\u201cWhat we have right now is zero ability to forecast whether the next 12 months is going to be a positive or a negative,\u201d says FW Cook CEO Dan Ryterband. \u201cAll of this uncertainty is making business planning with any degree of precision virtually impossible.\u201d<\/p>\n\n\n\n
Then, there\u2019s AI\u2019s meteoric impact, changing the labor needs and overall talent strategy for nearly all companies in all industries\u2014and fast. In a recent study by IBM, 77 percent of CEOs acknowledged that AI will have the most significant impact on their industry in the next three years. Yet, only 62 percent of employees received any kind of AI training, underscoring the difficulty companies are having keeping up with the pace of change.<\/p>\n\n\n\n
It\u2019s a lot. No small wonder CEOs are rethinking how they define talent, lead through uncertainty and build organizations resilient enough to weather what\u2019s next. Here are five of the most urgent and actionable talent trends to watch in 2025:<\/p>\n\n\n\n
1. TALENT STRATEGIES ARE SHIFTING FROM PROFICIENCY TO POTENTIAL.<\/h4>\n\n\n\n
As economic conditions shift, more companies are leaning into skills-first thinking and internal development to create a resilient workforce. The traditional focus on pedigree and tenure is giving way to a sharper focus on competencies, agility and fit for the future. And scenario-planning\/ prediction is losing ground to hiring for adaptability so that, no matter what happens, your people are ready.<\/p>\n\n\n\n \u201cWe are seeing a real shift,\u201d says Kathy Gersch, chief commercial officer at Kotter. \u201cIt\u2019s less about figuring out every eventuality that could happen, and more about preparing your organization to be able to adapt and change as they happen.\u201d<\/p>\n\n\n\n CEOs know that means focusing on skills development, but few have the systems to do it well. Morain notes that only 8 percent of talent leaders say they\u2019re confident in their workforce skills data, making it challenging to know where to focus.<\/p>\n\n\n\n His advice: prioritize. \u201cStart by identifying the most business-critical roles\u2014then narrow in on which of those are most dynamically changing due to AI or market disruption. Don\u2019t try to plan for the entire workforce\u2014start with the highest-impact 20 percent.\u201d<\/p>\n\n\n\n Instead of hiring for current proficiency, focus on future potential. \u201cOrganizations are starting to assess skills promise, not just skills proficiency,\u201d he says. \u201cWhat can this person grow into\u2014not just what can they do today?\u201d<\/p>\n\n\n\n That also means planning for leadership continuity. \u201cEven in a 15-person company, you need a continuity plan\u2014even if the gap between Person A and their backup is 40 percent,\u201d says Fred Voccola, vice chair and former CEO of Kaseya. \u201cWhether it\u2019s grooming someone internally or having recruiters lined up, you need to be ready.\u201d<\/p>\n\n\n\n For startups, this kind of agility begins at the hiring stage. Michael Gifford, CEO of fintech Splitero, says early hires must be both adaptable and team-oriented. \u201cIf they are resilient through the changes startup life brings and willing to lend a hand, they will succeed at Splitero,\u201d he says, noting that this mindset has shaped his leadership philosophy from day one. \u201cI support everyone at Splitero to be fearlessly decisive, autonomous but collaborative and creative problem-solvers.\u201d<\/p>\n\n\n\n One thing is clear: Leadership development and succession planning can no longer be limited to the top of the org chart. Companies are finding value in cultivating decision-makers across functions\u2014not just for agility, but also to build a deeper, more resilient bench. Several CEOs emphasized that empowering leaders at every level strengthens continuity and drives performance under pressure\u2014 and it surfaces future leaders earlier and more organically, deepening the leadership bench in the process.<\/p>\n\n\n\n AI isn\u2019t just disrupting workflows\u2014it\u2019s upending the entire talent lifecycle. From hiring to performance evaluations, AI tools are altering how companies assess, manage and develop people. And it\u2019s changing what can be accomplished by the existing workforce.