We haven’t faced a lot of changes in the HR department in the last decade or two. The majority of HR managers (of Chief People Officers or any other name) are still managing daily operations, administration, local law compliance and overseeing and/or implementing new ways of performance and talent management… with some exceptions, of course.
What we expect to happen in the next couple of years or next decade is probably the biggest changes HR departments and HR managers will have to embrace. There are many factors why these necessary changes are to happen:
- Talent war and skill scarcity. The majority of the CEOs of the biggest companies in the world are ranking people skills as one of their priorities. Competition has never been so fierce as today, especially in growing industries such as IT. HR will have to take a more important role in this area and to find new ways how to find, hire, motivate and further develop key talents and leaders in the organization.
- Outsourcing. Most of the administration and operational activities within HR such as regular administration, payroll, HR directories will be handled by the agencies or replaced by new analytical and storage tools which will be way more efficient and cheaper for the organizations than to keep hundreds of people managing low-value work.
- Due to fierce competition and an increase in the compensation packages and benefits portfolios, companies will have to focus on the culture of their organizations, such as clearly defined values leaders and employees are living by and purpose which is more than revenue generation but purpose which is impacting broader communities.
- The HR manager will have to change dramatically how they work and even though it is still relevant to stay close to business as a trusted advisor and have excellent business acumen knowledge, social skills and emotional intelligence or simply, empathy and deep understanding of people’s needs will be key skills needed, specifically for HR partners.
To put it simply, there are three key areas where we will face the biggest disruption in the following period and these are: technology, culture, and diversity.
The end of the 20th century was marked by major technological breakthroughs such as PC and Internet. This technological revolution that started in 90ies and is still active, influences the way we live, work and communicate.
Today it is almost impossible to imagine the world before the internet, for example, to go to the tourist agency to buy a flight ticket instead of purchasing it online or to use a fax machine to send documents when scanning and sending can be done via mobile phone in a matter of minutes. Numerous desktop and mobile applications helped us to go paperless, to work and communicate faster and easier with the entire world.
Two decades after the Internet became a platform for transformation, we’re still wondering how it all might turn out. Even in industries where competitive concentration is increasing, innovation hasn’t flatlanded as one might expect.
Which way to the future?
The organizations that are prospering aren’t lying in wait to the next inflection point – the moment when a new technology, business model or means of production really takes off.
Remaking the enterprise, they recognize, isn’t a matter of timing but of continuity. What’s required, now more than ever is the fortitude for perpetual reinvention. It’s a matter of seeking and championing change even when the status quo happens to be working quite well.
As the internet and PC were breakthroughs at the end of the 20th century, the beginning of the 21st century will be marked by artificial intelligence. What was part of science fiction movies is now becoming a reality.
Naturally, it is followed by many controversies in the way how it will be used and who is taking responsibility for the outcomes. Even though around 90% of the internet nowadays is on the dark web, we still use it daily and do not question the benefits of this network. Meaning, we cannot predict the negative consequences of artificial intelligence, but this must not stop us from embracing its potential for the benefits of people and work.
We already see usage in medical diagnostics with a very high rate of correctness, usage in banking, IT security and many other areas where fast processing of information is a requirement.
The way how the internet has transformed the way we work, similar is going to happen with artificial intelligence. The work process and environment will be most impacted by this change and probably initially will have the biggest impact in the corporate world, which is usually the case with technological advancements.
Technology is inevitably influencing Human resources departments across the world in all organizations. In the last couple of years, we see changes in HR much more than ever before, driven mainly by new opportunities for how work can be transformed and powered by technology. These changes are also affecting the role of an HR manager (now usually referred to as a Chief people officer), who will need to go from administration leaders to leaders of culture and people transformation.
Technology, AI and robotics will enable simplification of the HR workload and automation of the majority of manual work, which will allow organizations and HRs to focus on value-add activities. These value-add activities should be focused on cultural transformation with the employee experience in the center of attention.
For the organizations to do it right, decision making will have to go from intuition and experience to a data-driven approach powered by smart technology which is able to process and analyze a huge amount of structured and unstructured data.
Technology and AI are enablers and key catalysts of several HR trends of today: Talent acquisition with cognitive recruiters, Careers and learning real-time personalization, Employee experience and engagement, Culture, Recalculating the career routes, Non-biased decision making to foster Diversity and Inclusion.
We are currently witnessing real talent war in the market, especially within the IT industry. Companies are focused on finding candidates with the right skills, both internally and externally and keeping them motivated and engaged. Their success depends on the maturity of the organization, but also the HR department.
Since skills are the new currency, we cannot afford to use a “one size fits all” approach, instead we need to have a personalized approach, personalized learning and career planning, to have data-driven outcome predictions and not to rely on traditional methods. Personalized employee approach is possible only by using advanced technological tools we have available and Artificial Intelligence (AI) is one of those.
For example, in an organization of more than 10 thousand employees, having personalized learning and career plan is either impossible or just too expensive. However, a quite simple AI online learning platform can help each employee getting the education specifically for his/her job profile and needs of the business and market.
The best example of AI usage is certainly around success profiles. Hiring based only on CVs is not good enough as it can hardly predict the performance of the candidate. Typical outcome is either hiring the perfect CV candidate, who just did not fit in the organization OR hiring a person with inadequate experience, who demonstrated fantastic performance afterward.
The reason behind these situations is that the psychological profiles usually have little to do with CVs. If we imagine a perfect organization, you would need to have developed success profiles for each role including specifics behavior traits on each level and trained psychologist, who would hire the perfect candidates, work with them later on their career plans, develop personalized learning to close their gaps and improve their strengths. In the real world, this is absolutely impossible money, resources, time and effort-wise. With AI as an ally, this challenge can be addressed.
AI is learning from experience and the more information you provide, the more it becomes “smarter” with unlimited storage space to “remember” all information and data. New AI tools have the ability to understand human language, track people’s sentiment, learn from the “experience” (basically automatically adjust predictions based on the information feed) and to engage with humans on this level. So, soon we will have AI recruiters who will be able to assess someone’s profile and success factors easier and faster, without the bias and with a high probability of the outcome.
AI will also be able to suggest career options and job opportunities based on the profile, personal interests, skills, potential, and knowledge. Having the experience of the assessment of thousands of candidates, AI will be able to predict in which area employee needs to develop further, the best education and learning methods and such.
This will allow massive usage of the tools for a personalized approach to the entire workforce, not only for the selected population of executives which was done until now. Similarly, the power of AI technology can be used for internal movements, leadership appointments and any type of assessment, including also overall employee engagement based on the comments and discussions on public and internal social networks.
Successful business and Human resource departments of the future will be the ones who embrace new technologies in the right way and find benefits for their own organizations. This will allow them to win over the marketplace by being faster, more agile and smarter.