Talent hiring and retention is the toughest among the top challenges for CFOs over the next 12 months, said Gartner recently.
The tight labour 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, the advisory firm noted.
Gartner said it polled 234 finance leaders in July 2022 to identify the top challenges for CFOs over the next 12 months.
Hiring and retaining staff was the only task selected by a majority of respondents, the firm pointed out.
Forecasting, selected by 36% of respondents and cutting the right costs, selected by 35% of respondents, made up the top three challenges facing CFOs.
“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, he advised.
Raising compensation alone isn't the answer
In addition, the top challenges for CFOs are a reflection of finance leaders’ 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,” he said.
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, according to Gartner.
Organisations also need to refine their employee value proposition (EVP) to acknowledge a new reality of expectations for increased flexibility, the firm noted.
In addition to reinventing the EVP, CFOs should reassess their organisations’ recruitment efforts in collaboration with HR partners to ensure critical roles are being prioritised and more avenues of detecting talent are activated across the organisation, Gartner advised.