Peter is the Management professor at the Wharton School and keynote speaker at Oracle HCM World.
Change is driving value across businesses today—helping to create new products and services, leaps in process efficiency, and deeper market and operational insights. But at many companies, HR hasn’t been invited to the party that is figuring out how to prosper in this new environment, its role often diminished to that of a pesky interloper clucking about rules and procedures.
One reason for this is that historically, business leaders change their views on HR based on the state of the labor market. When the economy is down and the labor market slack, they see HR as a nuisance. But when the economy improves and the labor market tightens, HR flips to a valued partner worthy of more attention and assets. Until it gets very hard to hire, business leaders aren’t going to pay attention on their own.
CEOs and other executives are rarely experts on workplace issues, but such issues are crucial to organizational success.
So what can HR do to rise above the prevailing reputation of taskmaster and reclaim the role of strategic partner?
Clearly, HR needs to do some things differently. HR professionals need to disrupt the historic cycle that has defined them and take action now, ahead of the next inevitable shift to talent scarcity. I’ll be further exploring the specifics of this recommendation at Oracle HCM World in Chicago in April, in my opening keynote.
Specifically, I see a need for five actions.
Educate executive leaders on what workplace issues they should care about and why, by articulating a point of view on every people-related topic, whether you’re invited to or not.
Business-line leaders can have strong opinions and influence on layoffs, recruiting, flexible work arrangements, performance management, and other workplace issues. HR needs to make sure its input is heard, too, suggesting how each task should be handled and citing the evidence behind their guidance.
For example, HR can not only help protect the organization from litigation risk and the cost of poor hires during the recruiting process, but can also make sure that practices address applicant expectations and maintain a relationship with the company’s brand and products (some applicants are also customers) if they aren’t selected. Line leaders don’t have the knowledge or skills for this.
Practice know-how is important, but knowing what works when and why is more important. HR teams that succeed here will identify and implement solutions that work well within the current operational conditions, which for most businesses are changing faster and more frequently than in the past.
Deloitte, for example, disrupted its traditional ladder-style advancement track in response to a pressing need to retain and better engage key talent. Now Deloitte employees have a more open and flexible framework for career advancement, and the business has more agility to respond to change.
Workforce analytics is one of seven tracks at HCM World for good reason. Data-driven decision-making is becoming a norm, but in a recent survey by Deloitte, HR leaders said they are unprepared in analytics.
If HR doesn’t have the capability to use big data to solve classic HR challenges such as finding the best job candidates and improving productivity, then CIOs and their teams will fill the gap.
Fortunately, advanced business process technology has made it possible for nontechnical roles to access and apply analytics in everyday workflows, including those in HR .
HR departments aren’t used to quantifying revenue and profit contributions, but they need to get used to it. When HR teams document outcomes, traditionally they focus on individual benefits such as job satisfaction. But with the ability of organizations to gather and analyze copious amounts of data today, the excuse that one can’t quantify “soft” benefits doesn’t hold.
HR teams should be evaluating data on turnover, productivity, and other workforce issues to look for opportunities to become more effective and efficient, and then they need to link their actions to strategic performance metrics. The key here is to quantify HR costs and benefits in a way that turns talent decisions into business decisions.
HR invests in many programs that have minimal business impact. Think about the current preoccupation with engaging and retaining millennials, as if they’re an entirely different species. They aren’t.
Instead it makes more sense for HR to prioritize making the workplace an environment where all generations are engaged, collaborating, and are able to envision a career path with their employer.
One of the best ways HR teams can become regular contributors to strategic goals is to learn how technology, engagement, predictive analytics, social media and other new ideas are disrupting HR practices.
Oracle HCM World in Chicago April 4-7 is offering seven different educational tracks that cover modern ideas and practices and provide ample opportunity to learn from peers. The tracks are: