2023 had been a year of key events which shaped the Corporate world, and a lot of them made indelible impressions on us. Let’s look at three major aspects which have contributed to transforming the industry landscape, and will continue to gain importance in the years to come.
Layoffs & their far-reaching impact
We have heard of them before, and more this year. Harsh as it may sound, layoffs are here to stay – especially in the Technology world. 2023 was a lot about how behemoths like Google, Microsoft, and Amazon laid off thousands of employees starting from January this year, but also about all the other companies that followed suit. TechCrunch recently reported that more than 240,000 jobs were lost in 2023.
What changed this year? To begin with, many economists predicted waves of recession, which led companies to think more efficiently than growth in their operating structures. Many technology organisations had invested heavily in Engineering as well as other talent in the pandemic, and in a way were responsible for an unprecedented rise of salary levels in the Tech world. Needless to say, they had to bear the brunt of this downturn. The larger organisations announced that they would direct their capital towards investments in AI-powered technologies. Investor funding also started drying up. Eventually, one word gained relevance - Profitability.
The layoffs this year have created talent gaps which cannot be filled and many individuals have started rethinking risk – about the companies they want to join and long-term commitments they want to make. A study by 365 Data Science showed that the median level of experience of those let go around January this year was 11.5 years. Similar trends continued over the rest of the year as well. The trends now show many mid-level employees recalibrating their career graphs, thinking about dual part-time careers, contractual work/gig assignments, etc. This may be a big turning point for how careers will shape up going ahead since companies are going to continue being wary of hiring for at least another 5-6 months, which may only enhance the hesitation levels of new joiners.
One possibility is that being laid-off will slowly start becoming normalised, while earlier the stigma attached to it was higher. Eventually, this might also push required performance levels a few notches higher, especially for those at leadership levels.
The advent of Generative AI
This has been the year when all talk regarding the earlier novice ‘AI / ML’ terminology moved to a definitive term – Generative AI. Let’s give the soothsayer predictions a miss – yes it has created a revolution, and it can be a huge game changer, especially in the HR space. What we have seen and heard in 2023 is the beginning, and it certainly has amazed as well as scared us. AI finds applications in almost all areas of Business and augments our human intelligence and capabilities to help us perform our jobs in a faster and more efficient manner. The latter half of 2023 was a lot about exploring tools like ChatGPT & Google Bard, and chatbot functionalities added to hundreds of well-known apps, etc. Now the space opens out to new job possibilities – the likes of prompt engineers (who create instructions to tell AI applications what to do), AI project managers, and AI ethicists (with a major role to play in the dynamics of how AI is used responsibly), and many such new roles.
In the space of HR, AI primarily delivers a footprint in making the HR Operations sub-function extremely efficient and enhancing the employee experience. In the Talent Acquisition and Onboarding space, it helps generate unbiased interview questions, create job descriptions, screen resumes, create role-based onboarding plans & review mechanisms, etc. In the space of Learning and development, AI plays a key role in creating customised learning paths based on role and capability. Likewise in the areas of Rewards, Talent Management, HR policies & processes, and so on, we see multiple applications of AI.
It's important now that we stop thinking about AI making jobs obsolete and start thinking of gaining a competitive advantage by using AI – since those who do - will stand a higher chance of success than those who stay away from it.
Remote work & back to office
Much has already been said about remote work over the last two years. In 2023 we saw companies incentivizing employees to return to office; slowly what began as an incentive turned to punishment, with some organisations also penalising those who did not return. With this, there is a wall of beliefs which has emerged – on one side are those whose faith inclines towards more in-person people management, the need for physical office space, in-person collaboration, etc. – on the other side are those who are inclined to let the work talk for itself with the place ceasing to matter, high use of remote-work and collaboration tools, meeting once a quarter / half-yearly to celebrate – and so on.
There is one major shift which has happened with all this: Flexibility has shifted to being a hygiene factor (reference – Hertzberg’s Two-Factor theory). Nuances of work-life balance have been redefined, and along with it the importance of wellbeing. In 2024 and beyond, the factor of flexibility will be fully exploited by organisations seeking a competitive advantage. Of course, we have seen leading organisations providing flexible work practices in the past as well; however as work models move to more asynchronous communication, use of AI tools, innovative methods of collaboration, etc. – leaders will need to explore newer dimensions of hiring and managing people better, and planning work more efficiently. As Gen Z and the generations beyond take centre stage, talks around the 4-day work week, global expansion and borderless workforces will continue, and newer insights will emerge.
2023 has hence opened up many paradigms for organisational effectiveness, and the years to come will require leaders to explore and build upon these to create better workplaces.