Moving HR Forward
To succeed in today's increasingly volatile and complex business environment, HR leaders are going to need to first address some serious talent-related challenges.
By Bucky Couch
HR guru Dave Ulrich once described HR as having moved through a range of stages, from administration to developing HR practices such as reward, succession planning and learning to connecting HR to business strategy. He then went on to describe the next stage in the development of HR, which he calls "HR outside in.".
Ulrich says that "HR outside in" will see HR teams look outside of their organizations to customers, investors and communities to define what successful HR looks like. As Peter Cheese, CEO of CIPD, says: "There are now so many critical business, economic and social issues that are genuinely strategic and that we have to engage with and have the confidence to talk to."
This sentiment is reflected in the challenges outlined in KPMG's report, Rethinking Human Resources in a Changing World. The report of 418 executives from around the world shows HR teams need to match the supply of talent to where the growth opportunities are greatest and create more innovative, agile and globally responsive organizations.
Added to this is the volatile global context that organizations are operating in. If you have been to, or followed, recent HR conferences you may have also heard of the term VUCA, which stands for volatility, uncertainty, complexity and ambiguity. Organizations now find themselves working in an environment in which technology is changing rapidly, global and local market conditions and global and local skills challenges are a priority and all of this is taking place at break-neck speed thanks to hyper-connectivity.
With this as the backdrop, there is huge potential for HR teams to become more strategic and to demonstrate their return on workforce investment. Here are five trends that will shape HR in the future:
1. Toward an integrated technology ecosystem
In his review of the HR Tech Europe conference, analyst Josh Bersin said, "While the tech markets continue to be hot, let's all remember that HR organizations and their companies need sound, solid solutions which solve real business problems, not just deliver fun and fanciful tools."
All HR teams will be well aware of the technology opportunity for the year ahead -- be it mobile, software as a service, bring your own device, harnessing data analytics and so on. However, the reality will be how best to integrate systems to deliver real-time intelligence to users, be they line managers or senior executives. Sales and CRM solutions have led the way and HR systems will need to catch up and quickly. For HR professionals, understanding the technology opportunity and turning it into business advantage will be more critical than ever.
2. Focusing on better employee engagement
The 2012 Global Workforce study from Towers Watson shines the light on the issue of employee engagement. Its survey of 32,000 full-time workers showed that just 35 percent of workers are highly engaged.
That might not be surprising considering the backdrop of global financial turmoil. However, it is an eye-watering statistic. The authors of the report go on to say that the overall quality of the work experience depends far more on the quality of employees' relationship with their managers, their trust in senior leadership and their ability to manage stress on the job.
The report goes on to say that organizations will need to focus on:
1. Enabling workers with the right set of tools, resources and support
2. Creating workplaces that are energizing to work in as they promote physical, emotional and social well-being
3. Responding to change fast
In the coming months and years, successful businesses will be the ones that adapt to change and quickly. This business imperative is clearly an HR imperative as research by Lumesse of more than 750 HR leaders showed that many large organizations are struggling to provide the training and skills quickly enough to keep pace with how they, their markets, competitors and customers are changing. The same challenges apply across the spectrum of HR disciplines.
4. Adopting 21st century talent management
Research from the McKinsey Global Institute suggests that by 2020, the world could have 40 million too few college-educated workers and that developing economies may face a shortfall of 45 million workers with secondary-school educations and vocational training. In advanced economies, up to 95 million workers could lack the skills needed for employment.
Finding talent is only one part of the story, however. Deloitte's Talent 2020 survey warns that employers must engage employees with meaningful work or watch them walk out the door (coming back to the engagement agenda). Its research shows that 42 percent of respondents who have been seeking new employment believe their job does not make good use of their skills and abilities.
5. Embracing the changing role of HR
Ulrich, in his vision of HR shifting to its next stage of development, 'HR outside in' as he calls it, suggests six new competencies for HR which are:
Credible activist -- HR professionals with credibility in the business, with good stakeholder relationships and who get things done.
Strategic positioner -- Understands the global business context and builds the relevant organisational capabilities around that.
Capability builder -- Helps define and build organizational capabilities.
Change champion -- Helps build the organization's capacity to change and to sustain change.
Innovator and integrator -- Ability to innovate and integrate HR practices around critical business issues.
Technology proponent -- Using technology to stay connected with peers and colleagues and taking a bigger role in managing information and turning it into useable knowledge.
HR's traditional rules are being seriously challenged. They are being overtaken by time, technology and the relentless ambition of organizations everywhere to succeed. In order to succeed, it is critical that organizations identify and embrace these challenges.
Bucky Couch is executive vice president, Americas, for Lumesse, a global leader in integrated talent-management solutions.