<\/p>\n\n\n\n \u201cProper use of AI tools\u2026 allow people to not only be 20 percent more efficient but like 200 percent more productive,\u201d says Voccola. \u201cR&D, software development, marketing\u2014these are all huge areas. Salespeople of the future will be managing dozens of AI bots\u2026 managing many versions of themselves out there.\u201d<\/p>\n\n\n\n That shift isn\u2019t limited to productivity gains\u2014it\u2019s also redefining how organizations structure workforces, distribute tasks and design talent strategies. \u201cWe\u2019re moving from a situation where it\u2019s not human or bot; it\u2019s human and bot. So, the workforce will be a blended mix of AI agents and humans,\u201d says Morain, adding that \u201cthe best CEOs are mandating their CHROs and their CIOs co-create the talent strategy together.\u201d<\/p>\n\n\n\n Amid the push to optimize through automation, some leaders are emphasizing AI\u2019s potential to deepen human skills\u2014not replace them. Phil Friedman, CEO of CGS, takes a human-first view of AI. \u201cAI, when used ethically and thoughtfully, can play a powerful role in accelerating [soft skills] development,\u201d he says. His company, which offers business process outsourcing, uses Cicero, an immersive AI-powered training tool to help employees rehearse high-pressure scenarios like de-escalating conflict or giving feedback.<\/p>\n\n\n\n Perry is exploring AI\u2019s value in more operational ways. While not in use for day-to-day retail at Klatch, it\u2019s already proving helpful in back-office functions like marketing and hiring. One hiring manager recorded his interviews, transcribed them and fed them to gen AI and asked it who would be the best candidate. \u201cI was like, \u2018ooh, I like that,\u2019\u201d says Perry. \u201cIt\u2019s not how he made his decision, but he used it as part of that decision-making process. That\u2019s a really interesting way to use it.\u201d<\/p>\n\n\n\n What separates the AI tools from old-school profiling is their ability to detect \u201cderailers\u201d\u2014traits or behaviors that might not show up in interviews but could lead to underperformance. \u201cSo you now know where the weaknesses are,\u201d says Dennis Carey, vice chair at Korn Ferry. \u201cYou now know what you need to do to give that person a better chance to succeed. You can upskill them, give them support, a mentor, whatever it might be.\u201d<\/p>\n\n\n\n Today\u2019s workforce wants purpose, flexibility, growth\u2014but rising disengagement is forcing leaders to rethink how they define and drive performance. According to Gallup, only 21 percent of global employees reported being engaged in 2024\u2014a drop driven largely by burned-out managers and younger workers. The ripple effects are costly: $438 billion in lost productivity worldwide.<\/p>\n\n\n\n Yet many organizations rely on outdated approaches to motivation and loyalty. Compensation, while certainly important, isn\u2019t enough\u2014particularly for small and midsize companies competing with deep-pocketed Goliaths for talent. \u201cWhen people feel like they\u2019re building something, not just executing a plan, they stay,\u201d says Samyr Laine, managing partner of Freedom Trail Capital. \u201cSmall moments of recognition, clear growth paths and honest communication go a long way.\u201d<\/p>\n\n\n\n For frontline workers, autonomy and connection matter as much as mission. Says Perry, \u201cWe do a four-day workweek and flexible scheduling, but we also let every manager take ownership of their store. They run events, try out new pastries, build community. That retains talent.\u201d<\/p>\n\n\n\n Meanwhile, some CEOs are doubling down on in-person engagement. \u201cI\u2019m a firm believer in in-office culture,\u201d says Voccola. \u201cIt adds 15 to 25 percent in productivity and creates better customer experiences. It also accelerates mentoring and employee development.