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Top 10 HR challenges facing professional services firms in a hybrid working world

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By chris

Blog | January 18, 2024

In the article below we look at the top 10 HR challenges professional services firms face in working effectively in a hybrid working world.

For those of us who are currently involved in managing or running professional service firms, there are many challenges that need to be overcome to get things right for our people and our businesses. Whether you are working in consulting, legal services, accounting, technology or other knowledge-based industries, effectively managing the challenges and allowing your firm to benefit from the immense opportunities is the critical factor leading to your overall success. Below we look at the top 10 challenges for professional services firms in a hybrid world:

1. HR Challenges: Talent Acquisition and Retention

Finding and attracting the top talent is a challenge for professional services firms that has always been there and will continue to exist. Simply put, the better the talent the more selective they can be in deciding which employer to work for. Gone are the days when attracting someone was simply “we pay the most”. Potential employees are still looking for competitive salaries, but many other factors now feed into their selection criteria including culture of organisation, team cohesion, personal growth and lifestyle considerations, benefits, as well as the ability to work remotely or in a hybrid way. Once attracted to an organisation detailed plans need to be in place to ensure employees are well looked after and given the training and opportunities to perform at their very best. Not getting this right will lead to increased staff turnover rates which can be detrimental to a professional services firm, leading to loss of institutional knowledge and client relationships.

2. HR Challenges: Skill Development and Training

Continuous skill development is crucial in knowledge-based industries where expertise is a key asset in obtaining and retaining business. Professional services firms must ensure that employees receive ongoing training to stay current with the latest knowledge, industry trends and advancements. The challenge lies in balancing client demands with finding the time for professional development. As one partner at a global consultancy recently commented, “the clients love our highly trained consultants but if we tell them we are going to take them for training sessions they get upset. It is like they expect the knowledge to be known without training and development.” This is a common situation but the pitfalls of not maintaining skills and knowledge is a team that quickly falls behind in key initiatives and latest knowledge.

3. HR Challenges: Work-Life Balance

With professional services firms the work is often intensive, and the demands can be tight leading to long working hours and increased stress levels for your team. This is often the nature of the work and the reason clients come to professional services firms in the first place. It is important to find ways to promote work-life balance to enhance employee wellbeing and prevent burnout. Often this comes with allowing staff to work remotely or at hours suitable to them if the work allows. Other strategies include policies to force down time. One leading firm had a policy of not allowing employees to work allowed during 6-8pm in the evening. Their policy was for employees to go and have their evening meal and spend time with friends or family. If work is still required, then come back to the work later in the evening but maintain the personal and family time in the evening. This is one example of how firms tackle the work-life balance challenges with their employees.

4. HR Challenges: Team bonding and cohesion

Building and maintaining teams and improving cohesion in a hybrid working environment, where some team members work remotely while others work in a physical office, presents unique challenges. It often becomes incredibly difficult to form teams and foster relationships without time spent physically together. Some strategies that work well is enabling teams to have in-office and remote days where teams come together, having regular communication channels where people mix formal and informal conversations help people stay connected and informed, or holding virtual team building activities, like quiz sessions, promote interaction between employees who aren’t physically together.

5. HR Challenges: Client Confidentiality and Security

Professionals in these firms often handle sensitive client information. It is essential to implement robust policies and procedures to protect clients’ sensitive data and limit access to it. This is especially critical when employees are working remotely, and extra steps need to be taken to ensure employees know how to protect data from unauthorised access. This could equally apply when working from a café or from a shared flat where steps need to be taken to ensure housemates don’t have access to client data.

6. HR Challenges: Performance Evaluation and Compensation

Developing fair and transparent performance evaluation systems is essential for the success of any firm. This can be especially challenging when the work involved is complex and collating evaluations from colleagues and clients must be done remotely. Having a clear, fair and transparent system for giving clear goals to employees along with the ability to track and report at an individual, team or company level is essential. The transparency of the evaluation needs to feed into compensation reviews which need to be competitive enough to enable the firm to both attract and retain top talent.

7. HR Challenges: Succession Planning

Professional services firms often rely heavily on the expertise of senior professionals. In some firms this can be as little as one or two partners. Clients rely on these senior professionals and the success of the firm often hinges on the quality of these relationships. In this environment, being able to effectively manage succession is a key challenge to overcome. Mapping out critical people in the organisation along with plans if they were to retire or exit the firm including talent management plans for high performers to move into their roles is key. This is an important activity to ensure adequate succession processes are in place.

8. Technology Challenges: IT Integrations

Often clients want professional services personnel to conduct their work on the client systems using their processes. These are different from the professional services firms systems. Having internal systems for HR, remote working & collaboration, and client communication is crucial. The professional services firm needs to ensure that employees are equipped with the right technology to perform their jobs effectively.

9. HR Challenges: Diversity and Inclusion

One of the key challenges when promoting diversity and inclusion is to ensure the equality of opportunity within the firm for its employees. Steps should be taken to ensure the organisation is accepting and inclusive of a diverse range of perspectives, beliefs and backgrounds.

10. HR Challenges: Legal and Regulatory Compliance

Professional services firms often operate in highly regulated environments. The firm must ensure compliance with labor laws, industry regulations, and ethical standards as well as any professional codes of conduct. Addressing these challenges requires a strategic and holistic approach to people management, tailored to the specific needs and dynamics of the professional services firm.

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HybridHero is a revolutionary HR software platform with hybrid working management built it. It is one app to manage your people, places and spaces.

It has all the core HR functions: onboarding & record keeping, documents, time off, organisational charts, a best of class performance management module combined with collaboration tools for when in office including in-office policy and booking features for desks, meeting rooms, parking and visitor management. Its user screens are simple and intuitive, its reporting and analytics cutting-edge and it is built on scalable, fully encrypted & secure cloud technology.

It has been designed to decrease your administration burden and reduce time and costs for your business. The onboarding and management of your global teams is simple, the performance management module helps your entire team perform at their very best, and you can easily manage their collaboration in your office or when they are working remotely. It is the platform for a hybrid working world.

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