HR operating models fit for the future of work and AI

I do not blame you if you feel that everything is changing at breakneck speed for HR! It really is. What does this all mean for the HR function and for the Operating model? And by the way, do you even have one? (FACT: About half of HR functions I talk to have NO HR operating or HR interaction model defined that informs their structure).

I thought I would consult Gemini (previously Bard) this time before adding my own research and thoughts. Here is my prompt:

I am an HR Director overwhelmed by the seismic changes brought on by the future of work and AI, What are the new HR Operating models that I need to consider to ensure that my function stays relevant?

And here is the answer:

Here are some new HR operating models you can consider:

1. Evolving Archetypes:

• Ulrich+: Builds on the traditional Business Partner model, emphasizing strategic HR, data analytics, and talent management expertise.
• Agile: Focuses on rapid experimentation and adaptability, with cross-functional teams and iterative processes.
• EX-driven: Prioritizes employee experience (EX) throughout the employee lifecycle, using data and feedback to design personalized experiences.
• Leader-led: Empowers line managers to handle HR tasks, with HR providing coaching and support.
• Machine-powered: Leverages AI and automation for administrative tasks, freeing HR professionals for strategic work.

NOTE FROM ME: This comes from McKinsey.

2. Emerging Models:

• People Value Chain Model: Views HR as a value chain creating value for individuals, teams, and the organization.
• HR as a Platform: Provides HR services as modular, integrated, and accessible applications for employees and managers.
• Shared Services Model: Centralizes administrative HR tasks for efficiency and consistency.
• Hub and Spoke Model: Combines centralized expertise with localized support for specific business needs.

3. Key Considerations:

• Your organization's size, structure, and industry: Different models fit different contexts.
• Your business goals and challenges: Choose a model that supports your strategic priorities.
• Your employees' needs and preferences: Consider their expectations for technology, flexibility, and personalization.
• Your current HR capabilities and resources: Assess your strengths and weaknesses before making changes.

Gartner proposes an interesting HR Operating Model that unlocks agility in HR.

Source: https://www.gartner.com/en/human-resources/topics/what-is-an-hr-operating-model

Josh Bersin provides us with a new HR Operating System in 2024 called Systemic HR. Below is a summary of the shifts he proposes. I strongly support the idea of HR focusing on Problems not Programs. AIHR calls is from silo’s to solutions.

Source: https://www.linkedin.com/pulse/new-operating-model-human-resources-emerging-called-hr-behbahani/

Let me add my own research and thoughts. I believe there is no right answer for you. You need to do the work of developing your target operating and interaction models for YOUR groups of employees and stakeholders and enable the model with the level of budget and resources you can allocate. You will also have to move at the pace where you can deliver both to current urgent needs AND transform to the future model.

The key shift is from inward looking and process focused to focusing in business outcomes. I see people teams very much as GROWTH DRIVERS In business today and NOT SUPPORT OR ENABLING functions. The capabilities and experience of employees are too important to not have a critical strategic driver. Yes HR has not been transformed or invested in adequately to transition to this new role.

For me, there is a very specific process for building an operating and interaction model of an organisation or a function. I always start the process with what the target operating model needs to look like. Who are the “customer” (employee) segments we are delivering to? What services are we delivering to them? What are the critical capabilities (skills, systems, AI) we need to deliver the right experience  on their journey to them?

It would look something like this:

Then we need to figure out, how are we going to deliver this? This is our target interaction model. Via chatbot? Via a call centre?, Via a person? We need to map the experience and processes and decide what the level of interaction will be and whether it will differ by persona/customer/employee group? What would a tiered service look like?

Tier 0 could be manager/employee/candidate self service and bots
Tier 1 could be manager help desk
Tier 2 could be partners in the business
Tier 2 could be working with a Centre of Expertise

Source: AIHR, Dr. Dieter Veldsman

Once you understand your target operating and interaction models, you can compare it with your current models and develop a transition plan. You also have to work out your new “ways of working” – are you going to set up cross-HR function work teams for key priorities and move them in agile ways between projects? Are you going to have a team like ING that drives end to end HR operations in teams along the employee journey? What methods of service design and project delivery will you use? Human Centred design, Kanban?

Source: https://agilehrcommunity.com/agilehr-community-blog/what-is-agile-hr-your-step-by-step-guide-and-handy-infographic/

It is important to enable this journey with Analytics, AI and Digital technology to ensure that the human interaction is more meaningful and leads to better problem solving and innovation. This is very exciting for HR. It truly takes away the mundane, repetitive, manual spreadsheet work. And yes we need to spend money on technology and we need to spend time and money on reskilling and upskilling but the upside is a workforce that is engaged, capable, high performing and agile. We also need to LIMIT the number of projects we take on so we can deliver excellent outcomes.