Hiring and retaining staff is the most difficult task facing CFOs over the next 12 months, according to a survey from Gartner, Inc. The tight labor market is part of a trifecta of factors including persistent inflation and supply chain disruptions that are set to continue challenging corporate profitability through 2023.
Gartner polled 234 CFOs in July 2022 and asked them to indicate their top three most difficult tasks over the next 12 months. Hiring and retaining staff was the only task selected by a majority of respondents. Forecasting, selected by 36% of respondents and cutting the right costs, selected by 35% of respondents, made up the top three challenges facing CFOs (see Figure 1).
“The data from CFOs align with what we are hearing from HR leaders, namely that competition for talent is expected to become fiercer over the medium term, and retaining that talent will become more challenging,” said Marko Horvat, vice president, research, in the Gartner Finance practice. “CFOs will need to deploy a variety of strategies to ensure critical roles remain filled while also protecting margins.”
Figure 1: CFOs’ Most Difficult Tasks to Manage for the Next 12 Months
“The top three challenges are a reflection of CFOs’ struggles to manage against a backdrop of persistent inflation and unusually high macroeconomic uncertainty,” said Horvat. “CFOs need to identify the few critical areas where investments should be accelerated, such as human capital and digital investments, while optimizing costs against a backdrop of stubbornly high inflation; this is no easy task.”
While raising compensation for top performers is inevitable, higher compensation alone will not solve the talent challenge and will ultimately pressure margins if deployed too broadly.
Organizations also need to refine their employee value proposition (EVP) to acknowledge a new reality of expectations for increased flexibility. In addition to reinventing the EVP, CFOs should reassess their organization’s recruitment efforts in collaboration with HR partners to ensure critical roles are being prioritized and more avenues of detecting talent are activated across the organization.