Pivoting your People Strategy and Capability

What is the appropriate role of HR in the future? HR has to become a strategic asset and driver of organisational agility amidst the most disruptive and ambiguous challenges organisations have ever faced. But has HR truly even come to terms with this means for their organisations, their function and their capabilities? Have they started pivoting to more effective strategies, collaborative operating models, technologies, analytics? Do HR professionals see the pace of business change as an unwelcome disruption or a great opportunity? If HR does not step up, they truly face the risk of becoming irrelevant when in fact the function should become MORE important. But we have a long way to go.

The current HR models were developed over 20 years ago and are no longer relevant in the new world of work. In 2015, Deloitte found that only 5% of Line leaders rated their HR function as excellent. In 2016 Accenture found that 92% of HR Executives they interviewed were planning to make significant adjustments to their operating model and/or leading HR transformation programs. Most of them are still struggling with insular HR functions, duplication between HR roles and processes and practices that are not flexible and fast enough to support fast changing businesses. They have tried to make adjustments, but very often have not been able to make significant shifts.

The CHRO of a global biotech firm recently observed, “We’ve been trying to implement ‘the Ulrich model’ for years. But we just can’t seem to move the needle and make it real.” (2015, Deloitte report).

Accenture writes:” As the world becomes increasingly volatile and unpredictable, organizations that can quickly and easily adapt to changing business conditions will outpace their competitors. To compete in a rapidly changing world, HR will need to fundamentally reshape itself so that the function becomes a critical driver of agility. As agility becomes the new mantra
of business, organizations will reshape themselves so that they can fluidly pull resources when and where they’re needed to rapidly respond to changing business will have to reinvent themselves—and they support—to drive agility in their organization. Those that fail to do so
may put their organizations at risk
of obsolescence. “

Josh Bersin describes the journey HR needs to take from efficiency to effectiveness to responsiveness and agility in order to become a High impact business driven function. We would add it also needs to be an employee and human centric function to be truly impactful.

From the perspectives of CEO expectations of HR, a 2011 Knightsbridge report found:” CEOs feel that HR executives, more than other senior executives, should have the capability to build trust, communicate and collaborate with others with exceptional levels of diplomacy and discretion. These attributes must co-exist, however, with a deep understanding of the business, including a far stronger grasp of the business’s operations and financial realities, including its algorithms and P&L. CEOs expect their senior HR executives to apply their professional expertise with a focus on issues and trends that matter to the business. If there is one area where CEOs want HR to perform better, and would do things differently themselves if they were heading the HR function, it is in knowing what the real business challenges are and applying expertise to managing and solving these challenges proactively.” “Lean, technology-enabled, well-trained HR teams are able to take advantage of modern talent practices and partner with business leaders to drive impact.”

Nick Holley of Henley Business School also asked CEOs what they want from HR. One CEO replied: ‘HR has the will to work
on the strategic but to be honest they spend 70–80% on operational stuff.’ Other results shoed that a significant number of CEOs believed their heads of HR were overly focused on a narrow HR agenda. In the end they narrowed down their three greatest needs from HR: commerciality, simplicity and talent.

Deloitte and others propose new operating model designs: “The High-Impact HR Operating Model empowers business leaders, employees, and HR professionals by aligning the work an organization needs with the capabilities that can deliver it most effectively. It emphasizes coordination within and beyond HR. It reshapes the roles and responsibilities within HR and the ways HR interacts inside and beyond the enterprise’s walls. It incorporates technology as another “role” in the operating model to create an integrated experience for the HR customer.”

Sources:

Deloitte Global Human Capital Trends: Rise of the social enterprise
Deloitte: Leading in the new world of work
Deloitte: The High-Impact HR operating model
Accenture: HR trends reshaping the future of HR
Accenture: A new blueprint for HR
CIPD: Changing HR Operating Models
EY: Facing future challenges: Transforming the HR function
Henley: What CEOs want from HR