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People Sustainability – why companies should seize the opportunity

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People sustainability is the key to long-term employee satisfaction and retention. Martin Kroner, Team Lead HXM Talent Management, explains why this is so, what companies can do about it and how we can support you in his guest article.

The importance, relevance and influence of HR have grown enormously in the last decade. The focus is more than ever on people and therefore also on employees. Quite clearly, because they are the key driver of success for the companies. We have long since stopped talking about a “shortage of skilled workers”, but rather a shortage of employees. Accordingly, companies must position themselves in the “Race for Talents” in order not to get lost in the competition and to attract the right candidates and employees.

This once again underscores the importance of employee retention. Meanwhile, studies also show that an aligned people sustainability strategy has a significant positive impact on key KPIs such as employee:internal satisfaction, brand reputation and environmental social governance (ESG) values (IDC Research (2022)). Reason enough to devote full attention and seriousness to this topic.

What is People Sustainability?

At our HXM Community Event in April, one of the breakout sessions was all about this: People Sustainability. But what is meant by this term? At its core, it is about understanding employees as the foundation of sustainability. This includes responsible interactions characterized by listening to and taking seriously their needs and motivations, as well as valuing and encouraging their contributions. The various requirements can be divided into multi-layered dimensions. A key factor here is a coordinated corporate culture that takes into account a variety of dimensions (see graphic) and responds to the diversity of employees’ needs.

Credits: 2022 SAP® SE

In this way, companies assume responsibility and pave the way for long-term cooperation with their employees. For example, the IDC Research study (2022) shows that 94% of the employees of companies in which the topic of “People Sustainability” is promoted are very or extremely satisfied with their jobs. This is an exciting finding, as this satisfaction usually has a positive effect on the length of time employees stay with the company.

What does People Sustainability look like in practice?

As part of our HXM Community Event, we focused on one dimension (degree of empowerment & growth) with HR leaders and put it in relation to a second dimension (degree of transformation & development). On a continuum of different approaches (top-down approach, collaborative approach, bottom-up approach, and AI-based approach), we finally highlighted the different characteristics and conducted and discussed a customer-specific site assessment (status quo view). In the second step, the participants voted on the desired target status for each individual customer (target consideration).

The result: a large number of companies are currently on the verge of adopting a collaborative approach. The target status consideration was discussed in a very differentiated manner, with two directions emerging: on the one hand, toward the self-organized approach, and on the other, toward the AI-based approach. Everyone agreed on one thing: The initiative of the employees must be strengthened and the influence of the managers reduced. He also said it is critical that companies become bolder and move from the comfort zone to the learning zone. Here, pilot projects in particular can serve as “feelers” and drivers.

So don’t wait, start purely on the journey to becoming a sustainable People Sustainability Inspirator. For the good, for all of us.

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