In 2023, 77% of employers report talent shortages. Organizations are struggling to fill new positions, retain top talent, and reskill their employees.
Tackling these challenges is the job of a Chief People Officer (CPO).
But what does a CPO do and what skills are necessary to succeed? In this blog post, we'll explore the responsibilities and skills required of a CPO and why you need one.
What is a Chief People Officer?
The Chief People Officer or Chief Human Resources Officer (CHRO) serves as a top executive who manages and develops a company's most valuable asset which is its people. The chief people officer description extends beyond standard HR duties because this leader builds company culture and drives organizational effectiveness while synchronizing people strategies with business targets.
This executive must create and execute an extensive people strategy that includes:
- The organization uses talent acquisition strategies and hiring practices to secure and maintain superior performers.
- Performance management systems establish a direct connection between individual objectives and the company's strategic goals.
- The organization uses compensation and benefits plans that maintain both market competitiveness and equitable treatment for all employees.
- The organization runs employee engagement initiatives to boost morale and promote employee loyalty and productivity.
- Leadership development programs and training initiatives guide internal talent to grow into future leaders.
The chief people officer job description specifies essential skills in change management and DEI leadership along with building a workforce that adapts to future changes.
The Chief People Officer holds a vital position through both people policy development and establishment of conditions that allow employees to succeed and innovate which leads to sustained organizational success.
Why do you need a Chief People Officer?
A Chief People Officer’s primary goal is to increase productivity and profitability by ensuring employees perform at their best and want to stay and develop within the company.
You need a CPO because:
- In 2022, 40% of global workers wanted to quit their jobs (McKinsey)
- Not engaged or actively disengaged employees cost the world $7.8 trillion in lost productivity (Gallup, 2022)
- 58% of the workforce needs reskilling (Gartner, 2021)
- Companies with a thriving culture and a strong workplace community show 2,374% higher odds of aspirational levels of excellent work (O.C. Tanner Institute, 2023)
Today's workforce shows signs of restlessness and desires fulfillment that goes beyond financial reward. Authentic leadership together with a purposeful organizational culture and continuous professional development opportunities represent essential retention strategies where a skilled Chief People Officer (CPO) shows significant measurable results.
In fulfilling this mission, chief people officers oversee key pillars such as employee engagement, talent management, and leadership development, ensuring alignment with evolving business objectives and organizational goals.
Additionally, a Chief People Officer often works in collaboration with the chief human resources officer to maintain compliance with labor and employment law while driving emotional intelligence initiatives across teams.
Employee disengagement represents a fundamental threat to company profitability beyond its HR implications. To combat disengagement effectively a Chief People Officer creates meaningful experiences for employees, initiates specific engagement programs and ensures all organizational voices feel they make meaningful contributions to the company’s mission.
Strong interpersonal skills and human resources expertise become critical at this stage, enabling CPOs to manage employee benefit programs, boost employee engagement, and address underlying cultural issues that hinder performance.
An understanding of labor and employment law further supports strategic interventions that protect both employee rights and business continuity.
Modern workplaces require employees to engage in continuous learning while maintaining flexibility. The Chief People Officer oversees reskilling and upskilling initiatives through training programs, leadership development academies, and personal growth paths to maintain employee competitiveness and company performance in dynamic markets.
Through strategic human resources planning, CPOs manage employee benefit programs and create customized learning paths that reflect industry demands while driving workforce resilience.
This approach not only advances individual careers but supports business objectives by ensuring skills remain relevant amid rapid technological and market changes.
Today's businesses recognize culture as essential to their core business strategy rather than a nebulous metric. A top CPO actively designs and constructs organizational culture. They establish workplace environments where exceptional performance and loyalty become baseline standards through innovation.
By focusing on human resources alignment and fostering interpersonal skills development, CPOs make culture a tangible asset that powers operational success.
In today's competitive landscape where talent holds the highest value, the influence of a Chief People Officer extends throughout all departments and projects and determines every business outcome. Failing to recognize this role leads to more than the loss of good employees because it also results in diminished momentum and market leadership and innovation.
Without strategic hr expertise at the leadership level, companies risk stagnation, increased turnover, and the inability to effectively adapt to future business challenges.
Chief People Officer – Responsibilities
So what does a CPO actually do? Let me break this down for you.
Recruitment, onboarding, and offboarding strategy
The CPO develops a complete strategic approach that manages the entire lifecycle of employees.
- Attraction and recruitment: The CPO builds an employer brand to draw skilled employees and establishes efficient hiring methods.
- Onboarding: During onboarding new employees learn company procedures and gain motivation to engage with their roles.
