Businesses that expect to succeed in Europe in the next few years will have to come to grips with some serious challenges related not to raw materials, manufacturing processes, or the evolving nature of trade in the Eurozone, but with a host of issues related to how they recruit and manage staff.

The more specialized the staff, the more important these HR-type issues are.

At least that’s the conclusion of a report by the Boston Consulting Group titled The Future of HR in Europe: Key Challenges Through 2015.

More specifically, the report asserts that five elements of HR are critical to organizations’ futures, and further notes that most organizations surveyed for the report acknowledged that they are currently weak in those areas.

These five elements are all components of workforce management: managing talent, demographics, work-life balance, and change, as well as becoming a learning organization.

The rapid globalization of the economy and work may highlight these challenges today, but to my recollection, they’ve always been critical to an enterprise’s success.

In the beginning . . .

I eased into HR in my first “real” job – it took me several years, in fact, during which I was the shop steward for the office employees — that is, they elected me to represent them in dealings with management.

Of course, I had plenty of help – we were members of an office employees’ union and had access to the union’s professional and legal staff, as well as its financial resources.

I got a good deal of HR-type training from the union I belonged to, and learned about the regulatory system that controls employment in the US.

Once I was promoted to management and started becoming involved in HR as a management representative, as opposed to my previous involvement as a labor representative, I got a good amount of on-the-job training in HR from professionals who’d devoted their lives to industrial and labor relations.

I was in good hands.

Regardless of which side of the table I sat on, the constant underlying theme of pretty much every discussion I was involved in was workforce management.

Talent management was usually at the top of the list — how to recruit and retain quality people to work for us.

And as much as it might seem that hurling more money at people solves that problem, it ain’t necessarily so, as the song goes.

For me personally, for example, health insurance was a non-benefit because I was healthy and kept so.

It wasn’t the same for many of the people where I worked, though.

When I was shop steward, they taught me to be especially vigilant when management proposed any changes to our health insurance, even though such changes were only remotely likely to impact me.

Later, when I was a member of management, I kept that understanding of how important health insurance is to most employees, and always made certain that any health insurance changes we proposed would truly be beneficial to a majority of the staff before we proposed them – or imposed them, as we did in the non-union employers I subsequently worked for.

Tuition reimbursement was another hard-won benefit, which permitted staff to take job-related courses at one of the numerous institutions in New York City and get some of their tuition reimbursed.

Another area where we meticulously observed our staff’s interests was job vacancies.

When a job opened anywhere in the headquarters building, we posted it and permitted anyone to apply.

This is how I started our IT department when I couldn’t any longer handle the growing list of various computer tutorial and repair requests on my own.

I posted a job for a computer guy (I think we called it a technician job in the posting) and a fellow applied out of the shipping department.

I taught him everything I knew, which took most of his first day on the new job, and then shipped him off for outside training both in computers and also in common productivity software, like MS Office.

He was invaluable in his new job, and also did pretty well for himself in the process, earning MS certification in several disciplines.

Without that promotion to a job that challenged him and let him grow, I doubt he’d have been with us very long.

The BCG report says this: “Attracting and retaining talent demands that companies offer potential and current employees a value proposition that aligns closely with the desires of these groups as well as with the employer’s brand.”

And “Companies should also ensure that they target their offerings to meet the needs and goals unique to different ethnic groups . . . Companies need to broaden their talent pool by attracting and retaining diverse groups of employees.”

This sounds remarkably like offering health insurance and tuition reimbursement, giving reasonable staff leave, and offering career paths that permit people to grow into jobs that utilize all their skills and talents.

Wait, it Gets Better . . .

BCG’s report notes managing demographics as one of its issues, and mentions the graying of western Europe and the subsequent need to manage the loss of capacity and knowledge as a major issue in this area.

Thirty-five years ago, we weren’t as immediately concerned with the impending loss of the baby boomers, but we were aware that any unexpected vacancies in key positions throughout the organization could hurt us significantly.

We tried, with limited success, to perform what’s called succession planning so that when those vacancies did occur from time to time, we’d be prepared to deal with them.

As I pointed out in a previous post, our efforts in this area were obstructed more or less overtly by the very people whose absences we were trying to plan for; it sounds as if not much progress has been made in this area since.

So Why Bother?

From reading the BCG report, then, it appears that things haven’t changed much in the several decades since I joined the workforce.

Back then, managing talent and demographics were the main issues facing HR people, though we called them by different names.

They’re still the main issues, but they’ve been joined by work-life balance, change management and becoming the kind of organization that fosters learning in the development of a “top five” of critical issues.

