Issue link: https://www.e-digitaleditions.com/i/295251
[ 51 ] APRIL 2014 | www.hrotoday.com objective in 2014; 25 percent indicate margin improvement is their main goal. Only 10 percent are principally concerned with simply maintaining revenue levels, and just 3 percent with protecting margin. Significantly, only 4 percent of companies are actually targeting the acceleration of their historical revenue growth rate in the coming year. This very low number indicates a great amount of lingering caution and conservatism in business strategies. This conservatism in growth strategies becomes more evident when we look at the business strategies deployed to realize the coming year's financial objectives. Sustainable, innovation-based strategies are top ranked, but only to maintain historical growth rates. Historically, innovation has been associated with a growth-acceleration strategy. In the current environment, innovation is a prerequisite to merely maintaining historical growth grates, staying competitive, and ultimately remaining commercially viable. Improving innovative capacity just to support a very conservative growth strategy (or indeed, a survival strategy) represents a break with the past. For many, the need to implement sustainable, innovation- based growth strategies requires cultural change in every aspect of operations. Companies are extending their efforts to grow globally, as reflected in the high priority that study participants give to expanding the customer base. Globalization, too, brings its own cultural challenges. Not surprisingly, then, finding or developing the right talent remains one of the main challenges faced by companies. Reinventing HR to Support Growth The ultimate measure of the performance of HR organizations is their ability to support the business strategy. Since many of those strategies center on sustainable, innovation-based growth and global expansion, HR needs to change accordingly. Supporting enterprise goals in 2014 will require some HR organizations to make far more than incremental changes. The majority of companies are pursuing changes in cost structure. This gap continues a trend that has been unbroken since the 2008 recession. In 2014, HR will continue to focus on high-value-added programs, and on reducing effort and costs for routine transactions. Increasing the level of business partnering and the sophistication of integrated talent management will also help HR demonstrate how it further enables the business to meet its strategic goals. No Budget Relief in Sight Demand for HR services remains high, but on average HR budgets and staffing will shrink in 2014. The report finds that staff is slated to decrease at more than twice the rate of the budget. While this does not mean increased spending Market Insight Figure 1 Top HR issues for 2014 Source: Hackett Group's 2014 Key Issues Study