research finds that, at the executive level, 81 percent of respondents identify a need to strengthen digital talent (AI, robotics, machine learning); 80% tech, cloud and cybersecurity; and 79 percent marketing & sales. In an environment where people come first, 78 percent need to strengthen human resources capabilities. As environmental and social challenges continue, 71 percent of respondents need to strengthen skills in ESG-sustainability and 69 percent skills in ESG-DE&I[2].
Organisations are addressing talent needs and alignment by investing in ‘leadership development for high potentials,’ ‘hiring new leadership talent,’ and ‘redeploying or retraining existing people’. These top three priorities remain the same as 2021 findings. The use of interim executives shows a step change; 35 percent are extremely likely or likely to ‘bring in interim executives,’ up from 22 percent in 2021.
Findings on how organisations are approaching ESG show that for 50 percent of respondents ESG-sustainability is ‘primarily part of most business discussions’ or ‘deeply embedded in organisational culture’; and for 52 percent of respondents ESG-DE&I is ‘primarily part of most business discussions’ or ‘deeply embedded in organisational culture’.
At board level, 55 percent of respondents identify a need to strengthen skills in ESG-DE&I; 52 percent a need to strengthen skills in ESG-sustainability; and 50 percent a need to strengthen skills in innovation/business transformation. Despite this, just 40 percent consider it extremely likely or likely that their organisation will invest in a board review in the next two years.
Looking ahead to 2023, recruitment and retention challenges are expected to increase: 68 percent of respondents expect to experience recruitment challenges, compared with 49 percent the previous year; and 63 percent of respondents expect to experience retention challenges, compared with 50 percent the previous year. In the pursuit of talent, respondents are turning to innovative tactics to hire or retain talent. For retention, respondents are using bonuses, hybrid working and leadership development.
Hiring will grow, with 50 percent expecting an increase, compared with 36 percent the previous year. Interim management is increasingly valued; 40 percent expect an increase in their use of interim solutions, compared with 28 percent the previous year.
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