Nine people and tech predictions for 2022
It may be smoother sailing than in 2021, but there will be much for leaders to contend with in 2022 as the world opens up, retreats, then opens up again as we learn to live with COVID-19 becoming endemic, says Forrester VP group research director Laura Koetzle. In this continually changing scenario the only winners will be those who maintain the sharp focus required to build on the experiences of the pandemic and continue differentiating with creative processes, organisations, products and business models.
Each year research and advisory company Forrester publishes its predictions for what may happen in the year ahead. It analyses the trends across a range of industries and functions, including technology, innovation and employee and customer experience, to forecast what future-fit organisations will do in the coming year. Among its general predictions are that future-fit companies will think beyond digital transformation to closer blend customer and employee experience. Transformation will become more human-centred but the talent shortage in technology will frustrate some plans, leading to increased wages to attract the right tech people and the faster adoption of cloud-first and low and no code solutions.
Here The People Space picks out nine predictions that will most affect people and HR leaders:
1. One-third of first attempts at anywhere-work simply won’t work as 60% of organisations shift to hybrid
Vaccine mandates will lead to complications, but won’t be the cause of most return-to-office failures. The real pain, says Forrester, will be felt at the 60% of companies shifting to a hybrid model. One-third of first attempts at anywhere-work simply won’t work. Leaders will claim support for hybrid work, but still design meetings, job roles and promotion opportunities around face-to-face experiences. When it’s clear that productivity is suffering, these same execs will blame hybrid work rather than looking in the mirror at the real culprit. A smaller number of failures will come from the 30% of companies that insist on a fully in-office model, only to find that employees simply won’t have it. Attrition at these companies will rise above their industry averages — monthly resignation rates will rise as high as 2.5% for as much of 2022 as needed until executives feel the pain and finally commit to making hybrid work … work.
2. Companies with advanced automation programmes will obliterate — not merely beat — the competition
Some 5% of the Fortune 500 will adopt an automation framework to fuel extreme innovation. Forrester calls it an automation ‘fabric’ — a framework to build, orchestrate and govern a hybrid workforce of human and digital workers that links artificial intelligence (AI)-based and traditional automation components, supported with an active programme for innovation.
3. Investment in automation will increase as businesses look to boost productivity
Organisations in Europe alone will invest up to €3.3bn in automation over 2022. This investment will not only be in high tech manufacturing but also in lower wage sectors, retail and hospitality to augment productivity of workers in those sectors and help make up for the shortfall in people (see point 4). European retailers, such as ASOS, Sephora and Zara, already complement their workforce with automation for personalisation and predictive purposes. In 2020 alone, European enterprises invested a total of €1.88 billion in employee productivity automation tools, such as digital process automation (DPA), digital decisioning platforms, workforce optimisation, conversational intelligence, robotic process automation (RPA) and AI-based text analytics. Compound annual growth rates in 2022 will continue to be at around 33% for RPA and 13% for DPA.
“The challenge is making sure people have the appropriate skills base to transition into newer jobs,” says Koetzle. “One expected challenge to keep in mind is that historically entry level jobs have been feeders for people who grow up in the profession. When fewer people start at entry level because more entry tasks are automated you need new routes to get people in.”
4. 35% of service companies will introduce physical robot workers
Restaurants and other businesses can’t fill the glut of job openings for service workers. This worker shortage will not go away, even with reduced employment subsidies. Healthcare, food preparation and warehouse jobs that typically command low wages with difficult working conditions will increase steadily over the next 10 years. Companies that depend on them will invest in service-worker automation for customer self-service, grounds maintenance, delivery robotics, food preparation, surveillance and janitorial support, altering the low-end service-worker landscape permanently.
5. Employees will lash out a corporate ‘tattleware’ aimed at making them productive and employee experience will erode
Workers are allergic to the idea of monitoring software, says Paul McKay, principal analyst at Forrester. And this is why its introduction is “a complete non-starter.” While the idea of productivity software may sound great in practice, especially with the launch of new flexible working policies, the idea organisations can use workplace productivity suites in people’s homes is counter to what workers are expecting – for example more autonomy, asynchronous working, flexible hours and so on.
In October 2020 almost one in three European employees said that their employers used software to monitor their productivity while working from home. EU privacy regulators started fining companies for unlawful monitoring of employees and expect more fines in 2022. Employee backlash will grow as employers attempt to monitor how often they click, what they click on, and when they are facing their computers. Tattleware adoption degrades employee experience by 5%, says Forrester. Its recommendation? Don’t go there.
6. The UK will diverge on privacy and data protection laws – but business won’t much notice or care
Data privacy is one of the areas the British Government has highlighted as an area of divergence in order to show that the decision to leave the European Union was worth it. Forrester says it has been “flummoxed” by the discussions around data privacy. As it says: “If the whole legal basis of shipping data over borders had changed overnight it would have been a major headache.” The notion of taking out limited safeguards on areas such as automated decision-making is controversial. So expect most businesses to continue to comply with existing data privacy legislation like GDPR. After all, it doesn’t make sense to have distinct processes for different countries, so business will tend to follow the standards in the most stringent country. Plus consumers may vote with their feet if you remove safeguards.
7. Nearly all development tools will include an AI bot by the end of 2022, including low and no-code tools
The growth of low and no-code tools, i.e. tools that do not require you to have programming knowledge, is a big opportunity, as it gives access to business staff rather than just software experts. However, just because you can doesn’t mean you should. There need to be guardrails to ensure that the introduction of AI-based technology does not create legal issues or usage problems. Forrester advises organisations that they need thoughtful governance on where they want to introduce sophisticated AI in their processes and need to explain what those processes are doing. So whatever you build must be explainable to colleagues and customers. “It’s not a place for moving fast and breaking things. You’ll only repent at leisure when you have to clean up the mess,” says McKay.
8. 60% of firms will find themselves with more technical debt post pandemic
During the pandemic organisations operated and digitised very fast. The experience of getting large swathes of the workforce to work from home quickly meant organisations took speedy decisions without the foresight usually seen in technology architectural planning. Now there is a huge amount of overlapping technology. ”I have one client who has 1,000 SaaS-based applications and no idea how to rationalise this down,” says McKay. The speed at which organisations moved into the cloud means firms need to spend this next year and beyond pausing and rationalising all the stuff they have thrown out there. “With old stuff you need to ask whether you should put in a migration path to the cloud and standardise infrastructure. For new stuff you need to introduce some principles on how to guide business on sourcing services within the cloud,” says McKay.
9. Values-based consumers and employees are here to stay: transparency is vital
Across Europe, nearly 50% of consumers say they will buy from brands that match their values. According to Forrester Analytics data, 69% of European adults wish more companies were transparent about their business practices and that figure is 87% for the most empowered consumers — they increasingly expect brands to use their platforms to contribute positively to society. In the same survey, 47% of Europeans say they regularly purchase from brands that align with their personal values, including 62% in the Netherlands, 57% in Spain and 55% in Italy. In 2022 Forrester expects a 15% increase in those averages, driving brands to take further action.