A volatile economy, advancing technologies and increasingly complex consumer behavior are all pushing organizations to rethink their business strategies and functions. In this phase of industrial transformation, HR has emerged as one of the most critical functions as hiring the right candidates has never been more crucial. According to a Mettl survey, talent with diverse skills sets will continue to be in demand to fill new-age job roles emerging in the existing VUCA environment. The survey also highlighted that acquiring the right talent will be one of the top priorities for competitive firms.

From a support function to being strategic business partners, the evolving and expanded role of HR in organizations faces both new challenges and opportunities. As HR professionals prepare to steer organizations through unchartered territory in the next decade, here are some of the main challenges that HR leaders are likely to face.

1. challenge: the rise of gig economy

As millennials become more aware and connected, they prefer work opportunities that give them more than just financial freedom. They are looking for freedom to work remotely and to fix their own hours. Even companies are looking to optimize the size of their workforce by hiring employees on contractual or short-term project basis. Gig economy is creating 56% employment in the country and is growing at a rate of 20% to 30% annually. As flexible hiring becomes the way to maximize efficiency for growing organizations, hiring managers need to do away with traditional hiring methods and look for newer avenues for sourcing and attracting the right talent.


Gig workers are not likely to be attracted by traditional perks of a regular job such as job security, benefits, etc. Therefore, recruiters need to identify other things such as challenging and meaningful work, and higher flexibility to attract the new-age workers. Hiring leaders will also have to apply an increased focus on building a strong employer brand, as working for well reputed, socially responsible brands is a rising trend among millennial employees.

2. challenge: developing strong leadership

With increasing ambiguity in the market, companies are required to have a clear long term vision in place, with a strong leadership to drive it. The challenge has gone beyond hiring good talent and has moved to retaining and developing them into business leaders. It is of vital importance that firms train their first-time and junior managers for future leadership. Despite of 83% companies knowing that leaders can emerge at any level in the organization, only 55% of them have implemented leadership development programs for all levels.


The responsibility of HR managers has to be expanded from just hiring A-list talent to fill company positions to tying their current talent’s career aspirations with company goals. It is essential for the leadership to support their HR in providing a clear career development path to high potential employees. This is becoming a steadfast way for developing loyalists who envision their future along with the company. Futuristic companies such as EY, Upwork and Paycor offer great innovation learning and growth programs to their employees to prepare them for leadership.

3. challenge: leveraging new technologies and digitization

Today, technology is constantly changing and HR is not untouched by digitization and other technological advancements. From sourcing talent to shortlisting the best candidates to assessing the best fits, all hiring processes are now being revolutionized due to technology. The HR today is also responsible for helping employees adapt to changes due to technology and innovation. In addition, talent development through reskilling and upskilling has become one of the critical tasks for HR professionals. According to Boson Project and SAP SuccessFactors, ‘The biggest challenge for tomorrow’s HRD is digital transformation’.


A good way to start is by keeping up with the latest technology trends in the field of recruitment and L&D. The market for new hiring tools and assessment software is expanding, and growing businesses are partnering with third party firms to provide them with end-to-end recruitment and talent management support. HR leaders also need a communication strategy for the employees so they are better prepared for the changes they will be exposed to. By setting clear goals for learning initiatives and training programs HR managers can leverage new technologies to create the maximum business impact.

4. challenge: Increased focus on employee experience

As challenging as it is to hire HIPOs today, it is even more difficult to engage and retain them. Due to the huge expense attached to employee turnover, the emphasis on retaining high performing employees has never been more. Smaller firms do not usually have the budget to retain employees with the help of attractive benefits such as insurance schemes, retirement plans, etc. Therefore, the focus lies on improving their employee experience and making that as their biggest brand USP. According to a study conducted by the Globoforce WorkHuman Analytics and Research Institute and IBM Smarter Workforce Institute, companies with a positive employee experience have gone to reap major financial rewards.


HR professionals constantly need to come up with highly cost-effective strategies to enhance their employee experience in order to increase job engagement. Assessment and onboarding processes, for instance, are the start of establishing a strong connect with the employee. Research has revealed that having a structured onboarding process means employees are 58% more likely to stay with a company for three years or more.

It is clear the HR as a function has come a long way and is still continuing to evolve. With transforming business models and evolving employee needs, HR professionals will have to constantly push their learning curve in order to serve in the best interest of their organizations. People managers, who are adapting quickly to new hiring techniques, automation and digitization are more likely to prove successful in industry 4.0.

about the author
yashab giri new
yashab giri new

yeshab giri

chief commercial officer - staffing & RT professionals

yeshab is responsible for leading the development and expansion of randstad India’s value added staffing services which currently encompass field force, engineering and technology roles.