\u201d<\/p>\n\n\n\n But the warning signs are clear: Engagement is eroding. Morain reports that only 44 percent of employees are willing to support their latest change initiatives\u2014down from 74 percent a decade ago. \u201cWe measure something called \u2018network performance\u2019\u2014how well people elevate those around them. That number\u2019s at just 12 percent today. People are exhausted.\u201d<\/p>\n\n\n\n What\u2019s needed, say experts, is a deeper cultural shift. \u201cSome are moving in this stress environment to more of that command-and-control, just-tell-people-what-to-do mentality,\u201d says Gersch. \u201cPeople may stay in that for the short term because they\u2019re scared. But as soon as that condition changes, if you haven\u2019t shown them that you\u2019re really valuing what they can contribute, they\u2019ll leave.\u201d<\/p>\n\n\n\n Ultimately, purpose and autonomy have moved from nice-to-haves to must-haves. \u201cIf your culture doesn\u2019t support change resilience, you won\u2019t make it through transformation,\u201d says Morain. \u201cWe\u2019re seeing the best companies developing leaders who are resilience builders, who routinize the reflexes of dealing with change.\u201d<\/p>\n\n\n\n Culture has always mattered\u2014but now it may be your only sustainable advantage. As companies grapple with AI disruption, macroeconomic shocks and demographic shifts, long-term success increasingly hinges on their ability to evolve from the inside out.<\/p>\n\n\n\n \u201cYou can\u2019t outthink every possible scenario,\u201d says Gersch. \u201cYou have to build a bench that\u2019s able to pivot.\u201d<\/p>\n\n\n\n Carey underscores the point: \u201cCompanies are only made up of two things: money and people. Many companies understand the money part\u2014but they don\u2019t understand the people side of the equation.\u201d<\/p>\n\n\n\n That gap in understanding shows up when culture, talent strategy and business strategy are misaligned. \u201cThere\u2019s often a disconnect between what the talent strategy is focusing on and what the culture is you\u2019re trying to create,\u201d says Dr. Laura Hamill, co-founder of Limeade. \u201cYou have to be intentional about making that experience real.\u201d That intentionality, she explains, shows up in the details: \u201cIt\u2019s the story you tell at onboarding. It\u2019s what you reinforce and reward. It\u2019s how performance management is designed. It\u2019s whether people feel they\u2019re trusted and cared for.\u201d<\/p>\n\n\n\n As hybrid work models become the norm, leaders must work harder to ensure that culture transcends geography. Kimberly Taylor, CEO of JAMS, touts deliberate connection-building. \u201cDefining and maintaining a strong culture always requires intentionality, particularly when associates are working remotely or are geographically disbursed,\u201d she says. \u201cWe create frequent opportunities for cross-collaboration across teams and bring associates together for in-person events throughout the year.\u201d<\/p>\n\n\n\n If efforts fall short and the lived employee experience fails to reflect the company\u2019s website or leadership messaging, it can lead to \u201ccultural betrayal,\u201d says Hamill. \u201cThat\u2019s when people see the values on your website and then don\u2019t experience them in how performance is managed or how they\u2019re onboarded. That gap is damaging.\u201d<\/p>\n\n\n\n David Naylor, CEO of Rayburn Electric Cooperative, shows how a consistent, values-driven culture becomes an advantage. \u201cWe intentionally moved away from the classic pyramid-shaped hierarchy toward a flat organization mindset,\u201d he says. \u201cThat means giving people the freedom to make decisions in their area, the tools to act on them and the trust they\u2019ll use that freedom wisely.\u201d<\/p>\n\n\n\n That approach empowers Rayburn\u2019s cross-functional teams to adapt quickly to disruption\u2014from climate-related risks to AI-fueled energy demand. \u201cWe foster the belief that their work matters, and their voice has weight,\u201d says Naylor. \u201cThat drives resilience through uncertainty.\u201d<\/p>\n\n\n\n Culture isn\u2019t about slogans\u2014it\u2019s about behaviors. Naylor takes responsibility for fostering cross-functional collaboration, open communication and leaders below him who really walk the talk. \u201cI try to listen more than I talk. I try to show up. Leadership doesn\u2019t live behind a desk. It lives in front of people, showing up where it\u2019s needed.