Regardless of how successful companies in Latin America are today, research shows many may be unprepared to meet the challenges of the future workforce. Feedback from Latin American executives surveyed as part of the SAP-supported Oxford Economics “Workforce 2020” study reveals both high-performing and underperforming organizations in this region are struggling to understand the impact of the top three labor market shifts affecting workforce strategy: millennials entering the workforce, globalization, and recruiting employees with base-level skills.
Unlike other parts of the world like United States and China, there is little difference between the workforce strategies of high-revenue-growth and low performing companies in Latin America. For example, 61 percent of executives at high-revenue-growth companies in the United States say Human Resources (HR) works with the C-suite to make strategic decisions about the business vs. 31 percent of underperformers. In Latin America, about the same percentage of high-revenue-growth companies (36 percent) and underperformers (40 percent) say workforce issues drive strategy at the board level (See graphic above). The numbers are the same when it comes to workforce management. Thirty-six percent of high-revenue-growth companies and 40 percent of underperformers in Latin America have a plan to achieve the workforce management vision. Contrast those findings with China where 91 percent of high-revenue-growth companies have an execution plan for achieving their vision of workforce management compared to 59 percent of underperformers in that country.
Closing the technology skills gap
There were more differences between high and low performing companies in Latin America when it came to training and education. Low-revenue-growth companies were significantly more likely than high performers to say it is difficult to acquire employees with analytics or programming/development skills. And, executives at high-revenue-growth companies were more likely to say they have well-defined processes and tools for developing talent. However, low-profit-margin-growth companies are more likely to offer incentives for pursuing further education (55 percent vs. 35 percent), suggesting they may be looking outside their organizations to develop skills.
Leadership for the Future
Similar to regions worldwide, Latin American companies are challenged in developing leaders to support future growth. Interestingly, high-revenue-growth companies are significantly less likely than underperformers to say their leaders can lead a global workforce, and that talent in leadership positions can drive global growth. However, more high-performing companies (68 percent) say leaders are able to drive and effectively manage talent than underperformers (51 percent).
In many countries worldwide, HR has begun to assume a more strategic role, working in partnership with the business to achieve corporate growth objectives. Based on this survey, some Latin American companies across all performance levels may need to consider strengthening the connection between HR and the rest of the business to help drive growth.
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