All companies today are navigating an array of converging market forces while at the same time dealing with continuous new innovation that continues to disrupt their business cycles. In addition, digital technologies like cloud, automation, machine learning and AI have opened up entirely new business models and divergent ways of working.
Meanwhile, baby boomers are leaving the workforce en masse and millennials are now stepping into significant leadership roles. The millennial leader unlike their boomer counterpart who learned to excel in hierarchal structures, will look to foster a more balanced power structure, supporting workplaces that value integrity, openness, fairness and teamwork.
At the same time, the incoming workforce, Generation Z—people who were born from 1995 onward, are creating the need for companies to fast adapt to different ways of thinking, transformational initiatives, and new approaches to traditional employment practices and policies.
In this highly dynamic landscape, every company needs to be supported by a highly agile human resources function (HR) that is well equipped to deal with continuous and chaotic change. This type of agile HR isn’t about tweaking old processes, it is about HR transforming itself as radically as the businesses HR supports in the digital era we live in.
According to a study by Oliver Wyman (What role for HR in 2020-2025? February 2016) by 2020, no fewer than five generations will coexist in the workspace. Faced with this unprecedented situation, HR will have to manage these different worlds through customizing the HR value proposition, as the “one size fits all” approach is no longer viable. HR must learn to listen to people in a more differentiated manner, provide individualized solutions while carefully avoiding functional silos or fissures between generations.
In addition to generational challenges, both customer experience and digital transformation are additional reasons for transforming HR practices as many organizations are reorienting their resourcing, focus and culture around customer-centric strategies. As businesses transform to become ‘fit-for-purpose’ for a rapidly changing digital world, the HR function is playing a critical role in supporting this change through a heightened focus on defining and maintaining culture, learning and employee engagement.
In order to calibrate HR towards making a difference, I have outlined a few of the most important mind-set and technological developments for HR in 2019.
Redefining human resources
Overall, HR needs to orientate themselves much more around the use of technology and particularly with data that has the potential to radically shift HR practices and processes. This brings new challenges and the need for HR professionals to improve their digital literacy and skills in order to maximize their use of new technologies and adapt them to the rapidly shifting organizational context that surrounds them.
Today’s employees want feedback and recognition, not just rewards for their performance. Providing immediate performance feedback and coaching has become widely expected. Employees don’t want to wait for an annual performance review to obtain feedback; they want to know where they stand and what they can do to improve immediately.
Instead of once a year goals, it is more effective for managers to meet with their employees at a minimum of once per month to review progress on goals and to provide coaching for success. Goals should always be relevant in the moment and should be replaced if they have been achieved or are no longer relevant.
In this context, HR needs to consider what type of process is best suited for indoctrinating regular feed-back into the process of managing performance and development planning. There are many vendors in market that provide cloud-based software that makes it easy for employees to set goals and give ongoing feed-back.
No longer relegated to peer to peer networking, social media has become a real and viable global community of potential and existing employees. 73% of 18-34-year olds found their last job through a social network. (Source: Aberdeen Group). Between social recruiting, profiling, social conversations and compressing the employee experience into the mobile environment, how organizations communicate with current and prospective employees is completely different than the landscape just a few years ago. Social recruiting allows businesses to not only target ideal candidates, but to also post open positions and bring employer brand awareness to a larger pool of qualified individuals. Personal social pages give hiring managers the opportunity to identify and screen potential candidates more efficiently and engage personally.
The recruiting market
According to Josh Bersin (2018 HR Disrupters) Recruitment is the largest marketplace in HR. Companies spend millions each year on recruiting and it has become an escalating war for employment brand, candidates, candidate experience, and strategic sourcing. High volume recruitment is being automated by machine learning, recruiting apps and other new tools; skilled job recruitment is being revolutionized by open sourcing tools, more automated recruitment management systems. On-line personal and culture assessment tools are now available for everyone.
With the complexities of the workforce today, HR needs the ability to observe the employee experience in real time so they can stay well ahead of the curve in understanding how changes are affecting the workforce, what the driving issues are, and how to create more engagement in the workforce.
Modern approaches use a combination of management feedback — as well employee driven feedback that is open-ended and crowdsourced. Today, there is a plethora of dynamic real-time survey systems, sentiment analysis software, organizational network analysis (ONA) tools, and other products on the market that automatically ask employee peers for feedback, providing real-time coaching.
There are many open feedback tools on the market that provide employees new places to comment on the workplace. A new area of growth is the explosion of systems to offer pay transparency and are now crowdsourcing and providing benchmarking tools to help employees „find their worth“ (a phrase Glassdoor coined) through open feedback and benchmarking.