\u201d<\/p>\n\n\n\n And leaders must be held accountable. \u201cWhen you have a scenario where you say you want to operate this way, but then you allow one leader on your team to operate differently, it undermines everything,\u201d says Gersch. \u201cThat worked 20 years ago. It doesn\u2019t work now.\u201d<\/p>\n\n\n\n CEOs are reevaluating how compensation aligns with performance, risk and retention\u2014and trying to gauge whether to make exceptions. After all, when pay is based on the value of the stock in order to align performance with shareholder interest and that stock tanks due to external factors\u2014e.g., sweeping tariffs\u2014retention becomes a concern.<\/p>\n\n\n\n But Matt Turner, managing director at Pearl Meyer, cautions against overreaction. \u201cThere\u2019s so much unknown about what will happen with the tariff situation. It\u2019s better to wait and see\u2026 if you make an adjustment now and it looks like you\u2019ve benefited from a windfall, that can be really bad optics.\u201d<\/p>\n\n\n\n Ryterband says the uncertainty is prompting boards to favor flexibility and defensibility over rigid performance frameworks. \u201cThe ultimate objective in a compensation system is to have balance because balance should lead to durability in both favorable and unfavorable economic climates,\u201d he says. \u201cMoving toward a relative measure as opposed to setting this absolute also takes out some of the imprecision.\u201d<\/p>\n\n\n\n Turner agrees that equity remains a critical tool. \u201cUsing time-based restricted stock makes a lot of sense,\u201d he says. \u201cIt may fall 20\u201330 percent in a year, but it\u2019s still helpful in a retention situation.\u201d<\/p>\n\n\n\n For mid-sized companies that struggle to compete on salary alone, culture becomes the key differentiator, says Morain. Showcase growth paths so that employees can see their future in your company, and emphasize stability during times of uncertainty. \u201cCandidates are cautious right now,\u201d he says. \u201cSwitch premiums are at a low. Reassuring them about your long-term plans will be critical to get people to take the leap.\u201d<\/p>\n\n\n\n Designing pay plans that can withstand disruption isn\u2019t just a financial exercise\u2014it\u2019s also a leadership one. Friedman emphasizes the importance of people-first decision-making at the top. \u201cOne mistake is viewing talent as a cost center instead of a growth engine,\u201d he says. \u201cBuilding the right team doesn\u2019t solely live within HR. It\u2019s a strategic imperative that touches every part of the business.<\/p>\n\n\n\n \u201cAt CGS, I\u2019ve interviewed hundreds of people over the years,\u201d he adds, \u201cand I still believe it\u2019s one of the most important things a CEO can do.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":" It\u2019s on every CEO\u2019s \u2018must have\u2019 list these days. Understanding these five talent trends will help you build one. <\/p>\n","protected":false},"author":31,"featured_media":373709,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_oasis_is_in_workflow":0,"_oasis_original":0,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","footnotes":"","_links_to":"","_links_to_target":""},"categories":[2130],"tags":[57692],"class_list":["post-373704","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-talentmanagement","tag-featured"],"acf":[],"yoast_head":"\n![\"\"](\"https:\/\/chiefexecutive.net\/wp-content\/uploads\/2025\/08\/Heather_Perry_at_Klatch_Coffee_Cafe_Location-1-683x1024.jpg\")
2. AI IS REDEFINING HOW TALENT DECISIONS GET MADE.<\/h4>\n\n\n\n
3. WORK EXPECTATIONS ARE BEING REWRITTEN.<\/h4>\n\n\n\n
![\"\"](\"https:\/\/chiefexecutive.net\/wp-content\/uploads\/2025\/08\/samyr_laine__headshot_option_2_960-1-683x1024.jpg\")
4. CULTURE HAS BECOME A COMPETITIVE BUSINESS IMPERATIVE.<\/h4>\n\n\n\n
![\"\"](\"https:\/\/chiefexecutive.net\/wp-content\/uploads\/2025\/08\/DAvid-Naylor-819x1024.jpg\")
5. VOLATILITY IS RESHAPING COMPENSATION PHILOSOPHY.<\/h4>\n\n\n\n