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What will the Next Generation of HR Look Like?

May 6, 2023

By Anthony Kaylin, courtesy of SBAM-approved partner, ASE

Over the years, HR has evolved from personnel to human resources to business partners to HR consultants and more. However, often HR remains very transactional, with minimal involvement in strategic planning and decision-making. In part, that is the design of HR as the facilitators of people within an organization to constantly putting out fires as legal compliance grows. But in 10 years from now, will HR change from transactional to more strategic roles?

First, HR needs to understand data and predictive modeling. Data analytics can be used, for example, to establish programs by tracking employee performance, identifying skill gaps, and creating training programs to bridge those gaps.  From 2018 Josh Bersin stated that “One of the biggest opportunities for HR in the next several years is learning to leverage data and harness the power of AI, predictive analytics, and behavior economics. These disciplines, which are now well underway in most companies, will become vital sources of insights for CHROs and other C-level executives in the coming years. Our research shows that 70% of companies are now heavily investing in people analytics, for example, and more than 40% believe AI will significantly impact their workforce in the next two years.”

Next, HR function will have to change focus from company to employees; in other words, the HR function of the future puts employees at the center of the HR strategy. Again, according to Josh Bersin back in 2018, “The biggest opportunity for CHROs to add value will be taking their expertise on the people side of the business to push new organization, leadership, and career models to the rest of the C-Suite. Our research clearly shows the need to rethink organizational models to be more agile and the need to redefine leadership models to accommodate the way digital businesses operate. This will force CHROs to pull their C-suite peers together and work closely on these topics as the company becomes ‘more digital,’ more diverse, and more dynamic over the next two years.”

Which leads to HR becoming comfortable with technology to automate routine HR tasks and streamline HR processes from AI to simple digitalization. Although the future HR person needs to have a broad experience in employee relations and related areas, they also must be a technophile. As Tim Sackett pointed out in 2018, which is true today, “[HR must collaborate better with] IT. Right now in most HR shops the HR and TA leaders virtually have no say in what technology they use. IT makes almost 100% of these decisions. That is like IT telling the CFO which accounting software to use! That doesn’t happen! And it shouldn’t happen in HR and TA. You don’t have to be an IT genius to know which platform or system works for your needs better than another. Yes, you do have to know something. Yes, you do have to put in some time and get comfortable with the HR Tech landscape. We, as HR and TA leaders, need to be the ones who choose the technology we use, and we have to make wise decisions on this. IT will be a partner with us in this decision process, they should not be the decision maker in this process.”

Finally, HR has to become more agile and have better ability to move and change when necessary. In order to do so, HR needs to breakdown its own silos and understand how the business makes money. HR has to also understand that stakeholders are more than the employee/manager relationship. They must be more well-rounded, especially in accounting and finance, even taking positions outside of HR to gain this perspective. If they understand the full picture, it will be easier to drill down to effectuate people policies that will be more effective for the organization. It is very rare for an HR professional to become a CEO, but a CEO who has HR experience can be very effective for the organization.

Mary Barra, the CEO of GM, describes her time in HR as illuminating. “I loved that time, because you’re dealing with people.” She noted, though, that “sometimes people do the craziest things. You see everything in HR. But you also see the goodness of people and how to really help them achieve their goals.” Strategy only works if people believe in the leader and will follow that person’s path, otherwise the organization will stall and peter out. Most organizations are not military, and understanding people is the surest way to success for an organization.

Source:  The HR Digest 4/25/23, Knowledge at Wharton 7/3/18, Quantum Workplace 1/25/23

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