3 Ways Private Companies Can Tackle Talent Challenges
Today, with unemployment near all-time lows, it’s no secret that many companies big and small are facing worker shortages. Manufacturers are often struggling to replace retiring workers on assembly lines. A lack of skilled tradesmen is delaying a lot of housing construction. There aren’t enough truckers to transport all the oil coming out of the ground because of increased production.
While the skills shortage can be tough on all employers, it’s an especially thorny issue for private companies. Many lack the name recognition of their bigger public counterparts. They may not be as ready or willing to win the talent war by offering higher compensation. While many private companies are large and multinational in scope, there are also those at the other end of the spectrum—small startups that are big on promise but short on track records. All these factors can make it more difficult for private company employers to not only recruit but also retain their existing staff at a time when inboxes are filling up with job offers.
Recent research conducted by Deloitte put some numbers on the scope of the challenge on a global basis and identified talent-management gaps that private companies can remedy in the short term.
First was Deloitte’s global business survey, which found that decision makers often find themselves caught between two powerful trends: the need to hire new workers to meet increasing demand and an intensifying battle for a shrinking pool of skilled workers. The second report, Deloitte Human Capital’s 2018 Trends Report, culled responses from over 11,000 companies—more than half of them private—and isolated steps companies can take to address current talent challenges.
Together, the research points to three areas where private companies can use their organizational advantages to better manage today’s talent challenges:
Encourage more C-suite collaboration.
Private companies are known for being agile, with fewer reporting lines between executives and a streamlined corporate structure that helps get things done. Surprisingly, though, many leaders at the top of these organizations simply aren’t collaborating. In this year’s Human Capital Trends survey, a stunning 73 percent of both responding public and private executives told us their C-suite leaders rarely, if ever, work together on projects or strategic initiatives. Forty-three percent of private companies say their CXOs collaborate to troubleshoot organizational challenges, while almost 28 percent collaborate on long-term initiatives.
For the next generation of talent, many are drawn to private companies due to the access to leadership. This is one of the strongest advantages they have over organizations with a more matrixed structure. But access doesn’t mean impromptu conversations in the elevator between an employee and a direct superior. It means the chance to work side-by-side with leaders across the organization, giving employees the chance to demonstrate what they have to offer and gain potential sponsors for future opportunities and increased job mobility.
As networks of teams replace hierarchies, the C-suite must follow suit. The Human Capital Trends survey found that companies where C-suite executives regularly collaborate are a third more likely to be growing at 10 percent more than companies whose leadership operates in siloes.
Double down on training and leadership development.
With the global labor market as tight as it is, you might think private companies would be mainly focused on finding new workers and paying them more—but you’d be wrong. Our global private survey found that private company executives’ top talent priorities for this year are training and leadership development.
This makes sense on two fronts. One, investing in existing workers lets them know they are valued and therefore may be less likely to leave. And, second, it also addresses rampant skills shortages by bringing in promising hires with superior soft skills and teaching them the hard skills they’ll need to thrive. Companies shouldn’t just fall back on instructor-led educational programs. They should embrace alternative types of ongoing educational experiences that expose employees to different learning opportunities and allow them to innovate.
Stay flexible with a hybrid workforce.
It’s no secret that the number of contingent and temporary workers continues to rise. By 2020, 37 percent of our Human Capital Trends respondents predict they will use more contractors, while 33 percent say they’ll turn more to freelancers and 28 percent will increasingly rely on gig workers which are independent contractors.