So why bother issuing reports if these issues continue to claim the top spots in the hierarchy of critical issues facing modern HR departments and the organizations they serve?

Years ago, I’d have recommended issuing reports like this with a concluding paragraph reading something like this: “We’ll let you know when things change.”

Today, though, I think it’s important to issue these reports regularly even if their results are largely unchanged.

They don’t just report the issues that are uppermost in executives’ minds, but also their level of importance and the degree to which those executive feel they’re prepared to meet the challenge.

These figures may change from one report to the next, so that readers can get a better feel for what progress is actually being made.

Another reason it’s important to issue reports like this regularly, even though the top five issues remain largely unchanged, is that ongoing developments are tracked.

For example, this year’s report notes the extent to which globalization is affecting HR decision-making.

For example, the “old” approach to talent acquisition was to hire locally and hope that qualified individuals could be found.

This made more and more sense in larger urban areas, which then forced enterprises to gravitate toward those more costly areas.

Modern HR Problems

At the union in New York City, we frequently explored various plans to maximize the space we had.

Our entire staff was in a single building, but one of our affiliates operated out of a building it owned just a few blocks away.

We toyed with the idea of renting an office from them and relocating one or two of our departments, or even just a few individuals with specialized duties.

We — that is, my boss and I, with the support of the union’s president, came up with a few proposals, all of which were wildly unsuccessful, and all for the same reason — the people involved went ballistic over the idea of being removed from the center of power.

They viewed it as a demotion, a bad reflection on their work.

We later merged with another union that owned several buildings in midtown Manhattan, and all of our departments moved to those buildings, but only some moved to the headquarters building.

Those that moved to other locations were bitterly disappointed, and all gave excellent reasons why they should be in the HQ.

Nevertheless, it wasn’t going to happen – there was only so much space available, and we had excellent telephone communication and a good computer network.

The BCG report tells me a couple of things in this area, but the most important is that progress is being made.

Executives no longer insist on having the entire team close at hand,

and team members are also more and more willing to work remotely.

In fact, team members, once they learn and experience some of the benefits of remote work, seem to me to be far more willing to give up that proximity to the headquarters.

The discussion of remote work brings up another interesting development, the concept of BYOD

– Bring Your Own Device. In the past, the employer always provided the equipment for the job – typewriters, calculators, desktop computers, videocameras, etc.

Staff who needed equipment for work outside the office likewise have been provided with that equipment by the employer.

This new trend, though, mimics the approach seen in many garages, where mechanics provide their own tools.

It permits staff to bring their own equipment to the job – laptop, tablet, smart phone, even desktop computer, or whatever.

The compatibility issues that used to make this a nightmarish proposition have largely been dealt with, though there still are glitches from time to time.

Most employers realize, though, that many employees prefer to use their own technology to access company networks and information, and instead of trying to stop them, they encourage the practice.

Some employees even see it as a sign of an employer’s flexibility.

Perhaps what my boss and I should have done, instead of considering moving people out of our building to a nearby building, was let the affected people work from their homes . . .

But hey, what did we know? The Internet was a reality, but the World Wide Web wasn’t yet the robust vehicle it’s become.

In including work-life management and change management, as well as becoming a learning environment to the top five, BCG alerts me that these issues, which are more oriented toward employees’ sensibilities and sensitivities, are finally being paid the attention they deserve.

Just as succession planning was often honored more in the breach than in practice, with companies scrambling to fill unanticipated vacancies in crucial positions, so, too, many businesses in the past honored these three new additions with lip service only.

Some continue to do so.

With respect to work-life management, for example, one major American employer hires mostly part-timers and touts flexibility as an employee benefit of this practice.

This seems like an attractive arrangement for employees who have other obligations, such as caring for children after school or working another part-time job to enhance their income.

In fact, given the increasing complexity of many people’s lives, such arrangements would seem to be ideal, giving people the opportunity to balance the daily demands of life with the necessity of earning the money to meet life’s financial challenges.

The company doesn’t work with fixed schedules, though — instead, it changes schedules every two weeks and insists that employees be available to work whenever they’re scheduled, even if it interferes with their other obligations.

Thus, the company requires its employees to keep themselves on an “on-call” basis all the time, even though it pays them only for the hours they actually work.

Fortunately, at least from workers’ perspectives, most part-time work in the US is performed on relatively stable schedules, but this one company is a huge employer, and some others follow the examples it sets.

That is to say, the more progress we make, the more progress we realize we need to make.

Human nature always shows up as a confounding variable, but the underlying reality is that the more things change, the more they remain the same.

Download The Future of HR in Europe: Key Challenges Through 2015

Dale.