- Offboarding: gathering feedback and mitigating potential reputation problems.
What does a chief people officer do beyond recruitment basics? Their systems make sure these phases work strategically and fit into the company's overall objectives.
When onboarding or offboarding processes are mishandled they damage employer brand credibility but smooth transition processes can maintain loyalty even among employees who are leaving.
Performance management
CPOs are responsible for designing and evaluating the company's performance management process by:
- Identifying performance gaps
- Working with managers to create development opportunities for employees
- Establishing feedback and coaching processes (performance reviews, 1:1 meetings, 360-degree edback, peer reviews)
- Training leaders in providing effective feedback
- Providing digital tools and other resources
Succession planning
The combination of unprecedented turnover rates and intense competition for top talent makes succession planning essential to avoid operational disruptions.
The CPO should collaborate with leaders to establish succession plans for critical roles.
- The CPO must collaborate with leadership teams to establish who will take over critical positions after current leaders leave.
- Identify the skill gaps of potential successors.
- Train and develop those potential successors.
What does a chief people officer do to future-proof an organization? Their proactive succession pipelines are designed not only to fill vacant positions but also to establish leadership depth throughout all departments.
Chief People Officers who establish transparent advancement paths while developing internal talent early enhance organizational resilience to unexpected leadership changes or retirements.
Employee experience
A 2022 research by Gartner revealed that employees who operate in human-centric work models are 3.8 times more likely to be high performing. People need to feel supported, valued, and engaged in their work to give their best.
Improving the employee experience is, without a doubt, a critical goal of a CPO.
Here are some ways a CPO can do this:
- Providing professional development opportunities (mentorship programs, career development plans, training programs, workshops, and conferences)
- Promoting diversity and inclusion
- Fostering a positive work-life balance (such as flexible work arrangements)
- Establishing teamwork and collaboration processes
- Ensuring fair and equitable compensation
Compensation and benefits program
An enjoyable work setting yields positive effects but fails to retain employees if their salary falls short.
Additional considerations are important to take into account. Workplace benefits including paid vacation time and flexible work schedules along with childcare support remain crucial to attracting and keeping talented employees alongside competitive salaries.
A Chief People Officer should:
- Understand their employees' expectations and priorities.
- The Chief People Officer should analyze salary information and performance statistics to maintain competitive compensation packages for the company.
- Create benefits packages that match both employee requirements and personal objectives.
Modern compensation strategies are no longer one-size-fits-all. Chief People Officers need to keep adjusting pay structures and benefits packages to match evolving market trends along with generational expectations and business circumstances.
By customizing programs carefully the company can maintain its status as an employer of choice and manage costs effectively.
Company culture
“Culture eats strategy for breakfast” said Peter Drucker, the management guru. No matter how solid your strategy is, if the people executing it don't have the appropriate culture, they will fail.
Imagine a tech company that wants to provide agile, innovative solutions to its customers. How can it do so if people fear sharing ideas and everything has to go through the CEO?
The CPO is in charge of shaping a culture that aligns with the company values and goals and fostering the behaviors the organization needs for success.
Some actions for improving company culture are:
- Defining and communicating the company's values
- Acting as a role model
- Establishing a recognition and rewards program
Employer brand & reputation
Chief People Officers are responsible for positioning the company as an employer of choice in the industry and helping attract the right talent. This includes developing employer branding strategies, engaging with potential candidates, and promoting the company's culture and values.
Chief People Officer – Skills
You probably now understand what a CPO does. But how does he do it? Let me walk you through the skills a Chief People Officer needs.
Solid HR expertise
If you are searching for a CPO, look into people with extensive expertise in HR. The ideal candidate should deeply understand human resources best practices, including talent management, compensation and benefits, performance evaluations and management, and employee engagement.
Interpersonal and communication skills
Strong interpersonal skills are essential for CPOs, as they need to communicate effectively with employees at all levels of the organization, build relationships with stakeholders, and manage conflict.
Among these soft skills are:
- Emotional intelligence
- Excellent verbal and non-verbal communication skills
- Active listening skills
- Networking ability
- Conflict resolution
Leadership skills
Successful experience in leadership positions is another essential requirement. Your CPO needs to be a people person that will inspire your employees and guide them toward organizational success.
Business knowledge
You can’t get the best out of your employees if you don’t understand what they do and how they contribute to the final product or service.
This is why the CPO must have a strong understanding of the industry in which the company operates, including financial metrics, business trends, and competitive forces.
Problem-solving capabilities
In the ever-changing business landscape, CPOs must be strategic thinkers that can analyze complex issues fast, identify root causes, develop practical solutions to improve performance, and change course when needed.
