HR leaders can’t seem to catch a break. The roller coaster ride that started in 2020 appears to continue. The global business landscape is as volatile as ever; talent shortages remain and are compounding employee burnout, and AI advancements are happening more and more often. What can HR leaders expect this year?
A recent article in Harvard Business Review examines Gartner’s executive-level challenges for 2025 and their predictions for HR leadership.
New Demands for a Future-Ready Workforce
Loss of Expertise
Employees with the most experience, baby boomers, are reaching retirement age in record numbers, and as they leave the workforce, companies need to fill the knowledge gap. Entry-level work is more commonly being handled by AI technologies, which can impact the learning curve of younger employees.
To compound the issue, a 2024 survey by Gartner showed that 60% of employees are not receiving the on-the-job coaching they require to build their core job skills. HR teams need to work with leadership to, “build their collective intelligence, using technology to ensure that knowledge can easily flow between experts who have skills and novice employees who need skills.”
Technology will Drive Restructuring
As technologies like AI continue to change how we work, the question of organizational design is valid. Will the historical way we structure a workforce be optimal in the future? Is sticking to what we know holding back the innovation that technology could provide?
According to Gartner, companies should consider “creating flatter, less-hierarchical organizations, centralizing corporate functions to reduce duplicative work and create consistency, and investing in agile learning practices for cross-functional teams.”
Nudgetech will Emerge
Garter found that collaboration satisfaction, an indicator of performance, is down to 29% from 36% three years ago. Companies should consider new AI-powered tools, such as nudgetech, to improve collaboration. Examples include knowing a colleague’s preferred communication method (email, text, call) and providing custom suggestions.
The Evolving Role of Managers
Employees Seek Fairness
Even though management through algorithms can be “alienating,” employees find it to be fairer than human management. In a Gartner survey, 87% of employees believe algorithm feedback would be fairer than if it came from their manager. While people will need to verify and validate AI recommendations, “for more everyday activities such as in-the-moment performance feedback, bots are likely to take on an increasing share of managers’ tasks, especially for work that is digitally based, easily quantifiable, or supported by IoT sensors.”
Keeping Top Performers
One benefit of new technology is freeing employees to perform higher-level work. However, AI can mask low performers, so they appear to be contributing. HR leaders must focus on outcomes rather than just processes to identify actual high performers. Guidelines on how and when to use AI for work produced will also need to be clarified.
Inclusion and Belonging for Everyone
With the changes impacting DEI initiatives, companies are looking at how to provide inclusion and belonging benefits to the entire workforce. By focusing efforts on everyone, diversity becomes an outcome rather than a goal. “Organizations that develop inclusive cultures and fair processes, such as standardized recruiting practices that benefit all candidates, inclusive management, and a focus on collaboration and connection, will experience balanced growth in hiring, promotions, and retention across demographic groups.”
Emerging Talent Risks to the Organization
Lead with People, not AI
Embracing new technologies too quickly can be problematic. Unknown risks will emerge, costs can skyrocket, and negative consequences can impact employees. Garter found that 20% of employees say their job is harder based on recent technology changes. “HR should take a leadership role in AI governance conversations to incorporate employee feedback about which workflows can be improved to increase productivity and innovation.”
Loneliness is Impacting Well-Being
Loneliness has become a public health crisis, and its impact at work is just as severe. “When employees are lonely, their engagement levels lag and their performance suffers.” It is not just affected remote workers; in-office employees are less satisfied than their hybrid and full-time remote counterparts.
Companies that acknowledge and address the issue can often improve performance and meet profitability goals. “Actively guiding how employees collaborate with one another by identifying personalized connection needs and providing structured opportunities for employees to learn (or re-learn) how to interact positively with their colleagues.”
Employee Activism Impacts AI Adoption
With the speed at which AI is evolving, the lack of oversight or guidance from employers, governments, or governing bodies is not surprising. According to Gartner, only 20% of CIOs are focusing on the potential negative impacts of AI on work and well-being.
According to the article, employees are making their voices heard to shape how AI will be adopted. “Progressive organizations will embrace this, co-creating their AI strategy and values with employees, including crowdsourcing AI use cases directly from employees before deciding which capabilities to pilot and incorporating multiple avenues for collecting and evaluating employee feedback.”
While there are many challenges, limiting your focus to the top one or two that impact your company can help prepare you for the future. If you need help understanding how executive leadership can set the tone for AI, send us a note, and one of our retained search consultants will reply.