The role of the HR professional has changed dramatically along with the workforce and economy, and that evolution will continue as machines and embedded AI technology replace tasks once performed by humans. But that doesn't make people―or the HR teams that work with them―any less important. Tomorrow's HR leaders will need to be bigger, broader thinkers, and they'll have to be tech-savvy and nimble enough to deal with an increasingly agile and restless workforce.
To proceed, the leadership in HRM and in all related HR functions that properly report up to the most Senior HR position (usually the CHRO or Chief People Officer (CPO) must align and commit to strategies/initiatives that are intertwined and dependent on underlying HR Technologies.
Keeping HR Relevant
These technologies themselves represent as much as a $15 Billion dollar industry. As you can see in FIG 1 – the delivered functionality is driven by the focus on workforce talent and a significant number of stated trends confirm that.
Those trends are supported by these 4 foundation statements or strategies:
- STRATEGY 1 – Know your organization’s mission, values and business strategies and direction - not just those of your own HR function
- STRATEGY 2 – Embrace any and all manner of HR technology with a needed emphasis to ensure the existence of “ONE SYSTEM OF RECORD (OR TRUTH)” which is an integrated, cloud-based HRMS
- STRATEGY 3 – Utilize well understood Metrics and (so called) Workforce Analytics to position HR as a Strategic Business Partner
- STRATEGY 4 – FOCUS on TALENT ACQUISITION, CAREER MANAGEMENT and the overall Employee Experience (EX)
FIG 1.
Know Your Organization
Recognize the Value of HR Today
To be viewed as a Strategic Business Partner and a provider of actionable insights and thus value to your own organization, these significant initiatives must be in a HR Leader’s Action Plan today, now.
The abundance of already proven and delivered HRMS functionality encompassing some AI driven features and reporting along with integrated Social Media applications have coincided with the impact of multiple generations in the workforce, the need for significant Talent Management, Candidate Relationship Management and an overall engaging and effective User Experience (UX). The top tier HRMS providers have incorporated their development plans with this in mind, and so should any HR Leader.
Embrace HR Technology
Evolving Challenges & Expectations
Back in 2018, the Society for Human Resource Management polled more than 3,000 HR executives to identify their top challenges. Here are the results shown in order of stated priorities.
FIG 2.
Among these, were “transforming HR into a strategic partner”, “managing globalization”, “managing talent”, and “managing demographics” (in particular, Millennials). These findings align with the ways in which HR’s role has evolved.
With the proliferation of effective software in support of a majority of the functional responsibilities under the overall umbrella of an HR function or department, HR’s role has altered and expanded, along with the expectations of senior management.
HR executives are expected to act as “experts”. They are responsible for onboarding, engagement monitoring, and providing forecasts to help management make decisions and implement the many programs that address the SHRM top issues and more. In many cases they are expected to apply behavioral science knowledge for recruiting, evaluation, compensation, training, and so forth. They must also oversee talent management and apply business perspectives to benefits, compensation, and succession staffing, and other functions.
The effective use of HR technology must be oriented to add “value”. The “value” proposition must be effectively communicated, (if not sold) by HR executives.
The 2 figures below shows the relationship of how HR Technology features themselves can contribute to the value proposition.
FIG 3a.
FIG 3b.
HR must seek significant strategic influence. The technology at hand will enable them to move from a tactical – administratively driven function to one of “Game Changing” strategic involvement at the highest level of any organization.
It's that technology that will help HR adjust to a changing workforce accustomed to going online to get everything from a date to a car. HR departments will need to make more information and services directly available via Employee and Manager Self-service (ESS/MSS) on multiple devices to workers around the clock―a shift that will also free up time to allow HR leaders to focus more on business strategy and employee career paths.
Know the Metrics
The More Strategic HR: A Vision
In becoming a strategic partner providing value added actionable information that supports the overall organization, offering insightful support to the strategies and vision of the company, HR’s role becomes more critical than ever before. Aided by technology, today’s HR has a positive impact on business alignment. It can assist in getting all five of the key success drivers of: people, processes, technology, structure, and culture in alignment which enhances organizational capabilities and drives performance.
FIG 4.
Thus this alignment has a “domino effect” as each program builds on the success of others with the end result increased overall financial performance by the entity.
To achieve this end result HR must also understand the organization in which it is a part. No longer should HR executives think only of HR initiatives. The need exists for HR executives and staff – at every level – to understand the mission and vision of the organization and its looming strategies and organizational direction.
WEBINAR: People Analytics in the Real World
HR must know the industry in which they are working, be it Manufacturing, Healthcare, Finance etc. And importantly, HR must anticipate the information needs of the Executive level if not the Board of Directors.
The figure below shows some of the concerns of the C-level executives as they strive to steer any organization. Their concerns are certainly not solely focused on the workforce itself, although it is an important component. Additionally, the Board and any Executive Team expect to achieve “Value” from the function of Human Resources or Human Capital and its senior leadership.
FIG 5.
How to Present "Value Added Information"... Not Data
Today, spreadsheets and most “Ad hoc” reports are too limiting to present the “information” or “actionable insights” (and not just data points) that your key stakeholders, Boards of Directors, and CEOs are looking for.
As shown in Figure 5, Executives and Boards would welcome “information” that enables actionable programs in support of a company’s strategies. Much of what senior executives seek are directly related to the workforce. Key Performance Indices are an important measurement of the company, and their makeup varies from industry to industry and company to company.
The more HR executives anticipate and understand what types of information is sought, the better they can build the outputs to display appropriate information. These will be in the form of various charts and trends – all classified as metrics. However, many do rely on some manner of workforce statistics, as direct employee staffing information is incorporated into any metrics related to the performance of HR programs.
