RGP Study Finds C-Suite Leaders Are Shifting Their Workforce Strategies as They Take on More Transformation Initiatives

Rhea-AI Summary

RGP, a global consulting firm, released research showing a shift in workforce strategies towards a greater equilibrium between full-time employees and outside talent. The proportion of outside talent on transformation teams increased from 38% in 2020 to 45% in 2022, with expectations to reach 48% by 2024. Companies adopting a Dynamic Workforce Model experienced a 54% increase in market capitalization over the last five years, while organizations with less success saw a 21% decline. Skills shortages resulted in project start delays for 60% of respondents and pushed-out completion dates for 53%.

Positive

• Companies adopting a Dynamic Workforce Model experienced a 54% increase in market capitalization over the last five years.
• The proportion of outside talent on transformation teams increased from 38% in 2020 to 45% in 2022, with expectations to reach 48% by 2024.

Negative

• Organizations with less success in achieving key goals in transformation initiatives saw a 21% decline in market capitalization over the last five years.
• Skills shortages resulted in project start delays for 60% of respondents and pushed-out completion dates for 53%.

More companies are embracing a new Dynamic Workforce Model to gain competitive advantages

IRVINE, Calif.--(BUSINESS WIRE)-- RGP (Nasdaq: RGP), a global consulting firm, today released new research that shows an unprecedented reconceptualization of the workforce is underway, driven by C-suite leaders who are moving toward a greater equilibrium of full-time employees and outside experts.

RGP’s poll of more than 1,000 business leaders found that large global companies have an average of 20 transformation initiatives – defined as $1 million-plus projects intended to improve revenues, profits, costs, cycle-time, quality or other metrics – in progress this year alone. Most respondents predicted an even greater number of transformation efforts by 2026, yet 42% indicated they did not have enough internal talent to staff their transformation initiatives in 2022.

In response to this whirlwind of transformation and a persistent talent shortage, C-suite leaders are shifting their workforce strategies to a greater equilibrium between full-time employees and outside talent. The proportion of outside talent on transformation teams increased from 38% in 2020 to 45% in 2022, and leaders expect this figure to reach 48% by 2024.

“This workforce strategy of blending internal talent with skilled outsiders enables companies to build constant transformation into the core DNA of their businesses, and we refer to this as a Dynamic Workforce Model,” said Kate Duchene, Chief Executive Officer of RGP. “This concept is not very different from the way that Hollywood film productions use teams of independent contractors and employees from different companies to complete a short-term project. Organizations across other industries are starting to embrace this model for major transformation initiatives due to the competitive advantages it presents, and we believe this is happening across the workforce.”

RGP found that a Dynamic Workforce Model can create a significant competitive advantage for businesses. An analysis of executives who reported that their organizations achieved key goals on every transformation initiative in 2022 – 16% of respondents – shows that the market capitalization of publicly listed companies rose an average of 54% over the last five years. In contrast, the market capitalization of organizations that had achieved key goals in less than half their transformation initiatives declined an average of 21% during the same period.

The study also found that skills shortages have wide-reaching impacts on transformation initiatives, with 60% of respondents reporting project start delays and 53% reporting pushed-out completion dates. More than 40% of respondents reported missed critical goals, while 37% said insufficient internal skills have increased the difficulty of making important operational changes.

“Talent can collaborate effectively regardless of where they are physically located or who employs them, as long as they are experts in their field,” said Duchene. “C-suite leaders learned this during the pandemic, and they are embracing a more efficient and more profitable workforce model that enables them to pivot quickly without sacrificing vision, mission, and strategy. It is a new way of thinking that requires a re-evaluation of talent strategy and tech capabilities, and we are seeing more CFOs and CHROs partnering with CEOs to determine where they need injections of outside expertise.”

The findings are based on RGP’s June 2023 survey of 1,005 respondents from companies with at least $1 billion in revenue based in North America, Asia-Pacific, the UK, and the European Union. The sample was evenly divided between technology, financial services, life sciences, and healthcare companies. Read the full report, “The Transformational Impact of a Dynamic Workforce” by visiting https://rgp.com/now/research/dynamic-workforce/transformational-impact/.

About RGP

Recently named among Forbes’ World’s Best Management Consulting Firms for 2023, RGP is a global consulting firm focused on project execution services that power clients’ operational needs and change initiatives utilizing on-demand, expert and diverse talent. As a next-generation human capital partner for our clients, we specialize in co-delivery of enterprise initiatives typically precipitated by business transformation, strategic transactions or regulatory change. Our engagements are designed to leverage human connection and collaboration to deliver practical solutions and more impactful results that power our clients’, consultants’ and partners’ success.

A disruptor within the professional services industry since our founding in 1996, today the Company embraces our highly differentiated agile delivery model. We attract top-caliber professionals with in-demand skill sets who seek a workplace environment characterized by choice and control, collaboration and human connection. The trends in today’s marketplace favor flexibility and agility as businesses confront transformation pressures, severe skilled labor shortages and speed-to-market challenges. As talent preferences continue to shift in the direction of flexibility, employers competing in today’s business environment must rethink the way work gets done and consider implementing new, more agile workforce strategies. Our client engagement and talent delivery model offers speed and agility, strongly positioning us to help our clients transform their businesses and workplaces, especially at a time where high-quality talent is scarce and reliance on a flexible workforce to execute transformational projects is increasingly imperative.

With approximately 3,800 professionals collectively engaged with over 1,900 clients around the world from 41 physical practice offices and multiple virtual offices, we are their partner in delivering on the “now of work.” Headquartered in Irvine, California, RGP is proud to have served 88% of the Fortune 100.

The Company is listed on the Nasdaq Global Select Market, the exchange’s highest tier by listing standards. To learn more about RGP, visit: http://www.rgp.com. (RGP-F)

View source version on businesswire.com: https://www.businesswire.com/news/home/20231031212975/en/

Pat Burek

Financial Profiles

201.655.3406

pburek@finprofiles.com

Source: RGP

FAQ

What is the research about?

The research by RGP focuses on the shift towards a Dynamic Workforce Model, which involves a greater equilibrium between full-time employees and outside talent.

What is the impact of adopting a Dynamic Workforce Model?

Companies adopting this model experienced a 54% increase in market capitalization over the last five years.

What percentage of outside talent is expected on transformation teams by 2024?

By 2024, it is expected that 48% of transformation teams will consist of outside talent.

What were the negative impacts of skills shortages?

Skills shortages resulted in project start delays for 60% of respondents and pushed-out completion dates for 53%.