Deloitte: In 2025, HR Is Tasked With Managing Tension Amid Rapid Change

In times of constant, large-scale change in the workplace, HR leaders are tasked with managing their workforces through immense economic, social and technological disruption. While tough times may encourage business leaders to lock in operationally, a new report from Deloitte suggests that focus does not need to conflict with making workers happy—establishing stability and growth across the workforce leads to higher profitability.

“This shift toward ‘bossless’ organizations is likely being driven by a renewed focus on efficiency, agility, and worker empowerment with ‘zero distance’ to the customer,” the report’s authors wrote. “Economic pressures have organizations looking to reduce costs, and artificial intelligence and other technologies are poised to take on many administrative tasks.”

The consulting firm’s 2025 Global Human Capital Trends Report highlighted numerous conflicts between leaders, managers and employees around remote work, AI adoption, performance management and the role of middle managers. Savvy HR leaders can play a key role in alleviating these pressures to drive financial success.

“For most organizations, eliminating managers altogether isn’t the solution. But neither is simply retaining or elevating the role of the manager as it has existed for over a century,” Deloitte said in the report.

Global socioeconomic pressures and the rapidly changing business world are putting a crunch on people’s lives. Employee engagement is down, executive turnover is rising, workplace stress is up, and navigating change is not easy for everyone.

“Some key capabilities that managers often perform will always be needed—like coaching and development of their people. Today, the people being managed are in need of support more than ever due to the shrinking half-life of skills, the impact of AI, and the increasing pace of change,” the study authors wrote.

The state of the working world before the pandemic is never coming back, and the only constant since then has been change. Serving employees in better and different ways will be key to maintaining the ability to adapt going forward—75 percent of workers surveyed by Deloitte said they are hoping for greater stability at work in the future.

The report also pointed out that leaders favor more agile ways of working while employees favor stability.

“The average worker experiences 10 planned enterprise changes each year—including organizational restructuring, culture transformation, large technology initiatives, and more—up from two in 2016,” the report said.

Deloitte’s study found that organizations that successfully increase the capacity of employees to grow and think deeply at work are 1.8 times more likely to report better financial results and 1.4 times more likely to say they are creating broad value for customers, community and society. The best HR teams are figuring out how to do this within budget, while managing change well and using an enhanced approach to skill identification and building, the report noted.

“Stability begins at the level of people. If workers don’t feel a stable connection to the organizations they work for, an organization’s ability to continuously adapt and evolve could be hindered,” the study authors wrote.

Part of the solution includes better and more robust training, as nearly three-quarters of workers, executives and managers cited an urgent need to prioritize human skills like curiosity and emotional intelligence. Survey respondents also pointed to declining mental health among managers and time spent “firefighting” as challenges holding up management. Additionally, 36 percent of managers said they felt unprepared for the people-leadership aspects of their role.

The report also noted the long-ongoing performance management disconnect, suggesting that it’s time for companies to reinvent their processes in that arena with an eye toward enabling and “engineering” better outcomes for people and the business.

“Despite years of reinvention and retooling, performance management processes still fall short when they’re relied on as the sole means to unlock human performance. That’s because one, singular process isn’t big enough to encompass the many factors that drive both human and business outcomes,” Deloitte said.

“Organizations need to expand beyond the performance management process [with] a robust performance management process,” the report said, “but it goes beyond process to incorporate organizational culture and design, manager and people connections, tech and data, workforce practices, and workplace design.”