Introduction

FOREWORD

Given how much workplace cultures have changed over the past three years, one might expect at least a short period of stasis. Our research this year suggests no such thing. The fundamentals of work, the priorities of employees, and the role of leaders all continue to evolve, and this year’s report presents a roadmap with insights to navigate the transformation already underway. This journey will compel organisations to take a closer look at how they manage change as well as how they show empathy, practice flexibility, build skills, and develop resilience. Many of these concepts should be familiar to professionals who shape their cultures. But as you’ll see, these models are changing quickly, too.

The road ahead undoubtedly includes the essential, frontline workers who form the backbone of numerous industries. Recognising their work is a critical first step. The second, according to our research, is transforming appreciation into action. Once leaders have a deep comprehension of employees’ experiences, challenges, and aspirations, they can translate it into tangible support and ensure each person feels a sense of belonging, fulfillment, and connection.

This merging of recognition and empathy is a strategic necessity for attracting and retaining talent. Organisations that truly see, hear, and value employees can turn empathy from a buzzword into an impactful, teachable practice and create environments where people know they’re valued and respond with loyalty and great work.

Our report also highlights the powerful forces of skill building and flexibility. The future of work belongs to organisations that promote perpetual learning and development. However, as the boundaries between professional and personal life increasingly blur, employees also crave balance—a need met by flexibility enriched with fairness that respects individuals’ unique circumstances and contributions.

Two final themes shed new light on the topics of resilience and change management. Organisations that combine proactivity with perseverance, and approach change with a greater focus on people, can expect to weather storms and consistently emerge stronger.

For 2024, the O.C. Tanner Institute assembled the diverse perspectives of thousands of employees, leaders, HR practitioners, and business executives across the globe. Our goal: to equip HR leaders with the necessary insights and strategies to meet today’s most immediate and consequential challenges head on.

By fostering cultures of resilience, empathy, and meaningful appreciation, we can ensure our employees and organisations benefit from every change that awaits us.

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INTRODUCTION

It may be many years before we fully grasp the long-term effects of the Covid pandemic on workplace cultures. But we do know that for most organisations, the corollaries were seismic. And while this past year was nowhere near as destabilizing as the two before, it had its share of aftershocks—small but powerful shifts that make us question what’s to come. We’ve seen shifts in job requirements and skills gaps, shifts in employee needs and expectations, and significant shifts in how, when, and where people are willing to work—as well as what they’ll work for. But just as important are the shifts organisations can make now to address new realities and lead, rather than survive, the next wave of change.

Many organisations have already adjusted their policies and philosophies around schedules, work locations, benefits, and career development. Others, however, may feel weary, burned out, or even paralyzed after years of intense and rapid transformation.

The most important thing to remember is that proactive changes needn’t be dramatic to be effective. Seemingly minor shifts can lead to major success if organisations keep employees at the forefront of decision-making. Our research shows a people-centered approach fosters cultures where employees feel fulfilled and ultimately drives better business outcomes.

As workplaces evolve in various ways, organisations will need to work closely with employees to create solutions and environments where all can thrive. Traditional methods of leadership, top-down tactics, and “business as usual” are not viable answers.

Fortunately, we have some alternatives. This report reveals the insights, strategies, and principles that enable HR leaders to build thriving workplace cultures—where employees want to come, do their best work, and stay—in the face of ongoing change.

Let’s start with a look at how culture has shifted over the past year.

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Changes in Talent Magnet™ areas

Each year we measure changes in the six core elements of workplace culture that together determine employee decisions to join, engage with, and remain at any place of work. We call them Talent Magnets because of their power to attract and connect people to their teams and organisations.

1. Purpose

An organisation’s reason for being besides profits. It’s the difference it makes in the world, why the company exists. Employees need to feel connected to the purpose and understand how their jobs contribute to it. Once they do, their work takes on meaning. Organisations should clearly articulate the connection between work and purpose.

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2. Opportunity

The chance to develop new skills, contribute to meaningful work, feel challenged, have a voice, and grow. Opportunity is more than the lure of promotions and pay increases. It’s about preparing and empowering employees to make decisions, inviting them to the table, and offering them projects that will expand their skills and relationships.

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3. Success

The thrill of accomplishment, innovation, breaking barriers, playing on a winning team, and experiencing victories. Employees must find success at the individual, team, and organisational levels, and it should be nurtured and publicly celebrated.

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4. Appreciation

Feeling valued for one’s contributions and being recognized for one’s worth. Appreciation is essential to employees—people need to know their leaders and peers notice and are grateful for their efforts and contributions. Appreciation is most effective when it’s delivered in timely, personal, and meaningful ways.

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5. Wellbeing

Caring about the employee as a whole—their physical, emotional, social, and financial health. Wellbeing ensures employees can be their strongest, most capable, most authentic selves at work. A comprehensive approach to wellbeing requires leaders to create an environment of inclusivity, life balance, and connection.

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6. Leadership

The mentoring, coaching, inspiring, and facilitating that allow individuals, teams, and, ultimately, organisations to succeed. Great leaders co-create a shared purpose for their teams and empower their employees to do great work. As the most influential of the six Talent Magnets, leadership cultivates the other five.

Taken separately, Talent Magnet scores haven’t changed much—all except purpose fell by only one percentage point over the last year. As we track other cultural metrics, we find the same lack of movement in employee engagement. Geographically, IMEA scores the highest and Europe the lowest on all culture measures except for wellbeing. The Americas report the highest wellbeing score for employees.

From one perspective, recent challenges appear to have had a minimal negative impact. But from another, not a single culture score has improved.

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Opportunities for organisations in 2024

Based on our research, we see six possible shifts that are well worth organisations’ proactive attention.

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1. A culture of nimble resilience

HR leaders can help their cultures become more adaptable and innovative. This shift requires replacing traditional, reactive approaches to resilience with one that centers on people, celebrates diverse perspectives, and fosters cross-disciplinary collaboration.

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2. Equitable flexibility for all employees

People now expect greater flexibility in when, where, and how they work. And without it, they’re more likely leave an employer. However, incorporating flexibility equitably and without compromising the organisation’s needs is a significant challenge. The key is tailoring flexibility to employees in their many, varied roles.

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3. Practical, empathetic leadership

Empathy is often loosely defined and implemented without training or boundaries, resulting in “empathy fatigue” among leaders and coworkers. Leaders must understand and act in response to their people’s needs, challenges, and potential in order to create a culture where both employees and leaders feel supported and connected.

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4. Awareness of the 80% experience

The difference between the experience of corporate employees and that of “the 80%” (a term we’ll unpack thoroughly) presents a major challenge. Employees in the 80% are critical to operations, yet they report being overlooked and undervalued. Many feel disconnected from their organisation, suffer from high burnout and attrition, and express resignation to unfulfilling work experiences due to lack of support, opportunity, and voice.

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5. Improved skill-building programs

Also known as upskilling, this popular business trend is growing as employees seek new opportunities and education, and as organisations strive to improve retention. Upskilling programs are essential for recruiting and keeping top talent; however, employers face challenges, including avoiding potential pitfalls and meeting both employee and organisational needs.

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6. More effective change management

Over the past three years, the rapidly evolving work environment has taken a toll on morale, wellbeing, and turnover. To counter these effects, organisations need to focus on employees throughout the change management process and earn their trust. And cultivating greater trust requires giving people a voice and empowering leaders at all levels.

While change and uncertainty always seem to be on the horizon, successful organisations prepare for them. As you consider the following pages, keep in mind you don’t need to overhaul your culture programs and initiatives. As our findings demonstrate, small, consistent adjustments that put a sharper focus on employees will return large and lasting dividends.