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Majority of senior HR executives in mainland China and Hong Kong see need for workforce transformation, KPMG survey finds

Majority of senior HR executives in mainland China...

HR executives need to focus on workforce shaping, improving employee experience and rapid reskilling of labour to prepare for the challenges

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The majority of surveyed senior human resources executives in mainland China and Hong Kong recognised the need to transform their workforces, KPMG survey found. Reshaping the workforce with technology, improving employee experience and reskilling labour are top priorities.

Titled The Future of HR 2019, the 21st annual report surveyed more than 1,200 senior HR executives, including 134 from mainland China and Hong Kong. As much as 90 percent of mainland China and Hong Kong respondents agreed that their workforces need to be transformed in light of the changing market landscape, the survey found. Only 37 percent of mainland China respondents and 11 percent in Hong Kong were confident that their HR functions were able to respond to change, compared to 36 percent globally. 

“HR executives need to shift from traditional work force planning to much more near term workforce shaping – align your company’s business and human resources needs – and adopt technology to enable that,” said Peter Outridge, Head of People & Change Advisory and Partner, Hong Kong, KPMG China. “They also need to focus on employee experience, looking further than the current traditional employed labour workforce and think about contingent labour and flexible forms of working. Meanwhile, rapid reskilling is a priority. Given the pace of change, organisations need to be constantly equipping and empowering people to evaluate new opportunities and issues, and embedding the required capabilities to be successful in a time of unprecedented change.”

In terms of investment in HR technologies and digital solutions, HR executives in mainland China and Hong Kong have mainly invested in “human capital management software”, “HR mobile applications” and “payroll system and/or vendor” solutions over the last 24 months. While the trend is set to continue in Hong Kong in the next two years, respondents from mainland China highlighted robotics process automation (RPA) and artificial intelligence (and/or machine learning) as upcoming priority of HR technologies.

Other key findings about mainland China and Hong Kong:

  • 45 percent of surveyed HR leaders said they have a digital transformation work plan in place, slightly higher than global average at 40 percent 
  • At least 40 percent of surveyed respondents agree that preparing the workforce for a future with AI is one of the biggest challenges HR will face over the next five years
  • Around two-thirds of surveyed HR leaders in mainland China which are currently undergoing a digital transformation (or completed recently) consider skill deficiencies and lack of resources to be the key barriers to moving from initial phases of the transformation to scale, around half of Hong Kong respondents said the same 
  • Workplace culture is another barrier to digital transformation identified by 39 percent of Hong Kong respondents (vs 29 percent in mainland China); 38 percent of Hong Kong respondents said their current culture is more task oriented rather than innovative or experimental

The survey also highlighted the difference in opinions between the HR teams and their senior leaders. Sixty percent of the global surveyed HR executives believe AI will eliminate more jobs than it creates, while 62 percent of surveyed CEO believe AI will create more jobs than it eliminates, according to KPMG’s 2018 Global CEO Outlook.

“HR executives need to make sure they are spending more time with the C-suite, and really understanding how HR enables the business strategy of the company,” said Jonathan Lo, HR Transformation Lead and Partner, Hong Kong, KPMG China. “Organizations making limited strides could soon see today’s technology disrupt them out of existence. And those largely inactive organisations face a much shorter timeline to extinction as the digital economy quickly renders them irrelevant,” 

 

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About this survey

During July to August of 2018, 1,201 senior HR executives from 64 countries participated in the Future of HR Survey, with representation from 31 industries across Asia Pacific, Europe, North America, Middle East/Africa and Latin America. Approximately half of the sample are companies with headcount of 5,000 or more employees and 42 percent of participants were from organisations with annual revenue of more than USD1 billion.

About KPMG China

KPMG member firms and its affiliates operating in Mainland China, Hong Kong and Macau are collectively referred to as “KPMG China”.

KPMG China is based in 21 offices across 19 cities with around 12,000 partners and staff in Beijing, Changsha, Chengdu, Chongqing, Foshan, Fuzhou, Guangzhou, Hangzhou, Nanjing, Qingdao, Shanghai, Shenyang, Shenzhen, Tianjin, Wuhan, Xiamen, Xi’an, Hong Kong SAR and Macau SAR. Working collaboratively across all these offices, KPMG China can deploy experienced professionals efficiently, wherever our client is located. 

KPMG is a global network of professional services firms providing Audit, Tax and Advisory services. We operate in 154 countries and territories and have 200,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

In 1992, KPMG became the first international accounting network to be granted a joint venture licence in mainland China. KPMG was also the first among the Big Four in mainland China to convert from a joint venture to a special general partnership, as of 1 August 2012. Additionally, the Hong Kong firm can trace its origins to 1945. This early commitment to this market, together with an unwavering focus on quality, has been the foundation for accumulated industry experience, and is reflected in KPMG’s appointment for multi-disciplinary services (including audit, tax and advisory) by some of China’s most prestigious companies.

© 2020 KPMG Huazhen LLP — a People's Republic of China partnership, KPMG Advisory (China) Limited — a wholly foreign owned enterprise in China, and KPMG — a Hong Kong partnership, are member firms of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International.

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