Here is a brief list of the types of information that Board Members, C-Level executives and Senior level Advisory Committees seek to interpret which will lead to strategic initiatives:
FIG 6.
Which Metrics Should HR Measure?
Accordingly, a number of metrics and the ways in which they play a role in determining how your company is being perceived arise from four important perspectives. Most typically they can be stated as:
- From the Customer’s Perspective: Executives will want to know how the company is being perceived by its’ customers. A few goals and measures can be used to answer this question, including customer satisfaction, sales trends, brand strength, market share, and customer loyalty.
- From the Growth & Learning Perspective: Executives will want to know how the organization will continue to improve and create value. Measurements such as first to market percentage, number of development activities, and percentage of ready successors may help to ascertain growth and learning status.
- From the Internal Business Perspective: What is the company doing well? Compiling data presented as trends related to compliance, workforce productivity, turnover rate, job fill rate, etc. will provide “actionable information” to justify new programs.
- From the Financial Perspective: The leadership team of large organizations in reality, answer to the body of shareholders and stakeholders. Financial data and trends such as Earnings per share, growth revenue, budget accuracy, and profit/employee rates will provide an important picture of the overall viability of the organization. Some of the metrics, although financial, do involve HR and Workforce underlying data.
HR alone may not be responsible for measuring every one of the discussed Key Performance Indices – thus the need for system integrations and some data transfer if not manipulation. But the end result is worth the effort. The HRMS providers have, within the last few years, added these type of algorithms to their delivered core functionality.
Many of their clients who have the data are already using analytics to predict and assess everything from employee retention and employee flight risk to recruitment strategies and the success of wellness programs. For example, chatbots allow candidates and employees to have automated, personalized conversations with a computer. A worker could use a chatbot to find out how many sick or vacation days he has remaining or what procedures the company's dental plan covers. And a job candidate can answer questions, complete assessments, and track the status of his or her application through a personalized assistant who has a name, a face and a pleasant demeanor. Of course, all these features are computer-generated.
Millennials, now the largest generation in the workplace, are used to getting information right away through a computer or smartphone. A wide range of employee experiences, then—from application to onboarding to checking benefits and paid time off—are now available on multiple devices to accommodate the digital customer experience younger workers prefer. HR must embrace and provide that capability at a minimum.
Focus on Talent Management
Talent Acquisition, Career Management & Employee Experience
This initiative then directly evolves to the need to focus on the functions of talent acquisition and career management. These are sometimes grouped under the overall function of TALENT MANAGEMENT (TM).
As stated, Human Resource professionals need to know and contribute to the vision, mission and financial success of the business―otherwise, they won't be taken seriously by the C-suite. And on a practical level, they won't be able to execute effective workforce planning or attract, hire and train and retain the right talent – their “key” employees.
Want to know more about talent management? Check out our HR Guide.
We already see some of the top tier HRMS vendors, using algorithms and analytics have the ability to deliver what is generally referred to as the “NINE BOX MODEL” seen below.
FIG 7a.
But importantly, a major enhancement, one that adds tremendous strategic value and actionable insights, is the ability to show the potential of flight risk by any specific individual employee.
FIG 7b.
Courtesy: Ultimate Software
In Fig 7B the 9 Box Model has been reconfigured to show not just the individual employee’s position on the XY axis of Potential vs Performance, but also that individuals likelihood of leaving the company – as determined by embedded AI algorithms and shown by the relative size of the “bubble” alongside the employee’s name.
The ability to anticipate unwanted turnover by key employees has a strong impact on the entity’s bottom line. The cost of turnover is significant. Any opportunity for the HR function using its underlying HRMS as one system of truth to identify such situations is no doubt value adding.
With improved technology HR managers in the new decade will have more time to focus on individuals, enhancing both recruitment and engagement and thus retention.
The Gig Economy
Now a workforce majority, millennials and soon to follow Gen Z have specific expectations and mindsets.
Additionally this new workforce will include not just transient workers (60 percent of Millennials told Gallup they are open to new job opportunities) but also “gig workers” who pop in and out of jobs on a daily basis. In addition, HR will need to help assess which tasks throughout the organization can be automated and then reskill those whose jobs are affected by automation.
RELATED: How to Engage the Remote Workforce
A recent Willis Towers Watson survey found more than half of employers say it will take "breakthrough approaches in HR's role" to deal with automation and digitalization. Meanwhile, some of HR's remote workers will increasingly be very remote―as in, seven or 10 time zones away―as globalization leads to an increasingly diverse workforce.
Closing Thoughts
Talent management is a business strategy and HR Leaders must fully integrate it within all of the employee related processes of the organization. Attracting and retaining talented employees in a talent management system is the job of every member of the organization, but especially managers who have reporting staff (talent).
An effective strategy also involves the sharing of information about talented employees and their potential career paths across the organization. This enables various departments to identify available talent when opportunities arise.
An organization that does effective succession planning ensures the best talent is trained and ready to assume the next position in their career path. Succession planning benefits the employees and it benefits the organization. Managers across the organization must know who is considered a “key” contributor and be ready to keep those persons fully engaged and ready for their next ever more important role.
In larger organizations Talent Management requires an integrated HRMS that tracks all necessary data points that help to identify and move individuals in a variety of directions. A vertical career ladder is a thing of the past.
So, now as 2020 begins, there is no shortage of critical initiatives for HR leaders to focus on. “Vision 2020” in the year 2020 is a good place to start.
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