A recent study by The Economist Intelligence Unit (EIU) revealed that growth is once again at the top of the corporate agenda for global business leaders. With Tucana’s HR Transformation Conference just passed, the HR Technology Conference in Las Vegas next week and HR Tech World Congress in Paris the week after the conference, season heralds a real opportunity for the role HR can play in leading the business. In particular, a key theme is ‘transformation’. In this blog I want to look at three areas of transformation that businesses need to prepare for and undergo to thrive in such a dynamic environment – it goes beyond the bits and bytes of it.
Business Transformation – A Top Priority
With growth a strategic priority, for many companies, the next few years will be a turbulent time, rife with Mergers & Acquisitions (M&As), restructuring, product and geographical market expansions – big decisions that can make or break a business. Based on a global survey conducted by the EIU, there is a strong consensus among C-level executives to leverage data analytics to strengthen their intuition and experience. They agree that data-led insight will better the chance of success in big decision making, from organisation design through to the functional implementation of a Target Operating Model (TOM).
A key differentiator for businesses will be how quickly they can deliver these transformations and transition their workforce to adapt to an increasingly fast-paced marketplace. Companies that lag behind in the analytics race will struggle to adapt and suffer extinction. Yet, many executives struggle to apply data analytics to gain visibility and understanding of the organisation. This makes it hard for leaders to make the right decisions with many transformations stuck in a world of unwieldy Excel spreadsheets and PowerPoint slides.
To make strategic decisions and deliver value fast, leaders must be able to understand the supply and demand of people, roles and skills against processes and projects. Transformations cannot be delivered by moving org charts round a PowerPoint slide. Businesses must recognise the need to empower executives and invest in solutions which can make the most of a largely untapped pool of highly valuable organisational data. Transformations driven by organisational data will put companies in a stronger position to generate value when making important strategic, organisational and people decisions. Regardless of which transformation decisions companies are undertaking, a successful execution calls for engagement of people across the organisation. This creates a huge opportunity for HR to harness its ownership of people data and bolster its capability to be a leading force in the business.
HR Transformation – The Time is Now
Traditionally, business transformation has been driven by financial numbers, and people have come second. HR must transform itself as a function to start putting people back into the heart of strategic decision making. This means overcoming a skepticism when it comes to HR data and analytics. Hitherto, very few companies are successfully implementing HR analytics and in two-thirds of organizations, the majority of time is still wasted on consolidating, repairing, and manipulating data instead of analysing them.A recent survey conducted by Harvard Business Review Analytic Service revealed that out of 230 executives, 27% agree that HR does not know how to talk about HR data in relation to business outcomes, while 47% and 54% respectively attribute the lack of analytic acumen among HR practitioners and hard-to-access data requiring too much manual manipulation as the two biggest obstacles to achieve a better use of organisational data. Extrapolating from this trend, in the near future, it will no longer be sufficient for HR practitioners to only use workforce data as a reactive measure to streamline processes and cut down cost. Instead, they need to move along the maturity curve and use organisational data across the business to proactively to gain predictive insights, understand deeper correlations, and drive revenue and profit. In the context of helping drive business transformation, this will have 3 main benefits:
- Faster delivery: a lot of attention is given to strategy, not much to implementation. And yet the faster HR can implement a workforce integration or restructure, the faster the organisation can realise the benefits.
- Better retention of top talent: When undergoing a transition there is a big risk that you lose your top performers or get dragged into tribunals. A data-driven approach ensures you know who you have to keep where and that you are fair to all your employees
- Organisational effectiveness: Building a comprehensive baseline of data means that HR can shift from delivering one-off interventions to providing value and insight on an ongoing basis, creating that much sought after ‘agile’ organisation
HR Technology Transformation – Deliver Change Faster
In line with the HR transformation, a shift in thinking means a shift in the tools used to support this change. There are two core areas which are holding companies back:
- Legacy Technology: Companies spend years implementing a new global HRIS system only to come out the other side and immediately transition to the next one. This transition is time-consuming, complex and resource-heavy. Organisations must use intuitive data handling tools as an interim to help speed up and support this transition.
- Reliance on the wrong technology: HR recognises the need to evolve their use of data and analytics. And yet the technology used and the skillsets within HR are not aligned to maximising the opportunity. This iswhere a shift from traditional transactional tools proves pivotal. If HR truly wants to lead business transformation it must move beyond Excel and PPT, and support their core HR systems with agile analytics and modelling solutions which allow them to prepare and implement change in a faster and more focused way