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Workforce shaping is HR’s defining challenge

The impact of the Fourth Industrial Revolution — the term used to describe the convergence of AI, RPA, Machine Learning (ML), and cognitive platforms — is forcing teams to shape their workforces to consist of all worker types, including permanent, gig, contingent, and machine. To use the 4Bs vernacular: buy, build, borrow, and bot.

Over half (56 percent) of the respondents to our HR survey agree that preparing the workforce for AI and related technologies will be the biggest challenge for their function. And while most (87 percent) are prioritizing efforts around how to identify the future workforce composition (the 4Bs), HR leaders still seem uncertain about the best approach to do that.

Committing to workforce shaping

The importance of using workforce shaping to break down and rethink traditional roles is largely understood by HR functions across the globe.

To meet the future needs of their organizations, HR needs to actively challenge who – or what – carries out the majority of traditional tasks. Ninety percent of Pathfinding HR* organizations cite that identifying the future workforce composition is a strategic priority, and approximately 80% believe they are largely prepared to do so. However, over half of their counterparts report they are either not particularly, or not at all, prepared.

Future workforce

Source: Future of HR 2020: Which path are you taking? KPMG International

Where does upskilling fit into the equation? And how much?

HR executives generally identify with the significant need to reskill the workforce. Two in three HR executives are prioritizing upskilling of the workforce to manage the impact of AI on the workforce, with 77 percent planning to upskill up to 30 percent of their workforce in digital capabilities over the next 2–3 years. CEOs seem to have a more aggressive agenda.

According to the 2019 Global CEO Outlook, 44 percent of CEOs across major markets plan to upskill more than half of their workforces in new digital capabilities (such as advanced data visualization, ability to code, etc.) over the next three years (yet only 11 percent of HR executives plan to upskill that much of the workforce.)

Workforce upskilling

Source: Future of HR 2020: Which path are you taking? KPMG International

We found a very strong correlation between increased revenue over the last fiscal year and plans to upskill 11–30% of the current workforce in new digital capabilities during the next 2–3 years. Organizations in this range are more likely to report increased revenue growth year over year than those upskilling a different proportion.

Workforce shaping

Five ways Pathfinding HR organizations are shaping the workforce of the future:

  • Investing heavily in workforce shaping roles 
  • Understanding that, although they may still require strategic workforce planning in some capacity, workforce shaping starts from future business scenarios and then “works back”
  • Focusing on upskilling the workforce and ensuring they have the right capabilities to work in the future-state environment
  • Maximizing the success of workforce shaping through collaboration with C-suite leadership
  • Establishing regular refreshes of workforce shaping scenarios

Footnote:

* Pathfinding HR: A small subset of the survey sample (approximately 10%) who are simultaneously focusing on four discrete, yet interconnected capabilities: workforce shaping, purpose and culture, employee experience, and workforce analytics. Their ‘counterparts’ refers to the remainder of the survey population.


Throughout this site, “we”, “KPMG”, “us” and “our” refer to the network of independent member firms operating under the KPMG name and affiliated with KPMG International or to one or more of these firms or to KPMG International.

The views and opinions expressed herein are those of the interviewees and survey respondents and do not necessarily represent the views and opinions of KPMG International or any KPMG member firm.  KPMG’s involvement is not an endorsement, sponsorship or implied backing of any company’s products or services.