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Global talent shortage now top emerging risk facing organisations

Global talent shortage now top emerging risk facing organisations

Business execs are grappling with a series of interrelated risks from a rapidly transforming business environment, reports Gartner

GDPR regulations and digitalisation bring with them a host of specialised talent needs impacting nearly every organisational function

Staff shortages have escalated in the last three months to become the top emerging risk organisations face globally, according to Gartner.

Gartner’s latest Emerging Risks Survey showed that concerns about “talent shortages” now outweigh those around “accelerating privacy regulation” and “cloud computing”, which were the top two risks in the 3Q18 Emerging Risk Monitor.  

Gartner says the report is based on a survey of 137 senior executives in the last quarter of 2018.

“Organisations face huge challenges from the pace of business change, accelerating privacy regulations and the digitalisation of their industries,” says Matt Shinkman, managing vice president and risk practice leader at Gartner.

“A common denominator here is that addressing these top business challenges involves hiring new talent that is in incredibly short supply.”

 Gartner (January 2019)
Gartner (January 2019)

Sixty-three percent of respondents indicated that a talent shortage was a key concern for their organisation.

The financial services, industrial and manufacturing, consumer services, government and nonprofit, and retail and hospitality sectors showed particularly high levels of concern in this area, with more than two-thirds of respondents in each industry signaling this as one of their top five risks.

Gartner says its research indicates that companies need to shift from external hiring strategies towards training their current workforces and applying risk mitigation strategies for critical talent shortages.

“Organisations face this talent crunch at a time when they are already challenged by risks that are exacerbated by a lack of appropriate expertise,” says Shinkman. “Previous hiring strategies for coping with talent disruptions are insufficient in this environment, and risk managers have a key role to play in collaborating with HR in developing new approaches.”

Talent crunch may exacerbate other key risks

Beyond a global talent shortage, organisational leaders are grappling with a series of interrelated risks from a rapidly transforming business environment. Accelerating privacy regulation remained a key concern, dropping into second place in this quarter’s survey. Respondents indicated that the pace of change facing their organisations had emerged as the third most prominent risk, while factors related to the pace and execution of digitalisation rounded out the top five emerging risks in this quarter’s survey.

Mitigation strategies to address this set of risks often come at least partially through a sound talent strategy.

Gartner says one way to more adequately managing data privacy regulations is the appointment of a data protection officer, as both GDPR regulations and digitalisation bring with them a host of specialised talent needs impacting nearly every organisational function.

“Unfortunately for most organisations, the most critical talent needs are also the most rare and expensive to hire for,” says Shinkman.

“Adding to this challenge is the fact that ongoing disruption will keep business strategies highly dynamic, adding complexity to ongoing talent needs. Most organisations would benefit from investing in their current workforce’s skill velocity and employability, while actively developing risk mitigation plans for their most critical areas.”

Gartner recommends that enterprise risk teams and HR leaders collaborate to clearly define ownership of key talent risk areas that their organisation is facing.

“Different parts of the organisation often have different pieces of information about what is actually going on from a talent risk perspective,” notes Brian Kropp, group vice president of Gartner’s HR Practice.

“The best organisations are moving away from traditional engagement surveys to understand their talent risks. Building robust talent data collection and analysis techniques to better listen to their employees and identify real-time risks is a key part of this process.”

Credit: Dreamstime

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Tags risk managementskills shortageprivacychange managementGartnerC-Suitedigital economyhuman resourcesceo and ciochange agentdigitalisationCXOchief people officerGDPR

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