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‘People issues’ are top challenge for companies


As brick-and-mortar companies try to evolve all or parts of their business to compete in today's fast-paced, high-tech e-business environment, they're running into a traditional problem: people.

Newly released survey findings from management consultants Hewitt Associates show that nearly two-thirds (64 percent) of traditional companies believe their e-business activities are trailing non-traditional competitors, such as dot.coms and startups, and cite people issues as one of the main reasons why. In fact, 61 percent of companies surveyed say people issues - such as attracting talent, motivating employees and managing people - are among their top challenges to achieving e-business success, along with organizational commitment (61 percent) and product development (54 percent).

'It's not just about technology and speed to market. Companies are finding that people are a key element to achieving success in today's e-world. And the companies that take the lead in finding ways to attract, engage and retain talented people will have the advantage in today's competitive e-business environment,'' says Bob Gandossy, global practice leader with Hewitt Associates.

Executives from more than 100 companies from a variety of industries said that the most common people-related challenges they're experiencing as they transform to e-business include:

- Aligning Old and New Cultures. Nearly three out of five companies (58 percent) surveyed say this is their biggest people challenge. "E-business requires entirely different ways of working - a faster pace, quicker decision-making, greater customer focus, even different financial metrics. Many companies find aspects of their current cultures can get in the way. They need to change, yet they naturally want to preserve some of the positive elements of a current culture that employees and customers cherish. So it's a real dilemma: What do we keep, and how do we change - fast?" says Gandossy.

- Leadership Support and Guidance. More than half of the companies surveyed (56 percent) say gaining support and guidance from their leaders on new e-business activities is a challenge. According to Gandossy, this is not unusual, since the amount of money and resources required for an e-venture can be quite large. In the Internet world, unlike traditional business, executives don't have much time to discuss or debate decisions.

- Attracting Talent. This is another large issue for companies, with 41 percent indicating they struggle to attract talent for their e-business. "Companies cannot be successful in the e-world without the right people, and in today's hot job market, they're competing against startups and dot.coms that offer unique opportunities, benefits, flexibility and attractive compensation packages," says Gandossy. "Traditional companies have to look for new and unique ways to provide value to employees, making themselves stand out as great places to work."

- People's Availability. Along with finding talent, 40 percent of the companies surveyed struggle with getting time from their current resources. According to Gandossy, many companies leverage their current staff to launch e-business ventures rather than hiring from the outside, but even then they run into issues with getting enough time from these employees.

- Managing Leadership. More than one-third of companies (35 percent) cite finding ways to manage their new e-business leadership as a top challenge. Says Gandossy, "Companies are realizing that traditional mechanisms to keep leadership aligned, such as quarterly reporting and team meetings, are too slow to be effective in the Internet world. So, many companies are grappling with how much autonomy to give their e-business leaders and, at the same time, keep the e-business connected with other parts of the company."

Other common people-related challenges for employers trying to transform in today's e-world, according to Hewitt's survey, are:

- Enabling learning and development among current employees to support e-business activities.

- Keeping talent.

- Transitioning skills of current employees to e-business.

- Developing technology and software skills among current employees.

- Delivering total rewards, including compensation and benefits, for e-business talent.

Hewitt Associates LLC is a global management consulting firm specializing in human resource solutions.


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