Modern corporate learning
As digital impacts ever more broadly across sectors and corporate divisions, learning and development becomes even more essential to the transformation of business functions in becoming truly ‘fit-for-purpose’ in a digital-empowered world.
HR can make ensure that employees are prepared to deal with new frameworks and expectations through adapting quickly to new breed corporate learning tools including experience platforms, micro-learning platforms, modernized LMS systems, and new AI-based systems to recommend learning, find learning, and deliver learning. Virtual Reality (VR) once used just for gaming, is now used by 88% of mid-sized firms in the US (article by SF business times). We can expect to see smarter and smarter technologies to help employees and HR find „just what is needed“ along the lines of performance support.
For many years, HR has been able to pull information out of their HRIS to understand metrics such as turn-over, tenure and social demographics, however in today’s world of “Big Data”, HR can go much further in understanding the total picture of employees, looking at things such as who people associate with the most, who they spend time with, what teams people are part of, wellbeing data (activity, location, energy) and sentiment data (feedback, mood, and sense of belonging).
On functional side, HR can measure and assess the impact of HR initiatives on employee satisfaction, learning cost/benefit analysis, monitoring of key performance indicators, compensation modelling and issues with retention.
On a firm-wide and culture level, further insight can be unlocked about underlying beliefs, assumptions, norms of behavior, and practices that support success or create risk.
Intelligent self-service tools
In today’s HR technology environment perhaps the most important new development is the fast-growing need for mobile, self-service, employee experience platforms. These are fast-adapting systems that bring document management, employee communications, and help-desk interactions into one integrated architecture. They sit between employee apps and back end applications, and they serve as the lifeblood of employee service centers which may be automated someday soon.
Additionally, artificial intelligence (AI) solutions are coming fast. Think of Apple’s Siri or Amazon’s Alexa for HR. For example, a voice application which employees to query the system for vacation balance, benefits advice, performance tips, and even compliance training.
Individualized HR Policies
To further meet the needs of a diverse workforce, individual tailoring will increasingly be required of HR policies. Successful hybrid approaches to treat certain generational segments collectively and others with a more tailored offerings. Employees, to satisfy their respective aspirations and needs, based on their profile and employee lifecycle, must be allowed to build a personalized “HR proposition” (balance of compensation, vacation time, etc.) from an adapted menu of choices proposed by HR. Listening closely to the various generations will give HR greater understanding of the motivations of each segment and help it to define the dimensions of a differentiated value proposition on which to base a more modular approach.
As the saying goes, “culture eats strategy for breakfast” (Peter Drucker). HR can play a strong roll with the CEO and other leaders by connecting the dots between mission, strategy, brand, leadership, and culture through robust culture measurement systems that can feed meaningful data to leaders for action. It means making sure communications and dialogue improve understanding of the desired future culture and how this connects everyone to purpose and strategy.
New compensation approaches
To address the individual needs of the various generations, compensation will need to be more than just standard offer within bands. Employees should be allowed to build their own package from a menu of choices, including salary, vacation time, company car, etc., to arrive at a given overall compensation envelope. This provides a more personal relationship between the employee, management, and the company. An example might be, for vacation time offer the option of acquiring more vacation time in exchange for lower cash compensation and working hours or offer the option of arranging working hours to dedicate more time to personal projects or family, over a specific period or permanently.
Recognition programs are being personalized for employees based on their interests, motivators, and needs. Companies such as Bonusly make recognition impactful by connecting it to company core values and giving visibility to everyone’s contributions. They believe that experiences are the best way to reward and recognize employees since they’re more memorable, personal, and shareable, which is what the next generation employee prefers. This notion of experience is also emerging as a shift in thinking about the workplace overall.
Foster personal development
To facilitate employee personal development, HR can invent new paths very different from traditional career paths. The hallmark of the traditional career path used to be employment, but tomorrow it will be capability, as this is the best guarantee of future employability.
Understanding individual capabilities can be time intensive, but this will allow HR to create internal and external capability pools that can be utilized for personal and career development on the job, as well encourage new forms of mobility. These capabilities can be reinforced as needed with training.
HR professionals can make a real difference to the companies they support through anticipating how to best manage the most diverse multi-generational workforce ever seen. Combined with continuously evolving technology, companies and their employees will have to regularly adapt to new ways of working.
HR has the chance to take lead, be real disruptors by considering the need and then seeking the right technology. Agile HR departments are experimenting with new ways to reduce bias, new learning strategies, new techniques to find new people, to coach them and manage their performance.
Specialized HR teams will work together to design solutions and programs that are integrated under a common mission, goal and culture. Increasingly over time, these solutions will learn from other solutions and practices from other organizations and industries where they may eventually automate themselves, but this is a whole new story.