Tools to help your Chief People Officer do the job better
CPOs have a lot on their plates. Luckily, several software tools can help them manage and develop human capital faster and more effectively.
These tools include:
- Performance management software: Save time and ensure HR processes are carried out properly by incorporating software that helps streamline the performance management process, automate performance reviews, and provide real-time feedback and coaching to employees.
Performance review analytics with Effy.ai
- People management software: Tracking employee attendance, managing time off requests, and scheduling team meetings can be tiring. With people management software, tracking employee data has never been easier. Some tools can also help automate HR processes, visualize data, and collect real-time feedback regarding employee engagement, productivity, and retention. Cool, right?
- Learning and development software: These platforms can help understand skill gaps and recommend relevant employee training based on their job roles and performance data. Some tools can also deliver online training programs and track employee progress.
- Compensation and benefits software: With this software, you can easily manage salary and bonus planning, stock options, and retirement plans. Having access to insights into salary trends, benefits utilization, and employee satisfaction can help identify areas where the organization may be underpaying or overpaying employees and recommend adjustments to the compensation strategy.
Bonus tips and things to know about the Chief People Officer
The Chief People Officer (CPO) plays a much deeper role than many realize. Beyond managing HR operations, the CPO becomes a key architect of growth, innovation, and cultural success. Here’s a closer look at what defines an exceptional CPO in today’s workplace.
Master human resources fundamentals and beyond
While strong human resources knowledge forms the foundation, a modern chief people officer must also understand finance, operations, and strategy to link people initiatives directly to business success.
Elevate talent acquisition through strategic thinking
A chief people officer must lead smarter talent acquisition initiatives by leveraging advanced tools like applicant tracking systems and innovative sourcing methods. This ensures finding, attracting, and retaining the best talent quickly and effectively.
Develop strong business acumen for leadership influence
To advise the chief executive officer and board members, the chief people officer needs deep business acumen. They must understand how talent decisions impact revenue, scalability, and competitive positioning across markets.
Lead HR teams with vision and purpose
Successful CPOs guide hr teams with clear direction, focusing on building cohesive, high-performing departments that drive organizational development and align people programs to shifting market needs.
Align HR strategies with broader business goals
The chief people officer is responsible for crafting hr strategies that aren't isolated from the business model. Instead, they ensure talent acquisition, development, and retention initiatives move in lockstep with operational and strategic objectives.
Prioritize employee engagement strategies to retain top talent
Through focused employee engagement strategies, a chief people officer strengthens loyalty, enhances productivity, and creates an energized workplace culture that supports innovation and collaboration.
Focus on continuous talent acquisition improvements
Talent acquisition is never “one and done.” CPOs must constantly analyze pipelines, candidate experience, and branding efforts to adapt to evolving workforce expectations and maintain a strong incoming talent stream.
Hone your business acumen to balance people and profit
The best chief people officer doesn't only advocate for employees—they balance people-first initiatives with smart financial oversight, showing that workforce investments are directly tied to measurable business success.
Build HR strategies that empower managers and teams
Future-focused hr strategies developed by the CPO empower frontline managers and enable self-directed leadership among employees, creating a culture where initiative and accountability flourish.
Understand key responsibilities across every stage of the employee journey
From managing employee relations to talent forecasting, succession planning, and compensation strategy, the chief people officer oversees the key responsibilities that influence every touchpoint of the employee experience.
Conclusion
Having a Chief People Officer can be a strategic advantage for your company, helping you manage and develop the organization's people more effectively. By focusing on talent management, employee engagement, and organizational development, the CPO can help improve business performance, build a strong culture, and position the company as an employer of choice.
You just need to ensure your CPO has the right set of skills and provide them with the tools to get the job done. Good luck!
FAQs: Importance of Chief People Officer
Is Chief People Officer the same as HR?
No, the Chief People Officer is a strategic executive responsible for managing and developing a company's talent, while HR is a functional department accountable for managing employee relations, benefits, and compliance.
Is Chief People Officer an HR role?
Yes, the Chief People Officer is a C-level HR executive responsible for managing and developing human capital strategies.
What is the difference between CPO and CHRO?
There is no difference between Chief People Officer (CPO) and Chief Human Resources Officer (CHRO). Some companies may use one title over the other, but both refer to the same HR function, which belongs to the executive leadership team.
What are the key skills of a Chief People Officer?
The key skills of a Chief People Officer include HR expertise, interpersonal and leadership skills, business knowledge, problem-solving capabilities, and strategic thinking.
