A 5-Step Action Plan To Kick Off The Digital Transformation Of Human Resources

The digital revolution in the workplace looks like a daunting and challenging process. And the complexity inherent to upgrading and evolving business operations from its current form to a more digital one is also applicable to Human Resources (HR).

In order to support and sustain the benefits of the digital transformation of the workplace, the digitization of the HR operation is also a must. Unfortunately, research shows that in most organizations HR is still narrowly focused on compliance and transactional activities. What’s worse, only 9% of the organizations are ready for the digital era in HR.

There are many examples in history that show that when an organization doesn’t evolve, it loses. The same fate will be shared by HR... unless it changes and evolves. HR can’t continue to operate the way it does today. It’s simply unsustainable because it doesn't add the value needed by the workplace for which it works.

The HR operation has to become more strategic. It has to focus on creating and delivering much more value. And technology can definitely support that process and make it easier for HR.

The digitization of HR is about levering on technology to transform its operations to create and deliver more value to the workplace and the people working in it. But the first step in the digital transformation of the HR is not necessarily the immediate implementation of cutting edge technology.

In reality, the digitization process in HR begins by simply acknowledging the need to evolve from what it is today to its digital version. Once HR is able to recognize this hard truth, hopefully the next steps in the transformation will come easier. 

I don’t want to oversimplify the complexities associated with designing and implementing a plan for the digital transformation of HR. Yet, this is a first approach for an easy-to-implement action plan that goes beyond technology.

This is a 5-step action plan to implement the digital transformation of Human Resources:

Step 1: Developing a digital mindset

Perhaps one of the most challenging things about a digitization process is the lack of technological or digital knowledge. This is true for many people, especially those who focused their careers on human science fields (psychology, HR management, etc.).

The good news is that HR people don’t need to be totally techy to understand how technology will impact their work. They just need to know the basics, remain open-minded and work with people who do know a lot about technology.

That’s what the digital mindset is all about. It’s not only about technology, but about curiosity, creativity, problem solving, empathy, flexibility, decision making and judgment, among others (these are some of the top 10 skills for the future by the World Economic Forum). HR needs to redesign itself to foster this digital mindset, both within its own boundaries and across the company units.

Is this easy to implement? I think so!

Step 2: Integrating techy people to HR

Let’s do a little experiment. Check out 10-20 job boards or job company websites to see if they list an HR opening. Take a look to the description of their HR job openings. How many techy people is HR hiring? How many positions that require technological skills are created?

A lot of people working in HR are not familiar with technology and perhaps not even fully comfortable with it. And we can’t expect a different outcome when they are not exposed to technology other than the basic computer programs.

The point is that HR can’t continue to live in its own little world, comfortable with the way it operates. It needs to bring people onboard with diverse backgrounds that can shake up the way traditional HR practitioners work. If HR wants to remain relevant, transform itself into a real strategic function and increasingly add more value, it will need people who think beyond traditional HR terms. It will need outsiders who bring fresh perspectives to the HR role.

Step 3: Moving to Agile HR

In many organizations HR still operates as an archaic function. It’s heavily focused on processes, rules and policies, and ensuring that everybody is in compliance with them. HR is living in a rigid world that doesn’t exist anymore.

The successful organizations of the future can’t really get any value out of just enforcing rules and policies. And they certainly don’t need an entire organizational unit policing people’s behaviors. They need more than that.  

Agile HR means implies a keener focus on flexibility and adaptability. To do that, it’s fundamental to understand those processes that once yielded some positive results, but are now outdated and can’t just be redesign into a new heavy process.

HR needs to establish wide and flexible operating frameworks that give people enough room to be curious, imagine, create, experiment and innovate. HR needs to spouse and practice an approach that is based on trust and confidence. People want to give their best and fully engage in their work. But when they’re caged within the boundaries of outdated processes they become increasingly desperate. The agile HR is flexible and focuses more on delivering value than enforcing meaningless rules.

Step 4: Transforming the organizational structure

Organizations need more collaboration and cooperation than ever before. The problems that most businesses are facing today are by far more complex than in the past. And the complexity is exponentially increasing.

One area where HR can add a lot of value is in the transformation of the organizational structures.

The most common style, the functional organization, had its merits. It worked very well in a time where information and decision-making could be centralized in a well-informed functional manager. However, the information flow today is just too rapid and complex for any single person to grasp on an individual basis. Organizations need to migrate from bureaucratic and hierarchical workplaces to flatter, self-managed and team-oriented ones.

HR needs to redesign the entire organizational structure and make it flexible in times of chaos, volatility and uncertainty. But HR needs to start by itself.

I believe in integration and not functional disaggregation. HR needs teams of people who know a lot about compensation, performance, technology, analytics and policies working together in one team, and not in separate units. This is diversity of knowledge. And the outcome is very powerful. HR can’t remain organized the way it is now. It needs to reorganize itself in order to foster real collaboration and cooperation. This doesn’t need much technical knowledge, but just the willingness to do it and act accordingly.

Step 5: Using data to inform decisions

For many years, corporate and HR leaders relied on their experience and guts to make important business’ decisions. Instinct and intuition as decision drivers are sometimes necessary. But no organization can fully and only depend on them and ensure accurate and optimal outcomes at the same time.

Data is essential to make informed decisions today. It’s the input that feeds the most important and relevant decisions a business leader can make. Thus, to achieve the most optimal HR decisions it is critical that HR leaders and practitioners rely on data. To do that, the first steps are to collect that data and understand how to use it.

Based on many conversations with HR practitioners, I’ve found that most of them understand the importance of using data. But few of them know what kind of data is collected, and even less know how to use it. To solve this problem, I go back to Actions 1 and 2: the need to develop a digital mindset and integrate techy people.

Data analytics is as much a science as it is an art. And HR needs to bring data artists to help them with collecting data, transforming it into useful information and then making appropriate decisions.  

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Invitation to Hacking HR

I want to invite you to the event “Hacking HR” in Washington, DC, on September 28. It's all about the Digital Transformation of HR and the workplace of the future. Artificial Intelligence, Virtual & Augmented Reality, Blockchain, Data, Bots, Gamification, Innovation. Technology is changing the way we live and connect with each other, and now it is disrupting the way we work.

Hacking HR is a forum to discuss how we can successfully bring HR and tech together today to create the organizations of the future. Hacking HR's inaugural event promises an evening of inspiring conversations and networking with like-minded professionals.

The event is free! For more information about speakers, location and registration, visit: www.hackinghr.io 

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