High performance is HR’s new focus

Published in December 2025, Fosway Group’s HR Realities research analyses all the critical trends and opportunities for HR leaders in the next 12 months. Here, Fosway analysts find HR leaders have a new priority – high performance.

In a dramatic turn from the previous five years of our HR Realities survey results, we have seen performance and profitability become the most significant organisational challenge in 2025.

The availability of skills, which had held the top spot for the past four years tumbled down the list of challenges from first to sixth, as economic headwinds combined with the pressure to rethink work and contend with the impact of automation, AI and robotics which created a storm that is beginning to radically reshape HR agendas.

It’s a truly significant moment in time which is potentially as momentous for HR as the recent pandemic. And its impact is sending ripples of pragmatism and disruption across the employee value proposition, employee experience and HR’s technology investment priorities. It could also redefine HR’s role in organisations, at least until the end of the decade.

As organisations and HR face increased uncertainty, innovation and strategic business partnering are critical

Whilst being a strategic business partner has always been a top priority for HR leaders, what is most significant about this year’s priorities is the adoption of AI, HR automation and chatbots. Under cost pressures and the need to moderate HR headcount, HR leaders intend to go all in on AI in HR as the features become available. 

The emergence of an INTELLIGENCE-LED HR function might be the most significant shift in HR this decade

With high quality analytics taking the top spot in HR teams’ list of the most important drivers for success, knocking employee experience into second place, there seems to be a real change taking place in HR’s identity. In the pursuit of facilitating an environment that ensures profitable people, it is technology, data, analytics and AI automation that are seen as the critical tools for driving HR’s success; even more than HR’s influencing skills.

AI continues to rise in HR’s thoughts about its future. This year sees another leap in expectations about the role AI will inevitably play in redefining the employee experience and HR operations. AI, machine learning and intelligent agents have steadily grown in their perceived importance, from relative obscurity back in 2018; in the last two years AI has emerged near the top of HR’s thinking about how it delivers future success. Based on this trajectory, it is also easy to see AI eclipsing strategic influencing and employer brand as key enablers of a successful HR operation.

This is an excerpt from the HR Realities 2025. Get the full insight and discover all the latest insight for corporate learning leaders by reading the whole report here.

What should you do next?

• There’s been little structured analysis of what AI features are live and delivering value HR teams. This is where Fosway’s Cloud HR AI insights come in. More here.
• The 2026 AI project is live; build your evidence-based AI strategy with Europe’s most experienced HR industry analysts. Sign up here

Other recommended reading

• The full research into EMEA’s HR leaders is here for you to benchmark you and your team’s experience: HR Realities 2025.
• The 2025 Fosway 9-Grid^TM for Cloud HR – full report. Released in September 2025, it’s the latest market and solution trends in Cloud HCM.

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