We’re In a ‘Performance Erosion’ Crisis. Here’s How To Break Your Business Free.

I want to talk about something important: the price of pho. A few years ago, a large bowl of pho at the Vietnamese noodle shop around the corner from my office cost $12. Now it’s $17.

Why did the bill for the exact same meal jump by nearly 50%? It’s no wonder. Businesses of all kinds are grappling with unprecedented inflation. But that’s not the only challenge.

The cost of doing business continues to rise, geopolitical tensions are disrupting trade and rocking stock markets, employee engagement is declining, finding the right talent remains difficult, and AI is disrupting work in ways we’re only just beginning to understand.

As a result, companies are finding themselves in a situation where their very existence is in jeopardy. It is no exaggeration to say that companies today are facing a crisis of survival on many levels. Nearly half of CEOs They believe that if their business continues on its current trajectory, it will not be viable in 10 years’ time.

Learn why companies get into such difficult situations and how they can turn it around with a deeper understanding of the only resource they have at their disposal: their people.

Related: AI will fundamentally change the workplace — how HR teams can prepare

Unraveling the “Performance Decline Crisis”

Despite all the technology, people – the fundamental driver of business success – remains a black box in most companies. Today, we have real-time insights into our customers and prospects through modern sales and CRM tools. But when it comes to the people who work with us, we often operate blind.

Of course, workforce analytics has been around for generations, but that analysis was limited to spreadsheets and confined to HR professionals. And even when information about people was available, it was usually siloed and inaccessible to the managers who need it most. At the same time, performance was not tracked systematically.

The result is a performance crisis. Productivity has, quite frankly, plateaued. In fact, today The lowest level in 75 years And the biggest challenge is Executive.

meanwhile, Half of the employees They are more likely to lose interest, be less productive, or simply walk away. 3 out of 4 Companies are struggling to recruit skilled talent. As a result, 1.9 million manufacturing jobs There could be vacancies in the United States by 2033.

And let’s not forget AI. Employers should: Nearly half of the workers’ skills Business will change dramatically over the next five years. For companies, uncertainty about who to hire leads to inefficiency and turnover, which is exacerbated when talent is an expense.

Just ask any blue chip stalwart. Intelis laying off 15,000 employees, or 15% of its workforce, as the tech giant admits it missed the mark on AI amid declining revenue.

So growth expectations are as ambitious as ever, but with productivity stagnating relative to operational costs, every business is heading in exactly the opposite direction.

For companies to rise to the top

To navigate these uncertain times, businesses need to make the most of their most precious resource. Now, more than ever, they need real-time insights that connect talent with business outcomes.

I’m not talking about the HR analytics of old, with its crowded tables reserved for HR analysts. What you need is on-demand insights that are accessible in real time across the company. For HR data to be useful, it has to be intuitive enough that managers can use it to make everyday decisions, big and small.

The good news is that while AI is a catalyst for disruption, Giving companies a workforce advantage When addressing a crisis of poor performance.

Consider the questions every company has about how people impact business outcomes: Who are your best talents? Who is most at risk of leaving? Where is productivity declining?

Related: AI is changing how we look at job skills. How can we prepare?

New platforms allow managers to ask these questions in plain language and provide clear, actionable answers instantly. The best of these platforms leverage vast databases of millions of anonymized employee records across industries to provide customized results and precise benchmarks.

pay This is another area where real-time HR data can be a game-changer. Most companies have detailed compensation policies, but the managers who make pay decisions often do so on a whim and are clouded by bias. Smart compensation tools powered by AI can help managers make more informed decisions by considering individual employee performance as well as industry standards and flagging pay disparities related to race, gender, and other biases.

In fact, the new platform acts as a one-stop shop for many of the typical questions employees pose to HR about pay, vacation time, benefits, etc. By turning all this information into self-service capabilities, HR can free up manual labor and focus on what really matters: securing the right talent to drive the business forward.

Of course, technology alone is not a panacea. Companies that want to leverage real-time HR data must also be willing to make a cultural shift. This starts with HR’s willingness to share the talent and performance insights they’ve accumulated. Talent is the largest budget item for most companies and the most critical driver of business success. Understanding how people work most effectively and sharing that information in a consistent, understandable, and secure way is a prerequisite for getting the most out of AI-powered tools.

Confronting the workforce challenges that underlie the performance decline crisis isn’t difficult. To get the most out of people in an unpredictable world, you need to understand them and how they impact business outcomes. In my experience, the best way to achieve that is to leverage the real-time insights that AI can provide. Just like the bowl of pho I ordered, running a business isn’t getting any cheaper. So it’s time to get an edge by working smarter.